Equipment Utilization
Establishing cost and sell rates for pressroom equipment usually starts with assumptions on the number of chargeable (saleable) hours you expect to get from each piece of gear. The cost of staffing that equipment and other overheads are added together and divided by the number of chargeable hours to arrive at an hourly cost rate. So, to ensure your cost and sell rates are appropriate and remain so, you should be monitoring the equipment utilization against costing assumptions from your budget and holding your sales management accountable.
No, that’s not a typo. I did say sales management. This is an area often charged to operations staff, but that makes no sense. Pressroom management has little control over the sales necessary to drive equipment utilization. Sales management on the other hand has a high level of control of equipment utilization. They may hit their sales targets, but if the work they sell is predominately subcontracted out, it can hurt equipment utilization rates and profitability. So you need to monitor not just overall sales but also the mix of in-house versus out-sourced manufacture, and the hours sold on each piece of equipment.
Click here to read the whole story by Bob Kadis
