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Financial directors (FD’s) of some of the UK’s largest finance companies are unaware of what their business spends each year on document production according to research announced today by the printer manufacturer, Lexmark International.

However, compared to other industries like property where 88% had no idea and retail where 69% had little insight, finance companies came out more favourably (with 30%).

The Gartner Group and other industry analysts estimate that the cost of document production is equivalent to between 1% and 3% of a company’s turnover.  This means that a business with an annual turnover of £20 million will be spending at least £200,000 a year on document production – possibly as much as £600,000.  It is therefore surprising that FD’s are ignoring a business expense that can have such a dramatic impact on their bottom line.

Survey findings include:

• Almost a third (30%) of FD’s questioned in the finance sector did not know the cost of document production to their business.
• 83% responded that they have no plans to reduce costs by getting document production under control. Furthermore, 13% did not see visibility of document production costs as critical to financial budgeting.
• Businesses located within London were the most aware with almost half (49%) claiming to have full visibility of document production costs.
• Property (100%), hotels and catering (68%) and transport (63%) see getting document production under control as a priority
• Retail (21%) and business services (37%) had no plans to get document production under control

“IT and marketing budgets are both subject to immense scrutiny by all UK finance businesses”, said Giovanni Giusti, Managing Director of Lexmark International in the UK. “And yet, here we have a cost of equal significance that many financial directors have absolutely no visibility of.”

Giusti continued, “Surprisingly, we take printing for granted. We think nothing of printing out emails to read once and then throw away or photocopying presentation handouts to give out after a meeting when the material can more easily be e-mailed. There is a significant cost associated with the incredible waste that happens today and this is directly impacting the bottom line.”

For businesses that need to reduce their expenses, document production costs present an easy and possibly incremental target to go after.  Securing an understanding of current costs is vital and, once done, there are some simple measures that can be adopted to reduce overall consumption:

• Encouraging employees to print on both sides of a piece of paper
• Implement electronic forms that are only printed when needed to avoid the significant cost of pre-printed forms
• Implement software tools that monitor usage across the organisation
• Investigate paper intensive business processes and look for ways to use technology that can reduce paper consumption.

‘Lexmark will continue to work with its customers in the UK to help them understand the significant cost that document production represents to finance companies’ business’ said Giusti.  “We will also work with them to show how they can apply technology that can have a dramatic impact on lowering their current costs.’

The survey of 200 financial directors from companies with a turnover of between £1 million and £20+million a year was commissioned by the printer manufacturer, Lexmark International and conducted by Continental Research in December 2003.

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