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Center for Business Innovation Profile: Meet the New Breed of Dealer, Not the Same as the Old Breed of Dealer
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Thursday, December 9, 2010
Tuesday, November 2, 2010
We've moved!
Thank you for following Imaging Industry Information, Strategy Development's blog.
Today, Strategy Development launched a new website, at a new address and incorporated the blog.
Please sign up to follow us at our new location: www.strategydevelopment.com/blog.
New Strategy Development website: http://www.strategydevelopment.com/
When reaching out to the Strategy Development team, please update your address books as our email addresses now end in strategydevelopment.com.
We hope to see you soon!
Today, Strategy Development launched a new website, at a new address and incorporated the blog.
Please sign up to follow us at our new location: www.strategydevelopment.com/blog.
New Strategy Development website: http://www.strategydevelopment.com/
When reaching out to the Strategy Development team, please update your address books as our email addresses now end in strategydevelopment.com.
We hope to see you soon!
Tuesday, October 19, 2010
Strategy Development Schedules Award Winning BTA MPS Back Office and Sales Training Classes for December in Philadelphia
We are conducting our award winning BTA Managed Print Services (MPS) Operations and Service Workshop on December 8, concurrently with BTA MPS Sales Workshop on December 8-9, in Philadelphia. These courses meet the training requirements of the Kyocera Certified MPS Dealer Program.
BTA MPS Sales workshop teaches sales leaders (dealership principals, sales managers, vice presidents of sales, and print specialists) a systematic and proven methodology to establish and maintain a profitable MPS program. Uncover new revenue streams, significantly increase the quantity of captured prints, lock in customers, enable differentiation from competitors, and, ultimately, sell more hardware.
Tom Callinan and Ed Carroll will lead this course. Topics covered in the workshop include: understanding the print space (the opportunity, IT's involvement, the sales approach and target markets); getting the appointment; presenting a value proposition; how to conduct an assessment; developing a strategy and tactics; how to build a print management proposal that sells; pricing a print management contract; how to expand the opportunity after the sale; and preparing for quarterly business reviews.
Become your customer’s "single source" for optimizing printed pages and the hardware used to produce them. Your customer enjoys eliminating the need to deal with multiple vendors and invoices, leveraging the benefits of a holistic view of their entire document output fleet, saving time and money, while improving efficiencies.
Jackson Jordan of Advantage Business Systems attended this class in New Orleans last week and said, “Great workshop! Straight forward, easy to understand approach to MPS. They give you the tools needed to implement a profitable MPS program. Thank you Strategy Development!”
Mike Woodard of Strategy Development created and instructs BTA MPS Operations and Service workshop, a course designed to jump-start your understanding of how to set up and manage all operational and service aspects of a MPS agreement. MPS is a go-to-market strategy that allows companies a robust and profitable relationship with your customers that generates a recurring revenue stream. Learn what you need to know for after the contract is signed that results in the added complexity to your back-office operations and to your service department.
Matt Mawby of Professional Business Systems said, “As a copier guy, this gave me an excellent service perspective on MPS. It was great to see the positive impact MPS brings to our service and operations."
Ron Fuhrman of Liberty Business Systems, had this to say, "This workshop helps to alleviate the angst of starting a successful MPS program and brought the project down to a simplistic, manageable process. The process, pricing and implementation ideas are well thought out."
The instructors have not been taught the material; they developed it, and lived it firsthand. When not in the classroom, they are consulting for clients, so the content is always in proper alignment with current and impending trends.
Click here for links to more information on the course, instructors, and to register for class.
BTA MPS Sales workshop teaches sales leaders (dealership principals, sales managers, vice presidents of sales, and print specialists) a systematic and proven methodology to establish and maintain a profitable MPS program. Uncover new revenue streams, significantly increase the quantity of captured prints, lock in customers, enable differentiation from competitors, and, ultimately, sell more hardware.
Tom Callinan and Ed Carroll will lead this course. Topics covered in the workshop include: understanding the print space (the opportunity, IT's involvement, the sales approach and target markets); getting the appointment; presenting a value proposition; how to conduct an assessment; developing a strategy and tactics; how to build a print management proposal that sells; pricing a print management contract; how to expand the opportunity after the sale; and preparing for quarterly business reviews.
Become your customer’s "single source" for optimizing printed pages and the hardware used to produce them. Your customer enjoys eliminating the need to deal with multiple vendors and invoices, leveraging the benefits of a holistic view of their entire document output fleet, saving time and money, while improving efficiencies.
Jackson Jordan of Advantage Business Systems attended this class in New Orleans last week and said, “Great workshop! Straight forward, easy to understand approach to MPS. They give you the tools needed to implement a profitable MPS program. Thank you Strategy Development!”
Mike Woodard of Strategy Development created and instructs BTA MPS Operations and Service workshop, a course designed to jump-start your understanding of how to set up and manage all operational and service aspects of a MPS agreement. MPS is a go-to-market strategy that allows companies a robust and profitable relationship with your customers that generates a recurring revenue stream. Learn what you need to know for after the contract is signed that results in the added complexity to your back-office operations and to your service department.
Matt Mawby of Professional Business Systems said, “As a copier guy, this gave me an excellent service perspective on MPS. It was great to see the positive impact MPS brings to our service and operations."
Ron Fuhrman of Liberty Business Systems, had this to say, "This workshop helps to alleviate the angst of starting a successful MPS program and brought the project down to a simplistic, manageable process. The process, pricing and implementation ideas are well thought out."
The instructors have not been taught the material; they developed it, and lived it firsthand. When not in the classroom, they are consulting for clients, so the content is always in proper alignment with current and impending trends.
Click here for links to more information on the course, instructors, and to register for class.
Sunday, October 17, 2010
Sales Education Focus
Sales education can help your sales force achieve greater success. To be successful in our industry or any industry, our salespeople need to be more than just subject matter experts on products and services. Whether they are just learning basics or getting back to them, a good foundation is a pre-requisite to success in sales. Without the proper balance of training, your sales people are at risk of failing on the job. Sales people who don’t know the fundamentals of selling are more likely to burnout, get frustrated, lose confidence, quit or worst – you fire them.
Going into the 4th quarter and on into 2011 there will be those that only “think about” improving sales effectiveness, those will be the companies that lose ground vs. those that act upon it. Companies that hunker down and cut investments in their sales teams’ effectiveness will watch the tail lights shrink in the distance of those competitors continuing to invest and improve.
2011 Sales Organization Goals
1. Increase sales professional revenue productivity
a. Increase sales revenues
b. Increase market share and share of wallet
c. Improve customer retention
d. Increase sales effectiveness
2. Reduce sales turnover
3. Improve access to key information
4. Revise or implement sales process
5. Improve margins
6. Decrease expenses
Surely companies will need to control expenses and wring out excesses (if any remain); but the answer, as with all aspect of a successful life, is balance. Initiating programs to increase your sales teams’ productivity and effectiveness is needed now more than ever. If you have recently evaluated and invested in your sales people’s education then you’re ahead of the game. But there is still plenty of room for improvement ahead. Recognize that whatever you have done until now has been enough to get you to here, but likely will not be enough to get you to there: there being where you want and need to be in twelve months.
There are many areas to measure when reflecting on how sales forces perform specific selling task during the sales cycle to educate the prospect, align solutions to needs, and win the business. Year over year, companies invest in sales training to teach sales executives the ability to understand the customers buying cycle.
A question many companies ask me when discussing sales education needs is the following “If I understand how my customers buy, can I sell with less effort?”
My research this past year shows that we at Strategy Development see some level of advantage attained in reducing the number of calls to close a deal through better understanding of buying trends. The real advantage though, is seen in the outcome of those sales opportunities. We see that sales executive win rates by companies who excel, or are adequate in this area are 12% higher than those companies that need improvement.
Taking the time to really understand how customers buy from you or a competitor seems to be well worth the investment. Buying processes can morph dramatically based on the changes in a customer’s industry. Take for example, the fact that some computer firms who generated a noticeable percentage of their revenues from financial institutions, they saw sales from those clients decrease in 2008 because of the subprime loans. Or consider the impact on pharmaceutical and health insurance firms with universal health care. If clients businesses change dramatically, the firms selling to them will see major changes in how they buy.
More than ever, there is a real payoff in acquiring marketplace knowledge (business acumen) about the customers upon whom your teams are calling. Figures from a recent CSO Insights survey show that if sales reps have been trained in marketplace knowledge (business acumen) and are willing to take the time to research accounts and apply what they’ve been taught (to speak about a customer’s industry), we will be able to impact their productivity through quota achievement and impact their ability to achieve income goals which directly ties into the ability for companies to retain personnel and reduce turnover. Companies focused on these areas of sales education see development in confidence for sales in analyzing customer needs and positioning products and services within the context of a buyer’s financial drivers and strategies. Armed with better business acumen, they demonstrate financial literacy in sales situations; engage in more strategic discussions with prospects, and open doors at higher buying levels. When sales training initiatives target marketplace knowledge (business acumen), sales personnel become better in offering products and services within the context of a customer’s real business needs. They become trusted partners as they develop long-term customer partnerships.
Strategy Development is a management consulting and advanced sales training firm with a focus to helping companies in the imaging space. Strategy Development advises companies on how to defend existing markets, assess entries into new ones, develop growth strategies, control costs and profitably invest resources. For more information on our strategic sales skills workshop and sales coaching consulting please contact me at ramos@strategydevelopment.org
Thursday, October 14, 2010
When the Going Gets Tough, Somehow or Other Perry Corporation Gets Growing
By Scott Cullen
Forget the doom and gloom and crying about the economy. You’re not going to see any of that at Perry Corporation in Lima, Ohio. No sir, Perry Corporation is rocking and rolling from every conceivable angle. Consider that its traditional MFP and service business is up about six percent over last year. How many dealerships in this day and age can lay claim to that? Meanwhile, the solutions division, which mainly sells archiving and workflow software is up 64 percent over last year. The goal was to grow this segment of the business by 50 percent, so things are even better than expected. And speaking of better than expected, managed print is up 321 percent, well above the 200 percent that was budgeted.
Perry Corporation services a wide variety of customers although they concentrate on certain verticals, notably education, healthcare, manufacturing, and local government.
Why do customers choose Perry Corporation?
“A lot of different reasons, but primarily because we have the cash reserves to fund them internally so there is no third party leasing company or bank involved, which gives us a ton of flexibility,” says Barry Clark, president. “We make it real simple for them. It’s a one-page contract, not 27 pages of terms and conditions. It’s just a simple, easy to understand, straightforward concept that we sell.”
It’s a new business environment and Clark concedes that customer expectations are changing, especially when it comes to dealerships like Perry Corporation who do more than just move boxes.
“If you’re still a box company, customer expectations have pretty much been the same, ‘I want a great price and great response times, etc., etc., etc.,’” he says. “As you broaden your product offerings, the bar keeps getting raised higher and higher.”
That higher bar means that with more complex product offerings, Perry has had to raise the level of competence and skill sets among its employees to better support their customer base.
“When you’re supporting someone’s network infrastructure for example, if that goes down it’s a lot more damaging to a client then when their MFP on the third floor is not working,” he explains. “Not only is a higher degree of care required because you’re getting into more mission critical areas of the organization, but they also looking to get the most out of what you’re providing them. The other big thing is adoption, they all want help in getting their employees to adopt the new technology.”
While some of those competencies and skill sets are home grown, Clark isn’t shy about searching elsewhere to acquire them, including strategic acquisitions that complement their core business.
Perry Corporation has acquired three companies in the past five years, including an IT firm.
“We’re diversifying more and more so we’re not dependent on one revenue stream for our growth,” explains Clark. “That was the reason for the IT acquisition.”
The acquisition of an IT company was a smooth move for an office technology company, particularly one that traditionally connects devices to a customer’s network and is responsible for supporting them as well. What Clark found was a company that designs, implements, and supports the IT infrastructure.
“It made sense to me since that’s a piece of the pie we want to provide,” says Clark. “There’s a lot of synergies and then again there’s not a lot in a sense. For example, in the IT world, the sales cycle is much longer. The due diligence, the surveying, whatever you want to call it, is much longer. Everything is longer and you might win a big deal and it might take you six months to complete the install. There’s really no lease expiration dates on an IT infrastructure.”
Besides the differences from a structural standpoint, there’s a whole different culture in place from a personnel perspective as well and that’s another reason why an IT acquisition fit the bill.
“When you try to meld a copier rep with an IT rep they have different objectives and goals,” notes Clark. “The way we’ve gotten around that is assign a highly specialized team that’s led by the VP of the copier division and VP of the IT division to big name accounts because that’s a more long-view strategy to approach those accounts compared to, ‘they have a lease coming due in three weeks, let’s see if we can go in and talk to them about their IT infrastructure.’
Having an IT element helps sets Perry Corporation apart from its competitors although the big boys like HP and Xerox now have that capability too.
“Ironically, we did that two years before they did,” says Clark.
With all the transitions that have taken place in the office technology business over the past 20 years—analog to digital, connectivity, solutions, MPS—which was the toughest for Perry Corporation?
“I think they’ve all been fairly difficult,” reflects Clark. “I’d be hard pressed to say one was harder than the other because with each one you have to develop a new business model and people have to get out of the box they were in.”
One of the plusses for Clark with any transition, including the most recent into managed print services is he has what he calls a ‘forward-thinking management team and forward-thinking employees.” That’s something not every legacy office technology dealership possesses. He also hasn’t been shy about going out and bringing in extra help, like Strategy Development, to help with not only the transition to MPS, but in identifying acquisition target to grow the business.
Strategy Development has also assisted Perry Corp. in putting management and sales operations processes in place to grow equipment revenue. Clark sought their expertise about a year and a half ago as hardware sales began declining.
“We were fortunate,” says Clark, “I know some dealers who lost, 20, 30, 40 points of percent of revenue. We didn’t decline that much, but we said, ‘most of our folks had never sold in a recession so let’s make sure there’s not a better way we can do this and Strategy Development showed us. It’s a lot of stuff we already knew and were already doing, but they were able to tie it together for us so it made more sense and became more of an executable strategy.”
Without giving away the store, one of the things Perry Corporation did was realign their individual sales territories. That was based on a Strategy Development MIF (Machines In Field) study and the notion that a rep needs a certain percentage of his territory to be existing customers to make a reasonable living and reduce turnover.
“It also helped us identify those reps that needed more help,” explains Clark.
MPS had been on Perry Corporation’s radar screen for some time, but they began taking it seriously in 2006. The acquisition of the IT company was not only part of their acquisition strategy, but their MPS strategy too. MPS is now Perry Corporation’s most profitable area.
“We’re up more than 300 percent from last year, but the net income is phenomenal,” beams Clark.
It’s not like moving into managed print was a walk in the park for Clark. He firmly believes it’s something that needs to be totally supported and communicated from the top down.
“You can’t just hand it off to a lieutenant and say ‘go make this happen,’” he says. “The executive team of the Perry Corporation was behind it 100 percent day in and day out. The second piece was we found the right person to run it. We didn’t think we could take one of our MFP sales managers and quickly get where we wanted to be, so we went out and found some new talent.”
A lot of the success is because Perry Corporation begins with the MPS message at C-level.
