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How deciding to purchase a truck relates to print fleet management

There is more to a printer fleet – and a pickup truck – than the lease cost

My son is just starting out in the workforce. He lives at home and we charge him a nominal rent, which means he has a high disposable income. Despite only driving within the city and planning to use the towing or hauling features of a truck maybe once or twice a year, he indeed wants a truck, and is drawn to adverts for the latest models which he could lease for $349 per month.

I explained to him, of course, the $349 lease price will not be the only cost associated with said truck. He has to factor in gas costs and lower gas mileage, as he will be doing mostly city driving and, well … it is a truck. The insurance on a new truck will be high as well.

My rough back-of-the-envelope math went as follows:

  • Advertised annual lease costs = $4,188.00
  • Estimated annual gas costs = $2,700.00
  • Estimated annual auto insurance costs =$2,400.00

Total annual cost = $9,288.00, or 23 percent of his $40,000 annual gross salary.

When I found myself using an industry term – Total Cost of Ownership – I stopped and realized this concept is one which is often ignored in the management of print fleets as well.

My son would have the capacity to do a great deal with his truck but in reality would only use its features once or twice a year. Many printer fleets are set up in the same way: high capacity – low utilization.

Many print fleet managers pride themselves on having negotiated a low Cost Per Click (CPP) by choosing A3 devices, but that cost only remains the lowest until the next round of contracts ends and buyers commoditize the CPP further. They neglect to look at associated costs, all of which must be paid in the end, including*: 

  • Maintenance kits for A3 devices, which are approximately 26 percent higher than for A4 devices.
  • Purchase costs for an A3 (11x17), which can come with a premium anywhere between 100 percent and 220 percent.
  • Energy costs for an A3 device, which consumes more power because the fuser unit is 41 percent larger than on an A4 device. In addition, the entire unit heats up regardless of whether the user is printing an A4 or an A3 page.
  • Footprint/real estate costs for a monochrome A3 multifunction printer (MFP) with finishing is nearly twice as large as that of an A4 MFP with finishing. When you factor in the recommended clearance space, you could place four A4 devices within the footprint of just one A3 device.

These print fleet managers end up in a similar position as my son and his hypothetical truck: paying a lot for redundant capacity.

When you are looking at the architecture of your print fleet, consider how much A3 (11 x 17) printing and copying you actually do. April 2011 InfoTrends research on A3/A4 Market Trends indicates that “A3 page output accounts for less than 4% of total pages.”

A NewField IT report titled “The A3 Document: Perception versus Reality” states, “The perception is that the A3 document is as necessary to our office printing needs as power-steering is to our cars. The reality, as evidenced by NewField IT’s review of more than 50,000 devices supporting over 105,000 users, is that A3 output in the office is remarkably low – less than 2.5% of total page volumes on average.”

This statistic leads us to two questions, a “why” and a “how”.

Why does office-based staff believe they need access to A3 output?

This belief is partly historical. A3 page volume used to be important but has been in decline for several years. NewField IT’s research found that five years earlier, A3 usage was (on average) double what it was at the time of the report. This decline in A3 usage has been brought on by the improvement in Microsoft Word and Excel skills and greater use of printing features which fit the document to the A4 page.

How does a Print Fleet Manager assess the true need for A3?

Start by looking at the quantity of paper being purchased. A review of the accounts payable ledger should quickly reveal how many A4 and A3 reams are purchased on an annual basis. In addition, if A3 pages are being charged at twice the amount of A4 pages, then the copier invoices should provide a breakdown of the different volumes in each paper category.

The secret to rightsizing your print fleet – and deciding whether or not to lease a pickup truck – is to focus on the Total Cost of Ownership rather than the Cost Per Click.

As for my son, when he realized the significantly higher annual cost, he purchased outright a smaller, more economical car and is now making monthly payments into a tax-free savings account. His goal is to save for a deposit on a condominium. I guess he does listen to his dad after all.

 

* NewField IT statistics