By now, any offset printing company that does not already have a digital press is probably thinking about buying one. Changing patterns in the demand for print are putting digital equipment on nearly every printer’s must-have list for customer satisfaction and retention.

A digital press may seem like a big investment. Unfortunately, for shops that don’t invest carefully, it can become too big. Having digital capability is essential, but there’s no reason to pay for more of it than the shop actually needs. Understanding how digital press costs are structured is the key to acquiring equipment that can handle the shop’s everyday workload without draining cash as it operates.

Thanks to advancements in technology, high-quality commercial print applications are now achievable on machines that are much more cost-effective than older digital presses. This means that with a little insight into cost structure, you can buy a solution that meets your needs today and doesn’t require high growth of the business to deliver ROI.

Total Cost of Ownership

The chart below breaks out the components of the total cost to own some (but not all) digital presses. It’s complicated. Consider, for example, the monthly base service charge for parts, service, and labor. If this cost isn’t built into the click charge—as it is with Heidelberg’s Versafire CV and Versafire CP digital presses—the shop will pay $1,600 to $2,000 before it runs a single sheet.

The click charge should be a straightforward cost, but it often isn’t. There’s the question of whether service and consumables are included. How is the click calculated: per separation or per 4/0 impression? Is sheet size a factor? A click charge based on a monthly minimum volume might appear to be an attractive deal, but if the shop fails to meet the volume, the result is a higher realized click charge. Finally, if the click charge is subject to an annual increase, the initial low cost could escalate to make the cost of ownership less competitive over the life of the lease.PrintDiginomics_CostOfOwnership

Then there could be hidden costs for things like “software maintenance” and “prepress job optimizing.” Versafire owners get peace of mind from knowing that all machine-related operating costs are bundled into the simple, no-minimum-volume click charge. Others may find themselves staring at monthly vendors’ statements that are as hard to decipher as cell phone bills.

Just as much careful thought has to be given to the initial outlay: the capital equipment cost. These days, a digital press that costs $500,000 isn’t necessarily better than one in the $100,000+ range. The bigger price tag might mean greater capacity, but that could be a red flag in and of itself: in the printing industry, underutilized capacity is a perennial economic trap. That is why a shop’s best course is to buy a press for the workload it has now, not the volume it expects to be handling at some point in the future.

It’s important to remember how much the performance of digital printing equipment has improved in recent years. In terms of color quality, substrate flexibility, and high-output productivity, a new Versafire CV or Versafire CP is more than a match for an older digital press costing two, three, or even four times as much.

Going head to head with today’s high-end machines, a new Versafire will run more economically than a $500,000 device in monthly volumes spanning hundreds of thousands of copies.

This is the most sensible route to ROI in digital printing. For most shops, and especially for first-time buyers, it’s a better strategy than trying to “grow into” a more expensive press that the shop might never be able to fully cost-justify. And, if a single Versafire turns out not to be enough, adding a second one when needed would still be a better decision than overinvesting in the $500,000 alternative.

No capital expenditure is a snap decision, but purchasing a digital press shouldn’t be an exercise in obfuscation. Your digital vendor must be able to provide an easy-to-understand breakdown of total ownership costs and a fact-supported explanation of ROI. Any proposal that isn’t expressed along these lines is an invitation to buyer’s remorse.

Heidelberg’s proposition to current and prospective customers always is that the purchase of a Versafire isn’t just a sales transaction—it’s a strategic investment. As a first step, Heidelberg presents every customer with a cost analysis that details the true and total cost of owning a Versafire in a realistic use scenario. This eliminates post-sale surprises and charts the clearest path to ROI.

To recap: buy a digital press based on the volume you expect to run now. Pay only for what you print. Beware of fixed costs such as base service charges and volume commitments. Also look out for “hidden” variable costs attached to things like software maintenance and prepress tweaking.

Above all, bear in mind that shops can get all the digital print quality, applications, stock range, and reliability they want at a lower acquisition cost than was available to them even a few years ago. That’s another way of saying that there has never been a better time to buy a digital press—specifically, a Heidelberg Versafire CV or Versafire CP—than right now.

 

D. Maurer-3-Edit

Dan Maurer

Vice President, Digital