“When you start at the C-level, they get interested pretty quickly,” says Clark. “If you could throw around numbers like 25-30 percent savings over what they’re paying today, you can make a pretty compelling argument about the fact that you can reduce their costs without them having to buy anything—at least up front.”
Perry Corporation won’t pursue the engagement if they can’t get to that C-level person.
“We need their buy in, we need them to open the door, we need them to corral the troops to get the information we need to make a good presentation back to them,” says Clark. “We spend a lot of time and money on training how to get to a C-level person.”
Outside help from the likes of Strategy Development has provided Perry Corporation with strategies for reaching C-level executives as well as guidance on compensation plans. Without turning this into an advertorial for Strategy Development, it’s been a big help.
“We would certainly have taken much longer to get where we are today if we had not consulted with them two years ago,” reports Clark. “They’ve seen enough MPS accounts and have enough clients that do MPS, and have been for some time, they can steer you and you don’t have to do so much trial and error.”
Meanwhile, Clark expects MPS to continue to be the company’s fastest growing book of business.
“In the next five years we’d like to have 25 percent of our total revenue coming from MPS contracts.”
Now that his MPS business is booming, what does Clark know now that he wishes he knew when he started?
“I wished we would have started earlier,” he laughs.
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Forget the doom and gloom and crying about the economy. You’re not going to see any of that at Perry Corporation in Lima, Ohio. No sir, Perry Corporation is rocking and rolling from every conceivable angle. Consider that its traditional MFP and service business is up about six percent over last year. How many dealerships in this day and age can lay claim to that? Meanwhile, the solutions division, which mainly sells archiving and workflow software is up 64 percent over last year. The goal was to grow this segment of the business by 50 percent, so things are even better than expected. And speaking of better than expected, managed print is up 321 percent, well above the 200 percent that was budgeted.
Perry Corporation services a wide variety of customers although they concentrate on certain verticals, notably education, healthcare, manufacturing, and local government.
Why do customers choose Perry Corporation?
“A lot of different reasons, but primarily because we have the cash reserves to fund them internally so there is no third party leasing company or bank involved, which gives us a ton of flexibility,” says Barry Clark, president. “We make it real simple for them. It’s a one-page contract, not 27 pages of terms and conditions. It’s just a simple, easy to understand, straightforward concept that we sell.”
It’s a new business environment and Clark concedes that customer expectations are changing, especially when it comes to dealerships like Perry Corporation who do more than just move boxes.
“If you’re still a box company, customer expectations have pretty much been the same, ‘I want a great price and great response times, etc., etc., etc.,’” he says. “As you broaden your product offerings, the bar keeps getting raised higher and higher.”
That higher bar means that with more complex product offerings, Perry has had to raise the level of competence and skill sets among its employees to better support their customer base.
“When you’re supporting someone’s network infrastructure for example, if that goes down it’s a lot more damaging to a client then when their MFP on the third floor is not working,” he explains. “Not only is a higher degree of care required because you’re getting into more mission critical areas of the organization, but they also looking to get the most out of what you’re providing them. The other big thing is adoption, they all want help in getting their employees to adopt the new technology.”
While some of those competencies and skill sets are home grown, Clark isn’t shy about searching elsewhere to acquire them, including strategic acquisitions that complement their core business.
Perry Corporation has acquired three companies in the past five years, including an IT firm.
“We’re diversifying more and more so we’re not dependent on one revenue stream for our growth,” explains Clark. “That was the reason for the IT acquisition.”
The acquisition of an IT company was a smooth move for an office technology company, particularly one that traditionally connects devices to a customer’s network and is responsible for supporting them as well. What Clark found was a company that designs, implements, and supports the IT infrastructure.
“It made sense to me since that’s a piece of the pie we want to provide,” says Clark. “There’s a lot of synergies and then again there’s not a lot in a sense. For example, in the IT world, the sales cycle is much longer. The due diligence, the surveying, whatever you want to call it, is much longer. Everything is longer and you might win a big deal and it might take you six months to complete the install. There’s really no lease expiration dates on an IT infrastructure.”
Besides the differences from a structural standpoint, there’s a whole different culture in place from a personnel perspective as well and that’s another reason why an IT acquisition fit the bill.
“When you try to meld a copier rep with an IT rep they have different objectives and goals,” notes Clark. “The way we’ve gotten around that is assign a highly specialized team that’s led by the VP of the copier division and VP of the IT division to big name accounts because that’s a more long-view strategy to approach those accounts compared to, ‘they have a lease coming due in three weeks, let’s see if we can go in and talk to them about their IT infrastructure.’
Having an IT element helps sets Perry Corporation apart from its competitors although the big boys like HP and Xerox now have that capability too.
“Ironically, we did that two years before they did,” says Clark.
With all the transitions that have taken place in the office technology business over the past 20 years—analog to digital, connectivity, solutions, MPS—which was the toughest for Perry Corporation?
“I think they’ve all been fairly difficult,” reflects Clark. “I’d be hard pressed to say one was harder than the other because with each one you have to develop a new business model and people have to get out of the box they were in.”
One of the plusses for Clark with any transition, including the most recent into managed print services is he has what he calls a ‘forward-thinking management team and forward-thinking employees.” That’s something not every legacy office technology dealership possesses. He also hasn’t been shy about going out and bringing in extra help, like Strategy Development, to help with not only the transition to MPS, but in identifying acquisition target to grow the business.
Strategy Development has also assisted Perry Corp. in putting management and sales operations processes in place to grow equipment revenue. Clark sought their expertise about a year and a half ago as hardware sales began declining.
“We were fortunate,” says Clark, “I know some dealers who lost, 20, 30, 40 points of percent of revenue. We didn’t decline that much, but we said, ‘most of our folks had never sold in a recession so let’s make sure there’s not a better way we can do this and Strategy Development showed us. It’s a lot of stuff we already knew and were already doing, but they were able to tie it together for us so it made more sense and became more of an executable strategy.”
Without giving away the store, one of the things Perry Corporation did was realign their individual sales territories. That was based on a Strategy Development MIF (Machines In Field) study and the notion that a rep needs a certain percentage of his territory to be existing customers to make a reasonable living and reduce turnover.
“It also helped us identify those reps that needed more help,” explains Clark.
MPS had been on Perry Corporation’s radar screen for some time, but they began taking it seriously in 2006. The acquisition of the IT company was not only part of their acquisition strategy, but their MPS strategy too. MPS is now Perry Corporation’s most profitable area.
“We’re up more than 300 percent from last year, but the net income is phenomenal,” beams Clark.
It’s not like moving into managed print was a walk in the park for Clark. He firmly believes it’s something that needs to be totally supported and communicated from the top down.
“You can’t just hand it off to a lieutenant and say ‘go make this happen,’” he says. “The executive team of the Perry Corporation was behind it 100 percent day in and day out. The second piece was we found the right person to run it. We didn’t think we could take one of our MFP sales managers and quickly get where we wanted to be, so we went out and found some new talent.”
A lot of the success is because Perry Corporation begins with the MPS message at C-level.
“When you start at the C-level, they get interested pretty quickly,” says Clark. “If you could throw around numbers like 25-30 percent savings over what they’re paying today, you can make a pretty compelling argument about the fact that you can reduce their costs without them having to buy anything—at least up front.”
Perry Corporation won’t pursue the engagement if they can’t get to that C-level person.
“We need their buy in, we need them to open the door, we need them to corral the troops to get the information we need to make a good presentation back to them,” says Clark. “We spend a lot of time and money on training how to get to a C-level person.”
Outside help from the likes of Strategy Development has provided Perry Corporation with strategies for reaching C-level executives as well as guidance on compensation plans. Without turning this into an advertorial for Strategy Development, it’s been a big help.
“We would certainly have taken much longer to get where we are today if we had not consulted with them two years ago,” reports Clark. “They’ve seen enough MPS accounts and have enough clients that do MPS, and have been for some time, they can steer you and you don’t have to do so much trial and error.”
Meanwhile, Clark expects MPS to continue to be the company’s fastest growing book of business.
“In the next five years we’d like to have 25 percent of our total revenue coming from MPS contracts.”
Now that his MPS business is booming, what does Clark know now that he wishes he knew when he started?
“I wished we would have started earlier,” he laughs.
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Wednesday, October 13, 2010
How Do We Help Our Sales Force Become More Effective?
I recently read a great article in B to B Magazine titled “Been there sold that.” It wasn’t that a single sentence of the article was new information—as a member of a consulting and advanced training firm that spends a lot of our time helping technology companies improve their sales effectiveness we have great visibility into the sales practice—but the fact that the article focused on selling to CMOs and the advice from these CMOs to sales professionals was the exact same that we provide adds credibility to what we see:
• The number one frustration of the CMO was that the sales professional did not know their company
This is a common issue we find in our industry as well, with sales professionals at all levels of success. They simply do not take the time to get to know their customers and prospects. Decades ago all sales professionals were taught to engage in conversations on pain areas with the prospect but that was before the internet, and the plethora of information available to research. Take the time to understand your customer and prospect and how your offering will help them achieve their goals. The article, which is focused on the CMO, does quote an IDC survey of senior technology buyers that states sales professionals are “somewhat prepared” or “not prepared” 54% of the time. So more than half the time the sale is dead before it starts.
• Not listening during the sales presentation
This issue manifests itself in many forms. We see sales professional giving value propositions as a presentation rather than as a talking point, where the prospect spends at least 50% of the time talking. It is also common for the sales professional to speak about the benefits to their offering areas where the prospect has already said they adopted what the sales professional is selling—the sales professional doesn’t adjust.
• Buyers are looking for a sales professional that provide value and understand the customer’s need and the general environment of the vertical
The bottom line here is that buyers aren’t looking to get pitched; they are looking for sales professionals that understand their business and their problems and that can demonstrate how their product or service can help the buyer address their pain points.
• Buyers try to minimize meetings with sales people
A person in a position of authority is constantly asked for meetings, both internally and externally. If an senior manager or executive cannot manage their calendar they will absolutely fail, so getting a meeting is difficult. The number one approach to getting on that meeting is through networking. Build and leverage your network.
• Have relevant material available
Case studies specific to the industry you are calling on are critical.
• Going above the buyer in the organizational structure
I’ll simply take the sentence directly out of the article to demonstrate a point we try to emphasize all the time in our training. We learned this from two perspectives: The SD team are all former senior managers and executives, and we have been involved in a significant quantity of large complex sales. “Often the CEO is the approver, not the buyer. If you usurp the buying organization, they you have made enemies of the actual buyer.”
I also think the article does a great job in summarizing the points so I’ll simply give credit where credit is due and use the words of Mark Wilson, VP-corporate marketing at Sybase, Inc, “The most effective salespeople understand what our company does. They come in with an idea of how they can solve our problem. They are good at listening, and they continue to evolve how they can solve our problem in the meeting. They have a number of case studies, and they pick them intelligently for companies that face the same problems that map to ours.”
David Ramos developed a strategic sales skills workshop and I have to say his program is right on the money. It was developed using his significant experience in working with sales professionals in the technology industry but it is clear that there is nothing unique in our industry: sales professionals simply need an opportunity to learn how to sell in a complex environment. You can contact David to get information on his program at ramos@strategydevelopment.org
• The number one frustration of the CMO was that the sales professional did not know their company
This is a common issue we find in our industry as well, with sales professionals at all levels of success. They simply do not take the time to get to know their customers and prospects. Decades ago all sales professionals were taught to engage in conversations on pain areas with the prospect but that was before the internet, and the plethora of information available to research. Take the time to understand your customer and prospect and how your offering will help them achieve their goals. The article, which is focused on the CMO, does quote an IDC survey of senior technology buyers that states sales professionals are “somewhat prepared” or “not prepared” 54% of the time. So more than half the time the sale is dead before it starts.
• Not listening during the sales presentation
This issue manifests itself in many forms. We see sales professional giving value propositions as a presentation rather than as a talking point, where the prospect spends at least 50% of the time talking. It is also common for the sales professional to speak about the benefits to their offering areas where the prospect has already said they adopted what the sales professional is selling—the sales professional doesn’t adjust.
• Buyers are looking for a sales professional that provide value and understand the customer’s need and the general environment of the vertical
The bottom line here is that buyers aren’t looking to get pitched; they are looking for sales professionals that understand their business and their problems and that can demonstrate how their product or service can help the buyer address their pain points.
• Buyers try to minimize meetings with sales people
A person in a position of authority is constantly asked for meetings, both internally and externally. If an senior manager or executive cannot manage their calendar they will absolutely fail, so getting a meeting is difficult. The number one approach to getting on that meeting is through networking. Build and leverage your network.
• Have relevant material available
Case studies specific to the industry you are calling on are critical.
• Going above the buyer in the organizational structure
I’ll simply take the sentence directly out of the article to demonstrate a point we try to emphasize all the time in our training. We learned this from two perspectives: The SD team are all former senior managers and executives, and we have been involved in a significant quantity of large complex sales. “Often the CEO is the approver, not the buyer. If you usurp the buying organization, they you have made enemies of the actual buyer.”
I also think the article does a great job in summarizing the points so I’ll simply give credit where credit is due and use the words of Mark Wilson, VP-corporate marketing at Sybase, Inc, “The most effective salespeople understand what our company does. They come in with an idea of how they can solve our problem. They are good at listening, and they continue to evolve how they can solve our problem in the meeting. They have a number of case studies, and they pick them intelligently for companies that face the same problems that map to ours.”
David Ramos developed a strategic sales skills workshop and I have to say his program is right on the money. It was developed using his significant experience in working with sales professionals in the technology industry but it is clear that there is nothing unique in our industry: sales professionals simply need an opportunity to learn how to sell in a complex environment. You can contact David to get information on his program at ramos@strategydevelopment.org
Tuesday, October 5, 2010
BTA MPS Training Classes Scheduled for November in San Francisco for Operations & Service and Sales Professionals
Strategy Development is conducting the award winning BTA Managed Print Services (MPS) Operations and Service Workshop on November 3, concurrently with BTA MPS Sales Workshop on November 3-4, at the San Francisco Airport Marriott Courtyard. These courses meet the training requirements of the Kyocera Certified MPS Dealer Program.
Mike Woodard of Strategy Development created and instructs BTA MPS Operations and Service workshop, a course designed to jump-start your understanding of how to set up and manage all operational and service aspects of a MPS agreement. MPS is a go-to-market strategy that allows companies a robust and profitable relationship with your customers that generates a recurring revenue stream. Learn what you need to know for after the contract is signed that results in the added complexity to your back-office operations and to your service department.
Matt Mawby of Professional Business Systems said, “As a copier guy, this gave me an excellent service perspective on MPS. It was great to see the positive impact MPS brings to our service and operations."
Ron Fuhrman of Liberty Business Systems, had this to say, "This workshop helps to alleviate the angst of starting a successful MPS program and brought the project down to a simplistic, manageable process. The process, pricing and implementation ideas are well thought out."
BTA MPS Sales workshop teaches sales leaders (dealership principals, sales managers, vice presidents of sales, and print specialists) a systematic and proven methodology to establish and maintain a profitable MPS program. Uncover new revenue streams, significantly increase the quantity of captured prints, lock in customers, enable differentiation from competitors, and, ultimately, sell more hardware.
