Mailing & Fulfillment Special Report — Getting Started In Fulfillment
Step 9: Pricing. Establish a pricing matrix for the fulfillment operation that includes all services completed. Some of these parameters, such as storage and customer service, have never been charged by printers in the past. As a result, justification with the customer and sales personnel will have to be developed and presented.
Following are a few of the basic pricing parameters that should be specified:
Storage - $/pallet/month
New Product Setup - $/setup
Warehousing - $/hour
Receiving - $/receipt
Cycle Counts - $/hour
Order Receipt - $/order
Fulfillment Cost - $/order
Shipping Materials - Cost + percent
Reports - $/report
System Usage Charge - $/month
Customer Service - $/hour
Initial Setup Charge - Total $
Step 10: Commitment. The most common problem I’ve observed is the lack of ownership and management commitment to learning and growing the business. The decision to add fulfillment to your current operation is not to be taken lightly.
This is a service business as compared to your current production business—printing. Pricing is based on services, employees and systems—not machines—and furthermore is a partnership arrangement with your customer. When you open a literature fulfillment application for a client, you become an extension of their operation and enter into a whole new business relationship.
A printer can easily enter into the fulfillment business with a $200,000 investment. This is much less than the cost for most pieces of equipment utilized in the printing business, including most bindery gear.
However, the investment required is in your time and dedication to understanding, driving and growing the fulfillment operations. If successful, you will increase print runs, improve print margins and decrease turnover (by up to 300 percent) by incorporating fulfillment into your service mix. So do it right—the first time. |||
About the Author
Tom Quinn is director of fulfillment services at the Mailing & Fulfillment Service Association (www.mfsanet.org). He can be reached at email@example.com.