1 / 12

Herff Jones Pricing & Profitability

Herff Jones Pricing & Profitability. June 14, 2010. History. In the diploma, announcement and invitation markets Competes with Jostens, Balfour, and Taylor (NRP) NP just earned business back that was lost to Smart in late 2008 due to price differential and service issues

virgo
Download Presentation

Herff Jones Pricing & Profitability

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Herff Jones Pricing & Profitability June 14, 2010

  2. History • In the diploma, announcement and invitation markets • Competes with Jostens, Balfour, and Taylor (NRP) • NP just earned business back that was lost to Smart in late 2008 due to price differential and service issues • Although the business was returned this account remains extremely price sensitive • Envelope stock is sold direct to Royal Envelope (this analysis combines the two accounts for purposes

  3. CY 2009 Profitability Herff Jones & Royal Envelope Total business: Volume 1,050 MM LB 77% increase from 2008 2010 volume is 493,825# thru March VM % 30% GP % 3% • Note profitability numbers are based on actual costs for 76% of total volume, standard costs for the remainder, and current pricing for all items

  4. Smooth or Vellum- $66.85 - $76.85/cwt Sales & Item Information Pricing Information • Text & Cover; smooth or vellum all plain edge • 925,458# in CY 2009 • 426,652# in CY 2008 • 421,572# in CY 2010 thru March • 29% VM • 5% GP • Price 01/2006 of $58.90 • Price 05/2010 of $76.85 • Pricing Activity since acquisition: • $2.00/cwt increase on 5/1/2010 • ($5.10)/cwt decrease on 3/5/2009 • $1.00/cwt increase on 1/1/2009 • $19.05/cwt increase on 7/1/2007 • $1.00/cwt increase on 4/1/2007 30% price increase since acquisition

  5. Swirl or Linen finish, some Deckle-Edge - $100.20 – $105.80/cwt Sales & Item Information Pricing Information • All text items with off-machine embossed finishes of Swirl or Linen. Some deckle-edge Items • 45,944# in CY 2009 • 82,251# in CY 2008 • 71,254# in CY 2010 thru March • 20% VM • -30% GP • Profitability numbers negatively effected by deckle-edge. Deckle-edge items returning a GP of -119% and VM of -27% • Price 07/2000 of $88.80 • Price 05/2010 of $105.80 • Pricing Activity since acquisition: • $4.00/cwt increase on 5/1/2010 • $9.00/cwt increase on 1/1/2009 • $3.00/cwt increase on 4/1/2007 18% increase since acquisition

  6. Parchment Text & Cover, some Deckle-Edge - $135.00 - $148.00/cwt Sales & Item Information Pricing Information • Parchment items. Some deckle-edge items • 30,849# in CY 2009 • 24,007# in CY 2008 • None in CY 2010 thru March • 38% VM • 10% GP • Deckle-edge items returning a GP of -48% and VM of 14% • Price 08/2001 of $114.00 • Price 05/2010 of $135.00 • Pricing Activity since acquisition: • $4.00/cwt increase on 5/1/2010 • $15.00/cwt increase on 1/1/2009 • $1.00/cwt increase on 4/1/2007 17% increase since acquisition

  7. Other Deckle-Edge - $125.90 - $129.90 Sales & Item Information Pricing Information • Deckle-edge items with a vellum finish • 27,745# in CY 2009 • 18,284# in CY 2008 • None in CY 2010 thru March • 1% VM • -70% GP • Price 07/2000 of $114.60 • Price 05/2010 of $129.90 • Pricing Activity since acquisition: • $4.00/cwt increase on 5/1/2010 • $10.30/cwt increase on 1/1/2009 • $1.00/cwt increase on 4/1/2007 13% increase since acquisition

  8. Handmade embossed, some with Deckle-edge - $114.60 Sales & Item Information Pricing Information • Handmade embossed items. Some deckle-edge items • 3,058# in CY 2009 • 33,659# in CY 2008 • None in CY 2010 thru March • 35% VM • 7% GP • Price 07/2000 of $88.80 • Price 05/2010 of $114.60 • Pricing Activity since acquisition: • $12.80/cwt increase on 5/1/2010 • $9.00/cwt increase on 1/1/2009 • $3.00/cwt increase on 4/1/2007 28% increase since acquisition

  9. Stock Purchases Sales & Item Information Pricing Information • Herff also purchased branded items (Starwhite, Sundance & UV Ultra II) • 17,146# in CY 2009 • 9,350# in CY 2008 • None in CY 2010 thru March • 58% VM • 38% GP • 40,000# List Price

  10. Cost Savings Options • Furnish change recommendations: • Bright White Vellum change furnish that would positively effect formation • Effects 621,528# of the Vellum/Smooth Category • $0.80 - $0.90/cwt of savings • $4,972 - $5,594 annually • Cost of bad paper machine trim • Bright White Vellum typically runs short on PM and deckle requires a butt roll to be created and broked • Effects the same 621,528# from above furnish change • Improvement in trim to optimal sizes would reduce cost approximately $3.00/cwt

  11. Pricing Proposal • Fred/Brad/Dave Lemmers to complete

  12. Revised Financials • Dave Lemmers to Complete

More Related