Without giving any examples or suggestions, I'm willing to bet there's something about your print shop that's a pain in the neck. Whether it's a machine or a process that's broken and in desperate need of help, this "thing" is hindering your shop's ability to grow and perform the way it ought to next year and beyond.
In this article, we discuss 5 things that print shop owners should consider before investing in new machinery for their shops. It's a timely topic for our US clients especially, because at this time of year, we recommend that they take advantage of the section 179 deduction when investing in new print finishing equipment.
1. Determine Your Business Needs
Like I hinted at earlier, when choosing which machinery to invest in, first take a step back and look at your business. What are your goals? And what's standing in the way of you achieving those goals? For example, if your goal is to double your profits but the current skilled labor shortage is hindering that, you’ll want to look at utilizing automation. If you want to expand your product offering, but space in your shop is an issue, maybe you want to look at machinery that offers you more versatility with a smaller footprint. These questions will help you identify what makes the most sense for you to invest in.
Download and fill out our free Print Shop Analysis Tool below, or contact one of our product consultants if you'd like help with this step.
Print Shop Analysis Tool
2. Determine Your Budget
Once you know what your business needs, you can determine your budget. Some things we recommend including in your budget calculations are the price of the machinery, any trade-in values of machinery you currently have, maintenance or repair costs, transportation, installation, and training for the new equipment. This means that your budget will need to be higher than the just price tag of the machinery to incorporate these costs that are sometimes forgotten.
3. Select the Right Equipment & Vendors
Now that you’ve determined what your business needs and have a budget in mind for achieving that, it’s time to select the right vendor. It’s important that you choose a vendor that understands your shop and your market, and can provide you with quality equipment, as well as great follow-up service. Downtime is every print shop's worst nightmare, so we highly recommend finding out if your vendor offers any service plans, etc. to keep your machines in optimal condition and prevent the dreaded downtime, especially during busy times of the year.
4. Payment Options
Another important consideration should be your payment options. Leasing is a popular option because it allows you to conserve your cash, especially if your business is growing quickly. Equipment finance agreements, in particular, allow you to take advantage of section 179, but we recommend discussing this with your accountant because every business is different and will have different tax returns. If you're looking to learn more about your leasing options, check out this session from Print2Finish with our friends over at Accord Financial.
5. Be Aware of Section 179 Deadline Dates
The Section 179 tax break is valid on the purchase date of the machinery and expires on the last day of the calendar year. For example, if you purchase a collator in October, the Section 179 expiration date would be December 31. In order to take advantage of the machinery tax break, you must complete the IRS Section 179 form and file it with your company’s federal tax return.
Summary
Investing in the right machinery for your shop isn't a snap decision. You'll want to make sure that what you ultimately decide to go with is what's best for you, your employees, your customers, and the future of your print shop. If you need help at any point, feel free to reach out to our team. We're always happy to help!