Digital printing technology is becoming more and more perfect, enabling printing companies to meet the changing needs of enterprises and printing customers in the 21st century. Digital printing equipment is not only very suitable for printing short-form, fixed-information printed matter, but also suitable for printing customized and completely personalized printed matter, so that printing companies can provide customers with diversified high-value-added printing services. To adapt to this rapidly changing and growing market demand, you need to have far-sighted insight, product development skills, data processing knowledge and pre-press processing capabilities, but also need to pay close attention to printing production costs and formulate a suitable printed product quotation plan .
With the widespread adoption of color digital printing technology, the black-and-white digital printing used in the copy shop in the past, the price-per-page method is also applied in the traditional commercial printing field. Although this method of pricing by cost-per-print or cost-per-page is quick and easy, it is not suitable for commercial printing companies (printing fixed or variable content prints). Because this popular digital printing cost analysis method usually does not take into account the full cost of the printing production process. And this incomplete cost calculation method creates an illusion for printing customers that this is the appropriate price for digital printing.
In fact, the price of digitally printed single-page printed products is often higher than the data advertised by equipment manufacturers; if the printing company wants to make a profit, the quotation given to the customer cannot be the cost price. Moreover, because personalized prints can inspire more customer feedback, and on-demand printing for specific target groups can reduce the amount of prints and reduce the inventory of prints, the value obtained by customers has actually been fully improved. The reduction in the inventory of old prints allows customers to obtain the latest, flexible and diverse prints with minimal input. Digital printing companies should therefore get more rewards.
Cost calculation method in hours
In commercial printing companies, there are a variety of different cost and price calculation methods. The most widely used method is hourly rate calculation. It is usually used to determine the production costs of various cost accounting centers such as pre-press, printing and various post-press processing. Multiplying the time spent on accounting for all costs in a job by the rate, plus the direct material cost, you can calculate the production cost of the job in a cost accounting center. The total cost of work production plus the comprehensive cost of the printing company (ie, management costs and cost of sales) is the total cost of the work. Adding the profit component on this basis, the result is the final sales pricing.
The practice of dividing the production process into different cost accounting centers has been widely accepted by the commercial printing industry. Although this cost calculation system is developed for the offset printing process, it is also suitable for digital printing processes.
Digital printing system should be divided into multiple cost accounting centers
Different from the traditional offset printing method, the digital printing system integrates prepress processing and printing operations. Its super function workstation can not only handle pre-press work, but also control printing jobs. Objectively speaking, it is possible to establish separate cost accounting centers.
Taking Heidelberg New Age NP2100 as an example, a digital printing machine can become a cost accounting center, and its workstation (NexStation) with pre-press (including RIP) and printing control functions can be regarded as another cost accounting center Different rates are used for different operations. When the workstation controls pre-press operations, it can use one rate; when it is used to control production operations, it uses another rate. When the workstation is used for both prepress and production control, a multi-task cost calculation method is required.
When dividing the cost accounting center, it is necessary to consider the work flow of digital jobs. By analyzing the specific types of jobs and work processes in each situation, printing companies can accurately calculate the costs of jobs and formulate their own best quotation plan:
1. All the work preparation and variable data pre-press work have been processed offline.
These jobs can be completed by the pre-press process of the printing factory, or by the printing customer or other units. When the data is transferred to the digital printing control workstation, it is already an electronic document that is fully prepared before printing. Although these data can be checked at the moment before output or some minor adjustments, in general, the documents sent to the control workstation should be ready for printing immediately. The content of these electronic documents can be fixed or variable.
2. The original data file is transferred directly to the control workstation. Subsequently, all data processing work, formatting process and variable content processing work are completed by the supporting software of digital printing system. The page layout work can be completed by the designer in the offline mode and then input to the workstation, or can be completed directly on the workstation. This type of preparation is usually suitable for variable data printing. But it can also be used to print fixed content.
3. Mixed data processing methods. That is, some steps are done offline (may be completed by the customer), while some steps are completed on the workstation.
If a digital printing system is mostly used for the printing of fixed information, with little or no pre-press processing, or the processing of variable information is completed offline, then the workstation and printing machine are classified as a cost accounting center The rate can meet the requirements. However, if the workstation performs both prepress work and controls the printing press, it is best to use two different cost accounting center rates.