Industry veterans, Tom Callinan and Ed Carroll, will lead this course. Topics covered in the workshop include: understanding the print space (the opportunity, IT's involvement, the sales approach and target markets); getting the appointment; presenting a value proposition; how to conduct an assessment; developing a strategy and tactics; how to build a print management proposal that sells; pricing a print management contract; how to expand the opportunity after the sale; and preparing for quarterly business reviews.
Become your customer’s "single source" for optimizing printed pages and the hardware used to produce them. Your customer enjoys eliminating the need to deal with multiple vendors and invoices, leveraging the benefits of a holistic view of their entire document output fleet, saving time and money, while improving efficiencies.
Jerry Ehrhardt of TLC Office Systems recently attended this class and said, “This is a good training class with educational substance. The instructors were very informative and knowledgeable. It has provided me a process I can implement with ease.”
Rich Fryman of ABS Business Products commented, “Tom and Ed didn’t waste time on worthless information. They were able to recognize that some information was good to have however did not need to go over it, which saved time to cover and stay on the ‘nuts and bolts’ of the class.”
The instructors have not been taught the material; they developed it, and lived it firsthand. When not in the classroom, they are consulting for clients, so the content is always in proper alignment with current and impending trends.
For more information on the course, instructors, or to register for class, please click here for BTA MPS Operations and Service workshop or click here for BTA MPS Sales workshop.
Mike Woodard of Strategy Development created and instructs BTA MPS Operations and Service workshop, a course designed to jump-start your understanding of how to set up and manage all operational and service aspects of a MPS agreement. MPS is a go-to-market strategy that allows companies a robust and profitable relationship with your customers that generates a recurring revenue stream. Learn what you need to know for after the contract is signed that results in the added complexity to your back-office operations and to your service department.
Matt Mawby of Professional Business Systems said, “As a copier guy, this gave me an excellent service perspective on MPS. It was great to see the positive impact MPS brings to our service and operations."
Ron Fuhrman of Liberty Business Systems, had this to say, "This workshop helps to alleviate the angst of starting a successful MPS program and brought the project down to a simplistic, manageable process. The process, pricing and implementation ideas are well thought out."
BTA MPS Sales workshop teaches sales leaders (dealership principals, sales managers, vice presidents of sales, and print specialists) a systematic and proven methodology to establish and maintain a profitable MPS program. Uncover new revenue streams, significantly increase the quantity of captured prints, lock in customers, enable differentiation from competitors, and, ultimately, sell more hardware.
Industry veterans, Tom Callinan and Ed Carroll, will lead this course. Topics covered in the workshop include: understanding the print space (the opportunity, IT's involvement, the sales approach and target markets); getting the appointment; presenting a value proposition; how to conduct an assessment; developing a strategy and tactics; how to build a print management proposal that sells; pricing a print management contract; how to expand the opportunity after the sale; and preparing for quarterly business reviews.
Become your customer’s "single source" for optimizing printed pages and the hardware used to produce them. Your customer enjoys eliminating the need to deal with multiple vendors and invoices, leveraging the benefits of a holistic view of their entire document output fleet, saving time and money, while improving efficiencies.
Jerry Ehrhardt of TLC Office Systems recently attended this class and said, “This is a good training class with educational substance. The instructors were very informative and knowledgeable. It has provided me a process I can implement with ease.”
Rich Fryman of ABS Business Products commented, “Tom and Ed didn’t waste time on worthless information. They were able to recognize that some information was good to have however did not need to go over it, which saved time to cover and stay on the ‘nuts and bolts’ of the class.”
The instructors have not been taught the material; they developed it, and lived it firsthand. When not in the classroom, they are consulting for clients, so the content is always in proper alignment with current and impending trends.
For more information on the course, instructors, or to register for class, please click here for BTA MPS Operations and Service workshop or click here for BTA MPS Sales workshop.
Monday, September 27, 2010
Does your MPS program focus on CPP or TCO?
What’s the difference? It depends on who you ask.
In recent months there have been a number of blog postings focused on the subject of TCO (total cost of ownership) for MPS opportunities. In most cases the author’s belief is focusing on TCO, and not on CPP, is the best way to distinguish yourself from your competition. Most articles will compared the components of both CPP and TCO, and some will suggest that CPP programs only focus on supplies, parts and service and TCO focuses on all the true costs of managing the fleet: Items like paper, IT support, network cost, etc.
The articles/post/presentations usually conclude with, those who focus on TCO are looking at the whole picture and are perceived more favorably as business consultants/advisors, differentiating them from the competition, therefore ultimately winning more lucrative MPS opportunities.
In theory I would agree that the broader your viewpoint, i.e. assessment and review, the more positive you should be perceived by the prospects you are focused on ,and in doing so, you might increase your chances for signing more MPS agreements. The problem I have with most of the postings is that the basis of comparison is very short-sighted when it comes to what is included in a CPP and too broad when you focus on their definition of TCO.
If you are looking at a transactional CPP (device basis), it will most likely include only supplies, service and parts, and the comparison would be accurate. But, if you take this basis and compare it to costs related to managing a fleet of devices, it is not an accurate assessment. You are comparing apples to oranges.
For those who are familiar with the Strategy Development’s MPS model, as clients or through our workshops, you know that the focus of the assessment in an MPS opportunity is identifying and quantifying all expenses directly attributed to the managing of the fleet of devices that you will assume when the prospect moves forward with your proposal. It is fleet based, it captures toner usage, service expense, parts, acquisition costs, maintenance, inventory carrying costs, obsolescence, and IT support. It focuses on capturing all expenses related to the services you will assume when the contract is signed.
In turn you convert the sum of these expenses to a CPP, so your prospect has a clear understanding as to the cost of producing a document in their organization. In fact you are capturing the TCO (minus paper). You do not focus on expenses that are not impacted through the implementation of this outsource agreement. For example, paper and network costs are two expenses that are consistently mentioned as costs that should be included in the TCO. I disagree with this belief.
The reason paper is not included is pretty straight forward. It is difficult to monitor or control, it is a commodity that adds very little, if any, value to the agreement, and it is not going away. In fact more of it may disappear before it ever gets into the printing device, making pilferage a real challenge to control, so why would you want to include it?
Including the costs of the network might not be as straight forward as paper. Even though printers drain network resources (Information Week says that 55% of network traffic is attributed to printers) the reasons you should not include it in your analysis are 1) you are not assuming the responsibility for the network, 2) the infrastructure and cost are not going away at the time a MPS program is implemented, 3) attempting to capture something that is not going away and you are not assuming responsibility for, will add significant time to your sales cycle and possibly decrease your chances of getting the deal. Yes, it might distinguish you from the competition but will this distinction secure the opportunity and will the prospect provide their costs for this knowing that you are not taking over this responsibility? I think not.
In summary, if you follow the Strategy Development model and identify and propose your opportunity on a fleet based, blended CPP you are in fact providing your prospect with an analysis of all the services and expenses you are assuming (i.e. costs directly associated with managing the fleet of printers). What more do you need? This is a TCO for the services you will provide. Why would you see a need to take it further?
In recent months there have been a number of blog postings focused on the subject of TCO (total cost of ownership) for MPS opportunities. In most cases the author’s belief is focusing on TCO, and not on CPP, is the best way to distinguish yourself from your competition. Most articles will compared the components of both CPP and TCO, and some will suggest that CPP programs only focus on supplies, parts and service and TCO focuses on all the true costs of managing the fleet: Items like paper, IT support, network cost, etc.
The articles/post/presentations usually conclude with, those who focus on TCO are looking at the whole picture and are perceived more favorably as business consultants/advisors, differentiating them from the competition, therefore ultimately winning more lucrative MPS opportunities.
In theory I would agree that the broader your viewpoint, i.e. assessment and review, the more positive you should be perceived by the prospects you are focused on ,and in doing so, you might increase your chances for signing more MPS agreements. The problem I have with most of the postings is that the basis of comparison is very short-sighted when it comes to what is included in a CPP and too broad when you focus on their definition of TCO.
If you are looking at a transactional CPP (device basis), it will most likely include only supplies, service and parts, and the comparison would be accurate. But, if you take this basis and compare it to costs related to managing a fleet of devices, it is not an accurate assessment. You are comparing apples to oranges.
For those who are familiar with the Strategy Development’s MPS model, as clients or through our workshops, you know that the focus of the assessment in an MPS opportunity is identifying and quantifying all expenses directly attributed to the managing of the fleet of devices that you will assume when the prospect moves forward with your proposal. It is fleet based, it captures toner usage, service expense, parts, acquisition costs, maintenance, inventory carrying costs, obsolescence, and IT support. It focuses on capturing all expenses related to the services you will assume when the contract is signed.
In turn you convert the sum of these expenses to a CPP, so your prospect has a clear understanding as to the cost of producing a document in their organization. In fact you are capturing the TCO (minus paper). You do not focus on expenses that are not impacted through the implementation of this outsource agreement. For example, paper and network costs are two expenses that are consistently mentioned as costs that should be included in the TCO. I disagree with this belief.
The reason paper is not included is pretty straight forward. It is difficult to monitor or control, it is a commodity that adds very little, if any, value to the agreement, and it is not going away. In fact more of it may disappear before it ever gets into the printing device, making pilferage a real challenge to control, so why would you want to include it?
Including the costs of the network might not be as straight forward as paper. Even though printers drain network resources (Information Week says that 55% of network traffic is attributed to printers) the reasons you should not include it in your analysis are 1) you are not assuming the responsibility for the network, 2) the infrastructure and cost are not going away at the time a MPS program is implemented, 3) attempting to capture something that is not going away and you are not assuming responsibility for, will add significant time to your sales cycle and possibly decrease your chances of getting the deal. Yes, it might distinguish you from the competition but will this distinction secure the opportunity and will the prospect provide their costs for this knowing that you are not taking over this responsibility? I think not.
In summary, if you follow the Strategy Development model and identify and propose your opportunity on a fleet based, blended CPP you are in fact providing your prospect with an analysis of all the services and expenses you are assuming (i.e. costs directly associated with managing the fleet of printers). What more do you need? This is a TCO for the services you will provide. Why would you see a need to take it further?
Tuesday, September 21, 2010
Strategy Development Launches Strategic Selling Course
Web-Based or Onsite Training for Beginning and Intermediate Sales Professionals
Strategy Development is launching a strategic selling course designed for beginning and intermediate sales professionals. This course is available as an eight-week webinar series, with the first term starting Monday, October 25, 2010, or as an on-site, two-day workshop.
The most successful sales professionals possess solid skills in every aspect of the sales process. Undoubtedly, each individual on your sales team has strengths in certain areas. Formal education in a repeatable sales process will take them to new levels. This strategic selling training will reduce turnover and facilitate an increase in sales, including not only traditional hardware, but color, software and services.
The program is a comprehensive workshop in sales fundamentals that will develop and improve abilities for new account penetration, as well as selling more products and services into current accounts. Attendees will learn time and territory management; business acumen and decision maker motivations; prospecting; questioning and listening skills; initial sales call and presentation skills, proposal writing fundamentals, proficiency in negotiation, account planning and customer retention; as well as about maintaining the relationship.
Click here for a brief overview video of the class.
David Ramos, a sales operations consultant with Strategy Development, developed the curriculum and will lead the educational experience. David has over 15 years of experience in sales, sales management, and sales training development in the imaging industry. David was a top producing business development manager in both the U.S. and Mexico whose experience spans selling leading edge technologies, strategic marketing, and key account management.
In a pilot class, Rob Sloan, Vice President of Sales at OASYS, Inc. said, “My sales team and I came away feeling that the time was well spent. Some of the areas we found most beneficial were prospecting techniques, managed print services, presentation skills, and color opportunities and applications in today’s marketplace. The content was relevant to our industry today and provided information that my reps could use in the field right away. We look forward to your next visit.”
Kelly McDonald of Advanced Office Systems had this to say, “It was very, very, very beneficial. One of my main reluctances to pipeline management and territory management was lack of education. I entered all of my potential prospects/leads and it is great to see how much potential revenue I have coming in over the next year. I hope I can attend more of your workshops soon! I think Advanced Office Systems will now become Advanced AWESOME Systems.”
Strategy Development also offers a three-month training & coaching experience for your sales team. The program begins with individual and team assessments and goal setting. It incorporates instructor led training, coaching, self-study, and application assignments that address the unique strengths and challenges of the team.
Online and on-site each has its’ advantages. Reps can learn in one-hour weekly intervals that require no travel or time out of the field. Alternatively, experience the interactivity of breakout groups, exercises, and role-plays along with the top-notch presentations in a two-day on-site class. Custom classes can also be designed for your specific needs based upon subject matter and duration.
For more information, or to register please reach out to David at ramos@strategydevelopment.org.
Strategy Development is launching a strategic selling course designed for beginning and intermediate sales professionals. This course is available as an eight-week webinar series, with the first term starting Monday, October 25, 2010, or as an on-site, two-day workshop.
The most successful sales professionals possess solid skills in every aspect of the sales process. Undoubtedly, each individual on your sales team has strengths in certain areas. Formal education in a repeatable sales process will take them to new levels. This strategic selling training will reduce turnover and facilitate an increase in sales, including not only traditional hardware, but color, software and services.
The program is a comprehensive workshop in sales fundamentals that will develop and improve abilities for new account penetration, as well as selling more products and services into current accounts. Attendees will learn time and territory management; business acumen and decision maker motivations; prospecting; questioning and listening skills; initial sales call and presentation skills, proposal writing fundamentals, proficiency in negotiation, account planning and customer retention; as well as about maintaining the relationship.
Click here for a brief overview video of the class.
David Ramos, a sales operations consultant with Strategy Development, developed the curriculum and will lead the educational experience. David has over 15 years of experience in sales, sales management, and sales training development in the imaging industry. David was a top producing business development manager in both the U.S. and Mexico whose experience spans selling leading edge technologies, strategic marketing, and key account management.
In a pilot class, Rob Sloan, Vice President of Sales at OASYS, Inc. said, “My sales team and I came away feeling that the time was well spent. Some of the areas we found most beneficial were prospecting techniques, managed print services, presentation skills, and color opportunities and applications in today’s marketplace. The content was relevant to our industry today and provided information that my reps could use in the field right away. We look forward to your next visit.”
Kelly McDonald of Advanced Office Systems had this to say, “It was very, very, very beneficial. One of my main reluctances to pipeline management and territory management was lack of education. I entered all of my potential prospects/leads and it is great to see how much potential revenue I have coming in over the next year. I hope I can attend more of your workshops soon! I think Advanced Office Systems will now become Advanced AWESOME Systems.”
Strategy Development also offers a three-month training & coaching experience for your sales team. The program begins with individual and team assessments and goal setting. It incorporates instructor led training, coaching, self-study, and application assignments that address the unique strengths and challenges of the team.
Online and on-site each has its’ advantages. Reps can learn in one-hour weekly intervals that require no travel or time out of the field. Alternatively, experience the interactivity of breakout groups, exercises, and role-plays along with the top-notch presentations in a two-day on-site class. Custom classes can also be designed for your specific needs based upon subject matter and duration.
For more information, or to register please reach out to David at ramos@strategydevelopment.org.
Monday, September 20, 2010
Scarcity of Empties Causes Big Problems For Remanufacturers
By Charles Brewer
For the remanufacturing industry, a reliable supply of high-quality, empty cartridges is essential. Simply put: without a good source of empties, there can be no “remanufacturing.” For a variety of reasons, however, the supply of empties is drying up. The situation is serious and has already resulted in spot shortages and price increases. And it’s bound to only get worse.
