Update your 2014 BHRs today and start estimating better, pricing smarter, and maximizing your profits.

One of the most common questions printing companies ask about their estimating is:
“How often should I update my budgeted hourly cost rates?"

The industry best practice is to update your estimating cost rates at least every 6-12 months or anytime there are notable changes in your expenses, equipment, staffing, or productivity. After a company closes their financial year or creates their annual expense budget is always a good time to update cost rates. Your rates may increase or decrease, depending on what changes have taken place since the last time you updated them.

Considering the industry’s competitive environment, rates that are off just a few dollars can have a substantial impact on whether or not you win orders or make a profit. As a matter of policy, an organization should continually update their rates to maintain a competitive edge and sustain profits.

The major challenges faced by companies that don’t keep their cost rates updated includes:

• Inability to make accurate pricing, sales, and investment decisions
• Overpricing and losing valuable and profitable work, and potentially customers
• Selling orders below costs, resulting in lost profits and deteriorated productivity
• Being misled by inaccurate estimating and costing figures

Read: How inaccurate Budgeted Hourly Cost Rates almost put Quality Printing out of business.


The Cost Rates Advisor budgeted hourly rates software makes it easy for organizations to keep their rates updated.  It gives shops a more accurate picture of their out-of-pocket manufacturing and overhead costs so they can strategically estimate and price jobs. You can import data from spreadsheets, accounting software, and print management MIS software - making setup and updates fast and simple.

Cost Rates Advisor is used and proven by offset, digital, large format, flexographic, screen, and in-plant printing organizations throughout North America. Three tiered pricing starting at just $228 makes it affordable for companies of all sizes.

With Cost Rates Advisor, calculating and updating your estimating cost rates no longer needs to be a time consuming and demanding task. So update your 2014 BHRs today and start estimating better, pricing smarter, increasing revenue, and maximizing your profits.

Try it for FREE now by clicking here www.costratesadvisor.com

About CostRatesAdvisor
CostRatesAdvisor.com was designed by Profectus Inc., industry experts in the printing and packaging industry. It has been engineered based on proven industry best practices used by experts such as the Printing Industries of America (PIA)©, National Association for Printing Leadership (NAPL)©, Specialty Imaging Graphics Association (SGIA)©, and the Financial Accounting Standards Board (FASB)©. The software has built-in "best of breed" formulas, intelligence, and functionality that make it the industry's most superior product for developing budgeted hourly cost rates.
 
About Profectus Inc.
Profectus is a national consultancy that helps printing and packaging organizations improve their business by implementing best business practices and maximizing the value of their information technology investments. The company was founded in 1993 and has contributed to the success of hundreds of printing and packaging organizations throughout the United States and Canada spanning all industry segments.

10 Ways to Financially Improve Your Printing Organization

Financial performance is a major concern of all organizations, whether you’re a commercial, packaging, digital, large format, or in-plant printing operation. Here are 10 ways you can improve the financial performance of your organization.

1. Improve Administrative Processes
Implement lean principles in your administrative areas to eliminate unnecessary and redundant non-value-added activities, steps, and handoffs in your sales, estimating, order entry, purchasing, invoicing, and accounting workflow.  Put a team together to define the steps required to get jobs through your administrative processes and design a more efficient "Lean" workflow.

2. Implement Industry Best Practices
Best practices are proven methods in which printing organizations have achieved top performance and serve as goals for other companies that are striving for excellence. Why reinvent the wheel? Improve your financial performance by adapting these accepted best practices to your specific needs.

3. Speed Up Throughput And Delivery
Write up orders accurately and effectively, and then use the quickest means available to produce and deliver products to customers. Unnecessary delays can add days or weeks to customer payments. You must pay out considerable costs in paper, wages, and other expenses to produce orders, so you want to get reimbursed as soon as possible.

