Franking

It’s well publicised how Franking Machines can save money but at what point should you consider a Franking Machine to handle your outgoing mail? Franking only becomes viable if you have a consistent need for letters and parcels to be sent. When evaluating the need for a Franking Machine it’s important to cost in the price of equipment to find your break even point.

Stamps vs Franked (Prices exclude VAT – as of March 2016)
Type Of Mail Weight 1st Class Stamp 1st Class Frank You Save 2nd Class Stamp 2nd Class Frank You Save
Letter 100g £0.64 £0.51 20% £0.55 £0.37 33%
Large Letter 100g £0.96 £0.79 18% £0.75 £0.64 15%
250g £1.27 £1.10 13% £1.20 £0.89 26%
500g £1.71 £1.46 15% £1.54 £1.19 23%
Small Parcel 1kg £3.35 £3.07 8% £2.85 £2.57 10%
2kg £5.50 £5.22 5% £2.85 £2.57 10%
Medium Parcel 1kg £5.70 £4.87 15% £4.95 £4.47 10%
2kg £8.95 £7.57 15% £4.95 £4.47 10%

 

Buying or Renting/Leasing a Franking Machine

When considering a Franking Machine you may be wondering whether to rent/lease or purchase outright. In general, leasing/renting will give you greater flexibility should you require an upgrade and offers a low monthly fee with no capital outlay. Buying outright effectively means you are locked into the machine you have chosen but is more cost effective providing there is no need to upgrade.

There are four manufacturers of Franking Machines in the UK licensed by the Royal Mail:

  • Neopost
  • Pitney Bowes
  • Francotyp-Postalia
  • Frama (UK)

The cost of equipment ranges from supplier and volume, in general, there are three ranges of Franking Machine*:

  • Low Volume Franking (15-75 items per day)
  • Medium Volume Franking (75-300 items per day)
  • High Volume Franking (300+ items per day)

*Ranges vary per manufacturer

Size of Machine Purchase Rent/Lease* Break Even Point
Low Volume £1,000 – £2,500 £19 – £48 per month 4 letters per day
Medium Volume £2,500 – £7,500 £19 – £145 per month 4-26 letters per day
High Volume £7,500 – £25,000 £145 – £483 per month 26-90 letters per day

*Rental rates based on 5-year lease rental at 6%.

These figures do not include maintenance or ink and should only be used as a rough guide but you can see when considering a Franking Machine for the first time it is useful to add up the overall cost of usage.

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