All the complicated physics and chemistry involved in electrophotographic printing make remanufacturing toner cartridges technically challenging. Precision toners must be matched and qualified with various components like imaging drums and fusing units to get a reconditioned cartridge to work properly. If the toners and components don’t work flawlessly every time, it will be glaringly apparent in the output--especially if it’s a color job.
While the stuff that goes into a refurb cartridge is critical to its performance, the most precious raw material is the empty cartridge itself. The best empties are OEM cartridges that are used once, properly repackaged when depleted, and then returned for remanufacturing. Because these so-called “virgin empties”--or “virgin cores”-- have never been remanufactured, they retain the characteristics of a brand new cartridge. After remanufacturing, cores begin to deteriorate and parts no longer line up like they did originally so remanufacturers always try to use virgin cores. If not, there can be problems. The risk of toner leakage increases, for example, and the tolerances are less precise making it more difficult for components to perform properly.
Recent gains in market share by the remanufacturing industry has played a big part in the draining of the empties pool. The recession sent customers looking for less expensive consumables, and many turned to remans as an alternative to expensive OEM products. Sales of new OEM cartridges plunged, which reduced the number of empties entering the pool. Demand for remans was further fueled by ill-timed price increases by virtually all OEMs in late 2007 and early 2008. Then, various OEMs encountered logistical problems that led to OEM cartridge shortages, which further limited the number of new empties entering the supply of cores. The net result was that demand for remanufactured cartridges exploded just as the availability of empties dropped because OEMs were having an assortment of difficulties selling new cartridges.
Beyond the growing popularity of remanufactured cartridges, there are other factors at play limiting empties availability. For years, empties brokers kept remanufacturers supplied with virgin cores but that business has been encroached upon. Since the middle of the decade, OEMs and large remanufactures have successfully established their own large-scale collection programs and increasingly they’ve marginalized brokers. Supplies vendors--OEM and non-OEM alike--have have been able to woo the brokers‘ suppliers especially those in the channels. They’ve done a pretty good job “closing the loop” on spent cartridges, and while they are still far from 100%, the number of exhausted inkjet and toner cartridges being reclaimed by individual OEMs and remanufacturers is growing. Millions of cores that were once available to the remanufacturing industry at large through brokers are now being captured and retained for the exclusive use of only a few large companies.
OEMs have always put a lot of time and energy into collecting empty cores to keep them out of the hands of their archrivals, the remanufacturers. Every empty they collect is potentially one fewer remanufactured cartridge an OEM has to sell against. Because of the terms of their contracts, copier OEMs always had an advantage and could leverage their dealer channels and service technicians to get back empties. Because printers are sold outright, however, it wasn’t as easy for printer OEMs to get their empties back. For years, HP had collection rates of less than 50%, although I’m sure that has changed. HP has grown increasingly active in collections. It has partnered with Staples, for example, to collect empties at the office superstore’s retail outlets. The OEM also has opened separate inkjet and toner cartridge facilities to process millions of empties so the plastics can be recycled.
Thanks to its Prebate program, Lexmark has been perhaps the printer OEM most successful at getting its empties back. The firm has achieved return rates in excess of 80%. Through the program, which is now known as “Use and Return,” if a customer agrees to return the empty at the time of purchase, Lexmark provides a discounted price on certain replacement cartridges. Using a “shrink wrap” agreement commonly featured on software packaging, opening the box and using the cartridge creates a binding legal contract guaranteeing Lexmark gets its empty back.
Not only are the end users legally bound to return their Prebate cartridges, for years Lexmark contended that the deal extended its rights as a patent holder. The company claimed the Prebate contract under U.S. Patent law meant remanufacturing Prebate cartridges violated Lexmark’s intellectual property. Although remanufacturers scrupled with Lexmark’s interpretation of patent law, most were unwilling to risk a lawsuit so Lexmark retained the majority of the cartridge market for machines using Prebate replacement cartridges. Then, after years of legal wrangling, a U.S. federal district court determined in 2008 that the Prebate contract did not extend Lexmark’s patent rights, although the court indicated that the agreement satisfied the requirements of a binding contract. The firm says its Use and Return program is very popular with customers and they continue to honor the contract and return their empties.
As I mentioned earlier, large remanufacturers are also collecting empties by the millions. Take, for example, Clover Technologies. According to Golden Gate Capital, a private-equity group that purchased the remanufacturer in April, Clover has annual revenue in excess of $450 million. It is the largest remanufacturer in North America, perhaps in the world. Clover is a supplier of private-label products to wholesalers, distributors, and retailers and is believed to be a key vendor to office superstores including Staples and Office Depot. The relationships with the various channels provide Clover with the opportunity to collect a lot of empties. The company says it collects over 60 million spent cartridges each year and claims to be the industry’s “largest collector and remanufacturer of empty cartridges.”
In addition to collection programs run by OEM and non-OEM supplies vendors, U.S. patent law is also restricting the supply of cores in this country for remanufacturing. Under what is referred to as the “repair doctrine,” a cartridge can be repaired--or remanufactured--without violating any patents. This concept was worked out in the U.S. courts in the 1990s and it’s what keeps the remanufacturing industry out of legal troubles. Over the past eight years or so, however, the courts have added a wrinkle to the doctrine. They’ve ruled that the patent holder rights are only exhausted if the first sale of a product occurs within the U.S. If instead a cartridge is first sold outside of the country and is later remanufactured and sold in the U.S., the remanufacturer and its distributors have then violated any patents originally covering the cartridge. Strange but true!
Because case law has significantly changed the concept of patent right exhaustion after the first sale, the supply of empties that can be remanufactured and sold in the U.S. has been dramatically reduced. The change means that no empties can be imported and remanufactured for sale in the U.S. OEMs are vigilantly monitoring third-party supplies vendors to make sure none of them refill empties first purchased overseas and resell them in the U.S. Epson has already successfully sued a number of remanufacturers and their distributors for doing just that with empty Epson ink cartridges that were sold abroad. In August, Lexmark filed suit against 24 companies for selling or remanufacturing toner cartridges first sold outside of the country and imported for sale in the U.S.
The scarcity of empty cores has had an adverse impact on the remanufacturing industry. Supply and demand has driven core prices into the stratosphere. Depending on the SKU, some cores can cost 300 X what they cost several years ago--if you can get the core at all. Sensing growing desperation, some unscrupulous firms with injection-molding capabilities are offering “new plastic,” which are empty clone cores that trample on OEM IP and are direct knock-offs of the original cartridge.
It remains to be seen how the dire empties situation be resolved. For sure, it will force empties-starved firm to outsource production. So more small remanufacturers in the U.S. will change business models and become distributors, a trend that has been ongoing for years. In addition, big players will need to invest in their own programs and cozy up to firms in the channels that have access to empties. I would expect that more large remanufacturers will gobble up brokers, another trend that has been ongoing. And you can bet there will be more lawsuits--and plenty of them. Beyond those givens, it’s interesting to speculate. Could empties become so valuable that OEMs allow some cores to flow to a select few that are willing to pay a premium? Will the cost differential between legitimately remanufactured cartridges and OEM supplies close? If so, what happens to the remanufacturers’ value proposition? Or will the price of all consumables continue to rise? Only time will tell!
Charles Brewer is the President of Actionable Intelligence, a market research firm based outside of Boston, MA that follows the digital imaging hardware and consumables industry. Brewer previously served as Managing Editor for Lyra Research, a company which collaborates with imaging industry decision-makers worldwide, enabling clients to strengthen their market position and achieve profitable growth, where he wrote and managed a monthly newsletter.
For the remanufacturing industry, a reliable supply of high-quality, empty cartridges is essential. Simply put: without a good source of empties, there can be no “remanufacturing.” For a variety of reasons, however, the supply of empties is drying up. The situation is serious and has already resulted in spot shortages and price increases. And it’s bound to only get worse.
All the complicated physics and chemistry involved in electrophotographic printing make remanufacturing toner cartridges technically challenging. Precision toners must be matched and qualified with various components like imaging drums and fusing units to get a reconditioned cartridge to work properly. If the toners and components don’t work flawlessly every time, it will be glaringly apparent in the output--especially if it’s a color job.
While the stuff that goes into a refurb cartridge is critical to its performance, the most precious raw material is the empty cartridge itself. The best empties are OEM cartridges that are used once, properly repackaged when depleted, and then returned for remanufacturing. Because these so-called “virgin empties”--or “virgin cores”-- have never been remanufactured, they retain the characteristics of a brand new cartridge. After remanufacturing, cores begin to deteriorate and parts no longer line up like they did originally so remanufacturers always try to use virgin cores. If not, there can be problems. The risk of toner leakage increases, for example, and the tolerances are less precise making it more difficult for components to perform properly.
Recent gains in market share by the remanufacturing industry has played a big part in the draining of the empties pool. The recession sent customers looking for less expensive consumables, and many turned to remans as an alternative to expensive OEM products. Sales of new OEM cartridges plunged, which reduced the number of empties entering the pool. Demand for remans was further fueled by ill-timed price increases by virtually all OEMs in late 2007 and early 2008. Then, various OEMs encountered logistical problems that led to OEM cartridge shortages, which further limited the number of new empties entering the supply of cores. The net result was that demand for remanufactured cartridges exploded just as the availability of empties dropped because OEMs were having an assortment of difficulties selling new cartridges.
Beyond the growing popularity of remanufactured cartridges, there are other factors at play limiting empties availability. For years, empties brokers kept remanufacturers supplied with virgin cores but that business has been encroached upon. Since the middle of the decade, OEMs and large remanufactures have successfully established their own large-scale collection programs and increasingly they’ve marginalized brokers. Supplies vendors--OEM and non-OEM alike--have have been able to woo the brokers‘ suppliers especially those in the channels. They’ve done a pretty good job “closing the loop” on spent cartridges, and while they are still far from 100%, the number of exhausted inkjet and toner cartridges being reclaimed by individual OEMs and remanufacturers is growing. Millions of cores that were once available to the remanufacturing industry at large through brokers are now being captured and retained for the exclusive use of only a few large companies.
OEMs have always put a lot of time and energy into collecting empty cores to keep them out of the hands of their archrivals, the remanufacturers. Every empty they collect is potentially one fewer remanufactured cartridge an OEM has to sell against. Because of the terms of their contracts, copier OEMs always had an advantage and could leverage their dealer channels and service technicians to get back empties. Because printers are sold outright, however, it wasn’t as easy for printer OEMs to get their empties back. For years, HP had collection rates of less than 50%, although I’m sure that has changed. HP has grown increasingly active in collections. It has partnered with Staples, for example, to collect empties at the office superstore’s retail outlets. The OEM also has opened separate inkjet and toner cartridge facilities to process millions of empties so the plastics can be recycled.
Thanks to its Prebate program, Lexmark has been perhaps the printer OEM most successful at getting its empties back. The firm has achieved return rates in excess of 80%. Through the program, which is now known as “Use and Return,” if a customer agrees to return the empty at the time of purchase, Lexmark provides a discounted price on certain replacement cartridges. Using a “shrink wrap” agreement commonly featured on software packaging, opening the box and using the cartridge creates a binding legal contract guaranteeing Lexmark gets its empty back.
Not only are the end users legally bound to return their Prebate cartridges, for years Lexmark contended that the deal extended its rights as a patent holder. The company claimed the Prebate contract under U.S. Patent law meant remanufacturing Prebate cartridges violated Lexmark’s intellectual property. Although remanufacturers scrupled with Lexmark’s interpretation of patent law, most were unwilling to risk a lawsuit so Lexmark retained the majority of the cartridge market for machines using Prebate replacement cartridges. Then, after years of legal wrangling, a U.S. federal district court determined in 2008 that the Prebate contract did not extend Lexmark’s patent rights, although the court indicated that the agreement satisfied the requirements of a binding contract. The firm says its Use and Return program is very popular with customers and they continue to honor the contract and return their empties.
As I mentioned earlier, large remanufacturers are also collecting empties by the millions. Take, for example, Clover Technologies. According to Golden Gate Capital, a private-equity group that purchased the remanufacturer in April, Clover has annual revenue in excess of $450 million. It is the largest remanufacturer in North America, perhaps in the world. Clover is a supplier of private-label products to wholesalers, distributors, and retailers and is believed to be a key vendor to office superstores including Staples and Office Depot. The relationships with the various channels provide Clover with the opportunity to collect a lot of empties. The company says it collects over 60 million spent cartridges each year and claims to be the industry’s “largest collector and remanufacturer of empty cartridges.”
In addition to collection programs run by OEM and non-OEM supplies vendors, U.S. patent law is also restricting the supply of cores in this country for remanufacturing. Under what is referred to as the “repair doctrine,” a cartridge can be repaired--or remanufactured--without violating any patents. This concept was worked out in the U.S. courts in the 1990s and it’s what keeps the remanufacturing industry out of legal troubles. Over the past eight years or so, however, the courts have added a wrinkle to the doctrine. They’ve ruled that the patent holder rights are only exhausted if the first sale of a product occurs within the U.S. If instead a cartridge is first sold outside of the country and is later remanufactured and sold in the U.S., the remanufacturer and its distributors have then violated any patents originally covering the cartridge. Strange but true!
Because case law has significantly changed the concept of patent right exhaustion after the first sale, the supply of empties that can be remanufactured and sold in the U.S. has been dramatically reduced. The change means that no empties can be imported and remanufactured for sale in the U.S. OEMs are vigilantly monitoring third-party supplies vendors to make sure none of them refill empties first purchased overseas and resell them in the U.S. Epson has already successfully sued a number of remanufacturers and their distributors for doing just that with empty Epson ink cartridges that were sold abroad. In August, Lexmark filed suit against 24 companies for selling or remanufacturing toner cartridges first sold outside of the country and imported for sale in the U.S.
The scarcity of empty cores has had an adverse impact on the remanufacturing industry. Supply and demand has driven core prices into the stratosphere. Depending on the SKU, some cores can cost 300 X what they cost several years ago--if you can get the core at all. Sensing growing desperation, some unscrupulous firms with injection-molding capabilities are offering “new plastic,” which are empty clone cores that trample on OEM IP and are direct knock-offs of the original cartridge.
It remains to be seen how the dire empties situation be resolved. For sure, it will force empties-starved firm to outsource production. So more small remanufacturers in the U.S. will change business models and become distributors, a trend that has been ongoing for years. In addition, big players will need to invest in their own programs and cozy up to firms in the channels that have access to empties. I would expect that more large remanufacturers will gobble up brokers, another trend that has been ongoing. And you can bet there will be more lawsuits--and plenty of them. Beyond those givens, it’s interesting to speculate. Could empties become so valuable that OEMs allow some cores to flow to a select few that are willing to pay a premium? Will the cost differential between legitimately remanufactured cartridges and OEM supplies close? If so, what happens to the remanufacturers’ value proposition? Or will the price of all consumables continue to rise? Only time will tell!
Charles Brewer is the President of Actionable Intelligence, a market research firm based outside of Boston, MA that follows the digital imaging hardware and consumables industry. Brewer previously served as Managing Editor for Lyra Research, a company which collaborates with imaging industry decision-makers worldwide, enabling clients to strengthen their market position and achieve profitable growth, where he wrote and managed a monthly newsletter.