4. Leverage Technology
The proper use of technology will improve the synergy of your organization and help it run more efficiently and effectively. An integrated management information system (MIS) like Avanti, EFI Monarch, EPMS, ePace, Radius, or Printers Software is a critical tool for managing and operating a financially sound printing organization. A typical MIS incudes estimating, order entry, inventory management, shop floor data collection, scheduling, job costing, and accounting. Implementing an ecommerce solution can eliminate time and costs associated with processing orders, speed your order to cash cycle, minimize inventory, and enhance relationships among customers and suppliers.

5. Keep A Tight Control On Inventory
Paper accounts for approximately 1/3 of your costs, so less cash tied up in inventory generally means better cash flow. While some suppliers offer deeper discounts on volume purchases, if inventory sits on the floor too long, it ties up money that could be put to better use elsewhere. Implement Just-in-time (JIT) inventory practices to reduce in-process inventory. You should not have items sitting in your inventory if it can be replenished before a job goes to press.

6. Review and Reduce Expenses
Take a hard look at all of your expenses. Consider ways to decrease operating costs, but be careful not to cut costs that could impede performance or profits. Reduce production expenses by scheduling better, reconfiguring work shifts, improving job planning, and eliminating spoilage. If you haven't already done so, implement Lean Office and Lean Manufacturing principles.

7. Know Your True Costs
Having a clear understanding of your costs is essential for producing accurate estimates, pricing orders, measuring job costs and profitability, and generating accurate accounting reports. Good job costing and shop floor data collection software can help to make sure that all of your labor and material costs are fully accounted for and absorbed in your estimating cost rates and pricing.

8. Invoice Customers Promptly
A customer cannot pay an invoice until they received it, so the faster you get the invoice to the customer, the faster you’ll get paid. When possible, send an invoice within 1 to 2 days after the order has shipped. A best practice is to establish the invoice amount when the order arrives and as the customer requests changes. The only exception is billable overs and shipping charges. Many companies are expediting the invoicing process by sending PDF invoices to customers using email.

9. Measure Your Performance
If you don’t measure it, you can’t improve it. If you don’t measure it, you can’t manage it. Time after time studies have found a strong correlation between a company's financial performance and effective goal setting. There are various tools for measuring performance including Performance Benchmarks, Key Performance Indicators (KPI’s), Balance Score Cards (BSC), and dashboards. Metrics can assess the health of your organization’s financial, production, cost, quality, and customer service performance.

10. Utilize Your Employees  Better
The need to effectively leverage the skills of employees is critical to improving your financial performance. You may have some people that have evolved into the wrong position over time. Or employees that are overloaded with work while others do not have enough to keep them busy. Take a close look at the skill set and workloads of your staff. Make sure employees are in the position that is best leveraging their capabilities.

If you're interested in learning how Profectus Printing Industry Business Consultants can improve your organization, contact Profectus for a FREE phone consultation at 1-888-868-8662. Or visit our website: www.profectus.com



Cost Rates Advisor Budgeted Hourly Rates Software

PIA Converge Conference

Are you planning on going to the PIA Converge Conference in November?

The Converge Conference - The Next Generation of Print and Communication Services - is designed for the new breed of company that is integrating the components of conventional and digital print, web technology, automated workflow, personalized and cross-media campaigns, mailing services, and more.

While many challenges exist to undermine profitability, so do numerous profitable opportunities. Progressive printing companies are adding new services, changing their names and rebranding. The result is a new breed of company integrating the components of conventional print, digital reproduction, web technology, mailing services, personalized cross media campaigns and much more.

The Converge Conference will present the strategy, tactics, and tools necessary for creating a dynamic new profit oriented business paradigm. Key industry leaders have acknowledged that there is no other conference attempting to serve the industry in the same way as Converge. The conference is broken into three tracks - Sales and Positioning, Production and Workflow Issues, and Value Added Services - the program is designed to appeal to a wide cross section of companies and individuals. I will be giving a session on how to integrate these new services into your management information system.

The Converge Conference takes place November 7-10, 2009, at the Hilton Bonnet Creek in Orlando, Florida. It is presented in partnership with the Printing Industries of America, the IPA, the Association of Graphic Solutions Providers, Digital Printing Council, Direct Marketing Association (DMA), and Printing Impressions magazine. Visit the Converge Conference website at http://converge.printing.org/

If want to learn how your organization can grow and prosper by taking advantage of new value-added business opportunities, join us in Orlando at The Converge Conference.

