No to ‘Value-Added’ Plans –Farquharson/Tedesco
A Peek into the Numbers
Let’s consider the $100k miniature folding job referenced above. In this case, $10,000 of printing should generate about $1,000 of net profit. For the outsourced $90,000 portion, a 20 percent markup will generate $18,000 of incremental income, of which we can easily assume at least 50 percent will be left over in contribution margin after appropriate management and admin costs are deducted. This leaves at least $9,000 additional profit, which is significantly greater than the $1,000 generated from internal operations. Better yet, this printing company still has a lot of capacity to produce core business.
Very much alive and now officially an industry curmudgeon, strategic growth expert T. J. Tedesco can be reached at tj@tjtedesco.com or 301-404-2244.
Bill Farquharson is a respected industry expert and highly sought after speaker known for his energetic and entertaining presentations. Bill engages his audiences with wit and wisdom earned as a 40-year print sales veteran while teaching new ideas for solving classic sales challenges. Email him at bill@salesvault.pro or call (781) 934-7036. Bill’s two books, The 25 Best Print Sales Tips Ever and Who’s Making Money at Digital/Inkjet Printing…and How? as well as information on his new subscription-based website, The Sales Vault, are available at salesvault.pro.
