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.

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.

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.

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.

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.

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?


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.

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!

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.

Thursday, August 12, 2010

For U.S. Remanufacturers, MPS Is Both A Blessing And A Curse

by Charles Brewer

It’s increasingly difficult to make money marketing remanufactured toner cartridges in the United States. Remanufacturing cartridges that perform well consistently has always been a challenge and that challenge has been compounded significantly with the introduction of new imaging technology, particularly color. Finding vital supplies has also become an issue. The supply of empty cores--the remanufacturing industry’s life blood--has been drying up for the past few years and the price of empties has skyrocketed. And most importantly, years of fierce competition led by large companies both foreign and domestic has resulted in severe price compression and razor thin margins.

Medium-sized remanufacturers in the U.S. have been hit the hardest. Many mid-sized players were established at a time when they could cover the majority of the market producing only a handful of cartridges. Now, remanufacturers must offer dozens of different SKUs to supply today’s diverse installed base. Many mid-sized firms, however, lack the capacity to produce such a wide array of cartridges. These firms now must outsource the majority--if not all--of their production. This has caused a fundamental shift in the industry, and many companies have changed their business models from that of a producer to a distributor. Outsourcing can be expensive and being profitable while selling cartridges from a third party is a difficult proposition especially when selling monochrome SKUs, which have become increasingly commoditized.

Those mid-sized companies that continue to produce cartridges in-house also find it difficult to turn a profit. Often they lack the economies of scale needed to negotiate lower raw material prices with suppliers so their costs are high compared to the big guys. The smaller firms get little respect from empties brokers and must pay top dollar for the most popular cores--if they can get them at all. Suffice it to say that for those firms that have been able to continue to produce their own products, the overhead has grown to a point where they find it hard to operate profitably.

Managed print services seemed to offer remanufacturers relief from some of their most vexing problems. First and foremost, MPS was seen as a way to add value to commoditized products. Just like it does for hardware vendors, MPS held the promise of improved margins by providing remanufacturers with a way to wrap valuable services around their consumables. It could also give mid-sized firms a vehicle to differentiate themselves as a service provider in the marketplace. Depending on how they shaped their MPS services, remanufacturers could reap added benefits like having some say as to the type of equipment their clients would employ, which would limit the range of SKUs the remanufacturer had to provide. And, it would allow the remanufacturer the ability to collect precious empties--a service that the clients would also value.

The remanufacturing industry as a whole became aware of print management solutions about five years ago. Initially, interest was strong, but remanufacturers recognized they faced a number of hurdles if they were to offer MPS packages. They lacked technology, for example, to monitor their clients’ machines even for the most basic MPS offering. And they had to move from the transactional sale associated with selling cartridges to the solution sale required for an MPS contract. Remanufacturers also faced logistical changes as they moved from providing some fixed number cartridges to supplying customers with cartridges as needed.

As the industry continued to demonstrate a desire to offer MPS, various companies have come forward to support remanufacturers. Technology to monitor printer fleets, for example, has been increasingly available from firms like PrintTracker, PrintFleet, and others. Likewise, various companies have stepped up to help remanufacturers successfully transition from transaction sales to marketing MPS solutions. There are now scores of seminars and workshops aimed at helping smaller remanufacturers launch and manage MPS programs.

Despite all the support and interest, however, it’s not clear that MPS will be the panacea the mid-sized remanufacturers have been looking for. In fact, it’s quite likely they will not be able to offer a profitable managed print service.

It’s difficult for a company that markets supplies exclusively to offer a real managed print program. For clients to realize the full benefits of MPS, there needs to be some degree of fleet optimization, and optimizing a printer fleet requires swapping out hardware. While this may include physically moving devices within an organization and taking some off-line, often it requires deploying new hardware. There are some remanufacturers that are also VARs and they succeed in the MPS market. But those companies that only sell cartridges ultimately will find it impossible to compete with the MPS contracts that dealers and VARs can offer.

Another big challenge that mid-sized firms face are the expenses associated with MPS. It can be costly to acquire the equipment and software required to support monitoring technology. There are companies that will host the services, but outsourcing can get expensive especially for a small company. Remanufacturers also face new cash flow issues. Rather than collecting full payment at or near the time of delivery as they had when they sold cartridges, companies may have to wait months for MPS payments to come in before they can cover their costs. Moreover, often companies must stock up their customers’ supplies closets with inventory and that cache of cartridges may not yield any cash for months.

