Most organisations have no idea what printing actually costs them. When Gartner analysed enterprise print expenditure, they found that printing typically consumes 1-3% of annual revenue—yet fewer than 20% of organisations actively manage this spend. Managed Print Services (MPS) addresses this visibility gap while delivering typical savings of 20-30%. Here's what every enterprise buyer needs to understand about MPS.
The Iceberg Problem: Why Printing Costs More Than You Think
Ask any CFO what their organisation spends on printing, and they'll likely quote paper and toner costs. These visible expenses represent only the tip of the iceberg—typically less than 30% of true print expenditure.
The Visible Costs (What You Track)
- Consumables: Toner, ink, drums, maintenance kits
- Paper: Standard and specialty stock
- Device acquisition: Capital purchases or lease payments
The Hidden Costs (What You Don't Track)
- IT support time: Printer issues typically account for 5-15% of helpdesk tickets
- User productivity loss: Walking to distant printers, waiting for jammed devices, reprinting failed jobs
- Emergency consumable orders: Premium pricing for rushed deliveries when toner runs out unexpectedly
- Energy consumption: Enterprise MFDs consume 500-1,500 kWh annually
- Inventory carrying costs: Storage, obsolescence, and capital tied up in consumable stockpiles
- Vendor management overhead: Multiple suppliers, invoices, and procurement transactions
- Security and compliance: Unmanaged devices representing audit risks and potential data exposure
- Fleet inefficiency: Over-provisioned devices, underutilised capacity, suboptimal placement
- End-of-life disposal: Secure decommissioning, environmental compliance, data destruction
Quantifying the Hidden Costs
Research from IDC and Quocirca consistently shows that hidden costs typically equal or exceed visible costs:
| Cost Category | Typical % of Total Print Cost | Annual Cost (200-person org) |
|---|---|---|
| Consumables | 25-30% | $25,000-$35,000 |
| Hardware/Leases | 20-25% | $20,000-$30,000 |
| Paper | 5-10% | $5,000-$12,000 |
| IT Support | 10-15% | $10,000-$18,000 |
| Energy | 3-5% | $3,000-$6,000 |
| Productivity Loss | 10-15% | $10,000-$18,000 |
| Administration | 5-10% | $5,000-$12,000 |
| TOTAL | 100% | $78,000-$131,000 |
Key Insight: A typical 200-person organisation spends $80,000-$130,000 annually on printing—roughly $400-$650 per employee. MPS typically reduces this by 20-30%, delivering annual savings of $16,000-$40,000.
What Managed Print Services Actually Includes
MPS is frequently misunderstood. It's not simply outsourced toner delivery—it's a comprehensive management framework that transforms how organisations procure, operate, and optimise their print environment.
Core MPS Components
1. Device Monitoring and Management
MPS providers deploy monitoring software across your fleet. This provides:
- Real-time status visibility: Device availability, error conditions, supply levels
- Usage analytics: Volume by device, user, department; colour vs mono ratios
- Predictive maintenance: Anticipating component failures before they cause downtime
- Security monitoring: Firmware status, configuration compliance, threat detection
2. Automatic Consumable Replenishment
Monitoring data triggers automatic supply shipments:
- Toner shipped when levels reach reorder threshold (typically 15-20%)
- Maintenance kits dispatched based on page counts
- Just-in-time delivery eliminates both stockouts and inventory carrying costs
- Consolidated shipments reduce handling overhead
3. Proactive Maintenance and Support
MPS shifts maintenance from reactive to proactive:
- Preventive maintenance: Scheduled service based on usage, not breakdowns
- Rapid response: SLAs for issue resolution (typically 4-8 hours for critical devices)
- Remote diagnostics: Many issues resolved remotely before technician dispatch
- Parts and labour included: No unexpected repair costs
4. Fleet Optimisation
Initial and ongoing optimisation services:
- Assessment: Comprehensive analysis of current environment
- Right-sizing: Matching device capabilities to actual workgroup needs
- Consolidation: Reducing device count while maintaining service levels
- Rebalancing: Ongoing adjustments as organisational needs evolve
5. Reporting and Analytics
Visibility that enables continuous improvement:
- Monthly usage and cost reports
- Department-level cost allocation
- Environmental impact metrics (pages, carbon footprint)
- Trend analysis and optimisation recommendations
What MPS Typically Doesn't Include
Understanding scope exclusions prevents surprises:
- Paper: Most MPS contracts exclude paper (though some include it)
- User abuse damage: Physical damage from misuse may not be covered
- Network infrastructure: Cabling, switches, and IT infrastructure remain your responsibility
- Software licensing: Third-party print management software may be separate
MPS Pricing Models: Understanding Your Options
MPS contracts use several pricing structures. Understanding these helps negotiate appropriate terms.
