Strategy: Should You Purchase Your Own Paper?
Purchasing your paper direct through a paper merchant might be a way to save money, but it’s not for all mailers. This month, I’ll help you determine if you’re a candidate to purchase your own paper and what it can mean in terms of savings, as well as the risks and common misconceptions associated with it.
While printers traditionally have been more qualified to purchase and manage paper than most small- and medium-sized catalogers, the management and economics of purchasing paper have changed in the past few years, often making it wiser to buy your own paper. Paper merchants have made it easier to purchase paper direct. They often can put price caps in place, although I don’t always recommend this, for reasons explained later. Additionally, they negotiate payment discounts and manage the inventory for you.
When to Buy Your Own
Your tonnage requirement, i.e., volume, is a key determining factor. Small catalogers probably shouldn’t purchase their own paper if they print in low quantities once or twice a year. Paper mills don’t ship the exact amount of paper, since they round to the nearest roll beyond what’s needed. That can be problematic to smaller catalogers.
If you purchase less than 80,000 pounds of paper at a time (about two truck loads), it’s probably best to continue buying paper through your printer. As a guide, this is the equivalent of approximately 300,000 64-page catalogs with a trim size of 8 inches by 10-1/2 inches on 40 lb paper. If your needs exceed these minimum standards, consider supplying paper to your printer.
In brief, consider buying your own paper if you:
• print at least three or four times per year;
• purchase a minimum of 80,000 pounds to 100,000 pounds of paper at once; or
• are certain you won’t be changing grades or the basis weight of the paper you’re using.