Some mid-sized firms are learning that rather than offering a new path to profits, MPS really represents new threats. First, large remanufacturers are increasingly active in the space and can undercut the mid-sized players. And, rather than losing one sale, losing an MPS bid means the customer is lost until the contract is up, which is typically between three and five years. Remanufacturers also have to do battle with new competitors as more and more companies offer some type of MPS solution. OEMs are providing new supports to their channel partners, which further strengthen the value proposition of those competing with the remanufacturers.

I don’t want to suggest that MPS is all doom and gloom for remanufacturers. It can open new doors and some new opportunities are emerging. Independent dealers, for example, are increasingly aware of the improved margins remanufactured cartridges can offer them compared to OEM, which is expanding the market for remans. But MPS is not good news for everyone in the industry and it will put further pressure on many remanufacturers doing business in the United States.

With over 12 years of experience, Charles Brewer is an independent consultant for the digital imaging industry. He is a contributing editor to Lyra Research's Hard Copy Supplies Journal published, which he managed from 2005 until 2009. Brewer has authored numerous articles, reports, and white papers on hardware as well as toners, inks, and media and has worked with various OEMS and third-party supplies vendors.

Wednesday, August 11, 2010

The Death of MPS

As the preeminent MPS consulting firm you probably wonder how this title made it onto Strategy Development’s blog. Does Strategy Development really think that MPS will die? The answer to that question is the same as the answer to a few others: Will CPP leasing die? Will digital products die? Will color output devices die? Of course the answer to all of these questions, including the death of MPS, is a resounding “No,” not in the foreseeable future.

So then why “The Death of MPS?” What I do expect to die are individuals (not physically just in discussion), companies, anybody, viewing MPS as some discreet business. I cannot wait to stop getting e-mails touting the latest show on MPS; the latest study on MPS; the latest definition of MPS; the latest MPS sliced bread.

Cost per page, or in the day cost-per-copy, was going to change the business forever; a business model shift and not simply a new approach to leasing. It did change the business in that it built in great switching cost and protected aftermarket. It also had a slight change on the business in the requirement to capture meters and the elimination of large aftermarket sales teams. But it was an evolutionary change and not a revolutionary change. Sure the software providers needed to catch up, but they did, and the dealer/reseller needed to transition their supply reps to meter collectors and supply shippers, and they did, but it wasn’t much of a blip on the screen with the benefit of hindsight.

Then digital was going to forever change the business. Remember the research firms saying, “if you don’t own the network you won’t sell copiers/printers?” A significant business model shift that would leave many copier companies in the dust and out of business: Well that never happened. Digital did have an effect that we are feeling now, printer and copiers go head-to-head, but it was a long change that provided a lot of opportunity to adapt. Owning the network never had an effect on acquiring output devices, and the dealer/reseller developed the skills to sell and maintain digital products and to leverage the professional services that could be sold with, or after, the installation of the device connected to the network.

Then color and production—take your choice: Dealers couldn’t afford to sell and maintain these devices. They were the bailiwick of the OEM with their hordes of cash and ability to deploy sophisticates sales professionals and support teams to support the products. Sorry, wrong again. Dealers adapted and successfully sold color and production, tweaking their business model as they went along.

And now MPS: Some would leave you to believe that MPS was some new and exciting space. I sold my first real MPS agreement in 2002—eight years ago—only we called it fleet management and it was inside of a facilities management (FM) agreement. To be fair our FM team was selling fleet management for years before that, I simply was involved in this transaction because it was a multi-million dollar contract and the customer wanted a full equipment refresh built into the agreement, with the equipment being refreshed over the multi-year agreement. In other words it had Balance Sheet risk so it needed executive engagement. I was also involved in numerous transactions in the enterprise space where the customer wanted to optimize and standardize their output fleet and use professional services, like advanced capture and routing, fax servers, variable data printing, web submission, and document management, to improve their workflow. Today you call these transactions MPS.