Tuesday, September 7, 2010
David Factor, Former OKI Channel Manager, Named Director of Business Development
We are pleased to announce that David Factor has joined the firm as Director of Business Development. In this role, David will lead the growth efforts at Strategy Development.
Factor has an extensive background in the imaging industry having spent 18 years at Oki Data Americas, most recently as National Sales Director. In this role, Factor developed business plans and strategies to enter the MFP business in 2004 and provided executive sales leadership for development of OKI’s managed print services strategy. Factor held numerous positions of increasing responsibility at OKI including district sales manager and national sales manager of the fax division prior to his role as national sales director.
“David Factor is well respected in the BTA and VAR channels having a long history of helping the dealer/reseller channel grow,” said Tom Callinan, managing principal of Strategy Development. “David knows the channel, understands how to help dealers/resellers grow revenue and profitability, and will be a significant asset in helping Strategy Development reach the many companies that have reached out to us for our consulting and training expertise. I am excited to have David join the firm as Director of Business Development.”
“I am thrilled to be joining the strongest team of consultants in the imaging business,” commented David Factor. “Having been exposed to the Strategy Development team members in the past, I know there is no better group at growing top and bottom line business results and their position as the industry leading MPS consultancy, the most notable growth strategy in years, is exciting. I also look forward to seeing many of my old dealer friends from the OKI days.”
David can be contacted at (908) 336-8147or factor@strategydevelopment.org.
Factor has an extensive background in the imaging industry having spent 18 years at Oki Data Americas, most recently as National Sales Director. In this role, Factor developed business plans and strategies to enter the MFP business in 2004 and provided executive sales leadership for development of OKI’s managed print services strategy. Factor held numerous positions of increasing responsibility at OKI including district sales manager and national sales manager of the fax division prior to his role as national sales director.
“David Factor is well respected in the BTA and VAR channels having a long history of helping the dealer/reseller channel grow,” said Tom Callinan, managing principal of Strategy Development. “David knows the channel, understands how to help dealers/resellers grow revenue and profitability, and will be a significant asset in helping Strategy Development reach the many companies that have reached out to us for our consulting and training expertise. I am excited to have David join the firm as Director of Business Development.”
“I am thrilled to be joining the strongest team of consultants in the imaging business,” commented David Factor. “Having been exposed to the Strategy Development team members in the past, I know there is no better group at growing top and bottom line business results and their position as the industry leading MPS consultancy, the most notable growth strategy in years, is exciting. I also look forward to seeing many of my old dealer friends from the OKI days.”
David can be contacted at (908) 336-8147or factor@strategydevelopment.org.
Tuesday, August 31, 2010
BTA MPS Sales and BTA Sales Management Training Classes Scheduled for October in New Orleans
Strategy Development is conducting the award winning BTA Managed Print Services (MPS) Sales Workshop on October 11-12, followed by the BTA Sales Management Workshop on October 13-14, in New Orleans, LA at the JW Marriott.
BTA MPS Sales workshop teaches sales leaders (dealership principals, sales managers, vice presidents of sales, and print specialists) a systematic and proven methodology to establish and maintain a profitable MPS program. Uncover new revenue streams, significantly increase the quantity of captured prints, lock in customers, enable differentiation from competitors, and, ultimately, sell more hardware. Tom Callinan and Ed Carroll, will lead this course. Topics covered in the workshop include: understanding the print space (the opportunity, IT's involvement, the sales approach and target markets); getting the appointment; presenting a value proposition; how to conduct an assessment; developing a strategy and tactics; how to build a print management proposal that sells; pricing a print management contract; how to expand the opportunity after the sale; and preparing for quarterly business reviews.
Become your customer’s "single source" for optimizing printed pages and the hardware used to produce them. Your customer enjoys eliminating the need to deal with multiple vendors and invoices, leveraging the benefits of a holistic view of their entire document output fleet, saving time and money, while improving efficiencies.
Jerry Ehrhardt of TLC Office Systems recently attended this class and said, “This is a good training class with educational substance. The instructors were very informative and knowledgeable. It has provided me a process I can implement with ease.”
Rich Fryman of ABS Business Products commented, “Tom and Ed didn’t waste time on worthless information. They were able to recognize that some information was good to have however did not need to go over it, which saved time to cover and stay on the ‘nuts and bolts’ of the class.”
BTA Sales Management Workshop, led by Ed Carroll, is two full days of how to improve sales effectiveness, reduce turnover and drive market share gains. Regardless of if, you are a new sales manager or have been managing for decades, this course provides a framework, process and tools to develop and refine your approach. The combination of a classroom setting for the theory and interactive breakout sessions to learn how to implement these tactics is a proven recipe for success.
Learn how to build effective sales teams, on boarding and training, designing individual development plans, territory design and management, account planning and penetration, quality field time, effective forecasting, as well as MPS and equipment pipeline growth.
Ron Rasberry of Advanced Office Systems said, "There are very few industry-specific workshops available today that focus on sales management. Perhaps this is because there are very few trainers and consultants around who have weathered the storm of change that our industry continually goes through. The Strategy Development team 'gets it.' They know what the 21st-century model dealership, sales manager, and strategic industry directions look like. More importantly, they are able to deliver this knowledge along with specific measurable performance standards that I believe every independent dealership can implement and expect to see improved business results."
Melanie Boyes of Blue Technologies commented, “I know I will double my productivity, activity and pipeline growth within eighteen months, if not sooner.”
Tom and Ed have not been taught the material; they developed it, and lived it firsthand. When not in the classroom, they are consulting for clients, so the content is always in proper alignment with current and impending trends.
For more information on the course, instructors, or to register for class, please click here for BTA MPS Sales Workshop or click here for BTA Sales Management. As a special note, BTA members may use their $250 coupons if booked on or before Friday, Sept. 24, 2010.
BTA MPS Sales workshop teaches sales leaders (dealership principals, sales managers, vice presidents of sales, and print specialists) a systematic and proven methodology to establish and maintain a profitable MPS program. Uncover new revenue streams, significantly increase the quantity of captured prints, lock in customers, enable differentiation from competitors, and, ultimately, sell more hardware. Tom Callinan and Ed Carroll, will lead this course. Topics covered in the workshop include: understanding the print space (the opportunity, IT's involvement, the sales approach and target markets); getting the appointment; presenting a value proposition; how to conduct an assessment; developing a strategy and tactics; how to build a print management proposal that sells; pricing a print management contract; how to expand the opportunity after the sale; and preparing for quarterly business reviews.
Become your customer’s "single source" for optimizing printed pages and the hardware used to produce them. Your customer enjoys eliminating the need to deal with multiple vendors and invoices, leveraging the benefits of a holistic view of their entire document output fleet, saving time and money, while improving efficiencies.
Jerry Ehrhardt of TLC Office Systems recently attended this class and said, “This is a good training class with educational substance. The instructors were very informative and knowledgeable. It has provided me a process I can implement with ease.”
Rich Fryman of ABS Business Products commented, “Tom and Ed didn’t waste time on worthless information. They were able to recognize that some information was good to have however did not need to go over it, which saved time to cover and stay on the ‘nuts and bolts’ of the class.”
BTA Sales Management Workshop, led by Ed Carroll, is two full days of how to improve sales effectiveness, reduce turnover and drive market share gains. Regardless of if, you are a new sales manager or have been managing for decades, this course provides a framework, process and tools to develop and refine your approach. The combination of a classroom setting for the theory and interactive breakout sessions to learn how to implement these tactics is a proven recipe for success.
Learn how to build effective sales teams, on boarding and training, designing individual development plans, territory design and management, account planning and penetration, quality field time, effective forecasting, as well as MPS and equipment pipeline growth.
Ron Rasberry of Advanced Office Systems said, "There are very few industry-specific workshops available today that focus on sales management. Perhaps this is because there are very few trainers and consultants around who have weathered the storm of change that our industry continually goes through. The Strategy Development team 'gets it.' They know what the 21st-century model dealership, sales manager, and strategic industry directions look like. More importantly, they are able to deliver this knowledge along with specific measurable performance standards that I believe every independent dealership can implement and expect to see improved business results."
Melanie Boyes of Blue Technologies commented, “I know I will double my productivity, activity and pipeline growth within eighteen months, if not sooner.”
Tom and Ed have not been taught the material; they developed it, and lived it firsthand. When not in the classroom, they are consulting for clients, so the content is always in proper alignment with current and impending trends.
For more information on the course, instructors, or to register for class, please click here for BTA MPS Sales Workshop or click here for BTA Sales Management. As a special note, BTA members may use their $250 coupons if booked on or before Friday, Sept. 24, 2010.
Monday, August 30, 2010
Frank Gaspari Looks to Separate FlexPrint from the MPS Clutter
By Scott Cullen
Frank Gaspari, CEO of FlexPrint, a national provider of document management and managed print solutions, is a straight shooter. Ask him a question and he doesn’t mince words. If you’re a copier dealer, copier manufacturer, or an MPS provider with a thin skin, you might want to stop right here and find something else to do because if you continue reading, Gaspari may say something that will ruffle your feathers.
There’s no denying Gaspari’s a successful entrepreneur and FlexPrint has enjoyed 700 percent year-over-year growth since its founding in 2005. No wonder the company was recently ranked by Inc. magazine as the 423rd fastest growing company in the nation. Prior to FlexPrint, Gaspari founded Column Office Equipment in Chicago in the early ‘90s. That company also made it onto the Inc. 500 before being acquired by Global Imaging Systems in 1999. Next up for Gaspari was a print management company, Image Manufacturing, which was also acquired by Global Imaging Systems.
Although FlexPrint started as a managed print services company, it does so much more than that. Strategically that makes a lot of sense because Gaspari is not a fan of the term, ‘managed print services’. We’ll give him an opportunity to explain an opinion, which borders on heresy in the document management world, later. In addition to its home base in Phoenix, Arizona, FlexPrint has more than 100 employees, offices in Los Angeles and Chicago, and supports hundreds of customers in 45 markets across the country.
How’s business?
Gaspari: Awesome, we’re growing, man. Business through the first six months is up a little over 40 percent compared to last year.
Who are your customers?
Gaspari: We have more than 300 customers coast to coast in every vertical industry. We focus on best in class companies with 200 to 30,000 employees, a lot of devices, and multiple locations. We’re not interested in doing business with the doctor’s office next door or ABC company that has five copiers and 10 printers. That’s not our business model. We want to engage with people where we can make a measurable impact and that’s typically an organization with a lot of devices and multiple locations, and who need a consultant to help manage this piece of the business.
Why do customers like doing business with Flexprint?
Gaspari: They choose us for our value proposition and our people.
When you say, ‘value proposition,’ what do you mean by that?
Gaspari: It’s different for every client. We’re not a managed print services company. We’re not a copier company. We’re what the customer’s pain and need dictates. We do a good job of analyzing what’s going on within their organization, understanding their business, and understanding what they need. We don’t have a cookie-cutter type of business model. I think some clients are more in tune with cost savings, so we can help customers there. Some are looking for process improvement, so we can help there. Some are focused on green initiatives and we can help them there. Some are interested in eliminating unnecessary discretionary printing, and we can help them there. And some of our customers are interested in all those things.
Who are your competitors?
Gaspari: We have all sorts of competitors. To be honest with you, there’s a clutter of me-too companies. There’s a clutter of people that want to simply move devices and a clutter of people that want to get into the space. A lot of the people who are getting into the space are grossly uneducated and they’re just diving into it because they’re being told that’s what they have to do. There are the copier people who are figuring out how to get into this space and some big VARs getting into this space. We’re not perfect, but I think we’re a few steps ahead of the clutter. And I put most in the clutter. That’s who we deal with every day.
What did you learn from your experience as an office equipment dealer that was helpful when starting FlexPrint?
Gaspari: What I learned was no matter how you spin it, copiers are a commodity and everybody sells the relationship and the service, and it’s all about price. What I saw happening before starting FlexPrint was printers popping up all over the place, and that gave me an opportunity to present a managed print program. What I learned from those two things is that you truly have to do what you say you’re going to do. You have to take a consultative approach and that means you don’t have any distractions as it relates to equipment, manufacturer relationships, quotas, any of that “stuff” that’s going to drive you to a decision that isn’t customer focused.
You don’t like to use the term managed print. Is that because it’s a buzz word that everybody’s using or is it too limiting?
Gaspari: Both of those reasons. It puts us in the bucket with everybody else. When we started, we were a managed print services company, but we don’t want to be in that bucket now because we do so much more than everyone else.
What is the biggest challenge of doing what you do, especially since you’re doing so much more than managed print?
Gaspari: As managed print continues to grow and become a bigger and bigger industry, separating ourselves on the initial phone call and the initial meeting from the clutter. It’s very difficult to do over the phone. Five years ago when we started no one was talking about this and it was a lot easier to get a meeting. Today, everyone is talking about it, they’re doing this, this, and this, and they’re stealing from somebody’s Website and this is the value proposition and the customer is like, ‘I’ve heard ten of these pitches, I’m not interested.’
Our biggest challenge is continuing to reinvent ourselves and bring measurable new value propositions to our customers to stay ahead of the clutter. Not just from a marketing perspective, but from a measurable, tangible results driven base to the customer. When you say, ‘What do we do for our customers?’ We do a lot of things. I would tell you that part of my job, which is completely different from what it was when I was with a copier company, is strategizing the space and looking at what else I can do to add more value to my customers. That’s a big deal because I have to stay ahead of the clutter. I have to bring them more value, measurable value, and that’s a challenge. One person I really depend onto assist me in this area is Tom Callinan of Strategy Development. Tom is a great resource for me and I seek his advice on many major decisions.
Tell me a little more about the environmental component you bring to the table?
Gaspari: The reality is it’s not a marketing line on a brochure or something we just talk about with no measurable deliverable for the customer. We’ve been talking about the green impact for the last three years. Number one is educating the customer about the amount of waste that goes into this part of their business as it relates to sustainability. Some customers don’t care. For some customers a green initiative is saving money. To educate them we have to show them how we can drive results. ‘If you’re interested in having a more sustainable, greener environment, this is what it means and here’s how we can deliver that for you.’ That continues to change and evolve as new technology comes to the table.
A lot has to do with paper reduction. Part of that value proposition, which is an oxymoron for a company that gets paid whenever you print, is eliminating print volume within our customers if they’re interested. Some don’t care about eliminating print, like a law firm because they’re billing back for everything. But some customers with a lot of discretionary printing are interested in a measurable program that eliminates printing year over year.
Where did the concept for going off in this all encompassing direction and starting Flexprint come from?
Gaspari: Before I started this I took a little time off to analyze my previous businesses and what I wanted to do. It came from two things; I looked at the market place and I knew that my biggest competition would be the status quo. I left Chicago to start this 2,000 miles away in Arizona—new people, new market, and there was no one else doing this—but I realized there was a huge opportunity for the right type of company.
Back then it was an aggressive company, forward thinking—one that would engage with a company like us. Part of it was, I saw the opportunity with my years of experience in this space and I knew it would be a lot harder from the perspective, it’s not a commodity, it’s not something you’re used to doing now, so you’re going to have to beat it home real hard, but as long as you have the right business model and value proposition, it could be done.
