Supplier Cost Drivers Print Example

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Supplier Cost Drivers Print Example
Typical cost breakdown shows that the suppliers
main cost driver is paper
Recommendations
Profit element, amalgamated into mark up on the
print element of the price

• Agree on common national specifications
• Reduce the format of prints to use less paper
• Reduce the weight (from 80 grs to 75 grs for
  example)
• Dont use branded paper with watermarks
• Dont use colour paper
• Buy the paper straight from a paper merchant
• Combine print paper with paper for office printers

Profit 10

• Administration
• 20
• Head-office
• Accounts
• Invoicing
• Admin
• Transport

Printers operating costs
Various cost elements 20

• Plate production, Ink, Labour set up,
• Labour printing, Labour folding, Labour
  finishing, Packing-box and label, Depreciation,
  Stock, Distribution

Paper 50
Paper accounts for around 50 of the total cost.
By reviewing the specifications and negotiate
wider deals on paper, the organisation could
reduce their print costs