What is the capital required to start a commercial printing company
Although there are already more than 50,000 printing shops in the Northern American continent alone, many are still opening up because of the increasing demand. While becoming a commercial printer could give you unlimited profits, there are also several capital expenditures that you need to spend on and these can set you back a sizeable. Look at the four biggest capital requirements that you would need to fulfill as you start a printing business.
1. The Units of Printing Equipment - The printing equipment would be the heart of your operations because that is where your output products are processed. In the past, the most that you can get is a four-color offset printer. Now, you can opt for digital presses. While the latter are newer units, their prices do not vary that much with offset printers. The advantage with digital printers is that you can receive online orders and process the orders much faster. You can get your printers for as low as $14,000 for a small unit with not much features. Such can already get your business going. The big machines used by publishing houses can cost more than $1 million.
2. The Office Space and Production Area - You will need a front office for your printing company because your production area should be separate. It could be found in the same building but should have a separator because the process should be confidential, especially the materials. Additionally, that will keep your customers from being annoyed with the smell of paper and ink. Since printers are large units, they can eat up a lot of space in the production area. You really have to compute the number of printing equipment you already have, including cutters and storage ages, as well as the workstation of your finishing department. The average rental today in the United States is about $18 per square foot. Naturally, if you live in a small town the rental is much cheaper than when you open shop in Manhattan.
3. The Initial Operating Costs - You have to set aside about six months-worth of operational costs for your initial operations. This money should be liquid because of course; you cannot expect your new business to be swamped with orders. Additionally, there are clients who will be asking for payment terms so that means that you will not have cash immediately. Some companies will be asking for a 30-day, 60-day or 90-day term for their jobs. To augment costs, you can request for a 50% down payment from your clients upon ordering so that the amount that will fall under terms will just be half of the total printing job cost.
4. The Marketing Expense - Many printers fail in this area but you should really advertise and market your print shop, especially if you are new. If you do not set aside a budget for this, this aspect will surely be neglected. You have to let the people know that you have opened a commercial printing shop that could cater to their needs. No matter how good a commercial printer you are, you have to invest in marketing so that clients will start coming in.
