Why are paper prices increasing?

With unpredictable circumstances over the past 18 months, it is difficult to know which products and services will change in price.

When it comes to paper, a product which has been part of everyday business operations for many years, the price has become quite volatile.

Paper is typically a product that has a stable price point. Even with the rise of digitisation, the demand and price of paper has not dramatically changed over the past 30 years. But during the course of 2021, there have been many rounds of paper pricing increases. From packaging to newspapers to everyday paper used for business communications.

Each time the price of paper changed, it increased between 4-9%¹ each time. This has created an estimated 3-5% increase on most printing orders. Percentages which may seem small but can add up when your businesses distribute a lot of documents.

Read on to discover why paper prices have increased at such a rapid rate, the challenges businesses face and the solutions to overcome them.

What is the current situation?

Suppliers of paper, such as the business Lecta, announced a 12-14%² price increase. Driven by an exceptional increase in raw materials driven by the soaring price of gas, electricity and chemical costs. Furthermore, The Navigator Company, a pulp and paper supplier, announced a 6%³ European price increase due to the rising prices in raw materials.

And it isn’t just paper that businesses are seeing extra charges for. Ink is also seeing a surcharge as well due to the shortages⁴ over the past few months. But why is this happening?

A lot of input costs that feed into paper and ink creation and distribution are the reasons causing the price hikes. Higher costs coming from energy, gas, CO2 allowances, transport and chemicals have all risen over the past 18 months. All of these costs feed into many elements of product manufacturing and distribution, therefore increasing the cost of sale for the end user.

Not only has the increased production and distribution costs created an issue, but supply chain challenges due to the COVID-19 pandemic are creating backlogs and are affecting sale prices.

What does this mean for businesses?

Businesses need to look at their paper and print activities and analyse how they can combat the current challenges. Should businesses pass the costs onto the customer, should they absorb the costs or should they spend more of their time sourcing the right paper supplier?

Businesses already spend a great deal of time on in-house document and communication processes. From creating and distributing communications, managing print and post rooms to spending time maintaining print machines. Sourcing low-cost, reliable paper suppliers only adds to these tasks.

Businesses need to find a more cost-effective, secure solution. Businesses have an opportunity to look at an outsourced solution that will save them time, resources and money.

What is the solution?

Outsourcing your print and post

Outsourcing document creation and distribution to a document distributor combats many of the current challenges.

Your outsourced document distributor provider will work on economies of scale. They will print many jobs at once, meaning they can buy print materials in large bulks. This reduces the cost of print materials for each individual business. Plus, your provider will be the expert in sourcing the most cost-effective and quality print materials, therefore providing your business with the confidence that you are getting the best deal.

However, even though outsourcing your print and post is a more cost-effective and efficient solution, there is an even simpler and smarter solution. Digital document distribution.

Digital distribution

Digital document distribution reduces a lot of business tasks. For example, no more sourcing paper and no more maintaining print equipment. But digital document distribution also provides many business benefits: