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Exhibit 1 Price trend of color separations to scan, assemble, proof and output

printer specified film for a hypothetical direct mail catalog page with one image

Price/Page of work ($):

1991

1992

1993

1994

1995

Colorscope

1,100

900

750

650

600

400

425

450

475

500

2

Service-Bureau

2 Service -Bureaus such as Kinko's and Alphagraphics typically do jobs that are cheaper, and
involve fewer and/or smaller pages.

000 . gaining management approvals. Photography (2 weeks). second class bulk rate post. studio and location shots. in this example. writing copy. Printing (3 days). producing layouts. $10. 2 rounds of proofs to the project manager.300. cutting. costs would break down as follows: Design (3 weeks). binding. 1 million copies of a 52-page catalog.000 $1.000 $120. addressing for national distribution Distribution (23 weeks).Exhibit 4 Time/Cost Breakdown for the Catalog Producer Direct mail catalogers constituted over 90% of Colorscope's customers.000 $30.000 $50. To produce an average project run. 200300 images. Prepress (2 weeks).

agency mags. pkg. mail. packaging. mail. mail. packaging mags. packaging magazines. publishing. agency 16 mags. agncy. mail. mail. Inc. books mags. pkg. agncy. dir. direct mail. retail . books mags. newsp 13 packaging 4 mags. Sales Employees (M$US) 200 130 109 104 1.850 1. mail. packaging. dir. packaging. dir. pkg. agncy. packaging. dir. dir. dir. books 1 1 4 1 2 packaging.Exhibit 5 Top American Pre-press Competitors (does not include printers that have integrated forward) Company WACE USA Applied Graphics Technologies Black Dot Group Schawk. Inc. mail. catalogs mags. direct mail. dir. agency packaging. 41 37 27 24 22 110 390 313 230 165 Facilities Primary Business (sites) 20 13 12 12 magazines.060 900 729 American Color 76 840 Intaglio Vivi-Color Enteron Group 60 56 450 400 Kwik International Color Associates TSI Graphics Blanks Color Imaging Kreber Graphics.

609.07 295.28 2.00 .000 20.69 295.28 1.82 100.30 442.92 147.92 295.000 11.763 11.413.000 2.000 11.69 295.246.28 1.015.000 20.97 369.28 2.73 2.64 501.28 2.000 2.000 10.405.28 3.000 8.07 442.409.212.007.23 516.800 8.011.811.606.606.30 295.000 4.30 221.000 7.000 11.69 73.82 501.28 2.91 3.108.38 295.15 295.00 64.15 295.73 3.600 23.000 1.09 1.049.92 147.38 8637 61435 3174.92 369.206 2810.907.46 295.007.28 2.107.99 147.000 9.Exhibit 8: Jobs completed in June 1996* Job # 61001 61002 61003 61101 61102 61201 61202 61203 61204 61301 61401 61402 61403 61404 61405 61501 61502 61601 61602 61603 61701 61702 61801 61901 61902 62001 Total Cost of Idle Time Total Rent on unused Floor Space Net Profit Customer # Pages 10 10 10 11 11 12 12 12 12 13 14 14 14 14 14 15 15 16 16 16 17 17 18 19 19 20 *All figures are disguised 16 16 32 16 16 16 32 32 32 128 16 16 16 16 16 16 16 32 4 4 16 16 4 4 16 1 545 Revenue 9600 9.000 23.212.91 3.73 4.000 0 315200 Materials Gross Margin 5400 3500 4500 1800 1500 1500 3300 3400 3200 13000 1800 3100 3900 2100 2000 2200 3600 3300 600 1000 2100 2500 1600 1700 2200 200 75000 4200 6100 18500 10200 9500 9500 19700 18600 16800 37000 6000 4900 4100 6900 7800 8800 7400 16700 1400 400 5900 7500 2400 300 9800 -200 240200 Job Preparati on Scanning 295.000 9.000 12.46 2.007.907.28 1.28 1.28 2.606.09 1.28 13.64 501.30 73.64 501.38 295.800 11.000 12.007.28 2.000 50.000 22.69 516.15 516.208.69 295.53 1.400 8.007.

185.28 1957.n Cost Labour Labour 0 3094.637 1.32 -206.89 2.601.04 4.55 -1152.59 794.20 86.56 690.154 6.023.59 3464.742.565 .28 5192.55 7278.19 592.312.55 5486.20 86.78 258.500 9.32 -753.034.00 13000 15201.40 4.67 296.45 2.03 296.000 0 0 8.419.91 4175.56 517.52 83243 Quality Output Control Net profit 1.78 431.56 722.28 4637.185.28 975.56 -2553.000 2528.12 2.32 -1427.Assembly 3.30 2.167.3675 0 0 0 0 0 0 0 1.52 592.184 0 0 0 0 1201.59 10162.589.16125 0 2088.300 Inhouse Correction Cost Material Customer Inhouse Initiated Correctio Rework Cost .96 -1511.639.34 2.85 2.215 1122.23 416.28 2640.5231 0 1.28 148.23 -1404.11 3.59 770.240625 0 0 3.312.56 690.312.34 148.00 13.191.67 592.91 8415.56 776.26 592.492.185.78 431.064.12 592.56 431.24 24156 12689 50041 9249.185.53 28201.86 5.20 86.65 592.60 4.90 592.371.945 0 0 0 465.56 592.24 2.32 646.74 592.23 -4132.191.185.100 0 0 0 0 0 0 0 1.78 517.000 0 0 0 0 0 0 1.56 604.700 1.335.12 690.32 -1451.456.78 258.185.12 2.818.78 2.78 345.000 2398.26 1.84 2.624.78 345.82 2.00 Customer Initiated Rework Cost Material 2.500 0 0 0 0 0 1.30 4.962.48 1.890.39 86.95 1.000 1.78 345.2 5483.78 431.70 148.00 21839.56 604.000 1841.34 2.78 345.00 29.185.81 592.17 1.3575 0 463.26 2.811.85 867.56 604.144 92.601.39 86.04 18.87 1.185.78 345.59 1210.62625 0 0 500 739.38 4.89 144.63 794.65 2.745.96 -72.87 7275.034.180625 898.58 1.77 1.818.77 592.30 2.

