The Death of the Copier Dealer - Rise of the "Hybrid"

2008

Things ain't what they use to be...

I was reading Ed's post over at the Imaging Industry News site about "Hybrid Dealers".

Ed states, "...No longer is it acceptable for the dealer to only provide the stellar technical insight of an IT VAR or Reseller, or conversely, only the stellar service and traditional click charge based financing options of the copier dealer.

Now the end-user expects the dealer to be able to provide the best of both worlds, the technical excellence of an IT reseller and the service excellence of a copier dealer..."

Ed and his group are right on with this observation - I see the need every day; I see the prospect changing too.

I would venture a guess that larger companies are experiencing this change and the need for a Hybrid Dealer or a Partner. 

Your typical small company does not have an IT and Facilities staff - sometimes, one person will fill both requirements. And this is why most smaller companies have embraced the MFP and its full function.

On the "dealer" side, I have been in the presence of the owners of successful Copier Dealers - they do not see "MPS" as a major interest of their customers. Interesting. They see MPS programs as another "arrow in the quiver" - arrows to be shot at the prospect. (Another interesting metaphor/cliche.) In the same light as duplexing, color, or scan to file. Just another "add".

"Hybrid" - according to Dictionary.com, "... anything derived from heterogeneous sources, or composed of elements of different or incongruous kinds: a hybrid of the academic and business worlds..."

So, yes, I would agree that a VAR/Dealer/Reseller "composed of elements of different or incongruous kinds" is a reasonable, Darwinian, expectation. The result would be an entity that takes "the best of both worlds" - CPC and IT knowledge.

My question is, "Can today's dealer change on its own, or will the Hybrid be grown from the ground up?"

Time will tell - meanwhile, I need to take my computer to the nearest Inacomp, ComputerLand, MicroAge - oh wait...they all changed their name to Best Buy, didn't they?

Check these out:

The Death of The Copier Dealer

The Death of The Copier Sales Person

Leading Edge and Bleeding Edge

Managed Print Services - Everybody Sells

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New Report Delivers Definitive Analysis of the Managed Print Services Market

Managed Print Services - A New Study Released

An interesting announcement recently from a firm in Ireland. The report costs 16,000 Euros, but the summary announcement had a few tidbits and even a quote from our friends at The Photizo Group.

From the announcement, " ...we have ‘evolved’ to 2008 where there are a myriad of MPS offerings and services. The question now becomes what is meant when someone says MPS. The Photizo Group defines MPS as ‘outsourcing’ the hard and/or softcopy document management functions.

The key market dynamics have come together to help create the need for managed print services.

The key dynamics are:

-- Adoption of MFP technology – MFP’s have become ubiquitous in corporate America by bridging the gap between copier and printer technology. In addition, MPS-based products have become the on/off ramp enabler for new workflow applications which are the foundation of many potential business process optimization efforts.

-- Changing customers – Decision-making is being consolidated into a single organization, either IT or Facilities/Purchasing.

-- Shifting channels – IT and copier dealers are competing for the same customers and the result is declining margins. It is no longer feasible to be a ‘box pusher’ any longer, and as a result firms see offering MPS programs as a way to improve profitability and to capture market share. Customers now have a wide variety of options for implementing MPS programs, including utilizing local or national dealers or by utilizing a hardcopy vendors' direct MPS program..."

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I like the "Shifting channels" comment and agree that box moving is becoming more undesirable - yet I do recognize there will ALWAYS be a place for "transactional" sales.

And customers always change. But, I am seeing the decision being made by BOTH Facilities and IT - in the same room, at the same time - opposed to Facilities handing off the decision completely to the technology group. This makes for an interesting dynamic.



Like this? Check this:

I.T. and Facilities and Your Copier

HP Financial News - UP 11%

An excerpt from :

Wall Street Beat: Salesforce, HP, M&A in the Spotlight

Marc Ferranti, IDG News Service

"...HP, which reported quarterly results Tuesday, continues to be a market darling. A speedbump in printing earnings and the prospects of absorbing services company EDS -- bound to be a complex undertaking -- does not seem to bother investors at all. HP shares jumped $2.47 to close at $46.16 Wednesday and continued to rise Thursday.