Cost-Per-Page (CPP) Model
The most common structure charges a fixed rate per printed page:
- Inclusive of: Hardware (often), consumables, maintenance, support
- Advantages: Simple, predictable, aligns provider incentive with efficiency
- Considerations: Volume minimums may apply
Flat Monthly Fee Model
Fixed monthly payment regardless of volume:
- Best for: Organisations with stable, predictable print volumes
- Advantages: Complete cost predictability; no bill fluctuation
- Considerations: Volume caps may apply; may not suit high-growth organisations
Tiered Volume Model
Different CPP rates at different volume tiers:
- Structure: Lower rates for higher volumes (economies of scale)
- Best for: Growing organisations expecting volume increases
- Advantages: Cost reduction rewards efficiency improvements
Hardware-Inclusive vs. Hardware-Exclusive
MPS contracts may or may not include device acquisition:
Hardware-Inclusive
- Devices included in CPP or monthly fee
- Technology refresh at contract renewal
- No capital expenditure required
- Higher ongoing cost but lower upfront investment
Hardware-Exclusive
- Organisation owns devices; MPS covers only services
- Lower ongoing cost but capital investment required
- Technology refresh responsibility remains with organisation
- May suit organisations with recently acquired fleets
Calculating MPS ROI: A Practical Framework
Evaluating MPS requires comparing current costs against projected MPS costs. Here's a systematic approach.
Step 1: Establish Baseline Costs
Calculate your current annual print expenditure across all categories:
| Category | Data Source | Your Cost |
|---|---|---|
| Consumables (toner, drums, kits) | Accounts payable records | $_______ |
| Paper | Accounts payable records | $_______ |
| Device acquisition/lease | Asset register, lease schedules | $_______ |
| Maintenance contracts | Vendor invoices | $_______ |
| IT support (estimate 10% of helpdesk) | Helpdesk ticket analysis Ă— hourly rate | $_______ |
| Energy | Device count Ă— 1,000 kWh Ă— utility rate | $_______ |
| TOTAL BASELINE | $_______ |
Step 2: Obtain MPS Proposals
Request proposals from multiple MPS providers. Ensure proposals include:
- Monthly or annual fee/CPP rates
- Scope inclusions and exclusions
- Service level agreements
- Contract term and exit provisions
- Hardware refresh provisions (if applicable)
Step 3: Compare Total Cost of Ownership
Calculate projected MPS cost over the contract term:
- Monthly fee Ă— 12 Ă— contract years, OR
- Mono CPP Ă— projected mono volume + Colour CPP Ă— projected colour volume
- Add any excluded costs (paper, if not included)
- Add implementation/transition costs
Step 4: Calculate Savings and ROI
Compare baseline to projected MPS cost:
- Annual savings: Baseline cost - MPS cost
- Savings percentage: Annual savings Ă· Baseline cost Ă— 100
- Contract savings: Annual savings Ă— contract term
Typical Result: Well-structured MPS engagements deliver 20-30% savings against baseline costs. For a $100,000 baseline, this represents $20,000-$30,000 annual savings, or $60,000-$90,000 over a 3-year contract.
MPS Benefits Beyond Cost Savings
While cost reduction drives most MPS decisions, operational benefits often prove equally valuable.