For most dealers/resellers MPS is a new go-to-market strategy and it does require changes in the business model, but those changes are becoming a lot clearer today. Early adapters dealt with remote monitoring software that was unpredictable at best. Today’s entrants find software that works well and improves every day. Early adapters worked with leading leasing companies to define contracts; today’s entrants benefit by having contracts that are well written for MPS. Early adapters had vision or faith, or maybe both, that MPS was a real revenue stream where they could make a profit. Today’s entrants have numerous examples of companies in the space growing rapidly and earning nice margins.

The success factors, from a high level perspective, of MPS are also clearly defined: Have a business plan, make an investment in the MPS business, use dedicated sales professionals, use a services led approach, employee quarterly business reviews, be hardware independent, and invest in sales, service and back office operations training. That’s not to say that companies aren’t adapting a MPS strategy at different times or only in portions. You have early and successful adapters, like FlexPrint, and you have many dealers/resellers who say they are in MPS because it is what they feel they need to say, but they really aren’t. The same was true of CPP, color, production, digital, and professional services. I remember Leslie in NYC (acquired by Danka) being the poster child for color back in the day.

We no longer talk about the risk of using a CPP model in our sales approach nor do we view it as a creative marketing approach. We no longer advertise that our products are digital or talk about the analog to digital transformation. We no longer look at production and color devices and wonder if we’ll ever be able to sell and support the devices. Think about this for less than a second: If you didn’t use CPP, didn’t sell digital devices, color, or production what would you be? Not a lot of debate needed as it is an easy answer, basically out of business.

An MPS contract can include imaging and printing devices, support and supply of those devices, software applications related to documents, and consulting services. What does that sound like to you? If you’re reading this blog, and not lost in cyberspace, my guess is it sound like your business? Am I on the mark? So the longer you take to really get into MPS the greater proportion of your customers that will be signing MPS agreements with a competitor. If you competitor is good at MPS it will only be a matter of a few quarters after they get into your account that you are totally displaced. Therefore, MPS becomes both your growth approach and your survival.

This post is really focused on the dealer /reseller. For the OEM MPS can have a significant effect on their business. If all of the dealers / resellers suddenly become hardware agnostic—they simply sell and support what is best for the end users—it could accelerate the winners and the losers in the OEM space. There is also the issue of compatible supplies and InfoTrends has done a good job of quantifying the possible effect on a OEMs revenue stream in this area. The bottom line is that day is coming so the OEMs need to develop a model that makes their products the best choice for deployment inside of an MPS agreement. Maybe we’ll make that the topic of a later post.

Tuesday, August 3, 2010

A Dedicated Staff = MPS Success at GFI Digital

By Scott Cullen

St. Louis has the Cardinals, Rams, and the Blues, but one of the most successful teams in the market by far can be found at GFI Digital, an independent office technology dealership that’s grown into a $50-million business in 11 years.

The GFI Digital team covers a good portion of Missouri along with western Illinois, and has emerged as a leader and trend setter in the markets it serves. Customers have high expectations as well they should from their office technology provider, and if it weren’t for the dealership’s commitment towards providing solutions, top-notch customer service and support, it’s unlikely GFI Digital would be enjoying the success they do today. Whatever they’re doing, they’re doing right, from the top of the 150 personnel organization to the bottom and everyone in between.

Dealerships across the country may still be crying the blues as the economy stumbles and fumbles along, but at GFI Digital, business is up 22 percent this year. How can that be?

Mark Kehoe, vice president print management and one of GFI’s owners, and a man of few words depending on what you’re asking him, simply responds, “Work.”

Okay, can you elaborate on that, please?

“We’re protecting the base and pumping for net new business,” he adds. “The economy has opened up accounts that we normally wouldn’t get a chance at because they were happy with their current vendor. Now the higher ups are asking them to shop it a little bit and it’s creating opportunities.”

GFI Digital does well in what Kehoe describes as B-size and larger accounts. They tend to shy away from the smaller accounts with Kehoe stating, “We don’t need the practice.”

Asked why customers like doing business with GFI Digital, Kehoe cites reliable, prompt, excellent service. We’ve heard that line before and it’s an easy claim to make but a difficult one to put in practice. GFI Digital seems to be nailing it though and their reputation for service seems to precede them.

“St. Louis is a big ‘show me’ state, and once you start getting traction in these accounts and you’re doing business with this person, that other person is going to look at you,” explains Kehoe.

GFI Digital has plenty of competition although its most serious competitors tend to be other independent dealers and IKON. As far as direct branches, there aren’t that many to compete with and what’s there Kehoe describes as “weak.”

