Have you been watching the volatility of paper costs? While it’s a fundamental resource, it’s also one that’s availability has been contentious. With high demand and low supply, prices increase. As a result, you may have seen budgets for paper rise in 2022, especially around print and mail operations. To prepare you for what’s ahead, check out this 2023 paper costs preview.
The Paper Costs Landscape
The paper price escalation is a direct result of the pandemic. The paper market experienced many challenges, including a reduction in production, supply chain issues, and requirements to manufacture certain products over others. That led to price increases in commercial paper of 6-15% in 2021.
Even as the pandemic faded and supply chains were restored, 2022 saw increases in prices, too. Some of that is due to longer growing seasons for trees, a consequence of climate change.
In looking at the entire cycle to produce commercial paper, it’s complicated and requires lots of phases. The costs associated, such as fuel and energy, are ballooning due to inflation. So, what can you expect in 2023?
2023 Paper Price Expectations
In looking at paper production, it’s a global industry. Mills are in many countries, including China, the U.S., Mexico, Japan, Russia, and Germany. While each has its own economy, global trends impact the business. Some of the most recent pricing announcements include:
- Mitsubishi HiTec Paper raised all prices across its portfolio by 15% in September 2022.
- Nippon Paper announced it would increase prices by 15-25% in 2023, citing high costs of raw materials and energy.
Overall, there is uncertainty in the market, and demand is still outpacing supply. The year ahead could involve much higher rates and availability issues. If your organization handles print and mail in-house, your budget will need to grow, cutting out other expenditures. You can find relief by working with a transactional print and mail company.
Save Money on Print and Mail Even If Paper Prices Rise
In the current paper market, the trend lines on price keep going up, but that’s less of an impact for professional printers. Working from a no-waste principle called a white paper factory is key to their ability to absorb increased costs. The process involves feeding reams of white paper to print documents and envelopes simultaneously. There is no need for pre-printing, and there is no waste, either.
The rate that transactional printers pay for paper is much better than what companies that are not in the business can get. The purchases are in bulk, with large annual volumes of documents printed.
Another benefit of outsourcing is that availability of paper is minimized. Such organizations have contracts with the top paper vendors and receive adequate allocation each month. Shortages aren’t a concern. Whereas, if you hit such a snag, you’d have to pay even more elevated rates.
Additionally, all the costs associated with your internal operations are gone when you outsource. You won’t need to budget for equipment, other materials, technology, labor, and electricity. An organization can also save on postage.
Saving money is a top reason that organizations choose to outsource. It’s not the only one, however. Transactional printers specialize in mailings that are confidential, regulated, and secure. As a result of this singular focus, the accuracy, quality, compliance, and security of the process are elite.
If you are wondering about your 2023 budget numbers, you’ll want to connect with our outsourcing experts to see what you can save and gain.