One of the most common questions printing companies ask about their estimating is: "How often should I update my budgeted hourly cost rates?"
The industry best practice is to update your estimating cost rates at least every 6-12 months or anytime there are notable changes in your expenses, equipment, staffing, or productivity. After a company closes their financial year or creates their annual expense budget is always a good time to update cost rates. Your rates may increase or decrease, depending on what changes have taken place since the last time you updated them.
Considering the industry’s competitive environment, rates that are off just a few dollars can have a substantial impact on whether or not you win orders or make a profit. As a matter of policy, an organization should continually update their rates to maintain a competitive edge and sustain profits.
The major challenges faced by companies that don’t keep their cost rates updated includes:
- Inability to make accurate pricing, sales, and investment decisions
- Overpricing and losing valuable and profitable work, and potentially customers
- Selling orders below costs, resulting in lost profits and deteriorated productivity
- Being misled by inaccurate estimating and costing figures
The Cost Rates Advisor budgeted hourly rates software makes it easy for organizations to keep their rates updated. It gives shops a more accurate picture of their out-of-pocket manufacturing and overhead costs so they can strategically estimate and price jobs. You can import data from spreadsheets, accounting software, and print management MIS software - making setup and updates fast and simple.
Cost Rates Advisor is used and proven by offset, digital, large format, flexographic, screen, and in-plant printing organizations throughout North America. Three tiered pricing makes it affordable for companies of all sizes.
With Cost Rates Advisor, calculating and updating your estimating cost rates no longer needs to be a time consuming and demanding task. So update your 2014 BHRs today and start estimating better, pricing smarter, increasing revenue, and maximizing your profits. costratesadvisor.com
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