Ways Paper Costs Impact Printing Projects

How the High Cost and Shortage of Paper Leads to Higher Printing Costs

The price of paper has been rising for a few years now, and it doesn't look like it will be coming down anytime soon. The same has been happening with the supplies needed to manufacture large format printing and signage. That trend is now exacerbated by the lack of inventory.

This is what we will be discussing in this article:

1.  Which factors are affecting the cost of paper? Status of the industry,
2.  Analysis of how this may impact your printing projects
3. We provide valuable tips to keep your printing costs down.

1 – Which factors are affecting the cost of paper? Industry Status

The following points talk about what’s happening and provide some insight into who and how the marketplace is affected.

Which varieties of paper are unavailable?

The supply of every grade of paper does not currently meet the demand. This is true for wedding invitations to packaging, copy paper to labels, envelopes to linen, and everything else.

Mill Closures:

Some mills have ceased operations, such as a Neenah. Others are merging. Some can’t get the necessary pulp, which often comes from Europe or Asia.

Picture showing the operation of extending and drying paper that gets rolled and sheeted

Consumer Behavior:

Computers and phones changed behaviors and production costs in the USA, leading to the closing of paper mills for the last 20 years. The pandemic shifted “normal consumption habits” which led to uncoordinated plant closures and discontinued products, placing additional stress on the supply chain.

Labor Shortages:

Labor shortages are as prevalent in this industry as in many others. Adding new employees usually requires extensive training and a long learning curve. Therefore, processes are currently taking longer to be executed introducing further disruptions.

Import Duties:

Tariffs have been assessed years ago on paper coming from a number of countries. These tariffs compound with the increases in pulp, transportation costs, and local handling, and the effect is very significant.

Energy/Fuel Surcharges:

Coming out of the pandemic, the energy producers made decisions that are currently impacting the cost of energy. The current events exacerbate this even more. Paper manufacturing is energy-intensive. Tons of power are required to grow trees, cut and chip wood, mix and dry the paper.

Who pays for this mess?

Up to very recently, printing companies have been absorbing the additional costs. That has recently changed and the reason without price increases; printing companies can no longer burn cash in that way. Right now, printers must adjust to the new marketplace conditions, and do that fast.

Ruth Simon and Gwynn Guildor, reporting for the Wall Street Journal, reveal that even international corporations in every industry are experiencing disruptions, limited inventory and higher costs Demand for printed paper will eventually adjust to the new environment.

We are all paying for the disruptions in the economy in one way or another. Economic data from Fred Economic Data / St Louis Fed shows how much producer prices for pulp and paper have gone up, impacting even more severely in the marketplace. https://fred.stlouisfed.org/series/WPU09440114

Chart showing the producer price index of pulp, and paper

2 - Analysis of how this may impact your printing projects

Plan your printing and signage needs ahead. Don’t wait until the eleventh hour.

Before the 2020 pandemic started, you could have decided on the last minute about a direct mailing campaign that had to be out in a couple of days. A restaurant owner might have realized the last box of menus is now gone and would have to reorder immediately, and within a few days, he/she would have refilled without concerns. The printing of an invitation would have happened as soon as the tedious proofing was over.

None of that can happen right now, in a predictable way. Here’s why:

• Supply Chain: Most paper grades are unavailable. Paper used to be sitting in a local warehouse or a distant one but would be transported overnight and delivered seamlessly. Now it is unpredictable when paper becomes available. This one factor your projects disrupts and those of the printing company as well.
   
• Costs: Even when the stock becomes available, its cost is unknown, subject to market conditions. What this means to you is that the budget set by your company for a specific marketing action might not be sufficient. Be ready to have extra funds available to allocate.
   
• Estimates might not be as firm as in the past: Even when you have been presented with an estimate, most printing companies in the USA won’t commit to being able to process that order, because both the price and product availability are subject to market conditions.
   
• Revisit your Campaign: A key component of your campaign might be in back order for several weeks, which could imperil your project. As an example, 9”x12” envelopes have not been available for a long time, and insurance companies, heavy users of those, have had to reengineer their process. Inventory of 16pt cardstock, which is typically used for postcards and mailers, is extremely scarce. Can a different stock be acceptable? It could take time to find out what the alternatives are and make decisions.

It's not all bad news

As events evolve, more stable conditions will be created. There are some positive news in terms of a strong investment wave with new capacity

Things will get better. More shipments and new production plants are in the works

3 - Tips for keeping printing costs down

There are a number of ways to overcome some of these challenges.
 Here are three opportunities for you to consider:

Print What Your Current Need Is. Team-up with your print provider

Understand the goal that you are trying to achieve. Know how many pieces of printed envelopes, brochures, or folders will be needed. Get input from your print provider so that you understand your needs and the constraints of the system.

If multiple people will be working on a project, always discuss it with them before the design phase begins. Ensure that everyone involved knows and plans accordingly.

Printing starts with good design, and savvy designers should be aware of the impact of high paper prices on printing projects. Don't let the creative urges of graphic designers or content creators prompt them to include extra pages that aren't needed because doing so could cost you more than you’ve budgeted for the project.

Since the price of paper is unlikely to go down anytime soon, you need to be proactive to stay within your budget. With proper planning, you can still achieve your marketing goals, still having high-quality print work, but done for less money.

Shop Around for the Best Prices

Talking with a local printer may seem like the best way to go, but you might be able to save money using a reputable online printer. Just be aware that many online stores might have neither updated nor realistic information regarding paper availability or turnaround times. Reputable companies are better prepared to complete the sale-production-delivery cycle.

Stick to very reputable companies. Look for reviews shared by their clients on different platforms. Call them and talk to their team members to experience what dealing with that company might be like. Ask them about what is published online, and check that your printed documents will be delivered as agreed.

Price by itself is not a good measure to use to select a print provider. It has always been the case, but even more important right now.

Consider redesigning your piece

The concept of redesigning is deeper than the most common thought regarding graphic design.

- A piece that is smaller or has a different shape might make a more efficient use of the paper that printing companies use, therefore reducing the cost.

- Rethinking the strategy behind your piece might allow you to save money. Your piece might be able to accomplish its goal maybe with less copy, or less graphics, or any other combination of elements. 

The concept of redesigning is not new by any means, but especially now, revisiting the details might compound many benefits to you.
 

Build a strong relationship with your print provider and plan with them.

They’ll help you find more efficient ways to optimize your campaigns. The right online provider might get to become a great resource.

Conclusion

Printing can be a tricky business. With paper mills constantly changing and printing companies adapting to meet their clients' needs, not dealing with the right print-provider . This means you might be paying more for printing because the print shop has changed paper types.

For expert advice on minimizing paper costs and resolving other printing issues, contact our team at Color Copies USA today.