Regaining Control of Paper Output Costs with Laserstar10 Aug, 2004 By: Jim Farrell imageSource
Regaining Control of Paper Output Costs with Laserstar
Like many mortgage companies that were fortunate enough to be caught up in
the recent frenzy of refinancing—at one point interest rates were at a 40-year
low—the Poli Mortgage Group had no standardized system in place to secure the
correct document imaging equipment for its organization.
Because the demand for
refinancing was unparalleled, the Needham, Massachusetts based company quickly
got trapped in the "paper trail" that defines mortgage transactions, and quickly
lost track of the costs associated with it. As mounds of paperwork continued to
pile up, Poli Mortgage founder, Chip Poli, had discovered that his company’s
document management costs were out of control due to a lack of a proper buying
In the event of an equipment or toner shortage, which developed from
thousands of monthly mortgage requests, a staff member at the mortgage group
would rush to the nearest office supply store and purchase the first product in
sight that had print or fax capabilities. In a situation where business was
literally flying in the door, just fixing the squeaky wheel had left the
business with cost overruns that would create panic among the calmest of office
Management knew that they were printing somewhere between 50,000 and
150,000 pages per month, but they were uncertain on how to reduce that
expenditure. As the market slowed a bit, Poli decided to get out in front of the
paper issues by taking a look at his business’ document flow and seek out an
answer to reducing costs.
"In our industry, we could be very busy for six months
and then things could quiet down, depending on what the rates do," said
Christine Hadaya, office manager at Poli Mortgage. "It was difficult to keep
certain products, such as toner, in supply. We knew that being forced to order
at the last minute would drive up the price."
Sorting out the Solution
Massachusetts-based Laserstar, which had previously supplied Poli Mortgage with
14 laserjet printers, was brought in to supply some answers for the mortgage
Originally founded as a company that recycled toner cartridges, Laserstar eventually evolved into a document solutions firm. Company founder
Noreen Trudel developed a "pay-by-the-page" program for her customers intended
to take the guesswork out of the costs of document generation and management for
Trudel knew the program, which consolidates service, supplies, equipment and
the cost-per-page into a single monthly expense, would help Poli Mortgage regain
control of its uncontrollable costs. "They were caught up in the [refinancing]
wave," Trudel said.
Laserstar performed an assessment of Poli Mortgage’s current imaging
equipment, which also included three fax machines of incompatible varieties and
three photocopiers not connected to the business’ network, and a cost analysis
to determine a fixed monthly rate.
"Analysis of needs is a big component of this
[pay-bythe- page] program," said Noreen Trudel, CEO of Laserstar. "The analysis
of equipment used, as well as documents generated, can be very revealing to a
customer and can have a significant impact on their bottom line. The importance
of an analysis of this sort can’t be overstated."
The more than month long
analysis conducted by Laserstar at Poli Mortgage included:
1. An assessment of the equipment that the company already had in
2. A detailed cost analysis, which was accomplished by interviews with a
half-dozen key personnel. Laserstar has developed a series of questions that
includes: how much do you use each machine, what was the company’s last bill for
servicing, and what is like current document flow like? These interviews spanned
a 12-week period, several hours per week, and provided the basis for a detailed
analysis of what Poli Mortgage was spending on every aspect of its document
management, which emphasized not only the initial, out-of-pocket expenses
of purchasing equipment such as copiers and facsimiles and printers, but what
the cost of replacing cartridges and toner would be.
overall educational program for the mortgage company’s purchasing officials to
help them determine what type of equipment to buy. "Poli went out and bought a ton of equipment," Trudel said. "One of out biggest challenges is showing them that actually getting rid of equipment they paid for will save them money in the long run."
4. The determination of a per-page cost, maintenance and cartridge replacement. The two-step formula Laserstar uses for determining cost can vary from client to client, but it typically includes the actual cost of generating documents prior to any new solutions is put in place and analyzing what the solution sales will do to that perpage cost.
5. A contract with Poli Mortgage to provide a system that would meet that price and that range of use. The contract establishes a routine maintenance and toner replacement schedule that is ongoing and turnkey. On a monthly basis Laserstar audits the page usage and, per the contract, there is a fee for additional pages, but there is a rebate if the total comes under the agreed page count. "The rate is flexible and is based on what a company prints," Trudel added.
"Our machines are getting older," Hadaya said. "There is security to this. When we use equipment as extensively as we do, things happen. It is reassuring to know that when breakdowns occur we will not have unanticipated or out of control servicing costs."
"There is a real need in our industry for these all-inclusive programs," Trudel added. "Just as extended warranties have really caught on with automobiles, companies more and more need to determine costs accurately." Trudel said her company is also working to provide Poli Mortgage with desktop faxing solutions through the use of multifunction printers that can scan documents and transmit them electronically, which would reduce the need for paper and an additional phone line. It is estimated that will create a 20 percent savings for the company.
But the pay-by-the-page program has already paid off for Poli Mortgage.
Poli Mortgage has saved 20 percent of hard costs—or close to $20,000 to $30,000 annually. Laserstar’s solution gave Poli Mortgage a tool for budgeting, allowed administration to concentrate on other aspects of the company and has allowed the company some advanced planning time instead of having to react to an office crisis. Other benefits for the mortgage company have included a single monthly invoice that includes service, supplies and print out costs.
"They had four different vendors and were getting five to 10 invoices a month from each of them," Trudel said. "We’ve encompassed everything into one bill."
Laserstar also allows its customers to monitor document output via its website and make supply orders and service calls through the Internet as well. Service calls are dispatched to technicians in the field through wireless PDAs. Many businesses like Poli Mortgage are guided by an "I need it now" attitude. The pay-by-the-page program takes a longer-term look at a company’s needs and provides solutions that will save time, streamline billing and save costs. For a provider company such as Laserstar, it can also result in being perceived as a one-stop solution provider, which results in additional business.
Trudel explained that the pay-by-the page program has created another value for her company’s customers and has simply been another way to improve service.
"This program came from our customers asking to simplify things," she said. "It is a solutions-based program. It’s not necessarily more profitable than simply selling a machine, but it does showcase the company as a go-to source and enables companies to cross-sell their goods and services. "The best ideas come from your customers," she added. "You just have to listen to them. If you don’t, you might as well be flipping burgers somewhere."
“The best ideas come from your customers. You just have to listen to them. If you don’t, you might as well be flipping burgers somewhere.” Jim Farrell is president of PR First, a public relations firm Hanover, Mass. To learn more, visit
HP, Xerox, Tektronix, Konica Minolta and Oki
HP, Tektronix, QMS, Oki, Konica Minolta and Xerox products; electronic file and retrieval; scanning solutions; customized document management programs; pay-by-the-page program; document monitoring through the Laserstar website; and service calls via the Internet.