Delhi book printers get a crash course in cost estimation

The seminar was organised by Welbound at Urdu Bhawan in New Delhi.

K C Goel, president of the DBA says "Bookbinding in New Delhi is like a cottage industry and offers employment to tens of thousands of people. The whole existence of this industry is at stake now as input costs have been going up in double digits; while the price-realisation is coming down. One of the key reasons is the fact that unlike many other business models, book binding does not estimate costs on a real time or hourly basis. Historic and empirical methods like issuing quotes per signature and per book are still followed. Many of us are not making profits in most of the jobs we do. It cannot go on like this and that is why we requested Welbound to conduct such a seminar".

Ingawale's presentation consisted four key headings: Understanding costing, uncovering the myths of costing, analysing costs using simple tools, and how to remain competitive

The jargons of costing and the methodology of estimation were explained in simple terms with examples from day to day life. Costing of two typical jobs an A4 book of 200 pages and another book of 1000 pages were analysed. Ingawale used a simple, MS Excel-based estimator developed by him, to estimate the costs of these books, given different scenarios of capacities of the unit. These values were then compared with the price quoted by the binders. In most of the cases, the "profit" word was missing.

Ingawale explained the danger of estimating costs based on number of signatures. Given a certain investment on plant, machinery and variable costs related to the job like labour, adhesive, thread, electricity and so on the cost of a certain job is entirely on the efficiency with which it is turned around. Two different books of same size and number of pages may take different turnaround times, based on difficulty of the substrate, lot size etc. and hence, will have differing costs. In order to arrive at the costing for any typical job, it is important to consider these variables or else one will end up losing money.

Many of the binders present in the seminar agreed that they did not consider any administrative overheads like their own salary or rent while calculating the costs. Ingawale showed the impact of not considering these costs on a live demo of the basic estimating tool. The bookbinders were in unison while discussing the increase of costs in the last two years, be it labour, fuel, energy and consumables. Labour being the single largest component of costs of bookbinding, the increase seen in the last two years has literally taken away any profits left. Ingawale concluded his seminar with pointers on reducing wastage and adapting best practises so as to remain competitive in these tough times.