Small Business Issues

Top 7 hidden costs of using Franking Machines

We’ve used a franking machine for the past 8 years and whilst it has suited us some of the time there are some wild claims out there especially from some suppliers who claim it is cheaper than using stamps. Once you add in all the hidden charges it is, in our experience, often more expensive than using stamps.

So what are the costs missing from the headline rates you see advertised:

  1. Rental Costs
  2. Maintenance Fees.
  3. Software Assurance.
  4. Recharge Fees.
  5. Ink Cartridge costs.
  6. Weighing Scale Fees.
  7. The Hassle factor.

1. Rental costs you think cold be minimised with the the purchase of a machine, unfortunately you cannot use a franking machine in the UK without a support contract authorised by Royal Mail which in turn means support companies own the market and will not take on an user-owned machine. Subsequently the Franking Machine Market appears to be dominated by companies with poor customer service practices and a penchant to overcharge at every opportunity.

2. Rental companies initially offer what appears to be reasonable maintenance fee however given they will try to lock you into a long contract, by offering the longer ones with cheaper rental, once signed up they will increase the support costs year on year by a good amount. The support contract will state lots of good reasons why you need the contract such as calibration of the weighing scales however during our contract we never had a visit from the company check or carry out any preventative maintenance on the machine including calibration.

3. Software Assurance, all modern franking machines have a software element which controls the pricing and record what you’re sending so the companies can account for VAT inclusive services such as Saturday delivery or Next Day 9.00am delivery.  When Royal Mail change their fees (which they do at least once a year) you have to update the software to take account of the new prices, the Franking Machine company will charge you to update the software as it is not included in the Support Contract. You get a choice of paying annually for the service or paying as and when it gets updated.

4. Recharge fees; every time you add money to the franking machine you’ll get charged a recharge fee, typically this is a fee per recharge so the more you recharge in one go the cheaper it is.

5. Ink Cartridge Costs: the maintenance contract will state only authorised cartridges can be used in the machine otherwise the contract is deemed broken, these cartridges are typically 2-3 times the cost of  3rd party supplier cartridges which again are inflated due to the small market size.

6. Weighing scale fees. Franking Machine companies will separate the franking machine from the weighing scales, this means they can charge for an additional contract for the weighing scales.

7. In our experience we’ve found the franking market to be poorly regulated, this will probably get worse with the privatisation of Royal Mail, we’ve been duped into longer contracts than initially promised, had our contract traded onto another company without agreement and generally ripped off at every opportunity.

So why use a Franking Machine; frankly (pun intended, sorry) nowadays there is no need to, at the lower volume it would be more cost effective to use stamps (which can be purchased and printed online) and at the higher level it is cheaper to contract direct and use something like Royal Mail’s Online Business Account with a Pre-Paid Impression licence.


New Media Small Business Issues

Moving to a responsive web design

We’ve been looking for a while now at a content management system (CMS) that would suit our needs, alas to no avail. Some have come close however there always seems to something that would stop us.

As we couldn’t find one we’ve decided to hand code our site in the same manner that our original site was built.

We have been taking on board html5 snippets for a while now and the html5boilerplate site has proved a good source as has .net magazine.

Given we wanted a good design that was responsive this we found a was a good starting point and so far has proved to be a good grounding.

Issues we’ve found to date surround the monetization of the site in the google Adsense do not do responsive ad units that can be used and we’ve got issues with directing people to other websites that may not have responsive pages.

Small Business Issues

Incorrect Franked Mail refunds from Royal Mail – their latest wheeze!

Using a franking machine you occassionally make a mistake on the franking label, either in value or it smudges or prints poorly.

To make life easy for the Royal Mail they have a scheme where-by you can send these in and they will refund you the value less an amount for their admin of the scheme.

Prior to May 2012 they charge 5% of the returned items which had to be no more than 6 months old and the total valure had to be over £10.  In line with all their price hikes this suffered a 200% increase to 15% of the total cost of the franking pmpressions returned.

Their latest wheeze which they stated was also part of the new prices from May 2012 is to now demand you return the entire envelope which has the franking impression upon instead of what we always have done which is to return the label/impression section only.

Funnier still; when we stated concern over data protection with returning the entire envelope with our customers address on they said it was OK to cut this off!  – OKay let me get this right I can’t just send back the franked part of the envelope but I’ve got to send the entire envelope less the addressee part, surely this is just a bigger piece of paper in effect!!

The customer service assistant we spoke with when we phoned to complain about this said it was something their auditors had demanded as part of their fraud prevention measures.

Given each franking impression has our dye number on it I wonder how intelligent they are (or think we are!)

I’m at a loss how we could defraud them by sending a franking impression (that costs more than the face value printed on it) back for refund that we’ve printed (proved by our dye number) less 15% of the face value – any offers on how we can make money on this?

Irked by them stating they would give us the refund this time if we send them in with a note of the discussion I decided to do some further digging.

The stated this was brought in with the 30th April 2012 price rises – this turns out to be a blatent lie, checking the ROYAL MAIL SCHEME FOR FRANKING LETTERS AND PARCELS 2008 it states in Section 11.6

If a User prints a Franking Mark by mistake, the User may write to the Royal Mail controlling office to apply for a refund within 6 months of the date when the Franking Mark was printed, enclosing the franked envelopes, wrappers or other items which must total no less than £10. If Royal Mail receives all the information and evidence it requires and the amount of Postage or Fees shown by the Franking Mark is legible, Royal Mail will give the User a partial refund of the amount of Postage paid, having deducted an amount which Royal Mail considers to be reasonable to meet the administrative cost of dealing with the User’s application.

This could be read that envelopes must be returned until you check if this has changed, which when I checked the original inactment of the scheme via the London Gazette the wording was exactly the same; so no change.

If they accepted just the Franking Impression portion before then they should accept it now.