Revenue for the July quarter rose 10 percent to $28 billion in the quarter, while net income increased 20 percent to $2.5 billion, or $0.80 per share. Income and sales beat analyst forecasts.

Though revenue growth from its key printing division was slow -- up only 3 percent for the quarter -- and commercial printer sales were down 5 percent, sales for its software unit were up 29 percent. Software has traditionally been a weak spot for HP. A fast-growing software division combined with a strengthened services arm will only serve to reinforce HP's position as the largest tech vendor in the world.

Despite concerns about the U.S. downturn, however, the slowdown does not appear to be affecting the tech sector as badly as other areas of the economy. "The U.S.-led economic downturn shows no sign of causing a recession in IT spending," said Jim Tully, vice president at Gartner, in a forecast issued this week.

"Emerging regions, replacement of obsolete systems and some technology shifts are driving growth," Tully said.

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Interesting, and relevant to what is being observed in the field.

Three Months of Managed Print Studies - A Summary

Aug, 2008 -

Interesting observations and conclusions.

My weeks have been filled with lots of “windshield time” traveling from client to client surveying output fleets and provide business analysis. 


To date, these examinations encompass over 1800 machines and thousands of users.

Without getting into details here are some interesting points derived from looking at ALL the studies as one-

The Numbers:

• The number of printers to copiers has been 8.2:1. In only one case, the ratio was 3.8:1.
• In a fleet of nearly 1,000 machines, the average monthly volume is 4,809 images/month/machine.
• Average Cost Per Copy, using equipment cost only, is 0.021919 for copiers
• Average Cost Per Copy, when combining copiers with printers is 0.0409

The Purchase or Lease:

• Most lease terms are 60 months with a sub-majority of leases having “strange” terms; 44 months, 42 months, etc.
• Lease details are unknown. It is difficult to obtain original leases and often, multiple lease agreements with unique termination dates exist.
• Although my numbers do not reflect laser printers, as a normal business practice, the laser printer fleet has been purchased and the copiers leased.

Organizational Impact – The copiers are either “invisible” or perceived as a negative influence

• In nearly every organization, the output devices, to the end user, have become “transparent”. They perform effortlessly and without failure.
• Common through all organizations is the interest level regarding change – positive interest. Indeed, when interviewed, most users are quite happy with their existing system, yet they express positive feedback when presented with the option of getting new equipment. This is expected; people like “new stuff”. But when delving deeper, the expected level of satisfaction relating to the copier is not high. The “bar” is set low. As an example, end users become familiar with “Broken Again” sign taped to the ADF. Or employees accept the fact that one of their peers is proudly known as the “copier guy” – the one who can always fix jams, avoiding placing a service call with the copier company.

Examples can go on and on – the underlying theme is - People don’t expect much from the copier; they do expect to have jams, the do expect to have challenges with copiers, with printing, with losing output, with having the unit down for days at a time.

Equipment Miss-Match, lease end, invoicing and meter reads

• There is no surprise that once actual volumes are compared to the recommended volume bands of each machine, clients’ experience shock, awe and then general frustration at having paid for capacity they never utilized.
  
• Add to this the ultimate frustration of trying to terminate a lease, even at lease end, and the complete experience is a nightmare.
• Invoicing, incorrect meter reads, service call management all contribute to a disdain for clients’ current position – all this beyond the costs.

Please note, that these are my personal observations on a small pool of studies. My opinions are based on my interpretation of the data and interviews.

Also, HP studies revealed years ago what I am finding today – for every copier, there are 8 printing devices and average monthly output per device is less than 10,000 images.

No surprises for me, plenty for the client – and now we get to see how responsive to change some will be – stay tuned.

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Copiers and Crime...This Stuff Can Not Be Made UP

Every now and then I run into things like this:

Man Accused Of Copier Thefts Suspended

In the article, allegedly, a politician who "...was to oversee the courts and the money coming into the courts."

Over three months, the Cops video taped him looting coin boxes connected to the city's Ricohs.