Bind-In Order Forms-What's the Best Strategy? (2,000 words)
The bind-in order form does serve an important function. It would seem that the additional gross margin dollars generated from the full-color space in the catalog on the one or two pages you would have to give up for the order form would more than offset the cost of the bind-in.
But, you should do your own arithmetic in order to convince yourself. Let's look at an example. Let's assume our catalog is 64 pages and that the total sales generated from a mailing to 750,000 customers and prospects was $1,315,000 in revenue. If we do not count the front cover in our analysis, the average sales per page (63 pages total) would amount to $20,873. The average sale per page from a "hot spot" like the centerfold would probably be higher than this overall average. However, for purposes of this example, we will treat all pages equally. Let's also assume our returns rate is 6 percent and our gross profit is 55 percent of net sales. Per this example, the gross profit dollars we would be giving up by using a page or two from the catalog would amount to $10,830 per page on gross sales of $20,873 per page. The calculation is as follows:
