Strategy: Cost-Cutting, Revenue-Building Checklists ’09
2. Stop mailing rental multibuyers generated from the co-op databases. There’s a 25 percent to 30 percent duplication rate from one co-op to another. Rental multis created from co-ops against co-ops generally don’t perform well, although rentals against rentals, and rentals against co-ops, are fine.
3. Reduce paper costs. Paper prices have been coming down, so push your printer to ensure these savings are passed on to you. Get a competitive bid from a reliable catalog paper merchant. Consider buying your own paper and managing its use as a way to control costs. Don’t just switch to a lower-weight paper or a super cal sheet (i.e., SCA) without first testing the effect on response. Lost sales can more than offset the savings.
4. Reduce the number of version changes. Don’t repaginate every time you mail — versioning is expensive. Try a simple front cover change. Print to mail three times, changing just the front cover. You can produce two extra covers for less than $1,000 per cover change.
5. Save postage using add-a-name. This age-old process of adding one or two records to a carrier route to qualify for a discount where you were previously short of the 10-per-carrier-route requirement works. The records added bring your postal costs down.
Most mailers need a national circulation of 700,000 or more before add-a-name makes economic sense. At this level, about 5,000 to 10,000 catalogs will be added.
3 Affordable Ways to Increase Revenue
1. Increase page count if you can. Don’t reduce pages to save money. Adding pages and selling more products to existing customers are good ways to increase sales, especially when business is hard to come by.
Pages are a good value. The cost to increase pages is approximately one-half the percent increase in the page count. Sales should increase by approximately one-half the percent increase in page count, i.e., an 8 percent increase in page count will equal a 4 percent sales gain.