The other thing, aside from being a profitable business model, which as an entrepreneur you have to have, the other thing is the customer experience in this space is a great thing. Because of what we do and the relationship you have with them is not always bliss, but for the most part it’s a great relationship. It’s like selling a yacht; they love you versus selling a bunch of copiers or toner or whatever the hell you’re doing because you do a great service for them. In a company like us that prides ourselves in doing what we say we’re going to do, that was important to me. After 16 years of owning two companies, it wasn’t just about the money. I really wanted to do something that I enjoy doing every day.
How do you see your business growing over the next three to five years?
Gaspari: I recently hired a President and COO that freed up my time and now my focus is on really driving the business. It’s going to be difficult, but I believe with our real strong back end in 30-36 months from now we’ll be twice the size in revenue.
Beyond that any other thoughts on how Flexprint will change during the next 30-36 months?
Gaspari: We’ll definitely change. If we don’t, we’re not going to double our sales. We’ll add more components to our value proposition and probably get further away from managed print services, not that we won’t be associated with it. We’ve got to be because there are more people searching that [online], but our challenge is finding real measurable ways to add more value in the document output space within the client’s infrastructure. That will be the biggest change.
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Frank Gaspari, CEO of FlexPrint, a national provider of document management and managed print solutions, is a straight shooter. Ask him a question and he doesn’t mince words. If you’re a copier dealer, copier manufacturer, or an MPS provider with a thin skin, you might want to stop right here and find something else to do because if you continue reading, Gaspari may say something that will ruffle your feathers.
There’s no denying Gaspari’s a successful entrepreneur and FlexPrint has enjoyed 700 percent year-over-year growth since its founding in 2005. No wonder the company was recently ranked by Inc. magazine as the 423rd fastest growing company in the nation. Prior to FlexPrint, Gaspari founded Column Office Equipment in Chicago in the early ‘90s. That company also made it onto the Inc. 500 before being acquired by Global Imaging Systems in 1999. Next up for Gaspari was a print management company, Image Manufacturing, which was also acquired by Global Imaging Systems.
Although FlexPrint started as a managed print services company, it does so much more than that. Strategically that makes a lot of sense because Gaspari is not a fan of the term, ‘managed print services’. We’ll give him an opportunity to explain an opinion, which borders on heresy in the document management world, later. In addition to its home base in Phoenix, Arizona, FlexPrint has more than 100 employees, offices in Los Angeles and Chicago, and supports hundreds of customers in 45 markets across the country.
How’s business?
Gaspari: Awesome, we’re growing, man. Business through the first six months is up a little over 40 percent compared to last year.
Who are your customers?
Gaspari: We have more than 300 customers coast to coast in every vertical industry. We focus on best in class companies with 200 to 30,000 employees, a lot of devices, and multiple locations. We’re not interested in doing business with the doctor’s office next door or ABC company that has five copiers and 10 printers. That’s not our business model. We want to engage with people where we can make a measurable impact and that’s typically an organization with a lot of devices and multiple locations, and who need a consultant to help manage this piece of the business.
Why do customers like doing business with Flexprint?
Gaspari: They choose us for our value proposition and our people.
When you say, ‘value proposition,’ what do you mean by that?
Gaspari: It’s different for every client. We’re not a managed print services company. We’re not a copier company. We’re what the customer’s pain and need dictates. We do a good job of analyzing what’s going on within their organization, understanding their business, and understanding what they need. We don’t have a cookie-cutter type of business model. I think some clients are more in tune with cost savings, so we can help customers there. Some are looking for process improvement, so we can help there. Some are focused on green initiatives and we can help them there. Some are interested in eliminating unnecessary discretionary printing, and we can help them there. And some of our customers are interested in all those things.
Who are your competitors?
Gaspari: We have all sorts of competitors. To be honest with you, there’s a clutter of me-too companies. There’s a clutter of people that want to simply move devices and a clutter of people that want to get into the space. A lot of the people who are getting into the space are grossly uneducated and they’re just diving into it because they’re being told that’s what they have to do. There are the copier people who are figuring out how to get into this space and some big VARs getting into this space. We’re not perfect, but I think we’re a few steps ahead of the clutter. And I put most in the clutter. That’s who we deal with every day.
What did you learn from your experience as an office equipment dealer that was helpful when starting FlexPrint?
Gaspari: What I learned was no matter how you spin it, copiers are a commodity and everybody sells the relationship and the service, and it’s all about price. What I saw happening before starting FlexPrint was printers popping up all over the place, and that gave me an opportunity to present a managed print program. What I learned from those two things is that you truly have to do what you say you’re going to do. You have to take a consultative approach and that means you don’t have any distractions as it relates to equipment, manufacturer relationships, quotas, any of that “stuff” that’s going to drive you to a decision that isn’t customer focused.
You don’t like to use the term managed print. Is that because it’s a buzz word that everybody’s using or is it too limiting?
Gaspari: Both of those reasons. It puts us in the bucket with everybody else. When we started, we were a managed print services company, but we don’t want to be in that bucket now because we do so much more than everyone else.
What is the biggest challenge of doing what you do, especially since you’re doing so much more than managed print?
Gaspari: As managed print continues to grow and become a bigger and bigger industry, separating ourselves on the initial phone call and the initial meeting from the clutter. It’s very difficult to do over the phone. Five years ago when we started no one was talking about this and it was a lot easier to get a meeting. Today, everyone is talking about it, they’re doing this, this, and this, and they’re stealing from somebody’s Website and this is the value proposition and the customer is like, ‘I’ve heard ten of these pitches, I’m not interested.’
Our biggest challenge is continuing to reinvent ourselves and bring measurable new value propositions to our customers to stay ahead of the clutter. Not just from a marketing perspective, but from a measurable, tangible results driven base to the customer. When you say, ‘What do we do for our customers?’ We do a lot of things. I would tell you that part of my job, which is completely different from what it was when I was with a copier company, is strategizing the space and looking at what else I can do to add more value to my customers. That’s a big deal because I have to stay ahead of the clutter. I have to bring them more value, measurable value, and that’s a challenge. One person I really depend onto assist me in this area is Tom Callinan of Strategy Development. Tom is a great resource for me and I seek his advice on many major decisions.
Tell me a little more about the environmental component you bring to the table?
Gaspari: The reality is it’s not a marketing line on a brochure or something we just talk about with no measurable deliverable for the customer. We’ve been talking about the green impact for the last three years. Number one is educating the customer about the amount of waste that goes into this part of their business as it relates to sustainability. Some customers don’t care. For some customers a green initiative is saving money. To educate them we have to show them how we can drive results. ‘If you’re interested in having a more sustainable, greener environment, this is what it means and here’s how we can deliver that for you.’ That continues to change and evolve as new technology comes to the table.
A lot has to do with paper reduction. Part of that value proposition, which is an oxymoron for a company that gets paid whenever you print, is eliminating print volume within our customers if they’re interested. Some don’t care about eliminating print, like a law firm because they’re billing back for everything. But some customers with a lot of discretionary printing are interested in a measurable program that eliminates printing year over year.
Where did the concept for going off in this all encompassing direction and starting Flexprint come from?
Gaspari: Before I started this I took a little time off to analyze my previous businesses and what I wanted to do. It came from two things; I looked at the market place and I knew that my biggest competition would be the status quo. I left Chicago to start this 2,000 miles away in Arizona—new people, new market, and there was no one else doing this—but I realized there was a huge opportunity for the right type of company.
Back then it was an aggressive company, forward thinking—one that would engage with a company like us. Part of it was, I saw the opportunity with my years of experience in this space and I knew it would be a lot harder from the perspective, it’s not a commodity, it’s not something you’re used to doing now, so you’re going to have to beat it home real hard, but as long as you have the right business model and value proposition, it could be done.
The other thing, aside from being a profitable business model, which as an entrepreneur you have to have, the other thing is the customer experience in this space is a great thing. Because of what we do and the relationship you have with them is not always bliss, but for the most part it’s a great relationship. It’s like selling a yacht; they love you versus selling a bunch of copiers or toner or whatever the hell you’re doing because you do a great service for them. In a company like us that prides ourselves in doing what we say we’re going to do, that was important to me. After 16 years of owning two companies, it wasn’t just about the money. I really wanted to do something that I enjoy doing every day.
How do you see your business growing over the next three to five years?
Gaspari: I recently hired a President and COO that freed up my time and now my focus is on really driving the business. It’s going to be difficult, but I believe with our real strong back end in 30-36 months from now we’ll be twice the size in revenue.
Beyond that any other thoughts on how Flexprint will change during the next 30-36 months?
Gaspari: We’ll definitely change. If we don’t, we’re not going to double our sales. We’ll add more components to our value proposition and probably get further away from managed print services, not that we won’t be associated with it. We’ve got to be because there are more people searching that [online], but our challenge is finding real measurable ways to add more value in the document output space within the client’s infrastructure. That will be the biggest change.
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Wednesday, August 25, 2010
An SOS from AOS Raises the Performance of its Service Operation to the Next Level
By Scott Cullen
Ask any office equipment dealer what sets them apart from competitors or why customers like doing business with them and service will inevitably be one of the first things mentioned. Having an efficient service operation is critical to the success of every office technology dealership, including American Office Solutions (AOS) in Clarklake, Michigan.
Founded in 1969, AOS serves Lansing, Jackson, Adrian, and the surrounding areas and has a reputation for placing customers first. True, that’s something most dealerships claim to do too, but AOS consistently delivers on that promise.
“When AOS makes a commitment, whether it’s price of new equipment, service or a solution, we live up to that commitment,” says AOS President & CEO Ted McEldowney. “There are no surprises, no hidden costs, no fees. We do what we say we’re going to do for the price agreed upon.”
The company offers the obligatory selection of office technology with its primary vendors Sharp and HP. Understanding that an office technology dealership can’t survive on hardware alone, AOS also offers an array of services and is a HP certified printer servicing dealership.
As important as service is to AOS, and as good a job as AOS was doing, it was clear to McEldowney that it could do much better. They didn’t have written procedures for technicians to follow, nor did they have performance guidelines for technicians, both important for creating a top-notch service organization.
“The biggest obstacle was confirming the daily actions and job descriptions of our service staff from the delivery person to the service manager to make sure that the quality of service was at the highest standard possible,” explains McEldowney.
The writing was clearly on the wall that improvements were in order based on the data AOS was getting back from BEI Services, a provider of copier and service department benchmarking solutions.
“As we reviewed some of the reports from our ERP as well as NEXTGEN, Lacrosse, and MWAi, we found we didn’t know which reports were important to us and our goal of improving service for our clients as well as the profitability of our service operation,” recalls McEldowney.
Once these issues were confirmed in black and white, McEldowney realized he needed outside help to get his service operation back on track. He turned to Strategy Development who came in and showed AOS which measurable reports to use and assisted them in creating a total call procedure, which when followed correctly greatly improved the quality of service. In addition, Strategy Development helped define technician job responsibilities as well as implement a formal performance management process focusing on continuous improvement.
“They made it very easy by creating an action plan for us to follow,” adds McEldowney. "The plan includes all the reports and documentation to support that decision with a description of how all this information should flow together daily, weekly, monthly, quarterly, and annually.”
Sharing information and progress with service techs was also instrumental in moving things in the right direction.
“We worked with dispatch and the service techs by showing them the reports we were getting from NEXTGEN and BEI so they were aware of how their time was being accounted for,” says McEldowney. “Once we showed our techs what reports we were going to use to measure their performance, the improvements began immediately and every tech is still moving their numbers in the right direction.”
For McEldowney the most helpful recommendation he received was to focus on the total call procedure. Part of that involved sending AOS’s service manager into the field to follow techs on random calls.
“Our service manager was in the office because our ownership thought that’s where he needed to be,” notes McEldowney. “We were wrong. With our service manager in the field two days a week, he gets an opportunity to hear directly from our clients what they really think about our service.”
That feedback isn’t always positive, but McEldowney says it is better knowing than not knowing.
“Now we can fix things,” he says.
Implementing these changes was a cultural change for techs and for the most part the reaction was positive.
“We have a great group of techs and all have recognized that there are going to be changes, and fortunately some of the immediate changes showed improvements right away, so it wasn’t hard to get them to buy into our improved service department plan.”
That’s not to say it wasn’t a challenge. The biggest was making techs aware of how valuable their time is.
“The culture change has gone really well because everyone has bought into the new culture, from our delivery person, to our facilities manager, to our field technicians, to dispatch, and most important, our service manager,” says McEldowney.
Updating the dealership’s other managers—sales and administration—on the progress of the service department has also helped so when good things happen, it’s recognized within the entire company, which makes the service team feel even better about the job they’re doing.
Customers found this new approach to service positive as well.
“This is funny because it’s rare that a client contacts us directly to tell us how well our service techs did repairing a copier/MFP,” says McEldowney. “Since implementing these new strategies, we’ve had more than 10 clients in the past six weeks take time out of their day to contact us via e-mail, phone, or at a business meeting and tell us about their experience with our service. To us that’s a great start.”
The expectation is that this will increase AOS’s level of support on every call, which will then translate into a longer business relationship.
With a whole new attitude and approach to service, AOS is well prepared for future success and truly set themselves apart from competitors from a service perspective.
“We now have more tools to measure performance, spot trends, and make good decisions based on what we see happening through our daily report activity,” states McEldowney. “We pride ourselves on these improvements and it’s our plan to make sure we use all the tools to the fullest. In addition, the timing for AOS was perfect because we were able to implement many of these service tasks, goals, procedures, and measures as we continue to improve our MPS strategy.”
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Ask any office equipment dealer what sets them apart from competitors or why customers like doing business with them and service will inevitably be one of the first things mentioned. Having an efficient service operation is critical to the success of every office technology dealership, including American Office Solutions (AOS) in Clarklake, Michigan.
Founded in 1969, AOS serves Lansing, Jackson, Adrian, and the surrounding areas and has a reputation for placing customers first. True, that’s something most dealerships claim to do too, but AOS consistently delivers on that promise.
“When AOS makes a commitment, whether it’s price of new equipment, service or a solution, we live up to that commitment,” says AOS President & CEO Ted McEldowney. “There are no surprises, no hidden costs, no fees. We do what we say we’re going to do for the price agreed upon.”
The company offers the obligatory selection of office technology with its primary vendors Sharp and HP. Understanding that an office technology dealership can’t survive on hardware alone, AOS also offers an array of services and is a HP certified printer servicing dealership.
As important as service is to AOS, and as good a job as AOS was doing, it was clear to McEldowney that it could do much better. They didn’t have written procedures for technicians to follow, nor did they have performance guidelines for technicians, both important for creating a top-notch service organization.
“The biggest obstacle was confirming the daily actions and job descriptions of our service staff from the delivery person to the service manager to make sure that the quality of service was at the highest standard possible,” explains McEldowney.
The writing was clearly on the wall that improvements were in order based on the data AOS was getting back from BEI Services, a provider of copier and service department benchmarking solutions.
“As we reviewed some of the reports from our ERP as well as NEXTGEN, Lacrosse, and MWAi, we found we didn’t know which reports were important to us and our goal of improving service for our clients as well as the profitability of our service operation,” recalls McEldowney.
