Understanding TCO and ROI in Inkjet Printing

A flurry of industry buying activity typically centers around major industry trade shows and events. With drupa and the Inkjet Summit both now in the rear-view mirror — and the upcoming PRINTING United Expo slated for Sept. 10-12 in Las Vegas — there’s plenty of opportunity for printers and suppliers to discuss the value add of making CapEx investments. If serious, those face-to-face conversations eventually turn into return on investment (ROI) and total cost of ownership (TCO) analysis.

In this recent article, senior editor Toni McQuilken contacted production inkjet press manufacturers to get their feedback on how ROI and, more importantly, TCO, calculations factor into press buying decisions.

While they discussed inkjet presses, many of the same TCO considerations would apply to calculating the purchase of a new sheetfed offset press, finishing and mailing gear, and the like.

For example, a low purchase or lease price doesn’t necessarily equate to a similarly low TCO, especially when you start to factor in labor requirements, energy consumption, consumables costs, production output speed, service plan options, and other variables.

And, with available space on the production floor at a premium within most printing plants, factors like the footprint — or load bearing and temperature control needs — a machine investment will require is also a key consideration.

Conversely, adding new equipment can benefit available floor space and boost productivity: For example, an inkjet press can replace multiple outdated digital laser boxes, and an automated sheetfed litho press can out-produce several older offset models.

Two current realities seem clear, though. Skilled labor costs will remain high, as will prices for consumables, especially printing papers. So, sitting on the sidelines with outdated and inefficient equipment — although it may be fully paid off — is a failed business model. Investments in automation, new technology, and waste reduction are needed to remain competitive.

TCO calculations are critical when selecting a vendor partner when making new purchases, but so too is the comfort factor you have with that chosen dance partner to help ensure that your relationship doesn’t last like a one-hit wonder.