Five years ago the company made a strategic decision to move into managed print. It was a smart decision even though Kehoe realizes their initial approach to it was skewed.

“We were doing it the wrong way by selling equipment into the accounts,” states Kehoe. “And we were doing it with our general sales staff.”

Although GFI Digital enjoyed some success selling managed print the first four years, they could have done better. The big turnaround came last November when they assembled a dedicated sales staff focused exclusively on MPS.

Kehoe acknowledges the challenges of selling MPS, lamenting the longer sales cycles and the danger of getting bogged down with customers who are not going to make a decision, leaving the dealer holding the bag after doing a lot of work for nothing. That’s still a danger, but GFI Digital has learned from its mistakes.

“We’ve gotten a lot better at identifying where we need to focus,” says Kehoe. “If it’s not a go, they’re not wasting their time doing a bunch of work for someone who’s not making a decision.”
Transitioning its MPS approach from an equipment first mentality was a smart move.

“That wasn’t the right way to do it,” notes Kehoe. “First you pick up the maintenance contract and then you get the equipment, so it’s a totally different mindset.”

In Kehoe’s estimation, there’s no big secret in identifying an MPS candidate—it’s an organization with 40 machines or 100,000 minimum clicks.

“Our dedicated MPS staff is focused on the higher end customer.”

Along the road to MPS success, GFI Digital has had to deal with certain misconceptions among Kehoe’s prospects and customer base. He mentions customers who were at one time quoted a nickel a copy, telling GFI Digital reps, ‘We looked at that, we’re fine with what we’re doing.’

“We tell them, ‘keep an open mind; we have a new approach to MPS and it has nothing to do with selling hardware and no, you’re not going to be paying a nickel a print,’” says Kehoe.

That message is breaking down the misconceptions and GFI Digital is now billing $194,000 a month for services. And new MPS business just keeps rolling in. They just picked up a new $25,000 a month account and another big account is pending.

No wonder Kehoe says, “Our MPS business is growing dramatically.” Plus he expects the MPS portion of the business to reach $8 million annually in three years.

What makes Kehoe so confident?

“Because we have a three-year plan,” he responds. “Our plan is to add $15,000 a month in additional billings.”

The biggest obstacle to hitting those numbers is losing focus. Kehoe doesn’t expect that to happen now that he has a dedicated sales staff.

“It’s really not that hard if you focus on true MPS and only MPS and you’ve got six reps and all you’re looking for is $15,000 additional billings per month,” emphasizes Kehoe. “If you get off the focus of what you’re supposed to be doing—driving printer service—you’re not going to reach it. If you’re not focused on true MPS and MPS accounts, dedicated MPS, you’ll never get there.”

Identifying the decision maker for an MPS engagement is always critical and Kehoe identifies C-level executives as prime targets, but he does offer a word of caution before going there.

“You’ve got to be careful with the CFO or CIO because all of a sudden you’re alienating the director of IT so you have to quickly bring them into the fold, explaining to them, ‘No, we’re going to make you look good, not make you look bad in this process.’”

He adds that sometimes the CIO is too high, so then the focus should be on the director of IT or the person responsible for the organization’s help desk.

Kehoe has found that it’s not difficult finding the proper person to speak with, but the hardest part is simply getting in front of them. No big revelation there.

“Once you get in front of them, 70 percent of the time you’re going to at least get something moving forward,” he says.

GFI Digital wasn’t afraid to ask for help in developing its MPS strategy. Kehoe reveals that Strategy Development has helped them formulate the direction they should be going with MPS along with a compensation plan for the dedicated reps even though the compensation for GFI Digital’s higher end reps is higher on the salary side than what Strategy Development’s model shows.

Kehoe concedes that doing it right in the MPS world requires a financial investment to get things moving in the right direction.

“At the end of the first year we’re probably going to lose $63,000, but by the second year we’ll be making $1 million, and then it goes crazy from there,” reports Kehoe.

Asked if he has any words of wisdom for dealers who haven’t taken the plunge into MPS, Kehoe doesn’t hesitate, “ Don’t do it unless you’re going to commit to it, hire a dedicated staff, and then manage to a plan and stick with the plan. If you don’t, don’t even get involved with it because you’ll get frustrated quick.”

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.