Once these issues were confirmed in black and white, McEldowney realized he needed outside help to get his service operation back on track. He turned to Strategy Development who came in and showed AOS which measurable reports to use and assisted them in creating a total call procedure, which when followed correctly greatly improved the quality of service. In addition, Strategy Development helped define technician job responsibilities as well as implement a formal performance management process focusing on continuous improvement.
“They made it very easy by creating an action plan for us to follow,” adds McEldowney. "The plan includes all the reports and documentation to support that decision with a description of how all this information should flow together daily, weekly, monthly, quarterly, and annually.”
Sharing information and progress with service techs was also instrumental in moving things in the right direction.
“We worked with dispatch and the service techs by showing them the reports we were getting from NEXTGEN and BEI so they were aware of how their time was being accounted for,” says McEldowney. “Once we showed our techs what reports we were going to use to measure their performance, the improvements began immediately and every tech is still moving their numbers in the right direction.”
For McEldowney the most helpful recommendation he received was to focus on the total call procedure. Part of that involved sending AOS’s service manager into the field to follow techs on random calls.
“Our service manager was in the office because our ownership thought that’s where he needed to be,” notes McEldowney. “We were wrong. With our service manager in the field two days a week, he gets an opportunity to hear directly from our clients what they really think about our service.”
That feedback isn’t always positive, but McEldowney says it is better knowing than not knowing.
“Now we can fix things,” he says.
Implementing these changes was a cultural change for techs and for the most part the reaction was positive.
“We have a great group of techs and all have recognized that there are going to be changes, and fortunately some of the immediate changes showed improvements right away, so it wasn’t hard to get them to buy into our improved service department plan.”
That’s not to say it wasn’t a challenge. The biggest was making techs aware of how valuable their time is.
“The culture change has gone really well because everyone has bought into the new culture, from our delivery person, to our facilities manager, to our field technicians, to dispatch, and most important, our service manager,” says McEldowney.
Updating the dealership’s other managers—sales and administration—on the progress of the service department has also helped so when good things happen, it’s recognized within the entire company, which makes the service team feel even better about the job they’re doing.
Customers found this new approach to service positive as well.
“This is funny because it’s rare that a client contacts us directly to tell us how well our service techs did repairing a copier/MFP,” says McEldowney. “Since implementing these new strategies, we’ve had more than 10 clients in the past six weeks take time out of their day to contact us via e-mail, phone, or at a business meeting and tell us about their experience with our service. To us that’s a great start.”
The expectation is that this will increase AOS’s level of support on every call, which will then translate into a longer business relationship.
With a whole new attitude and approach to service, AOS is well prepared for future success and truly set themselves apart from competitors from a service perspective.
“We now have more tools to measure performance, spot trends, and make good decisions based on what we see happening through our daily report activity,” states McEldowney. “We pride ourselves on these improvements and it’s our plan to make sure we use all the tools to the fullest. In addition, the timing for AOS was perfect because we were able to implement many of these service tasks, goals, procedures, and measures as we continue to improve our MPS strategy.”
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Tuesday, August 24, 2010
From Printer Cartridge Recharger to MPS Provider
By Scott Cullen
Why rock the boat when you’ve got a nice printer cartridge recharger business going for you? That’s a question we just had to ask Frank Topinka, president of Page After Page in Shrewsbury, Mass. after taking his successful recharger company and transforming it into a successful provider of managed print services.
What initially set Page After Page apart in the greater Boston market as a recharger was its ability to provide an ever-expanding customer base with desktop delivery. That worked extremely well, especially when the big boxes began stocking compatible cartridges.
Now Topinka is not one of those guys to bury his head in the sand. He could see the winds of change blowing even while his business was growing. A little something called print management was looming on the horizon along with the realization that this concept might eventually threaten his customer base. The solution was a new strategic direction.
“When industries mature you have to look at what the OEMs are doing and we were seeing Xerox, HP, and Lexmark do print management deals at the enterprise level,” explains Topinka. “It was clear to me they would eventually bring it down to this level of the market.”
The boat was now rocking as the company embarked on what turned out to be a significant cultural change. “People aren’t used to change and we had to change our strategy and direction and get all of our people on board for doing something different than what we were doing before,” recalls Topinka. “We were still in the same business and selling the same product, but the whole method changed dramatically, which means that sales could no longer go out and sell a service of repairs at a price, toner at a price, and supplies at a price. Now we needed a consultative approach, we needed to build relationships and all the things that went with it.”
The transition at Page After Page began about five years ago with the company developing new sales strategies and ramping up its back-office customer support. Learning how to assess the customer’s print environment, producing documentation to show customers how Page After Page could help them in the long term, and presenting proposals were wildly different from the way the company had been conducting business as a recharger.
Being an early adopter had its challenges. “Nobody was doing it,” says Topinka. “Now everybody’s talking about it although I would guess not many are doing it in the way that’s defined by Strategy Development.”
Acknowledging that Page After Page services thousands of laser printers monthly and half of those are five years or older, Topinka’s transition strategy evolved from the organizational change of phase one into phase two with a printer refresh program. That meant moving into printer sales. To do that effectively Topinka started training his staff on printer specs and pricing and partnered with a leasing company.
During this training period, Page After Page learned a thing or two about multifunctional products and how to sell them as well. They also formed partnerships with third parties and connected with print service consultants and leasing companies to ramp up their knowledge and connections in this area.
Here’s where Strategy Development comes in, helping Page After Page develop a program that encompasses a thorough print assessment, printer strategy techniques, and a cost-per-page calculator that extends a minimum monthly page count to a single invoice for all of their services.
Topinka believes in giving credit where credit is due and he credits Strategy Development with helping him initialize his MPS program.
“Without their training we wouldn’t have been able to get this off the ground,” he says.
He also learned about MPS by attending industry forums and events like ITEX and watching what the copier manufacturers were doing even though at the time it was mostly all talk and little action.
Was the recharger background helpful in making the transition to managed print?
“You don’t need to be making your own stuff to be in print management,” responds Topinka. “Obviously, we started as a remanufacturer before I even knew what this business was. I had a background in manufacturing and I came in and refined the remanufacturing process and upgraded our production environment and some of our costs went way down and our quality went way up, so we still deliver that particular component in our print management, but we don’t talk about it. It’s allowed us to have favorable pricing when we need it, but that’s about it.”
Moving into managed print was an eye opening experience as Topinka and his team discovered the joys and pitfalls of longer sales cycles and the challenge of penetrating new accounts. Because Page After Page was one of the first in the market to offer MPS, they had to contend with a lot of suspicion from customers and hear time and time again, ‘I’m not going to a cost per page program’, even though Topinka’s sales reps were explaining in detail all the costs and the savings.
“We still had success in attracting some new business that way,” states Topinka. “Our first big customer came through—a big print management deal worth about $20,000 a month—and they’ve been with us for four years now.”
Fast forward to today and Topinka concedes business has been soft for the past 18 months although it seems to be picking up of late. What’s easier now is taking the MPS message to customers. Even though business has been soft, Page After Page has not lost a single print management customer during this period. That’s the good news. However, the biggest culprit of the soft market has been the economy.
“Without a soft economy we wouldn’t have had any problems at all,” says Topinka. “It caused everything to change. Other than that we’d be doing pretty well.”
Topinka has found direct mail an effective method for reaching new customers. That often involves a premium that warms up the prospect so Page After Page calls the customer remembers them. The latest premium is a remote-controlled $150+ toy car from HP Power Tools with the prospect’s name and the Page After Page and HP logos on it. The only thing that isn’t included is the remote. To receive that, the customer must schedule a meeting with Page After Page to talk about print management. After the first 10 days of the promotion, 14 appointments were scheduled.
“It’s the hottest thing we’ve done so far,” beams Topinka.
Currently, 40 percent of Page After Page’s business is straight print management deals and Topinka would like to see that grow to 80 percent in the next three to five years.
“The way that’s going to happen is by continuing to do the things we’re doing, attracting new customers into the program and by converting existing customers where we can. Many of our existing customers have looked at it, liked it, but haven’t changed because they don’t have any pain, so they just stay with the program they’re on now. I don’t know if they’re ever going to change because they still get all the benefits without the cost per page. They like the transactional model. I’m okay with that as long as I don’t have a competitor come in and take them away from me.”
Customers tend to go with Page After Page because of their reputation.
“We’ve been doing it a long time,” says Topinka. “We have a very good service component and we leverage that. Our response time is under four hours and we have a high rate of first-time repair, in the ‘90s.”
Topinka also credits a sophisticated print management presentation.
“Our value proposition is well structured and thought through,” he notes. “Prospects see value in how we present and our assessment tools, findings, and proposals are all very intriguing. We also do desktop delivery. That’s difficult and unique and not many dealers do it or can do it, but that’s our normal model.”
If Topinka what he knows now when he first started down the print management path he says it would be a better understanding of how to improve margins.
“Trading up the contract through quarterly reviews, adding value, we didn’t really understand that; we do now,” he says.
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Why rock the boat when you’ve got a nice printer cartridge recharger business going for you? That’s a question we just had to ask Frank Topinka, president of Page After Page in Shrewsbury, Mass. after taking his successful recharger company and transforming it into a successful provider of managed print services.
What initially set Page After Page apart in the greater Boston market as a recharger was its ability to provide an ever-expanding customer base with desktop delivery. That worked extremely well, especially when the big boxes began stocking compatible cartridges.
Now Topinka is not one of those guys to bury his head in the sand. He could see the winds of change blowing even while his business was growing. A little something called print management was looming on the horizon along with the realization that this concept might eventually threaten his customer base. The solution was a new strategic direction.
“When industries mature you have to look at what the OEMs are doing and we were seeing Xerox, HP, and Lexmark do print management deals at the enterprise level,” explains Topinka. “It was clear to me they would eventually bring it down to this level of the market.”
The boat was now rocking as the company embarked on what turned out to be a significant cultural change. “People aren’t used to change and we had to change our strategy and direction and get all of our people on board for doing something different than what we were doing before,” recalls Topinka. “We were still in the same business and selling the same product, but the whole method changed dramatically, which means that sales could no longer go out and sell a service of repairs at a price, toner at a price, and supplies at a price. Now we needed a consultative approach, we needed to build relationships and all the things that went with it.”
The transition at Page After Page began about five years ago with the company developing new sales strategies and ramping up its back-office customer support. Learning how to assess the customer’s print environment, producing documentation to show customers how Page After Page could help them in the long term, and presenting proposals were wildly different from the way the company had been conducting business as a recharger.
Being an early adopter had its challenges. “Nobody was doing it,” says Topinka. “Now everybody’s talking about it although I would guess not many are doing it in the way that’s defined by Strategy Development.”
Acknowledging that Page After Page services thousands of laser printers monthly and half of those are five years or older, Topinka’s transition strategy evolved from the organizational change of phase one into phase two with a printer refresh program. That meant moving into printer sales. To do that effectively Topinka started training his staff on printer specs and pricing and partnered with a leasing company.
During this training period, Page After Page learned a thing or two about multifunctional products and how to sell them as well. They also formed partnerships with third parties and connected with print service consultants and leasing companies to ramp up their knowledge and connections in this area.
Here’s where Strategy Development comes in, helping Page After Page develop a program that encompasses a thorough print assessment, printer strategy techniques, and a cost-per-page calculator that extends a minimum monthly page count to a single invoice for all of their services.
Topinka believes in giving credit where credit is due and he credits Strategy Development with helping him initialize his MPS program.
“Without their training we wouldn’t have been able to get this off the ground,” he says.
He also learned about MPS by attending industry forums and events like ITEX and watching what the copier manufacturers were doing even though at the time it was mostly all talk and little action.
Was the recharger background helpful in making the transition to managed print?
“You don’t need to be making your own stuff to be in print management,” responds Topinka. “Obviously, we started as a remanufacturer before I even knew what this business was. I had a background in manufacturing and I came in and refined the remanufacturing process and upgraded our production environment and some of our costs went way down and our quality went way up, so we still deliver that particular component in our print management, but we don’t talk about it. It’s allowed us to have favorable pricing when we need it, but that’s about it.”
Moving into managed print was an eye opening experience as Topinka and his team discovered the joys and pitfalls of longer sales cycles and the challenge of penetrating new accounts. Because Page After Page was one of the first in the market to offer MPS, they had to contend with a lot of suspicion from customers and hear time and time again, ‘I’m not going to a cost per page program’, even though Topinka’s sales reps were explaining in detail all the costs and the savings.
“We still had success in attracting some new business that way,” states Topinka. “Our first big customer came through—a big print management deal worth about $20,000 a month—and they’ve been with us for four years now.”
Fast forward to today and Topinka concedes business has been soft for the past 18 months although it seems to be picking up of late. What’s easier now is taking the MPS message to customers. Even though business has been soft, Page After Page has not lost a single print management customer during this period. That’s the good news. However, the biggest culprit of the soft market has been the economy.
“Without a soft economy we wouldn’t have had any problems at all,” says Topinka. “It caused everything to change. Other than that we’d be doing pretty well.”
Topinka has found direct mail an effective method for reaching new customers. That often involves a premium that warms up the prospect so Page After Page calls the customer remembers them. The latest premium is a remote-controlled $150+ toy car from HP Power Tools with the prospect’s name and the Page After Page and HP logos on it. The only thing that isn’t included is the remote. To receive that, the customer must schedule a meeting with Page After Page to talk about print management. After the first 10 days of the promotion, 14 appointments were scheduled.
“It’s the hottest thing we’ve done so far,” beams Topinka.
Currently, 40 percent of Page After Page’s business is straight print management deals and Topinka would like to see that grow to 80 percent in the next three to five years.
“The way that’s going to happen is by continuing to do the things we’re doing, attracting new customers into the program and by converting existing customers where we can. Many of our existing customers have looked at it, liked it, but haven’t changed because they don’t have any pain, so they just stay with the program they’re on now. I don’t know if they’re ever going to change because they still get all the benefits without the cost per page. They like the transactional model. I’m okay with that as long as I don’t have a competitor come in and take them away from me.”
Customers tend to go with Page After Page because of their reputation.
“We’ve been doing it a long time,” says Topinka. “We have a very good service component and we leverage that. Our response time is under four hours and we have a high rate of first-time repair, in the ‘90s.”
Topinka also credits a sophisticated print management presentation.
“Our value proposition is well structured and thought through,” he notes. “Prospects see value in how we present and our assessment tools, findings, and proposals are all very intriguing. We also do desktop delivery. That’s difficult and unique and not many dealers do it or can do it, but that’s our normal model.”
If Topinka what he knows now when he first started down the print management path he says it would be a better understanding of how to improve margins.
“Trading up the contract through quarterly reviews, adding value, we didn’t really understand that; we do now,” he says.
Scott Cullen has been covering the office equipment industry since 1986. Scott is Publisher/Editorial Director for Imaging Solutions Reseller; Editorial Director/Managing Editor for OfficeSOLUTIONS and OfficeDEALER; Editor for PC Solutions; and a contributing writer and Editor for Independent Dealer, OFDA, Mercer Business, ENX, BERTL’s iTchat, Repro Report.
Thursday, August 19, 2010
Want an Award: Send a Check
If you are a manager and have attended any event using your e-mail address and title you probably found yourself on a SPAM e-mail list. If that be the case I am sure you have been notified of the great honor of being nominated for the Who’s Who of (prestigious name). I remember the first time I received this exciting e-mail: I quickly clicked through to complete my biographical information for the listing, and just as quickly discovered the $50 “listing fee.” Wow, I looked around to make certain nobody saw me click through to what was now obviously a scam. I didn’t want to look foolish.