How E-Commerce Is Changing The Role of The Customer Service Representative

As more E-Commerce innovations become available to the printing industry, customers will become more empowered to place, track, and manage orders on their own. Many of the Customer Service Representative's daily responsibilities will become the customer's responsibilities. Rather then passing information from the customer to the CSR and back to the customer, the customer will be able to resolve questions at the click of a button at Internet speed.

So, what will your CSRs be doing in 3-5 years? The Internet, email, preflight software, and smarter file creation software have already begun to change the role of the CSR. Today, CSRs are spending more of their day at the computer, communicating information to customers, suppliers, and intra-company staff via email and web forms.

The future CSR will be more of a sales consultant position. Responsibilities will include preserving personalized relationships with customers, creating new business opportunities, and troubleshooting jobs.

Customer phone calls to the CSR will change to technical questions about file preparation, production requirements, and billing questions. The customer will also be contacting the CSR when there is a problem with the order status, finished goods inventory counts, and other information viewable on the Web.

The same E-Commerce features available to the customer will help the CSR service customers. This also presents the opportunity for the CSRs to work from remote sales offices, telecommute from their home, or use wireless Internet devices while in the customer's office.

Perhaps E-Commerce may even combine the roles of the salesperson and the customer service representative into one position in the future.

Profectus, Inc, is a national consultancy that helps printing organizations implement best business practices and maximize the value of their information technology investments.

Maximizing Your Print Management Software ROI With Post Implementation Assessments

When you purchased your current management system, you probably received all the training you needed to get the system fully operational. Right?

Wrong. Never assume the status quo is acceptable with your MIS system.

Studies from Profectus and other research organizations consistently show that businesses never use 40% or more of all application functionality. Often companies are unfamiliar with all the capabilities of their MIS due to ineffective training, "crash courses" to quickly get a system operational, and cutting training investments.

Once the system has been installed and is fully operational, it still has to be managed. You want to ensure that the system continues to operate at peak efficiency.

Business processes may change and need to be integrated into the system. New production equipment or product lines may have to be defined in your cost centers, production standards, and job tickets. Personnel might change positions and require training on other software components. As new employees are hired, they also will need training. The software itself will change over time as new functionality is incorporated into software product releases, requiring additional training to take advantage of these features.

As time passes, all systems tend to retreat from their initial levels of efficiency. Sometimes this is not noticeable until the system's efficiency has been significantly impacted. This deterioration can be avoided by conducting regular checkups of your implementation.

An annual budget for training will ensure that everyone is consistently taking full advantage of the system's capabilities. Take the time and invest the funds necessary to determine exactly what training and education is required by each person, and then provide it for them.

The better your people are trained on the capabilities of the software and the information it provides, the more likely your organization will maximize the system's potential.

A formal analysis of the entire system should be conducted at least annually. Revisit your initial implementation goals, objectives, and expected benefits to see if they are still being met. Talk to the users to determine their level of satisfaction and the need for additional training, modifications in business processes, changes in the system setup and reports. Then make adjustments as warranted.

The Changing Landscape of Print Management Systems – Are You At Risk?

Eectronics for Imaging, Inc (EFI) made several announcements last week regarding their Print Management Systems that has prompted new concerns among the printing industry. EFI announced that it has acquired Pace Systems Group and their ePace MIS product. EFI also announced that their popular PSI and Logic print management systems would eventually be discontinued and replaced with ePace. EFI will continue to support PSI and Logic for an undetermined amount of time.

EFI’s announcements have provoked several of the 2,000 printing companies using PSI, Logic, and ePace to reevaluate their current and future MIS strategies. A lot of these companies had evaluated ePace and purchased PSI or Logic because it was a better fit for their organization. Evaluating, purchasing, implementing, and changing a print management system is a daunting effort that most printing companies want to avoid.

