Elmer Rhodes (at podium), is joined by Tony Militano and Gary Wilbur at a panel discussion about digital services at the 2015 ERA/IRgA Convention in Atlanta.
By Ed Avis
Reprographics is an information management business, not a paper business. That point was driven home during an educational session called Digital Services and the Reprographer at the 2015 ERA/IRgA Convention in Atlanta in April.
“Nobody knows the general contractors better than us,” said Elmer Rhodes, owner of Cross Rhodes Reprographics. “We need to look at the power of our shops.”
Selling Professional Services
Rhodes opened the panel discussion with a presentation about how Cross Rhodes has thrived by bidding for the document management portion of major projects. Rather than positioning his company as simply a print provider, Rhodes shows project managers that he can run the entire document management process of a major job, and help the contractor close out 30 days earlier than the company would otherwise.
“Time costs them money,” Rhodes explained. “Any time you can help speed up the process, that saves them money.”
Rhodes said that on several recent bid opportunities, no other reprographer competed for the work. But software companies and other subcontractors did. He said his aim in those cases is to persuade the owners that his company’s experience in managing documents is superior to the other companies bidding on that portion of the job, since for them it’s not a primary focus.
Rhodes explained that in a typical job, he establishes a document management system for the contractor using PlanWell Collaborate (during the demonstration he logged into his company’s website and showed real-time examples of jobs underway). He sets up the job so that many typically manual processes are automated and smooth, making the contractor’s job much easier.
“Once we set up the job, they don’t have to worry about anything,” he said. “We take all the fuss and muss out of it.”
Rhodes said it typically takes about two days to set up a job, including all the permissions, email routing, and other elements. For a typical job that he described during the presentation, he said he charges $1,000 per month plus a commitment for 80 percent of the printing, including job site signage. Other jobs are worth more, depending on the services required and the billing situation. For example, for some jobs he charges by the hour for services rendered: “Every time my boot hits the ground on a jobsite I charge for it,” he said.
When a job is finished, he closes out the documentation and provides a complete close-out file that includes all the documents, emails, file structure, and other elements.
“Don’t just bid on the printing for a job, ask about the document management,” he said.
Charging for Digital
Gary Wilbur, president of R.S. Knapp in Lyndhurst, New Jersey, said his firm also charges for digital services, and has done so since the late 2000s.
“It wasn’t easy when we told clients we would start charging for certain services, and we lost some customers,” he said. “But today if we didn’t have that revenue, our repro department would be in a bad way.”
The bottom line, Wilbur explained, is that quantities of prints are way down, and charging for services related to documents – even if the printing doesn’t happen – has helped the firm maintain profitability.
Among the fees R.S. Knapp charges are a “first-out charge.” This is simply the fee to print the first page of a job, and it makes that first print cost three times the price of subsequent copies. This fee is akin to a “pre-flight” charge, since that first print out represents the work that went on before the print was made.
Another fee is a download fee, which is charged when a customer asks R.S. Knapp to grab a file from somewhere or take a file from an email.
“Sometimes you download and never print, but you still charge for that,” Wilbur explained.
R.S. Knapp also earns revenue from scanning services. Wilbur explained that Hurricane Sandy prompted many customers to begin scanning documents for fear of losing them in the next storm. And the emergency relief funds that resulted from Sandy have provided the cash to pay R.S. Knapp to do that work.
Another source of scanning revenue for Knapp is companies that are moving. Such companies often have rooms full of old documents that they don’t want to move, but need to keep in some form. Scanning is the perfect solution.
“We look for companies that are moving. When you move you get a moving budget, so they have the money to scan,” Wilbur explained.
As an example of the value of digital fees, Wilbur said that a recently completed project earned his firm $225,000, only $50,000 of which was for printing.
Tony Militano, president of Carbon Copy Digital in Calgary, Alberta, said the culture at his firm is “you charge for everything you do.”
Militano said digital services now make up 14 percent of his company’s revenue.
He said one important new business that his firm has entered is records management, often for Fortune 500 companies that are used to paying for a variety of services. For example, a records management job typically includes scanning, indexing, and quality control. That last service – quality control – would be taken for granted in a typical reprographics business, but Fortune 500 companies are used to paying extra for it, so Militano charges them for it.
Wilbur recommended that if a reprographics shop doesn’t currently charge for digital services, it should start adding a few small fees and slowly increase them. “We can’t make any money printing at 6 cents a square,” he said. “We have to be adding something to the invoice.”
To read more about charging for digital services, click here.