90 2035.58 10162.454 Total Cost of House Error 0 0 0 0 0 0 0 0 0 1.40 2185.06 12.841 0 0 0 0 0 0 2.398 0 0 0 0 0 0 1.17 2123.529 3.794 3.463 0 0 27.188 0 0 0 0 0 0 0 2.48 3118.34 -753.28 -206.24 77559.740 0 3.18 -72.95 7278.702 0 0 0 0 0 1.240 0 0 1.65 2640.22 .465 1.Total Cost of Cusomer Rework 5.519 Net Profit after adjustment for extra cost incurred 1661.67 -187.72 5486.240 0 0 0 0 0 0 10.702 0 0 1.53 55720.97 1886.74 4637.56 1957.77 5192.899 0 3.67 770.22 0 55720.81 975.398 0 0 0 2.50 7275.463 0 0 17.77 8415.794 3.529 3.06 3464.26 4175.188 0 0 0 0 0 0 0 4.03 2112.465 1.81 1210.065 Net Extra Cost 5.75 21839.

Exhibit 9: Hours clocked at different workstations in June 1996* JOB# 61001 61002 61003 61101 61102 61201 61202 61203 61204 61301 61401 61402 61403 61404 61405 61501 61502 61601 61602 61603 61701 61702 61801 61901 61902 62001 Idle Time Capacity Job Preparation Scanning Assembly 4 32 42 3 24 38 7 40 75 4 16 30 4 16 28 4 16 32 7 32 58 6 34 64 6 30 58 15 130 250 5 14 32 4 19 32 4 20 34 4 22 36 4 20 36 4 21 39 4 20 40 7 26 60 2 5 10 2 5 11 4 20 39 4 20 41 1 5 11 2 5 12 5 19 42 1 1 2 43 28 128 160 640 1280 Output 8 8 16 4 4 4 8 8 8 32 4 8 4 4 4 4 8 8 1 2 4 4 2 1 4 1 37 200 Hours clocked in different work stations include rework hours given in Exhibit 10. * All figures are disguised Quality Control Total 7 93 8 81 8 146 4 58 4 56 6 62 5 110 6 118 8 110 30 457 4 59 7 70 3 65 5 71 4 68 4 72 7 79 9 110 1 19 1 21 3 70 5 74 1 20 1 21 5 75 1 6 13 249 160 2440 .

Exhibit 10: Rework hours* Rework due to change in specifications by customer JOB# 61001 61002 61301 61502 61801 61901 Total Job Preparation Scanning Assembly Output 0 16 10 4 0 8 6 4 2 5 10 2 1 4 8 1 0 1 3 1 1 1 4 0 4 35 41 12 Quality Control 2 3 2 0 0 0 7 Total 32 21 21 14 5 6 99 Quality Control initiated rework of house errors JOB# 61301 61402 61403 61603 Total Job Preparation Scanning 1 3 0 9 0 10 1 3 2 25 * All figures are disguised Assembly Output 4 1 16 2 14 2 3 1 37 6 Quality Control Total 1 10 2 29 1 27 0 8 4 74 .

20 $86.000 $10.000 $11.246 $92.000 $1.000 $30.000 $224.000 $14.811 $64.000 $19.* Exhibit 11: Selected Financial Information for June 1996 Description Wages Depreciation Rent Others Total Overhead Labour Hour Overhead Rate/hr Floor Space in sq.000 $32.000 $8.000 $50.32 2000 500 Idle Total $125.500 15.000 $64.38 $72. * All figures are disguised Job Preparation Scanning Assembly $8.000 $500 $4.639 $1.492 $11.000 $1.000 $13.82 $100.999 $13.492 160 640 1280 $73.811 200 160 $148.000 $2.999 6.311 $29.000 $2.000 .639 $13. ft.26 1000 1000 4000 Quality Output Control $10.246 $10.000 $1.311 $5.000 $500 $25.

600 1.000 1.Exhibit 12: Materials expense in June 1996* Job# 61001 61002 61003 61101 61102 61201 61202 61203 61204 61301 61401 61402 61403 61404 61405 61501 61502 61601 61602 61603 61701 61702 61801 61901 61902 62001 Total Total Materials expense3 5400 3.400 3.700 2.100 1.000 8.100 2000 2200 3.000 1.500 1.800 1.500 .000 1.300 3.200 13.500 500 1.000 2100 2.500 4.000 1.600 3.200 200 75000 *All figures are disguised 3 Includes materials for rework.500 1.500 3.900 2.000 1.100 3.800 3.000 1.500 1.700 1.300 600 1.300 3. Customer initiated rework Correction of house error 2.