Print is one of the most universally used business services. Despite digitization, businesses continue to print invoices, records, client files, payrolling, reports, and millions of other documents. One study by Quocirca shows print typically accounts for about 15% of total IT budget in SMBs, and consumes about 12% of total IT resources.
That’s important for SMBs, which already account for 40% of IT spending in all industries. Reducing print costs is also one of the easiest targets for reducing IT budget and spending, simply because many organizations run inefficient or outdated print networks and often have large overhead costs they aren’t aware of.
In fact, independent studies by Xerox and KeyPoint Intelligence concluded that 90% of small to medium businesses can’t track their print costs because they don’t have management software, centralized systems, or awareness of where those costs are coming from.
While actual print costs will heavily depend on individual circumstances in your organization, it’s crucial that you understand what you’re spending on and why.
Basic Print Costs
Most people are aware of standard print costs like cost per page (CPP), hardware costs, supplies, and maintenance or repair. If you don’t know these costs upfront, they’re relatively easy to calculate based on your print network.
Hardware costs can be calculated to a monthly fee whether you make a fixed upfront purchase, lease-to-own, purchase on credit, or rent. This calculation is quite simply your cost of purchase per year purchase or yearly rental price + delivery/installation + monthly maintenance/repair costs + interest where applicable divided by 12.
Cost of Purchase Per Year can be calculated as the upfront cost of the printer divided by the number of years of expected use, which is typically 5-6.
So, the cost calculation for a single 25-user multi-function printer might look like this:
((($1,249 + 180) divided by 6) divided by 12) + $50 + $50 = $19.80
These costs are per printer, before print costs, and have to be calculated for every printer model in the organization X the number of those printers. Here, it’s important to review total actual costs based on receipts:
- Maintenance typically costs $10-$100 per month. This includes replacement drums and rollers, fuser assembly, etc. With bulk costs typically occurring at 3-6-month intervals and at 2-year intervals. (e.g. fuser assembly and print rollers should typically be replaced about every 200,000-500,000 pages depending on printer model and this will cost $200-$500).
- Printer Repair (if not covered by a lease or MPS contract) costs $50-$120 an hour in most regions
Lease contracts are more difficult to calculate because printers are rented using different pricing schemes that may depend on page volume, printer capacity, or a flat rate per month for the printer. In addition, lease fees can range from simple hardware to full managed services. Refer to your contract to determine the actual cost of each and if you are paying any extras for phone support, supplier delivery, etc.
Paper and toner costs are typically easy to calculate. Most organizations can expect to pay about $0.02 cents per page for black and white text and up to $0.30 cents per page for color, with variations relating to print volume, contract, and supplier.
Most print supply costs are fairly visible, but some might be harder to trace.
- Cost of paper per sheet (Averages at 1.2 cents per page)
- Cost of toner or ink (Cost of cartridge divided by number of pages printed) (averages at 1-3 cents per page)
- Supplier costs including delivery, phone calls, contract costs
In essence, most organizations spend about 0.3 cents per page in supplies, which works out to $30 per thousand pages. For an office with 50 people, who each print 750 pages a month (government workers print an average of 53 pages per day, medical 52, finance 43, and education 14), that’s over $1,100 per month in print supplies alone.
Hidden Print Costs
Print, maintenance, and hardware costs are easy to track and easy to calculate, but what about other, more indirect costs and overhead? Most organizations spend massively on indirect print costs including IT, networks, contracts, etc.
These are much more difficult to see because they typically involve other internal or external services such as existing IT budget.
Waste time is calculated as time where your employees aren’t doing anything of value (either providing output for the organization or recovering so that they can continue doing so). One study by Xerox shows that the average employee spends just over an hour a month waiting for printers to finish. Depending on how many employees you have, what their hourly wage is, and how much of that wait is incurred by old and inefficient printers or lack of employee awareness of those printers, this could be a considerable avoidable cost.
Most data suggests that about 15% of total IT budget is directed towards print. At the same time, about 23% of all helpdesk calls are print related. And, print takes up 12% of IT resources and 15% of IT time. These costs typically include print networks, software management, updates, help-desk calls, and similar.
- Monthly cost of print servers and network such as lease, purchase, and maintenance
- Percent of time IT spends on print related issues (if 15%, calculate 15% of IT salary)
- Percent of helpdesk calls that are print related (If 23%, add 23% of total helpdesk budget) (importantly, helpdesk calls go two ways, if you know how much time those print-related calls took, you’re paying employees with those issues for that time as well)
What do you spend on electricity each month to run printers?
How do printers factor into your security budget? Have they caused security breaches? Calculate security costs based on the percentage of security measures that are print-related.
It’s important to calculate hidden costs such as the cost (actual cost + time expenditure) of calling external help desks or maintenance, the costs of those services, delivery costs, etc. Most of these won’t have a major business impact, but they do add up. For example, do you pay to have contracts with suppliers open. If so, how many contracts do you have open and could you save by merging contracts?
Printers are typically deployed on their own networks, but this isn’t always the case. When it’s not, it’s important to calculate print costs based on what percentage of network load is comprised of print, what you’re paying for that, and what you’re paying for related server costs.
What do you pay per month for print-related software or print management software?
Gartner estimates that the average organization spends about 3% of total revenue on print, which is considerable. That expense can be reduced considerably through consolidating costs, matching printers to print-needs, educating employees, and switching to more cost-effective solutions.
Today, many organizations find these needs are met by a single managed print supplier (MPS), which offers a complete service including hardware, print supplies, management, security, and often training and long-term monitoring, as part of a single and easy-to-control monthly fee.