We are up against Xerox in a deal and they are proposing a B&W CPP a Full Color CPP and a Partial Color CPP. How are they coming up with a rate for Partial Color? The equipment in question is a WorkCentre 4250/4260.

I have no idea how they might do that but just curious I too am against Xerox in a deal where the are .009 per copy on B/W what is it there??

As it was explained by a dealer rep if the coverage is under 3% it will count the click as a partial color.

I got roped into one of these deals. I never saw what Xerox actually put on paper. Unfortunately my salesman said 'No Problem' before we actually figured out if we could do it at all.

The TA's have less information than the Voyager's did. We have to go and get a count every month and reset the fill statistics. I don't know what the Xerox machines can do - but the customer seemed to think it was by the copy - not a monthly average. We were able to smooth things out. They've only had one month where they've exceeded the fill allowance so far. Been running it for about six months.

Fortunately they are right next door to us, so we've been able to manage. The sales force now knows this isn't an option for others - but it would be really nice to be able to automate this so that we could bill directly from fill percentages and have them automatically reset with the counter submission. We'd be able to offer lower rates for color and still be protected if they go off the deep end.

good luck, how do you bill by the fill and not be so confusing.

It'd be easy - $.003 per 1% = $.06 per page.

Not to say that everybody's software supports this type of billing...

[QUOTE]Originally posted by Scotty:
It'd be easy - $.003 per 1% = $.06 per page.
QUOTE]

That calculation would assume you're charging the same for b/w as you are color, which of course you're not. Interesting concept though, this is the first I've heard of it. Which is of course terrible for dealers, who will see their profits shrink because they can't charge $.07 for spot color anymore...

quote:

Originally posted by NW:
[QUOTE]Originally posted by Scotty:
It'd be easy - $.003 per 1% = $.06 per page.
QUOTE]

That calculation would assume you're charging the same for b/w as you are color, which of course you're not. Interesting concept though, this is the first I've heard of it. Which is of course terrible for dealers, who will see their profits shrink because they can't charge $.07 for spot color anymore...

I wouldn't - B/W meter is completely separate -so it'd be subject to it's own rate.

As far a profits shrinking - we're finding that people are getting a color copier and then told not to do ANY color unless absolutely necessary. This means (especially on Voyagers) that we're getting screwed because we've got to put a kit in that costs 5 times as much as the Falcon's with very little color activity. I think if we could eliminate the $.07 charge for spot color people would let their guard down and start printing more in color. The other side of that is if their percentage is VERY low it'd have to have a bottom price to cover the kit - perhaps $.01 per click + the % rate.

Regardless there's no practical reporting method at this time from the machines...

The problem is that based on a 5% industry standard coverage. There is almost nobody out there that buys a color copier to do 5%. They buy them to do pics, church news letters that have high coverage etc... then the yeild of the toner is and should not be included in the industry standard 5%. Color should have a different standard of coverage. The toner costs is killing me. and the competition dictates low cost per click. So we will all get beat up on consumibles, kits included....(competitors incl.) !! Costs are not what they are stated on the raw cost per copy.

Oh and Happy Easter!!!

I'm not really having a lot of problems with coverage/toner use on color. The BIG problem we're having is the fact that people bought Voyagers because they wanted color - but didn't really need it. I have one customer that's approaching 300K with less than 30K in color - and instead of a $300 kit I'll have to put in a $1500 kit. That SUCKS!

There must be a way around that.... can you order the DV unit and drum unit seperate??

KMA has the kit in two parts - one appears to be a black kit and the other color, but it's still really one kit. I don't know if the DV units and drums rotate during black only or not, but when the TaskAlfa series came out they flat out said the TA's had a real color and b/w kit and was an advantage over the Voyagers.

The warranty is certainly tied to the kit - so parting stuff out's going to mess that up, thought there's not much point to the warranty at this point anyway.

Back to the original theme of this post the Xerox colour model. They are using this pricing model on the solid wax models as a way to offset the high capital cost. I have seen it most on the 9200 series. They quote a low B&W and limited colour (less than 1.2% colour I think) as a base rate, something around 3 cents for partial colour and then a much higher rate, around 9 to 10 cents for impressive colour. They show their sample documents and get people to buy into believing they will be able to save big on colour costs. This is then calculated to offset much higher lease costs.

Of course if the lower colour operating does not occur...customer is locked in and stuck. The answer then is "your documents are not as expected." Xerox has a software for these units that can calculate the coverage for colour and the meter is based on that calculation. Of course the customer won't take time to check to see what rate they will pay.

On the final piece...how to get the rate down and be protected on coverage. We have built a talk track that convinces the client to go toner out on colour. We include B&W toner on the standard click charge and supply all B&W toner. Customer pays for colour toner as used. Seems to work and we can convince them they will save, especially on the small spot colour jobs. About 85% of our colour machines are out this way.

Our experience is that Xerox has a lot of customer turnover. They promise the world, but then make the actual wording of the contracts so vague and murky, the end user doesn't know what it's really saying, or if their commonly-run jobs actually qualify for "partial color" or reduced rates. So after their first few billings, the customer notices they're paying more (a lot more) than they expected, that virtually none of their stuff actually counts as "partial color", and overall their costs are higher than if they would have just gone with you. But now they're locked into a 5-year lease, and swear never to buy Xerox again, until it's time to replace the box and the bean counters notice Xerox's pricing is "so much lower"... And the cycle continues.

But yeah, we see a lot of Xerox customer turnover. Where we have found success is by outlining to the customer what their 3-year or 5-year TCO (equipment acquisition + maintenance and supply costs) will be with us, and then suggesting that they request the same from the other bidders. Many times, the other bidders will decline, or their figures put us clearly in the lead. In the end, that's what really matters to the customer. Not five tiers of color click rates and all this crap, but at the end of my five years, what's the total I've spent on the box?