Cost Comparison. Pricing Comparison between Bing and a Council s Internal Processes. p f

Transcription

1 Cost Comparison Pricing Comparison between Bing and a Council s Internal Processes p f sales@bingmail.com.au

2 SUMMARY The following report is a price comparison for Bing and a small-sized Victorian Council managing their ad hoc mail. Based on letter type, such as delivery method and size, the report compares Council s Australia Post charges as well as their labour and material costs to Bing s pricing and has found substantial savings for Council if they were to outsource their mail to Bing. INTRODUCTION Local Governments across Australia are being driven to utilise new and innovative technologies to help deliver services more cost-effectively and efficiently to the community. Having years of experience in Local government and extensive industry knowledge, Bing understands the complexity of partnering with Council. Constant increases in the cost of postage, a push to drive efficiencies and changing demographics allows Bing to streamline process, increase productivity and minimise resources. The purpose of this report was to analyse whether Council are able to reduce some of their outgoing mail costs by utilising Bing s service. The data analysed in this report includes Council s Australia Post volumes and charges as well as estimated costs for internally processing mail (such as labour and overhead costs derived from current Bing clients) and Bing s pricing Bing compared product items from Council s Australia Post invoice breakdowns from March 2016 February 2017 with the equivalent items of Bing s pricing schedule. Some Australia Post items were excluded as it was too undistinguishable what the items may be in comparison to Bing s pricing. Comparisons were made between Bing s pricing (both colour and black and white) and Council s existing postage and processing costs (such as staff time in printing and folding mail). 1 P a g e

3 METHOD The Council s Australia Post volumes for March 2016 to February 2017 were used to calculate the Council s postage charges, mail volumes and internal processing costs for the three months. Bing used estimated internal processing costs per letter to determine Council s current mail costs (excluding postage). Internal processing costs are the expenses to Council for managing their mail internally. Through industry experience and understanding of mail expenditures, Bing has worked out an average cost per letter for the labour and materials used to send a letter internally. To work out a typical cost per letter, Bing used an average of both colour and black and white letters and estimated impressions and pages in each letter (which vary for standard DLX letters and large C4 letters) typically seen in Local Government mail. For small DLX letters, two impressions and a single piece of paper was used as an average. For large C4 letters, thirteen impressions and nine pieces of paper were used as an average. All costs analysed exclude GST. Below shows which Australia Post letter items were compared to Bing s letter types; Imprint large letters regular = Large C4 envelope regular Imprint small letters regular = Standard letter (DLX) regular Imprint large letters priority = Large C4 envelope priority Imprint small letters priority = Standard letter (DLX) priority Presort letters small regular = Standard letter (DLX) regular Presort letters small priority = Standard letter (DLX) priority Reply Paid Small = Bing Reply Paid Envelope Local Country Letters Regular = Standard letter (DLX) regular Local Country Letters Priority = Standard letter (DLX) priority International Economy Letter = Asia/Pacific International small letter (DLX) priority Council s estimated yearly material, labour and Australia Post charges were combined to estimate Council s current total expenses for their mail. These expenses were compared to Bing s equivalent pricing. Three price points for Bing were estimated; one for all letters to be in colour, another for all mail to be black and white and one for a mixture of colour and black and white. Australia Post had a price increase on the 3 rd of July 2017 so to get an accurate comparison, Bing did not use Council s Australia Post charges. Instead, Bing used the volumes of their mail for the 12 months and applied the current Australia Post cost for the letter type to compare to Bing s pricing. 2 P a g e

4 FINDINGS Council s Mail Volumes The following table is a summary of Council s letter volumes for March 2016 February Volumes are broken down by the letter type. Letter Type Standard DLX Regular Large C4 Regular Standard DLX Priority Large C4 Priority International DLX Asia/Pacific 12 Month Volume 89, Council s Current Mail Costs The below table shows the cost of internally processing a letter, excluding postage. Costs are broken down by material costs, labour costs and letter type. 3 P a g e

5 Summary of Council s Current Mail Costs Based on Council s Australia Post volumes and the above internal processing cost per letter (excluding postage), the below table is a summary of Council s estimated total mail costs for the period of March 2016 to February Council s costs of Sending Mail from March 2016 February 2017 Letter Type Australia Post charges paid by Council Internal Processing Cost to Council Total Cost to Council International $18.90 $10.50 $29.40 Small Priority letters $6, $6, $13, Small Regular Letters $77, $93, $170,838 Large C4 Priority letters $1, $1, $3, Large C4 Regular letters $5, $8, $13, TOTAL COST $90, $109, $200, Cost Comparison Based on Council s March 2016 to February 2017 mail volumes, the below table compares Council s current mail costs and Bing pricing. Bing costs have been broken down by colour and black and white letters. An average/mean of both colour and black and white letters was also estimated. Total Cost for March February 2017 Letter Type Council s Current Cost Bing B&W Cost Bing Colour Cost Bing Mean Cost International $29.40 $27.00 $28.30 $27.65 Small Priority Letters $13, $9, $10, Small Regular Letters $170,838 $117, $128, $122, Large C4 Priority Letters $3, $2, $2, $2, Large C4 Regular Letters $13, $11, $12, $11, TOTAL COST $200, $140, $153, $146, P a g e

6 Comparing Council s current mail costs to Bing s costs establishes a substantial saving to Council if they were to outsource their mailings to Bing. Estimated savings for 12 months if Council chose to outsource their mail to Bing: $53, if council sent both colour and black and white letters RECOMMENDATIONS Following the above findings, it is recommended Council outsource their outgoing mail to Bing to reduce their mail costs. Bing has also found other ways in which Council can further decrease their mail expenses. Bing s complete outbound mail solution enables Council to easily digitise their communications to reduce postage costs and also allows users to send , SMS, post and fax all together as a single batch of correspondence. Council can also reduce costs via the EasyPost Mailroom. Bing s service is able to match exact name and addresses to consolidate letters into a single envelope and find accidental duplicates to reduce postage costs. Controlling what mail is being sent out within an organisation can sometimes prove to be difficult. Utilising Bing s online customer portal, Council can manage and monitor their mail to further assist in eliminating some of their postage costs. Council can access all mailings and gain a detailed description of the lodgement as well as generate reports for Council on any information they would like to monitor. Further efficiencies can be gained by having a single provider. Instead of managing multiple suppliers such as couriers, Australia Post, printers, franking machines, folding machines, and printing companies who preprint letterheads and envelopes for Council, they will be given a single invoice from Bing. Council will no longer need to pre-order and manage stock or reconcile multiple invoices. Bing s invoices can even be broken down via department to allocate costs to each business unit. 5 P a g e