Things to Watch for When Evaluating Digital Press Contracts (Part 2)

By | October 25, 2016

Last week, I posted the first half of a checklist of things that, based on their experiences, print shops have noted to watch for when evaluating contracts for a new digital press. This is not to suggest that these “hidden” issues are rampant among digital press vendors. Only that they can pop up here and there. This list comes from the personal experiences of these printers, some of whom are outside the United States. This list was taken from an online discussion group, and this week, I’ll post the rest of the list. As last time, names have been removed from the quotes to protect the writer’s privacy.

6. FTR cost.

“If you own your machine and want to sell it [at some point], you have to find a buyer within your service area; otherwise there will be a hefty FTR cost.”

7. Service contacts and actual service standards.

“Digital presses can have all the bells and whistles, but if you do not get the service that these machines need, they become irrelevant. Investigate the service standards in your area.”

8. Contract rollovers.

Watch to see whether your contract rolls overs before the end of your lease or service contract.

“Some vendors will lock you into a full year of additional costs if you haven’t [contacted them in writing]. If you decide to go to another supplier, you may be hit with one year of costs. Always put [your termination of contract in writing] at least 90 days before the contract actually ends.’’

One printer noted that, in his area, some vendors write into their contracts that they reserve the right to charge up to 40% of their expected service income if the printer decides to seek an alternative supplier before the end of the service contract.

“If your current provider is presenting you with such a clause, ask for it to be removed, unless you are happy to pay charges for service you didn’t have, on volumes you didn’t produce to a supplier you are trying to leave.”

These are the experiences of these printers, and their experience may not be yours. Nor do these experiences reflect the contracts of every vendor.

What do you think? Do you have any words of wisdom to add?

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One thought on “Things to Watch for When Evaluating Digital Press Contracts (Part 2)

  1. Bill Carroll

    Thank You for starting this discussion. After 35+ years in the copier / printer industry, I find that there can be a divide between what (traditional) print providers expect and what vendors can reasonably provide for the low margins in this business. Her are a couple of thoughts:
    Do not (Do NOT!) sign any contract where the service (supplies+break fix) is included with the equipment as 1 payment. Keep your lease contract separate from the service contact. This gives you flexibility to choose service providers (assuming you have alternatives in your area) after the initial service agreement ends (typically 12 months).
    Watch for escalating service pricing. Many vendors quote a silly-low cpp for the first year or two, then raise the fee annually. They don’t break even until year(s) three or four. Ask yourself: do you want a service provider who does not make any money (margin) servicing your account? How much priority will they put on your needs?
    Trust but verify: if you can’t read and understand the terms of your lease and service contracts, find counsel in someone who can. Don’t sign anything without fully understanding your (and their) obligations.
    Don’t be afraid to do business with a locally-owned vendor. While a multi-national may offer lower pricing, who are you going to call when you have a concern ? A local business owner has to address your needs if they want to remain viable in this market.

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