Mergers and Acquisitions - Good or Bad?
If your software vendor has been acquired or merged with another software company, this may be good or bad for your company. There have been at least 20 mergers and acquisitions of management systems in the printing and packaging industry in the last 10 years including the following:

• Logic Associates acquired Covalent Systems in 1997 and then Constellation Software acquired Logic Associates in 1999.
• The Prism Group acquired QTMS in 1998 and acquired MicroInk in 2001. In 2004 MicroInk separated from The Prism Group and created Enterprise Print Management Solutions.
• VantagePoint Systems acquired Avalon Printing Software in 2002 and Harry Rohde Management Systems in 2005. And in 2007 Solarsoft acquired VantagePoint Systems.
• Creo and Prograph create printCafe in 2000 and then printCafe acquired Programmed Solutions (PSI), Hagen Systems, Logic Associates, AHP Systems, and M Data (Printsmith). In 2004 EFI acquired printCafe and then acquired Pace Systems Group in 2008.
• Printable Technologies acquired Collabria in 2001.
• Tectura acquired Concord Business Systems in 2004.
• Pace Systems Group acquired Profit Control Systems in 2005.
• Avanti Computer Systems acquired Parsec Corporation in 2006.

Acquisitions are also a means of bringing to a company innovation that may have happened elsewhere. Instead of the company making the investment to develop or enhance its own product, if can acquire a company that has already made the development investment. According to EFI, ePace’s Java-based browser application and flexibility above PSI or Logic are some of the key reasons it was acquired.

An acquisition with a technological advanced or financially sound company is a good way for a software company to obtain needed capital to improve their business, marketing capabilities, and support. Additional capital for software development can breathe new life into a stagnant software product.

Merging two software companies is tricky. It's extremely difficult to blend technologies, and as a result, a merged company often ends up maintaining the sales, support, and development staff of both companies. That makes it difficult to fulfill the cost-savings envisioned when the merger plans were formulated. Merging products was one of the challenges for EFI, considering some of the MIS products overlapped in market segments and capabilities. Since 2003 printCafe had considered combining some of their products to create a Best-of-Breed solution.

Product Life Cycles

Some software companies sell out because they have not appropriately invested in keeping their product current with the latest technologies, and their product may have reached the end of its life cycle. Programming languages, operating systems, databases, development tools, and the way users interact with computers are quickly changing. Any software that does not maintain these technology advancements can quickly become obsolete or undesirable. Print management systems that have retired or will be retiring soon include Covalent, PressTrak, Collabria, InfoNet, Parsec, Profit Control Systems, PSI, and Logic.

In With The New

While many products have reached their end-of-life cycle, fortunately there have been many new products that have emerged. Some older products have been completely re-written to create new products such as Hagen PMS to HagenOA, Globe-Tek to Globe-Tek Enterprise, and Pace to ePace. There are also many new products on the market including KODAK EMS Business Software, Press-sense, Printstar, HighJump, Print-Quotes Software, FORIX PrintBridge, and Virtual Systems. An increase in globalization and the internet has introduced many new products from other parts of the world to the North American market including Intraprint, Radius Solutions, HIFLEX, PrintVis, Shuttleworth Business Systems, Sistrade, and RedTie.

What can you do to limit your risk?

If the intent of your vendor is to eventually replace your product with the acquired product, then you might as well start evaluating alternative solutions now. The acquired product may end up being the best solution for your organization, but before you make that conclusion, benchmark your company’s requirements against other the 100+ print management systems www.print-estimating-software.com.

Make sure you partner with a software vendor that is committed to enhancing their product and embracing the latest technological advances such as programming languages, operating systems, databases, JDF, ecommerce, and printing technologies. You should be receiving at least 2 product update releases annually. These product releases should not just be bug fixes, they should include enhancements.

It’s also important that your software vendor has a management team that is active with its customers and the industry. A software company that listens to their users and is informed on the latest industry trends and technologies is more likely to improve their product. In most cases, these software companies and products will continue to succeed.

For the complete list of over 150 software products available to the printing and packaging industry, visit our online directory at www.print-estimating-software.com. You can also visit our website to learn about Profectus software selection, implementation, and risk assessment services www.profectus.com/services/it.htm.

