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The Financial Impact Of
Managed Print Services
Last month we highlighted the four reasons why people choose to outsource the management of their printer fleet.
Most of the CFOs with whom we work are looking for ways to control overhead expenses and boost productivity. The challenge is that these two goals are usually at odds. Boosting productivity usually means new costs, while controlling expenses means harming productivity.
Every so often a strategy appears that allows you to control expenses without negatively impacting productivity. A strategy that has proven to control costs is managed print services (MPS), and the principal reason it works is that you only pay for what you print.
According to the Gartner Group, office printing consumes 1-3% of a company's annual revenue. This means a company with $10 million of revenue might spend between $100,000 and $300,000 a year on printing. We have validated Gartner's estimate.
On top of these costs, most companies with whom we work initially had multiple vendors for printer hardware, supplies, and repairs. Each of these costs usually went into different budget line items. It's not until they were added up when management was surprised by how much printing and managing printing really cost. Managing these relationships and processing multiple invoices led to redundant and unnecessary costs.
Other common issues we have come across are:
- Companies have more document output devices than ever before.
- The related cost of printing support and infrastructure is rising at a rate much higher than the cost of the printed page.
- IT departments suffer from this increasing support requirement related to printers (and associated costs).
- Color is being used more extensively.
With MPS, the risk of wasted toners, of wrong repairs, of repairing printers that should be retired -- all of the inefficiencies of managing a printer fleet -- are borne by the outsourced vendor … not by the company itself. That is where the biggest amount of savings is.
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Matthew Castagne of WTAS LLC
Matthew Castagne is a managing director in the New York City office of WTAS LLC which has 14 offices worldwide and is a provider of tax, valuation, and financial advisory services. He recently signed with Advantage, having decided to transition from internally managing WTAS' printer fleet to outsourcing to a managed print service (MPS). Here he discusses what he anticipates will be the financial impact of that decision. |
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Advantage: Matt, what do you plan to save in terms of a percentage or dollar figure?
Matt Castagne: I can't give you a specific dollar figure but, based on the assessment Advantage did at our company, I'm looking forward to spending 20-30%
less this year compared to last.
Advantage: What do you expect will have the biggest influence on that savings?
Matt: Earlier, we had been looking for a one-stop solution rather than dealing with 14 different vendors. So we partnered with a company that managed the printer vendors for
us, which made sense at the time. But there was a premium to pay. They would find a local repair shop to fix our printers and then charge us whatever they wanted to charge. The cost
was significant.
Advantage: And now Advantage will be charging you a per-page rate instead?
Matt: That is correct. And we expect that, in the long run, that will work much better for us. In addition, instead of my IT people doing all the repairs -- which is how it works
in just our three offices here in the tri-state area -- Advantage will service all our printers. That will free up my people to concentrate on much more important projects.
Advantage: What about budgeting? Are you expecting that paying a per-page rate will make budgeting for your printing services simpler?
Matt: Most definitely. It will be nice to be able to put a hard number on what it's going to cost the firm for the year instead of guessing what repairs will cost. That number
could increase if we do more printing than normal, of course. But because much of the work in our business is now being done electronically -- with new initiatives like e-filing and
electronic document management systems -- I expect there will be less printing, not more.
Advantage: When you were paying for someone to come in and fix broken equipment, it must have been difficult to anticipate how many printers would break and how often and how
serious the problem would be.
Matt: Yes, we'd send a tech out, he'd be there one day to fix a printer, leave, and the next day another printer would fail in the same office, so we'd have to send him back
again. When you add up those kinds of costs, they are exorbitant. If MPS can eliminate those sort of charges, it's money well spent, I believe. And the fact that our people can then
concentrate on other projects is even more important. I'm looking forward to seeing how significant the financial impact MPS will have on us.
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Advantage Welcomes … |
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Advantage welcomes Wendel, Rosen, Black & Dean LLP as a client. Founded in 1909, Wendel Rosen is one of the oldest and largest law firms in the San Francisco East Bay. In 2003, it earned the distinction of becoming the first law firm in the country to gain third-party certification as a "Green Business."
Advantage also welcomes WTAS LLC as a client. WTAS was formed out of an international professional services firm, and provides a wide range of tax, valuation, financial advisory, and related consulting services to individual and corporate clients across the country.
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About Us |
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Advantage Enterprises delivers advisory and managed print services, primarily to professional service firms so they can focus on their highest and best purpose of billing their time and growing their client base.
For over 20 years, Advantage’s environmentally green
lifecycle management programs have increased productivity
of printing and imaging fleets and cut costs while
saving the environment.
To learn more about what gives the top law firms their
competitive edge, please visit our Web site at www.advtg.com
or e-mail us at
marketing@advtg.com. |
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"We've experienced the benefits of outsourcing the management of our printers. What about telecom? Much like printers, we have multiple locations, different services, and a stack of invoices each month that's difficult to get our arms around."
We've heard from you on this subject and have investigated vCom Solutions based on your recommendations.
