THE COST OF A LETTER
Discovering the exact cost of a letter is by no means an easy affair.
However, approximate figures may always be had and they are extremely
useful. The cost of writing an ordinary letter is quite surprising. Very
few letters can be dictated, transcribed, and mailed at a cost of much
less than twelve cents each. The factors which govern costs are variable
and it is to be borne in mind that the methods for ascertaining costs as
here given represent the least cost and not the real cost--they simply
tell you "Your letter costs at least this sum." They do not say "Your
letter costs exactly this sum." The cost of a form letter, mailed in
quantities, can be gotten at with considerable accuracy. The cost of
letters dictated by correspondents or by credit departments or other
routine departments is also capable of approximation with fair accuracy,
but the cost of a letter written by an executive can really hardly be
more than guessed at. But in any case a "not-less-than" cost can be had.
In recent years industrial engineers have done a great deal of work in
ascertaining office costs and have devised many useful plans for
lowering them. These plans mostly go to the saving of stenographers'
time through suitable equipment, better arrangement of supplies, and
specialization of duties. For instance, light, the kind or height of
chair or desk, the tension of the typewriter, the location of the paper
and carbon paper, all tend to make or break the efficiency of the typist
and are cost factors. In offices where a great deal of routine mail is
handled, the writing of the envelopes and the mailing is in the hands of
a separate department of specialists with sealing and stamp affixing
machines. The proper planning of a correspondence department is a
science in itself, and several good books exist on the subject. But all
of this has to do with the routine letter.
When an executive drawing a high salary must write a letter, it is his
time and not the time of the stenographer that counts. He cannot be kept
waiting for a stenographer, and hence it is economy for him to have a
personal secretary even if he does not write enough letters to keep a
single machine busy through more than a fraction of a day. Many busy men
do not dictate letters at all; they have secretaries skilled in letter
writing. In fact, a man whose salary exceeds thirty thousand dollars a
year cannot afford to write a letter excepting on a very important
subject. He will commonly have a secretary who can write the letter
after only a word or two indicating the subject matter. Part of the
qualification of a good secretary is an ability to compose letters which
are characteristic of the principal.
Take first the cost of a circular letter--one that is sent out in
quantities without any effort to secure a personal effect. The items of
cost are:
(1) The postage.
(2) The paper and printing.
(3) The cost of addressing, sealing, stamping, and mailing.
The third item is the only one that offers any difficulty. Included in
it are first the direct labor--the wages of the human beings employed;
and, second, the overhead expense. The second item includes the value of
the space occupied by the letter force, the depreciation on the
equipment, and finally the supervision and the executive expense
properly chargeable to the department. Unless an accurate cost system is
in force the third item cannot be accurately calculated. The best that
can be done is to take the salaries of the people actually employed on
the work and guess at the proper charge for the space. The sum of the
three items divided by the number of letters is the cost per letter. It
is not an accurate cost. It will be low rather than high, for probably
the full share of overhead expense will not be charged.
It will be obvious, however, that the place to send out circular letters
is not a room in a high-priced office building, unless the sending is an
occasional rather than a steady practice. Costs in this work are cut by
better planning of the work and facilities, setting work standards,
paying a bonus in excess of the standards, and by the introduction of
automatic machinery. The Post Office now permits, under certain
conditions, the use of a machine which prints a stamp that is really a
frank. This is now being used very generally by concerns which have a
heavy outgoing mail. Then there are sealing machines, work conveyors,
and numerous other mechanical and physical arrangements which operate to
reduce the costs. They are useful, however, only if the output be very
large indeed.
The personally dictated letter has these costs:
(1) The postage.
(2) The stationery.
(3) The dictator's time--both in dictating and signing.
(4) The stenographer's time.
(5) The direct overhead expense, which includes the space
occupied, the supervision, the executive overhead, and
like items.
The troublesome items here are numbers three and five. If the dictator
is a correspondent then the calculation of how much it costs him to
dictate a letter is his salary plus the overhead on the space that he
occupies, divided by the number of letters that he writes in an average
month. It takes him longer to write a long than a short letter, but
routine letters will average fairly over a period of a month. But an
executive who writes only letters that cannot be written by
correspondents or lower salaried men commonly does so many other things
in the course of a day that although his average time of dictation per
letter may be ascertained and a cost gotten at, the figure will not be a
true cost, for the dictation of an important letter comes only after a
consideration of the subject matter which commonly takes much longer
than the actual dictation. And then, again, the higher executive is
usually an erratic letter writer--he may take two minutes or twenty
minutes over an ordinary ten-line letter. Some men read their letters
very carefully after transcription. The cost of this must also be
reckoned in.
The cost of any letter is therefore a matter of the particular office.
It will vary from six or seven cents for a letter made up of form
paragraphs to three or four dollars for a letter written by a
high-salaried president of a large corporation. A fair average cost for
a personally dictated letter written on good paper is computed by one of
the leading paper manufacturers, after a considerable survey to be:
Postage .0200
Printing letterheads and envelopes .0062
Stenographic wages (50 letters per
day, $20.00 per week) .0727
Office overhead .0727
Paper and envelopes .0054
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$.1770
The above does not include the expense of dictation.
It will pay any man who writes a considerable number of letters to
discover what his costs are--and then make his letters so effective that
there will be fewer of them.