Case Study - Reducing print costs for a leading travel agency


The Challenge


Expense Management Analysts were engaged by a leading Irish travel agency and tour operator to complete a review of a number of cost centres within the company. Established for over 30 years the agency arranged quality holidays and leisure breaks for Irish customers. The company had it’s own internal accounting department and financial controller and had well established purchasing procedures for all office consumables and supplies.

The starting point was to complete a review of the company’s existing printing expenditure. A quick survey within the office identified 20 printers in use. According to a Gartner Group report, similar organisations had about 6.3 users per printer. The agency’s ratio was 3.0 employees per printer, the company had a majority of desktop printers versus shared network printers.

All printers and copiers were owned outright by the company and the financial controller’s team completed regular price checks on all toner supplies and often changed supplier to source best price. The management accounts were able to identify the total spend for stationery and office supplies but unable to pinpoint a detailed print spend or usage volume.

The company had well established purchasing practices. The challenge was to reduce print costs further.

The Process


Expense Management Analysts proposed monitoring both the level of usage and associated costs over a period of a month. The team worked on site to record meter readings for each printer and complete a stock take of existing toner levels. The readings were agreed and signed off by the client.

The audit also recorded a schedule of the existing printers including the make and model number, year of manufacture and any unique features. This enabled Expense Management Analysts to map current devices, determine their profiles, location, volumes and estimated current running costs and also establish the published energy consumption figures per printer where available.

The audit team returned to the company after 30 days and once again recorded all meter readings which enabled them to calculate usage. They also completed another stock take on all toner supplies and worked with the accounting department to establish all related purchases for the period.

With the prior agreement of the client, Expense Management Analysts also entered into dialogue with a cross-section of users on a one-to-one basis to gain a better understanding of the workflow within the office.

The team then collated all of this information to create a clear and easy to understand report. The audit report contained the following:

  • The ratio of devices to users within the company and a comparison with industry averages
  • Estimated annual current costs per device
  • Estimated annual output from all devices
  • A detailed schedule of all printers found and their features
  • A floor plan of all printers found
  • The type of documents most frequently printed by the business
  • An assessment of the current condition of all printers, estimated replacement timeline and replacement costs of the existing printer fleet
  • Any feedback gained from one-to-one staff interviews

Results

Based on the research results the team proposed two solution models as follows,

Model One - Like for Like Solution

Expense Management Analysts studied the type of documents most frequently printed by the agency and the manufacturer's toner or cartridge yield per printer within the existing fleet.

We negotiated the replacement of the entire fleet with modern economic high yield printers. The new fleet would be supplied and maintained at zero cost to the agency based on a 5 year toner contract commitment. When compared to existing usage and costs, this resulted in a 25% monetary saving per annum and delivered cost free maintenance throughout the duration of contract. It also eliminated the need over the coming years to replace the aging fleet. The solution was also easily scalable in line with future growth requirements.

Model Two

We completed a detailed review of the ratio of devices to users and found this to be more than double the industry average. In this solution we proposed replacing all legacy devices within the print fleet and also reducing the number of devices to a total of 14.

We completed supplier-neutral research based on solutions that would work for the customer’s particular requirements and workflow and then working with suppliers collected and analysed a number of proposals.

Features of this solution:

  • 30% estimated annual saving on consumables when compared with existing costs
  • All toner costs would be fixed for a 5 year period which protected the client against future increases
  • The supplier would deliver, maintain and replace all print equipment when necessary at zero cost to the client eliminating any capital expenditure requirement
  • The ratio of devices to users was reduced by more than 40%
  • All new devices would have low energy consumption ratings as opposed to the existing fleet. This combined with fact there would be in 30% less devices should lead to considerable energy savings. (These saving would be in addition to the estimated savings for consumables above.) 
  • The client was able to sell all devices within the existing fleet and recoup previous capital expenditure.

As the entire print fleet was to be replaced it was important that the client was able to monitor the ongoing savings/costs. The new fleet included a software solution which would enable them to monitor usage across the fleet and thus validate projected savings.

Summary

Expense Management Analysts delivered a solution which resulted in 30% cost saving per annum. In addition the solution eliminated the need for further capital expenditure over the coming years to replace the aging fleet and protected the client against future increases in toner cost. Download a copy of this case study here.

 

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