Software products mentioned in this Article

• Avanti www.avantisystems.com
• EFI Pace www.pace2020.com
• EFI PSI www.efi.com/products/print-mis/efi-psi
• EFI Logic www.efi.com/products/print-mis/efi-logic
• EFI HagenOA www.efi.com/products/print-mis/efi-hagen
• Enterprise Print Management Solutions www.entpms.com
• FORIX PrintBridge www.forixprintbridge.com
• Globe-Tek Enterprise www.globe-tekcorp.com
• HIFLEX www.hiflex.com
• HighJump www.highjump.com
• Intraprint www.intraprint.com
• KODAK EMS Business Software http://graphics1.kodak.com/us/product/workflow_data_storage/business_solutions
• Press-sense www.press-sense.com
• Printstar www.printstar.biz
• Print-Quotes Software www.print-quotes-software.com
• PrintVis www.novavision.dk/Default.aspx?tabid=86
• Prism www.prism-world.com
• Radius Solutions www.radiussolutions.com
• RedTie www.red-tie.com
• Solarsoft www.solarsoft.com
• Shuttleworth Business Systems www.shuttleworth-uk.co.uk
• Sistrade www.bdoisb.com
• Virtual Systems www.virtualsystems.com
• Directory of All 100+ Products www.print-estimating-software.com

Top 7 Reasons Printing Organizations Prosper From Ecommerce

Top 7 Reasons Printing Organizations Prosper From Ecommerce

Implementing ecommerce in your printing organization can be very challenging, but when done right your organization will receive significant paybacks. Here are the top 7 reasons printing organizations prosper with ecommerce.

1. Time and cost reduction – Ecommerce eliminates time and costs associated with entry and verification of documents and the expense of preprinted forms, paper, toner, postage, phone calls, faxes, and manual filing systems. This significantly reduces your labor costs and cost per business transaction.

2. Cash flow - Ecommerce eliminates days of mailing and paper shuffling by electronically exchanging invoices and payments with your customers. The same is true with suppliers, which allows implementation of just-in-time manufacturing practices that minimize your inventory investment.

3. Reduced stocking costs - Ecommerce speeds the ordering cycle, providing better information and minimizing inventories, floor space, storage, warehousing, and insurance costs.

4. Improved service - Ecommerce will enhance relationships among your customers and suppliers by providing continuous accessibility to order, billing, and other information, simplifying everyone's efforts.

5. Differentiation - Successfully implementing ecommerce with your customers and suppliers will project your company's image as a technological leader, especially when you exploit these new business opportunities before the competition.

6. Multi-company consolidations - Consolidators inherit an assortment of systems and data structures with each new acquisition. Ecommerce standardizes the information among the parent company, acquired companies, and divisions.

7. Business survival - As more of your customers adopt ecommerce technologies, they will demand their business partners also implement ecommerce.

Implementing an e-Business Strategy

It takes several years to actually implement the strategies needed to truly become an e-business. In fact, a recent study suggests that we will be implementing e-business strategies for the next 5 to 7 years. By then, e-business will just become "business."

In order for a company to actually become an e-business, its business practices and Internet technologies need to become fully integrated. Companies need to reinvent order processes and workflows, and people need to learn to adapt to these new ways of conducting business.

Some of the business practices and processes you may want to consider realigning include:

• Pre-production, production, and post-production workflows


• Forms, paperwork, reports, job tickets, etc.


• Personnel roles, job functions, job descriptions


• Departmental structure


• Inter-company, customer, and supplier communications methods

Implementation of an e-Business Strategy may require cultural changes in your company. Company owners and management must be willing to change the very way they do business if they expect to maximize their investment in e-Business technology. They must take an active role, even if only to monitor the implementation progress. This will demonstrate to employees that the new technology and related changes in the company are supported by the management and owners.

The most difficult part of becoming an e-business is "people". Companies will achieve greater success by educating their staff. You can accomplish this by hiring industry consultants, attending seminars, and subscribing to e-business publications.