How many people do you think actually complete that information and pay the $50? I’ll admit, I’ve read of that great honor bestowed on numerous individuals I have seen speaking at events. When I read the notation in their biography I immediately lose a level of respect for the person before I even listen to them speak. Are they so insecure that they think paying $50 for an “award” provides them with credibility?
It isn’t difficult to understand the scam: Send out 1,000 e-mails per day, have 20 managers actually pay the listing fee and you earn a cool $1,000 per day. Over a 240 day business year you earn $240,000 and the required investment to set-up this business? A slick looking website ($2,000), an e-mail distribution account ($200), and a list of managers ($5000). For a small investment of $7,200 these scammers collect $240,000 per year. Maybe they should buy twice as many e-mail addresses!
There have been numerous opportunities in the imaging business to buy an award. Now there is one more—for a mere $900 per month you can be named one of the top 100 service dealers in the country, or is it the world? For those predisposed to taking other’s money without providing tangible value it is a great….shall we say scheme, in that 100 companies paying $900 per month is an astonishing $1,080,000 per year, without doing a stitch of work other then selling these unsuspecting business people on the value of the award. You might even sell some of the “top 100” companies some consulting services: Imagine you get some of those “top 100” to pay you a fee to come in and train their sales force on how to market the recently acquired designation! Cha-Ching.
How could you possibly designate a company as top in anything without reviewing the entire pool of candidates? If you wanted to determine the top 100 universities wouldn’t you need to evaluate all qualified universities against a clearly defined set of criteria? Doesn’t the company certifying the top 100 universities need to be independent? If that certifying company was paid only by the universities that earned a spot on the top 100 list would there be any credibility in the list?
You could be a top 100 service company; you could be a Who’s Who, you could “earn” a degree from an unaccredited diploma mill “university,” but wouldn’t you rather spend your hard earned dollars on some marketing that will truly bring you respect? Over the last 25 years I have witnessed the imaging industry transform from the Wild West into a group of highly professional business operators. There is no need to resurrect the evils of the past with paid for awards.
What I have learned is that some dealerships are thirsting for a reputable industry player to certify that they have a quality customer service organization. Clearly service, including back office operations, is a determinant in selecting a vendor. As the only industry player with experience in all aspects of a dealership operation I take it as a challenge to support this need.
You can bet SD will never take your money with any type of scheme that can pretend to designate you as one of the top 100 organizations in the industry, since it would be impractical to think we can evaluate every dealership (and what if two dealerships in the same market were both stellar…is there any legitimacy in saying one is top 100 because they paid us first when the other might actually be superior) but we certainly have the skill set to know what good looks like. Look for an announcement in the not too distant future on how we’ll quench that thirst with legitimacy.
How many people do you think actually complete that information and pay the $50? I’ll admit, I’ve read of that great honor bestowed on numerous individuals I have seen speaking at events. When I read the notation in their biography I immediately lose a level of respect for the person before I even listen to them speak. Are they so insecure that they think paying $50 for an “award” provides them with credibility?
It isn’t difficult to understand the scam: Send out 1,000 e-mails per day, have 20 managers actually pay the listing fee and you earn a cool $1,000 per day. Over a 240 day business year you earn $240,000 and the required investment to set-up this business? A slick looking website ($2,000), an e-mail distribution account ($200), and a list of managers ($5000). For a small investment of $7,200 these scammers collect $240,000 per year. Maybe they should buy twice as many e-mail addresses!
There have been numerous opportunities in the imaging business to buy an award. Now there is one more—for a mere $900 per month you can be named one of the top 100 service dealers in the country, or is it the world? For those predisposed to taking other’s money without providing tangible value it is a great….shall we say scheme, in that 100 companies paying $900 per month is an astonishing $1,080,000 per year, without doing a stitch of work other then selling these unsuspecting business people on the value of the award. You might even sell some of the “top 100” companies some consulting services: Imagine you get some of those “top 100” to pay you a fee to come in and train their sales force on how to market the recently acquired designation! Cha-Ching.
How could you possibly designate a company as top in anything without reviewing the entire pool of candidates? If you wanted to determine the top 100 universities wouldn’t you need to evaluate all qualified universities against a clearly defined set of criteria? Doesn’t the company certifying the top 100 universities need to be independent? If that certifying company was paid only by the universities that earned a spot on the top 100 list would there be any credibility in the list?
You could be a top 100 service company; you could be a Who’s Who, you could “earn” a degree from an unaccredited diploma mill “university,” but wouldn’t you rather spend your hard earned dollars on some marketing that will truly bring you respect? Over the last 25 years I have witnessed the imaging industry transform from the Wild West into a group of highly professional business operators. There is no need to resurrect the evils of the past with paid for awards.
What I have learned is that some dealerships are thirsting for a reputable industry player to certify that they have a quality customer service organization. Clearly service, including back office operations, is a determinant in selecting a vendor. As the only industry player with experience in all aspects of a dealership operation I take it as a challenge to support this need.
You can bet SD will never take your money with any type of scheme that can pretend to designate you as one of the top 100 organizations in the industry, since it would be impractical to think we can evaluate every dealership (and what if two dealerships in the same market were both stellar…is there any legitimacy in saying one is top 100 because they paid us first when the other might actually be superior) but we certainly have the skill set to know what good looks like. Look for an announcement in the not too distant future on how we’ll quench that thirst with legitimacy.
Wednesday, August 18, 2010
Poll: Managed Print Services – Are you on board?
To keep your finger on the pulse of what your peers are thinking and doing, Strategy Development will be conducting monthly surveys, on hot topics in the imaging industry. Results will be published in our monthly newsletter: sddigest. Not registered for our newsletter? Click here to send me an email with your contact details.
Please take two minutes (literally!) to participate in this poll: Managed Print Services - Are you on board?
Please take two minutes (literally!) to participate in this poll: Managed Print Services - Are you on board?
Tuesday, August 17, 2010
Introducing ClearView, a tool to properly price and position MPS opportunities
Strategy Development has worked with a leading software developer to translate their knowledge and insight of proper pricing of managed print services (MPS) engagements into a comprehensive Excel-based pricing tool: ClearView. ClearView is user-friendly and easily blends expenditures for mixed fleets, related consumables, and services into a single cost-per-page (CPP). The blended CPP can enable a customer to reduce costs and/or allow print providers to improve margins.
ClearView turns data into intelligence in order to calculate a current CPP, as well as what a blended CPP would be in a variety of potential scenarios. The tool enables comparisons of MPS transactions from simple outsourcing, to redeployment, consolidation or refresh of devices, as well as comparing total cost of ownership to the prospect’s/customer’s current cost. Additionally, ClearView provides the ability to contrast costs from period to period to assist in conducting quarterly account reviews, a process developed by Strategy Development for the MPS space.
ClearView is being made available to Strategy Development’s consulting clients and participants in the BTA MPS Workshops, which were developed and are instructed by Strategy Development consultants. If you are current consulting customer or have attended a BTA MPS Sales or BTA Operations & Service training workshop in the past twelve months, click here to register for the training webinar which will take place on Wednesday, September 1, 2010 at 11am EST/8 PST.
ClearView turns data into intelligence in order to calculate a current CPP, as well as what a blended CPP would be in a variety of potential scenarios. The tool enables comparisons of MPS transactions from simple outsourcing, to redeployment, consolidation or refresh of devices, as well as comparing total cost of ownership to the prospect’s/customer’s current cost. Additionally, ClearView provides the ability to contrast costs from period to period to assist in conducting quarterly account reviews, a process developed by Strategy Development for the MPS space.
ClearView is being made available to Strategy Development’s consulting clients and participants in the BTA MPS Workshops, which were developed and are instructed by Strategy Development consultants. If you are current consulting customer or have attended a BTA MPS Sales or BTA Operations & Service training workshop in the past twelve months, click here to register for the training webinar which will take place on Wednesday, September 1, 2010 at 11am EST/8 PST.
Monday, August 16, 2010
Introducing WebEd: A monthly educational webinar series
This month Strategy Development is launching WebEd, a free educational webinar series to provide monthly training for sales, operations, and service professionals.
The series kicks off with two webinars: In the service track on August 24, Manage a Service P&L — How to Read, Interpret and React and, in the sales track, MPS Assessments – Know when to hold ‘em, know when to fold ‘em on August 25.
Manage a Service P&L — How to Read, Interpret and React
With a precise understanding, the service income statement (P&L) will provide a service manager with the information needed to make sound business decisions and realize 52% plus returns. Comprehension of how managed print services (MPS) business affects the P&L adds a layer of complexity that requires specific knowledge. This level of understanding can only be realized with the proper education of how to interpret, act, and communicate within the organization.
Date: Tuesday, August 24
Time: 11am EST/8am PST
Duration: 45 minutes
Speaker: Mike Woodard
Click Here for More Information and to Register
MPS Assessments… know when to hold ‘em, know when to fold ‘em
The assessment is the step in the sales cycle where you capture the information to justify the financial aspect of the MPS business case. Learn the in’s and out’s of performing assessments; when to walk away from a perceived opportunity; overcomplicating the process; to map or not; about gaining all of the critical information to justify a contract; as well as the perils of not having an champion or an agreement on pain. Avoid the many pitfalls that will help enable you to capture a large recurring revenue stream. Having knowledge of what NOT to do is as important as learning what you need to do well.
Date: Wednesday, August 25
Time: 11am EST/8am PST
Duration: 45 minutes
Speaker: Ed Carroll
Click Here for More Information and to Register
Hope to see you there!
The series kicks off with two webinars: In the service track on August 24, Manage a Service P&L — How to Read, Interpret and React and, in the sales track, MPS Assessments – Know when to hold ‘em, know when to fold ‘em on August 25.
Manage a Service P&L — How to Read, Interpret and React
With a precise understanding, the service income statement (P&L) will provide a service manager with the information needed to make sound business decisions and realize 52% plus returns. Comprehension of how managed print services (MPS) business affects the P&L adds a layer of complexity that requires specific knowledge. This level of understanding can only be realized with the proper education of how to interpret, act, and communicate within the organization.
Date: Tuesday, August 24
Time: 11am EST/8am PST
Duration: 45 minutes
Speaker: Mike Woodard
Click Here for More Information and to Register
MPS Assessments… know when to hold ‘em, know when to fold ‘em
The assessment is the step in the sales cycle where you capture the information to justify the financial aspect of the MPS business case. Learn the in’s and out’s of performing assessments; when to walk away from a perceived opportunity; overcomplicating the process; to map or not; about gaining all of the critical information to justify a contract; as well as the perils of not having an champion or an agreement on pain. Avoid the many pitfalls that will help enable you to capture a large recurring revenue stream. Having knowledge of what NOT to do is as important as learning what you need to do well.
Date: Wednesday, August 25
Time: 11am EST/8am PST
Duration: 45 minutes
Speaker: Ed Carroll
Click Here for More Information and to Register
Hope to see you there!
Never Listen to Anybody Worse Off Than You
Words of wisdom I learned from the great sales trainer Tom Hopkins when I attended his three day boot camp in the 1980s. I was in my twenties and new to the outside sales game, but they are words I have lived by throughout my business career, and not simply as a sales professional. The words are so simple and logical, yet have such profound implications.
Would you take medical advice from the guy who failed high school biology and works at the tire store installing your new tires? Would you listen to the doctor who thought you could install your own tires with two crowbars? Would you invest your money with the middle age guy living with his parents who doesn’t have enough capital to make his car payment and is close to filing personal bankruptcy?
At that sales training seminar back in the 80’s those words were profound, yet the meaning was also clear. The three examples I gave above could easily be identified because you would be standing in front of the person and wonder why this guy in the tire store uniform was giving you medical advice.
Now let’s fast forward twenty years. That tire changer, who flunked high school biology, has a blog titled “DeathoftheDoctor” and espouses his opinion on medical issues. He never really says anything with any substance, rather he just attacks anybody else that does and uses pithy phrases to indicate they are fools. Eventually, those “fools” begin to disappear from the blog since they didn’t sign-up to get berated and the only posters left are the real fool, your high school biology failure, and a small group of other flunkies who agree with this unqualified guy giving out medical advice.
The internet, self promotion, and lack of substance have elevated this guy—mostly in his mind because let’s face it he still goes to the tire shop each day—into some type of cult guru.
That 45 year old “investment guru” who attended two different obscure colleges over eight years, yet never graduated, also has his blog, “FailedInvestor.” This guru claims to have invented the hybrid investment approach—a long/short hedge enhanced with options. He claims it is the phase 3 of the modern approach to investing. He has all types of fancy charts and phrases and he too loves to attack others. You hear things like the large investment banks are stuck in the past and don’t understand his strategy and he was first to do this or that, but without much examination you can easily see that he simply changes terms and puts out press releases. His obsession with self promotion—a characteristic of all of these cyber world experts—even attracts some fools to invest in his fund. But in the end all is lost.
The point of this post goes directly back to the words of Tom Hopkins but links those words with the world we live in today. A blog, postings on LinkedIn or Facebook, giving a presentation at a show, or a press release doesn’t make you an expert. Education and experience are what makes an expert. Spend some time to get to know the specific experience of those you seek for advice and you will save a great deal of money and time.
Would you take medical advice from the guy who failed high school biology and works at the tire store installing your new tires? Would you listen to the doctor who thought you could install your own tires with two crowbars? Would you invest your money with the middle age guy living with his parents who doesn’t have enough capital to make his car payment and is close to filing personal bankruptcy?
At that sales training seminar back in the 80’s those words were profound, yet the meaning was also clear. The three examples I gave above could easily be identified because you would be standing in front of the person and wonder why this guy in the tire store uniform was giving you medical advice.
Now let’s fast forward twenty years. That tire changer, who flunked high school biology, has a blog titled “DeathoftheDoctor” and espouses his opinion on medical issues. He never really says anything with any substance, rather he just attacks anybody else that does and uses pithy phrases to indicate they are fools. Eventually, those “fools” begin to disappear from the blog since they didn’t sign-up to get berated and the only posters left are the real fool, your high school biology failure, and a small group of other flunkies who agree with this unqualified guy giving out medical advice.
The internet, self promotion, and lack of substance have elevated this guy—mostly in his mind because let’s face it he still goes to the tire shop each day—into some type of cult guru.
That 45 year old “investment guru” who attended two different obscure colleges over eight years, yet never graduated, also has his blog, “FailedInvestor.” This guru claims to have invented the hybrid investment approach—a long/short hedge enhanced with options. He claims it is the phase 3 of the modern approach to investing. He has all types of fancy charts and phrases and he too loves to attack others. You hear things like the large investment banks are stuck in the past and don’t understand his strategy and he was first to do this or that, but without much examination you can easily see that he simply changes terms and puts out press releases. His obsession with self promotion—a characteristic of all of these cyber world experts—even attracts some fools to invest in his fund. But in the end all is lost.
The point of this post goes directly back to the words of Tom Hopkins but links those words with the world we live in today. A blog, postings on LinkedIn or Facebook, giving a presentation at a show, or a press release doesn’t make you an expert. Education and experience are what makes an expert. Spend some time to get to know the specific experience of those you seek for advice and you will save a great deal of money and time.
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