Topic

Messages

Markups

I would like to survey the user group on markups. What markup percentages do you use on outside production costs? What markup do you use on media costs? Do you track and bill the following:

Color Copies
B/W Copies
Telephone Calls
Disks/Cds
Travel
Entertainment

We are currently evaluating our billing processes and this information would greatly assist me. Our agency currently does mark up any outside costs and we pass them along at net. We also have decided this year to move away from billing travel, entertainment, color copies and other items we have typically billed. I am curious as to how other agencies handle these items.

Lane Newsome
B U R R I S

17.5% markup on all out of pockets

Kathy McIntyre
Metzger

What markup percentages do you use on outside production costs? << Generally 20%, less for large print jobs >>

What markup do you use on media costs? << n/a >>

Do you track and bill the following:

Color Copies Yes/Yes (we try to break even vs. lease payments, paper, etc.) B/W Copies No/No Telephone Calls No/No Disks/Cds Yes/Yes Travel Yes/Yes Entertainment Yes/Generally no

Brent A. Byrd
Point Zero, Inc.

We mark up o/s production 30%. Our media commission is 15%. We track and bill long distance telephone (per detail from phone company), travel and supplies that can be identified with a client are billed to them. The copies are too much work to track so they are not tracked.

Ann Adams
Controller
J. Stokes & Associates

What markup percentages do you use on outside production costs?

25% up to whatever we can get away with...value pricing etc.

What markup do you use on media costs?

We don't do much - but we don't charge more than standard agency rates for entire media industry

Do you track and bill the following:

Color Copies > B/W Copies> Telephone Calls> Disks/Cds

We stopped tracking ages ago; but we charge $10 on EVERY invoice for every client to cover all "incidentals"

Travel

Sometimes - depends on what for, but never a mark-up

Entertainment NEVER - build that into labor billing rates...

Roxanne Cowan
Rutherford Bolen Group Integrated Marketing

20% Production / 15% Media. Bill back what ever you can.

Ed Miller
Grafica Group

1. Outside Production costs are marked up the net either 17.65% or 25% depending on the type (print is at 17.65%). I think you should have a markup on your outside cost, whatever it is. You don't want to devalue the time and effort the agency spends on the vendor relationship, paying and tracking invoices, researching and looking for the best cost for the quality and trying to find added value. We don't just place a phone call and we take responsibility for finding good value and high quality. If something gets screwed up through no fault of the clients, we eat it. 2. Media is marked up 15% on the gross which is 17.65% on the net amount. 3. We stopped tracking copies, phone calls, disks, etc in January of this year. Instead we have been billing a $50.00 project materials charge on every job. We have had no complaints since we have been doing this and you save on admin. staff time tracking and recording these costs. 4. We still track travel and entertainment because we cut checks for those but seldom do we bill them unless it was agreed to before the job started.

Mary T. Henry, Finance Director
Kleier Communications

We do not markup outside production costs. We bill for production time and for the incidentals you listed below.

Kurt Bollish
BOZELL & JACOBS

Yes . . . we bill all of the costs you have listed below. Our photocopier is assigned client numbers. Prior to being able to make a copy, you must put in the code. At the end of the month, we get the number of copies made on behalf of each client and bill them as an expense in C&P. B/W copies are 5¢. Color copies are tracked manually on an excel sheet placed by the color printer. Staff indicates the job number and number of pages printed on behalf of the client. These are also plugged into C&P as an expense Telephone calls (long distance only) are billed to each client via the account codes that were set up with our long distance provider, again with standard markup. Disks and CDs are tracked via sign out and billed as an expense. All expenses entered into C&P are subject to the standard markupof 15%. Travel charges vary. We do bill the client for all travel costs and we do use the standard mark up. If the client wants to save a little money, they may choose to make the travel arrangements and put them on their own credit card to avoid paying mark up. We do not bill entertainment. Media insertions are billed by the pub directly to the client. It may seem tedious, but it's really not that time consuming. We have not had any compaints regarding the costs of the items from any clients. Travel costs and billing of those costs may vary between clients.

Jody Breiland
McClenahan Bruer Communications Inc.

We do continue to mark up outside costs at 20% minimum - that is a factor of 25% in Clients and Profits for correct mark up calculation. I believe that commissions for media are still a standard 15% on average, and that is what we take. It's still a fair price for providing a cash "float" to our clients for these outside costs. Also, we do charge a fee for color outputs that is comparable to any local service bureau, but we do not charge for b/w copies - unless we are producing large quantities in house for final. Supplies are not charged unless they are specific to a certain job, and we only pass along the net cost of travel and mileage expenses, which I think is fair. Billing for entertainment is at the discretion of the AE, but if we pass it along to the client, is not marked up.

Carolyn Lorence
Core Creative, Inc.