Over the past twelve (or more) months, the print industry has had to deal with paper prices going up along with increasing labor costs and higher postage costs. Each of these factors has contributed to paper price increases over the last year and it looks like the paper cost increase trend is going to continue into the near future.
Having said that, do not worry! Yes, prices are increasing but part of the reason is because the cost of print was at an all-time low for over a decade. In fact, the price of printing almost bottomed out but print marketing is still one of the most cost-effective marketing channels. As opposed to in-house print shops, larger scale printers have the ability to absorb this rising cost. Plus, these larger printers will be able to improve the overall quality of their products thanks to enhanced targeting and increased personalization.
At NextPage, we have tripled the available inventory levels we offer on key paper stocks. Even though there are certain grades of stock that are proving impossible to find (for the moment), planning ahead means we can usually provide you a workable solution without a loss in quality.
What Factors Are Influencing Price Increases?
As mentioned above, paper prices have increased significantly and they are predicted to continue climbing throughout the rest of 2022. The rise in paper prices makes it easy to understand that the final print price will also rise since the majority of printing is done on paper.
Plus, the increase in minimum wage means employees have higher expectations regarding inflated salaries and perks. Once again, it is easy to see how costs could rise when the cost of employee labor also increases over time. Remember, this is an incremental increase in cost related to the efficiencies built into the print process.
Besides what we have already discussed, there are other factors that contribute to the rise in paper costs:
- Freight shortages and price increases (for ocean and trucking)
- Mill closures (both short-term COVID-related closures and permanent closures)
- Energy and fuel costs
- A shift in production priorities due to increased demands for tissue at home
Options to Manage Rising Paper Prices
When it comes to operating your business, the costs for print and mail must be taken into consideration. If you are running the operation by yourself, there are capital and operating costs that will fluctuate which makes it harder to determine the impact they will have on your budget. There is also the issue of not being able to decrease your fixed costs, even if you produce less printed materials, because your customers decided to go digital.
Keeping all of that in mind, what are your options when it comes to reducing print and mail expenses? One option is outsourcing to a company like NextPage that specializes in tasks such as printing and direct mail.
Are Higher Paper Prices Here To Stay?
Paper costs used to be at record lows and now that paper costs are higher than in the past, at scale, these increased costs are having a big effect on the affordability of print marketing as some sales are only offered for a few days.
The demand for paper and its prices remained relatively flat. Of course there were a few increases overtime that didn’t affect pricing in a major way, but now we are seeing pricing for the wood pulp used to make paper increase almost 50%, which is huge.
Thankfully, the help provided by improved software and the power of big data means print companies can enjoy a level of accuracy and granularity that was not possible in the past. Companies worried about their ROI will see their print budget maximized in a manner that keeps costs as low as possible while delivering a return on investment that goes beyond what they were able to achieve in the past.
NextPage is here to help you through this unprecedented time by using our reputation and relationship with mills and paper merchants to secure the needed raw materials for your projects/orders as quickly as possible.
Contact Us Now for More Information
Phone: (816) 459-8404