Want to hold the line on costs? Here are some practical suggestions
BY NOW YOU PROBABLY BELIEVE you’ve thought of everything you could to save your company’s bottom line from the horrid effects of the latest postage hikes. And maybe you have. But with the U.S. Postal Service mulling even more rate increases before the end of the year (see Gene Del Polito’s column in this issue), you’re probably going to have to start thinking all over again.
To get you started, here’s a checklist for both catalogers and non-catalogers. Granted, many of these suggestions already should be part of your management strategy. But too often, everyday firefighting may cause essential areas of cost containment to be overlooked.
Creative/Production
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Trim the size of your catalog (or test eliminating parts of your mailing piece) in order to save on paper. Make certain it’s not an obvious change unless it’s part of your overall marketing strategy.
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Have an ongoing dialogue with your printer and paper suppliers to get a better idea of where to find the best deals.
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Consider locking in contracts (e.g., for paper) while low demand is driving rates down.
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Keep in touch with your printer to become aware of the latest advantages in production and postal sorting.
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Keep abreast of every postal discount possible through your postal representative, the usps.com Web site and a knowledgeable printer.
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Consider eliminating the order form; some companies have tested and found no adverse effect. One key factor is how many orders you receive via phone, Internet and the mail.
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Consider co-op ads (where manufacturers pay to advertise in the catalog). Be certain that this fits your marketing strategy.
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Consider group purchasing arrangements; some companies have had success with this for printing and other production services.
Merchandising
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Think about raising prices on some items. This can be touchy in today’s value-conscious market, so evaluate what the traffic will bear. In some markets, higher prices can increase sales due to greater perceived benefit. Know what your competition is doing and act accordingly.
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Try harder for lower cost of goods. Constantly evaluate the quantities you’re ordering and the benefits of doing business with your suppliers relative to how this affects costs.
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Bring back some of your old best sellers. This holds down product development costs and can ensure success.
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Test products and establish strict quality control standards to avoid costly returns and reshipments.
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Standardize shipping box sizes.
Mailing
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Mail smarter. (It’s not as obvious as it sounds.) Rethink how deep you want to go into marginal rentals, hit your house files more often, and work harder at getting enough names per segment to make postal discounts.
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Take another look at your contact strategy to be certain you’re not mailing too often. As one guru puts it,
Network
