A franking machine provides a fast and easy way to manage your mail. Not only can it save you time and money, it has many other advantages for your business including presenting a more professional image and other branding and marketing benefits.
Despite the way in which digital communications have taken a dominant role in business, old fashioned postal delivery is still a vital part of business to business and business to consumer communications.
There are many different kinds of franking machines on the market and they range in price from several hundred to several thousands of pounds. While you can purchase a machine outright there are also lease and franking machine rental options that can have significant advantages. Approved Index help you to understand the different kinds of machines that are available and some of the more important features to look out for when choosing one.
How Does a Franking Machine Work?
A modern franking machine is a machine that franks your outgoing mail with the correct postage for the service you require. Different kinds of franking machines have different features, but in essence they will weigh the letter or envelope you wish to send, take account of the size which you input manually, check how you wish to send it (e.g. second class, first class, special delivery, destination etc.), calculate the postage and frank the envelope or print a label adding any customised text or images you wish to include. Each time the machine franks an item, the cost is deducted from your business's balance.
How Can a Franking Machine Benefit Your Business?
Franking your mail can make a huge difference to your business. It can save you time and money, it can add a professional appearance to your mail, it is a great promotional tool and it makes it easy to use the best mailing option for whatever you are posting.
Speed – Franking is the fastest way of dealing with your mail. Compared with franking, alternative methods of paying for postage like manually sticking on self-adhesive stamps are painful, labour intensive activities that are somewhat out of place in the modern world.
Money – Time is of course money, so by saving on labour you will already be saving, but there is much more to save than that. Postage has become expensive over recent years and there is no sign that the trend won’t continue. With a franking machine, you can save a considerable amount in postage costs - in some cases up to almost a third. We review costs saving in detail further along this guide.
Expenditure - Franking machines also keep a record of your postage costs, helping you take control of them. This makes recording postal costs much easier for your accountant so you pay the correct amount of corporation and reclaim VAT on non-rated postal items.
Image & Branding - Franking your mail is a great way to present a professional image to your clients. Most franking machines allow you to customise the appearance of your franking print - adding your company name, your logo and other information such as your return address. This will appear on every item that you send, whatever size of envelope or parcel, and benefit your brand by making you instantly recognisable to your customers the moment they glance at their post.
Marketing – In addition to providing useful contact information and having your brand on every item of mail you send, you can also add a marketing message. It might be a specific advertisement, information on a special promotional offer or in fact any message you want to send. The beauty of this is that this powerful marketing tool is entirely free.
Flexibility – Whether you wish to send your post by regular snail mail, recorded or special delivery, international post, business collections or any other of the expanding range of business postal options, you can pay for it using your franking machine. With some franking machines you can also separate out postal items that are free from VAT from those that are VAT rated.
Return on Investment with a Franking Machine
While it is difficult to assign a monetary value to items such as branding and lending a more professional image to your business along with labour and management savings, we can at least compare the cost of a franking machine with the savings you can expect to make on postage.
Franking machines come in many different specification levels and this is reflected in their costs. While a simple franking machine can be purchased for under £1,000, high end franking machines can cost anything up to £10,000 and some high volume franking machines can cost over £20,000.
Many businesses prefer to rent their franking machines which has two advantages: you avoid the high capital cost and the rental charge will appear on your P&L account as a cost of sales which can be better than having a franking machine as a depreciating asset on your balance sheet. Rental charges are typically from around £20 a month to £500 a month.
Postal savings on franking are always subject to change, but typically you can save 34% on second class mail and 15% on first class. For large letters, the savings are 26% second class and 23% first class. Savings on parcels are around 10% to 11%.
You also need to take account of consumables such as ink cartridges.
Once you have decided that franking is right for your business, the first step is to choose a franking machine. We explore some of the features to consider in the next section. Next you will need to apply for a franking licence which can be done via the company that is supplying you with your franking machine. There is a small cost involved which is generally included with the monthly rental charge.
There’s a particular set of rules and regulations which your business will need to adhere to including such requirements as separating your mail, having your machine serviced regularly and allowing it to be inspected by Royal Mail. You should also understand the rules about excess postage and how to reclaim if you make an error in Royal Mail’s favour.
Franking Machines for Small Businesses
While it’s clear that franking can save large businesses a considerable amount on postage costs, the case for getting a franking machine for a small business that sends out a limited amount of mail might not be as clear. However even if your small business sends out just a few items of mail a day, a low end franking machine can still make you a saving with some of the added benefits already mentioned. Certainly it is worth doing the sums; you might be surprised by how much you can save.
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What to Look for When Choosing a Franking Machine
In the UK there are just four licensed manufacturers of franking machines but there are many independent suppliers, most of whom also offer a range of additional related services. They also have different charges and contract details. These are some of the more important details you will need to consider when choosing one:
Capacity - you will need to decide on your current franking requirements and how they will change in the future. You should select a machine that can handle at least that capacity, possibly with an additional contingency.
Additional features - what additional features do you require? For instance, do you want to print additional information about your business as described?
Contract length - it is important to consider the length of your contract. Some suppliers insist on longer term contracts than others. Are you happy with a long term commitment or would you prefer to keep your options open?
Contract renewals – look out for rolling contract renewals. Some suppliers might offer the kind of contract that will roll over - possibly for several years if you fail to cancel it sufficiently far enough in advance.
Maintenance - does your supplier require you to take out a maintenance contract or is that included in the rental charge? You are obliged to have your machine serviced regularly.
Consumables - consider the costs of consumables such as labels and ink cartridges, especially if you print additional company information. There is a substantial variation in ink cartridge prices and you are obliged to use inks that are approved by Royal Mail.
Compare Franking Machine Quotes
If you want to speed up your mailing process as well as save up to 34% on your postage prices, just fill in our simple quote form to receive up to 4 free, no-obligation quotes from the UK's leading suppliers of franking machines.
Approved Index aims to make it as easy and straightforward as possible to match you with the most competitive franking machine suppliers based on your postage requirements, so head off those stamp price increases before they become a reality.
Let Approved Index help you find the best Franking Machine for your business.