Sunday, May 17, 2009

Why All The To Do About Printed Page Coverage

For year’s copier vendors have been selling pages on a cost per page (CPP) basis without regard to an end user company’s page coverage. In so doing they have been able to achieve nice profit margins that allow them to provide quality service, an easy to understand pricing model, fund growth and provide a fair return to the stakeholders.

With copier unit placements dropping rapidly the traditional copier dealers are now moving into the printer world, bringing with them their CPP model. But many dealers are suddenly talking about page coverage area. After selling pages for years why worry about coverage area now. More important, how do you calculate coverage area? Do you take a month’s worth of samples and send them to a coverage area lab for analysis? Do we calibrate print management sales reps’ eyes to ensure they can accurately calculate coverage area?

I believe there are many players driving page coverage, all with a bias. Statistics tells us that with a normal distribution curve 95% of N fall within two standard deviations. Of the remaining 5 percent, half would fall into the “greater than expected” profit range and the other 2.5 percent would fall into the lower than expected range. Do you usually manage your process to the 2 percent?

Moreover, it appears as if there is more evidence that page coverage is not the big concern it is made out to be. Xerox, in discussing the hybrid pricing approach on their ColorCube 9200, estimates it can bring the average cost of color copies down by 62 percent.

So using my deductive reasoning, since Xerox has stated that a normal color page will be in the range of any other copier, but there will be savings with pages with less coverage, doesn’t is stand to reason that Xerox is counting on significantly more pages having low coverage? That is something to consider.

Here’s the link to this and other information on the ColorCube 9200, which does look like a nice device:

Saturday, May 9, 2009

Print Managed Services firms told to target IT managers' headaches

Service providers that position themselves as a consultative business focused on relieving IT management pain-points stand to reap benefits.

Follow the link below:

First HP Now Xerox: Is Tiered Color Pricing The Future of Color CPP?

HP started tiered pricing with their Edgeline product. With low enough color density your expense per color page could be as low as that of a black print. If the color increased you fell into the accent color range or professional color range, and were charged accordingly.

The tiered approach had a lot of fans on both sides of the transaction. The vendor selling the CPP had great comfort that they were being fairly compensated for the quantity of supplies they would be providing. The users of the product were comfortable that they weren’t paying too much for color prints, particularly on those documents with only a few words in color.

We’ll have to wait to see what path HP takes with the development of the Edgeline. Now that Xerox has entered the tiered color pricing game other OEMs are sure to follow. The link below will take you to an article on Xerox’s new ColorQube 9200 series and the “Hybrid” pricing approach.