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Composition of hourly rates
The total production cost divided by the chargeable production time, the value obtained is the hourly rate. The total production cost is composed of many cost items, including equipment cost, production site occupancy cost, direct labor cost, management fee and other indirect costs. Some of the above costs are direct, some are indirect, some can be easily determined and included in the cost accounting center; some need to be reasonably simplified before they can be allocated to the cost accounting center. It must be made clear that direct costs are only part of the hourly rate. Sometimes, some indirect costs are even greater than direct costs. Indirect costs are usually fixed and usually do not increase or decrease during the operation of the enterprise. In most cases, overhead costs are allocated to cost centers and included in hourly rates. Otherwise, you will not be able to recover all costs through job pricing.
Equipment costs Equipment costs or equipment-related costs are called ownership costs. It includes equipment depreciation fees (for purchased equipment), rental costs, maintenance costs, electricity costs, equipment insurance fees (such as fire or accident insurance), and related taxes and fees levied by the government. Equipment depreciation or rental costs directly correspond to each equipment.
Production site cost
Depending on whether the space used by the printing company is company or leased, its occupancy cost is different. If the site is owned by the company, the site occupancy cost includes depreciation charges for the plant, interest on the mortgage (if any), house use charges (such as water and electricity charges, heating and cooling charges, sewage charges, etc.) and house and site maintenance costs. If the house used is rented, the cost of house occupancy includes rent and the corresponding above-mentioned fees (according to the terms of the rent agreement). After the cost is determined, divide the cost by the square meters of the total occupied area to get the cost per square meter. Multiply the number of square meters occupied by the cost center (including the work site with sufficient equipment) by the occupied cost per square meter to obtain the cost of housing occupied by the cost center.
labor cost
Refers to labor or labor-related costs, including direct wages of employees performing production labor, taxes and various subsidies related to wages, and indirect labor costs (including shipment, receipt and delivery, warehousing, and other support for printing production that cannot be Indirect cost of printing work) and management fee.
Direct wages or direct labor costs and their associated payroll taxes and various subsidies should be allocated according to the percentage of time a worker works in a cost center.
Indirect labor costs, including indirect labor wages, wage taxes, and various subsidies, can only be included in the relevant indirect labor cost center. For example, the labor cost of the material transportation personnel who transports the paper from the warehouse to the printing room should be included in the printing cost center. According to the indirect labor cost accounting method, the management cost is included in the corresponding cost center. The salary cost of salary, salary tax and subsidies of the management personnel of the printing workshop can only be included in the cost center of the printing workshop. The salary cost of the manager who manages the business of the whole plant shall be included in all cost centers of the whole plant.
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Indirect production cost
There are some expenses that cannot be directly allocated to various cost accounting centers. Although these expenses do not directly support a cost accounting center, they are indeed the actual costs of the printing company. These factory-wide or indirect production costs must be included in the hourly rate of the cost center in order to obtain a company's overall revenue and expenditure balance. Under normal circumstances, these costs should be calculated according to the distribution percentage and distributed to each cost center with the same standard.
Total production cost
Add all the related costs in each cost accounting center separately to get the total production cost of the center. Divide the total production cost by the chargeable production time for a specific job, and the value obtained is the estimated hourly rate for each cost center. If the printer adopts the method of printing pages or unit pricing, the total production cost is divided by the estimated production quantity of each cost center to obtain the estimated unit rate.
Hours chargeable
By definition, the number of hours that should be charged is the time required to produce a user ’s printed job. This part of time requires the user to pay a fee, which will be used to balance all costs. Non-charged items that should not be paid by users include equipment maintenance, training and employee meetings, reprinting of scrap or substandard products, and time lost due to downtime due to insufficient workload. For a typical single-shift printing factory, the chargeable time accounts for only 75% of all working hours. At this time, 75% of the working hours (this is the time that someone operates the equipment and can be used to produce jobs) is used to calculate the small
The final calculation result will be used to formulate the estimated hourly rate. But this is not the final result. There are also some non-productive costs that should be considered. Sales, customer service, and comprehensive management fees will significantly increase the total cost. Digital printing equipment must also take into account project development costs.
