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  The Cost of Business Communications
On average, for every $14 spent on printing, $96 goes to ancillary activities and the cost of obsolescence...

To understand the true cost of business communications, an organization must examine every stage of the document lifecycle. Many users still tend to focus on the final print “cost per page” for ink or toner on paper (or other media) in assessing document production costs. The real cost of documents, however, is embodied in the time, resources, and money spent in document processing, including authoring, design, revision control, ordering, warehousing, distribution, and inventory obsolescence.

For example, a large portion of the total cost of documents such as technical manuals, product manuals, and training manuals is incurred by internal creative tasks. CAP Ventures research shows that 42% to 62% of the total cost is incurred by internal creative tasks for shorter run lengths of 50 to 1,000. This is because a great deal of the content for these manuals must be developed internally, and frequently involves engineering or other professional resources. In contrast, printing accounts for only 7% to 22% of the total cost. On average, for every $14 spent on printing, $96 is spent on ancillary activities and the cost of obsolescence. For very large print runs, printing and fulfillment/distribution become the predominant costs. Nevertheless, print runs of 10,000 or higher are extremely uncommon for this type of document.


Average Relative Costs for 50 to 1,000 Manuals


Document obsolescence is a significant business issue. A 1997 CAP Ventures study reported that anywhere from 15% to 25% of print purchased is either thrown away or is somewhat out of date but still used. This percentage is higher for process color prints, presumably because users are less likely to throw such materials away due to the higher cost of producing them. In other words, the cost of reprinting prompts companies to continue to use outdated materials even though the documents contain information that is no longer valid. As a result, while companies have not spent any money on printing, they are still absorbing the cost of distributing outdated materials.

It is important to understand that the relative costs associated with the document lifecycle will vary depending on the type and the complexity of the document, as well as the length of the print run. CAP Ventures has developed models for documents of various types and complexities. Because costs vary based on the document type, document complexity, and print run, models are also provided in the form of a spreadsheet, in Microsoft Excel format. The spreadsheet allows readers to adjust the numbers in the models to develop cost models that are specific to their organization and document applications.

The preceding analysis is an excerpt from CAP Ventures’ research report entitled, The Cost of Business Communication: A Look at the Business Document Lifecycle. For more information or to purchase the report, please visit CAP Ventures' Publication Store.

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