A Full ROI Breakdown of IBM i Laser Check Printing

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People often ask me –

“How much money can I save if my shop switches our IBM i check-printing from pre-printed continuous form check printing to MICR Laser check-stock printing on laser printers”

ROI is important for any technology project. For the average shop, switching from pre-printed checks to laser checks will see significant cost savings.

These numbers can be used for ROI when writing up a Capital Request to replace pre-printed checks with blank check stock.

Here are some figures you can use to calculate your own check stock savings when switching to MICR Laser check printing.

Running the Numbers

Obviously, there’s more to switching to Laser check printing than just the cost of check stock. Probably the biggest advantage comes from being able to use a single check stock for multiple bank accounts, but for this simplified discussion, we’ll focus on stock-check savings for calculating ROI. Check out our e-Guide for more information on the entire process of switching to laser check printing on your IBM i.

It’s easy to calculate how much you can save by moving from pre-printed to blank check stock printing.

All you have to do is compare current costs associated with pre-printed checks versus the cost of Laser Check printing with your IBM i. These numbers demonstrate how much you can lower your operating costs by switching to blank security check stock.

Start Here: Determine the Cost of Pre-Printed Checks

First determine what you are spending on pre-printed checks today. The industry standard to calculate the cost for a case of pre-printed check stock is:

Form acquisition cost/case + Waste + Form inventory & distribution costs = Pre-printed check stock gross cost/case

The Form acquisition cost/case is simply the cost per case you’re currently paying for pre-printed checks. This number should be available on your invoice. The industry average is usually about $100 per case.

To get the Waste figure, I multiplied the Form acquisition costs/case by 15%. Industry estimates say that for every $100 in forms usage, about 15% (or $15) of the cost will go to waste, whether due to misalignments, or having to make changes resulting in obsolete check stock that has to be destroyed. So the Waste calculation becomes

Form acquisition cost/case x 15% = Cost due to Waste

Blank pre-printed forms also require secure storage, and inventory to ensure check stock is not missing, and enough is left for the next check run because your bank account number and check number are printed on each check. All pre-printed checks are live checks and must be secured.

The industry average number for pre-printed check Form inventory & distribution costs is calculated at approximately $18 per $100 spent or 18% so our calculation looks like this

Form acquisition cost/case x 18% = Form inventory & distribution costs

With these numbers in hand we can calculate

Form acquisition cost/case  + Waste + Form inventory & distribution costs = Pre-printed check stock gross cost/case

So if the Form acquisition cost/case of $100 for a box of forms, the actual Pre-printed check stock gross cost per case is:

Preprinted cost $100 + ($100 x 15%) + ($100 x 18%) = $100 + $15 + $18 = $133 Pre-printed check stock gross cost/case

This is what you are paying today, so let’s see what you could be paying.

The Cost of Blank Check Stocks 

Next we will calculate the cost per case of blank check stock with this equation:

Form acquisition cost + Form inventory & distribution cost +MICR Toner cost = Blank check stock cost/case

Because bank account numbers aren’t printed on blank check stock, no secure storage or inventory is needed. Blank check stock doesn’t turn into a live check until after the account number is printed on the check. Check out my post on laser printing security for more insight on why this cost is so low.

The labor and handling of cut sheet blank check stock is about half that of pre-printed check stock, mainly because it does not need to be burst, consequently, the industry standard of Form Inventory & distribution cost is about 9% or $1.98 per case.

Blank check stock needs to be printed with MICR Toner, and for our purposes will use an average $400 cartridge that yield 24,000 printed checks with 5% coverage. This means the cost for toner will be calculated as follows:

MICR Toner Acquisition Cost ÷ Yield = Cost Per Page x Number of Pages in a Case =  Cost of MICR Toner per case
$400 ÷ 24,000 = $.016 per page  x 2500 pages per case = $41.67 per case

For our apples to apples comparison, we now add the MICR cost to calculate your standard blank check stock cost per case will be:

Form acquisition cost + Form inventory & distribution cost +MICR Toner cost = Blank check stock cost/case
$22 + $1.98 + $41.67 = $65.65 Blank check stock cost/case

In other words, even with MICR toner, blank check stock cost less than half as much as pre-printed check stock.

The Magic Equations

Finally, it’s time to complete the equation to determine your total savings per case of checks:

Pre-printed check stock gross cost/case – Blank check cost/case = Cost savings/case using blank check

Estimating the average cost for a case of pre-printed check stock to be $133 and the cost of printing blank check stock to be $65.65 we can calculate the cost savings per case to be:

Blank check cost saving/case = $133 – $65.65 = $67.35 in savings per case!

To determine how much you’d save in a year, determine the volume of your annual check usage, multiply the savings per case by the total number of cases you use in a year, using this equation:

Blank check cost savings case x Number of cases per year = Total cost savings/year using blank check

If your check usage is 1000 cases per year, the total savings per year would be:

Blank check cost savings/year = $67.35 x 1000 cases = $67,350

So, blank check stock with MICR toner cost less than half as much as pre-printed check stock, you don’t have to inventory it, or VOID checks if there is a jam because there is nothing to void yet! Even if you use only 1/10th of that volume, you would save enough to offset the entire initial investment of a cost effective MICR Laser printing solution like DRV’s Secure Checks software, paid for in less than one year!

Add to the savings  the convenience of using a single check stock for multiple bank accounts, and the ability to change bank accounts without having to destroy check stock and you start to see that MICR laser check printing is the way to go!

I told you the savings were significant.

You can use these baseline numbers in your capital request for going to Laser check printing, or you can determine your own cost by running the steps below. Read on to calculate your own numbers.

Plugging the Numbers In

To get started, determine your annual check volume, and the cost per case. Once you get your own values, plug them into the equations and you’ll get your own blank check stock savings number. That number can be used for cost justification and ROI on a Capital Request. Other cost considerations could be the service contracts and ribbons for obsolete impact printers, as well as signature equipment, and the estimated labor associated with inventorying check stock or voiding checks.

As I said, check savings isn’t the entire justification for moving to laser and blank check stock printing but it is a big piece of the decision. In future posts, I’ll look at other justifications and benefits in moving to laser check printing.

Feel free to contact us at DRV Tech for more advice in creating your own laser check printing solution


Read more about Laser Check Printing:

10 Myths About Laser Check Printing

3 Key Security Advantages of Laser Check Printing


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