IT Resource Liberation
Printer support consumes disproportionate IT resources. With MPS:
- Helpdesk tickets for print issues drop 70-80%
- IT staff redeployed to strategic initiatives
- Reduced after-hours callouts for critical device failures
- Simplified vendor management (single point of contact)
Enhanced Security and Compliance
Modern MPS includes security management:
- Firmware updates deployed systematically across fleet
- Security configurations standardised and monitored
- Secure print (pull printing) eliminates uncollected documents
- Audit trails for compliance reporting
- End-of-life data destruction documented
Environmental Sustainability
MPS supports sustainability objectives:
- Fleet consolidation reduces energy consumption
- Default duplex printing reduces paper use
- Usage reporting enables behaviour change initiatives
- Consumable recycling programs
- Carbon footprint reporting for ESG disclosure
Improved User Experience
Well-managed fleets provide better service:
- Higher device uptime (99%+ typical under MPS)
- Faster issue resolution through proactive monitoring
- Consistent device behaviour across fleet
- Modern equipment with current features
Is MPS Right for Your Organisation?
MPS isn't universally appropriate. Consider these factors:
MPS Is Typically Beneficial When:
- Monthly print volume exceeds 10,000 pages
- Fleet includes 5+ networked devices
- IT resources are constrained
- Current print costs are unclear or unmanaged
- Fleet includes multiple vendors/models
- Security and compliance are organisational priorities
- Predictable budgeting is valued
MPS May Not Be Appropriate When:
- Very small fleet (fewer than 3-5 devices)
- Low monthly volumes (under 5,000 pages)
- Recent fleet investment with existing maintenance contracts
- Highly specialised print requirements outside MPS scope
- Organisation unwilling to standardise on recommended devices
Selecting an MPS Provider: Key Evaluation Criteria
Not all MPS providers are equal. Evaluate against these criteria:
Technical Capability
- Fleet monitoring technology and reporting capabilities
- Support for your current and planned device brands
- Security expertise and certifications
- Integration with your IT environment
Service Delivery
- Response time SLAs and track record
- Geographic coverage for your locations
- Parts availability and inventory management
- Escalation procedures and management engagement
Commercial Terms
- Pricing transparency and flexibility
- Contract term options
- Exit provisions and termination rights
- Volume adjustment mechanisms
Strategic Alignment
- Understanding of your industry requirements
- Sustainability credentials and programs
- Indigenous ownership (for IPP-aligned procurement)
- Long-term technology roadmap alignment
MPS and Indigenous Procurement Policy
For government organisations, MPS contracts can contribute to IPP targets when sourced from certified Indigenous businesses.
Contract Value Considerations
MPS contracts are valued at total contract value over the term:
- A 3-year MPS contract worth $50,000 annually has a total value of $150,000
- This total value determines applicable IPP provisions
- Contracts $80,000-$200,000 may qualify for direct sourcing from Indigenous suppliers
Dreaming Print Solutions MPS
As a Supply Nation Certified, 100% Indigenous-owned HP partner, Dreaming Print Solutions offers MPS that:
- Contributes to agency IPP targets
- Provides enterprise-grade HP hardware and support
- Delivers the full MPS benefit package
- Offers competitive pricing against non-Indigenous providers
Getting Started: The Assessment Process
The first step toward MPS is understanding your current environment. A comprehensive print assessment provides the data needed for informed decision-making.
What a Print Assessment Includes
- Device inventory: Complete fleet documentation including make, model, age, location
- Volume analysis: Monthly output by device, colour vs mono mix, peak periods
- Cost modelling: Current expenditure across all categories
- Optimisation opportunities: Consolidation, standardisation, and efficiency recommendations
- MPS proposal: Tailored service offering with projected costs and savings
Free Assessment from Dreaming Print Solutions
We offer complimentary print assessments for government and enterprise organisations. The assessment provides:
- Detailed understanding of your current print environment
- Identification of cost reduction opportunities
- Optimised fleet recommendation
- MPS proposal with transparent pricing
- No obligation to proceed
Contact us on 07 3186 8299 or email benlong@dreamingprintsolutions.com.au to schedule your assessment. As a Supply Nation Certified Indigenous business, government buyers benefit from simplified procurement pathways while accessing enterprise-grade HP solutions and comprehensive MPS delivery.
