The results of a survey of 115 catalogers about the average production costs and earnings.
Together, paper and postage account for about a quarter of the average cataloger's production costs. Still, there is good news: Catalog Age's managing editor, Harry Chevan, says the rise in paper prices is tapering off. The bad news is that the postal-rate reclassification scheduled for July 1 will hit small catalogers the hardest. "Smaller companies are going to see their postal rates go up by 10% or more," Chevan estimates.
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Average production costs and earnings as a percentage of revenues Cost of goods in the catalog 50%
General and administrative costs 17%
Earnings before interest, taxes, depreciation, and amortization 4%
Marketing and creative expenses 4%
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Source: A Catalog Age internal survey of 115 catalogers ranging in size from $1 million to more than $100 million, Stamford, Conn., August 1995.