Allocation of comprehensive management fees
For each printed product, there will be a comprehensive management fee for some projects, such as budget preparation and job planning costs (in some companies, budget and job planning costs are sometimes included in production overheads and sometimes included in sales expenses Medium), also includes advertising, promotional, transportation, telephone, office, and other miscellaneous expenses. These expenses must be allocated to the company's operating cost center. When analyzing the cost per page of digital printing, the comprehensive management fee is often overlooked.
Sales expenses and customer service
Some printing companies simply count all sales expenses as comprehensive management fees. Others separately record sales and marketing expenses, including sales and marketing labor costs, as well as some subjects directly related to the project, including advertising fees, promotional fees, sales personnel transportation costs, and sometimes even include office housing occupation fees . In fact, they also regard sales expenses as a cost accounting center. For digital printing companies, especially if there is a group of sales staff dedicated to this task, it is recommended that such expenses be separately charged to a cost center in order to clearly identify such sales costs.
Project development
The printing of variable content jobs is very complicated and often requires a lot of effort from the printer.
Although sometimes sales people can also help with project development, more often rely on technicians who have deep data and information processing knowledge, understand the requirements of variable content jobs, and understand customer needs.
Divide the total cost of each cost accounting center by the estimated chargeable time to calculate the hourly rate. Based on the budgeted hourly rate, the cost of each printed job can be calculated by determining the hours required for the job and the materials consumed. These data come from the cost accounting center for job receiving, pre-press processing, printing, post-press processing / binding, etc. For each cost center, a standard for estimating working hours must be established, and of course a corresponding standard for material consumption must also be established.
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Paper consumption estimation
The paper consumption index should consider the loss part, because the loss part cannot be the final product, but it will inevitably occur in the printing production. The waste products are caused by printing errors, and the labor and materials it spends cannot be converted into income. This part of the expenses should be separately recorded and included in the indirect expenses. The loss belongs to the part of the stipulations of the live work, and its cost is included in the production cost of the live work. Waste products are not included in the plan and are not included in the budget of the job. If waste products are produced, according to the principle of the printing company, the cost can be included in indirect production costs or comprehensive indirect costs.
Toner cost
The cost of toner used for a job is determined by coverage and loss factor. Under normal circumstances, the coverage rate can be estimated based on experience, and the level of toner consumption should be included in the estimation criteria of the printing process. When it is closer to the cost of digital printing and the cost per page they provide, it is necessary to know the inherent loss of toner for each device. Since the cost of toner accounts for a relatively high proportion of the cost of the entire job, it is also important to calculate its cost based on different coverage rates.
The cost of post-press operations
Estimate the cost of digital printing post-press operations is basically the same as other types of printing. When conducting post-press cost estimation, the key issue is to confirm whether all costs are included in the calculation, and whether the cost quotas and estimation standards are updated in time to reflect the actual situation.
Prepress cost estimates
It is very difficult for printing companies to make pre-press cost budgets and often contains a lot of guesswork. When it comes to estimating costs, prepress service companies are usually more cautious than printing companies because prepress work is their only or major source of income and directly determines whether the entire company makes a profit or loses money. However, for today's equipment systems, as long as you can count it, you can estimate it.
To estimate the prepress cost of fixed or variable content digital printing, use the same method as the traditional printing method and still use it to determine the steps of prepress processing, proofing and document output. First check / test the preparation of the master file, including the content, structure, and format of the attached data file; and then conditionally insert the merged information fields, which will be used to fill in text and pictures from the database. Proofreading and testing the data files with variable content before starting the merge operation can prevent wastage and cause waste products. Next, the information merge and output steps are the same as the pre-boot preparation and on-board printing process of the traditional printing method.
summary
Whether it is short-form jobs with fixed content or tens of thousands of long-form jobs with variable content, printing companies must include all costs when estimating and pricing. Careful analysis of operating costs is a prerequisite for obtaining sustained benefits. However, it is also important that printing companies should prove to customers that digital printing can provide high value-added printing products in a short time. These printed materials have personalized, flexible, timely, one-to-one marketing features and other characteristics that cannot be achieved by traditional fixed content printing methods. If the digital printing enterprise pays attention to the printing cost and carefully formulates a set of high value-added product sales plan, the digital printing system will provide endless business opportunities for the printer and its customers.
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