If you think you are losing money in prepress now, just wait until you add VDP and Web-to-print services. Even after all these years, quick printers are still undercharging for prepress and design services. What has become the most pivotal department in the shop’s workflow continues to be perceived as a production bottleneck. Printers charge low prices and hope that the prepress staff can produce the work for the quoted price. If the prepress part of the job goes over budget, it is the prepress staff’s fault for not working fast enough.

For many shops, the VDP and Web-to-print functions will be relegated to the prepress department. The extra work usually doesn’t mean an additional person. The work has to be wedged in among the other prepress functions. The prepress staff is under more stress to produce work, knowing it probably won’t be profitable.

Successful printers charge a profitable price for the work they do. Good pricing techniques include having set prices for correctly constructed customer files and penalties for customer files that don’t follow industry standards. For design and typesetting work, successful printers use a value price that should provide the department with a profit for most work. It doesn’t matter how long it takes to produce a job. The job is priced on its perceived value. The production manager reviews the price of every job before it gets into production to assure that it is profitable or the job doesn’t go to production.

Unsuccessful printers still use an imaginary hourly rate system. The rate sounds good, but no one ever uses it. The job is priced based on how long it is in prepress; yet no one measures the time spent on the work. Even minimum prices are set so low that the selling price doesn’t cover the time spent entering the order into prepress.

Wake Up Call

If a printer doesn’t have realistic pricing set for the typical prepress work, then the new tasks required for VDP and Web-to-print services will also be under priced. Printers “train” their customers to expect low or free prepress charges. Those customers will expect the new services to have little value and low cost.

VDP and Web-to-print services have a high value. Most services are tied to marketing efforts that have a higher perceived value. Printers need to be pricing this work at a higher level rather than trying to commoditize the pricing.

A recent study pointed out that printers who are new to VDP services typically break out prices rather than giving a bundled price. Experts think that printers are afraid that the higher value prices will scare the customers since they are use to paying low prices. Printers who have more experience selling VDP services will usually bundle the price.

Most success stories discussing high profits from VDP jobs don’t come from the printing industry. The people who are making the money are in advertising agencies, marketing departments, or are print brokers. Printers are just low cost producers who see their work sold at doubled, tripled, or even higher prices.