Managed Print Services and the Economy

MPS and the economic landscape - what can it all mean?

Even with the financial woes of the 70s, 80s and 90s as a comparison, all indications are that this little "blip" on the financial radar is closer to an E.L.E. than any other time.

"Unemployment surged by 603,000 in October to 10.1 million, the highest level in 25 years, according to a survey of households. In the past six months, unemployment has leaped by 2.45 million, the largest increase since 1975.

"A stumbling economy seems to have been kicked down the stairs," said Lawrence Mishel, president of the Economic Policy Institute. "This is what a deep recession looks like."

Two issues:

What can this mean for output devices and office equipment sales?

And

What does this mean for the burgeoning Managed Print Services segment?

Not good for the first issue and better for the second.

It's simple really, with the "commoditization" of hardware and the reduction in margins, aren't we looking for the ultimate angle?

The "angle" is lowering costs? Lowering the costs for your customers right now is the most important issue.

Think about it, if you are reducing your clients' costs associated with printing, on a fleet of machines for a good number of employees - the savings your plan, your idea, your "solution"(gag) brings to the table may be enough to save one persons job - and there by helping to feed that person's kid or mom, or grandmother. Letting that one person go to Wal*Mart, or In-n-Out to spend money. And those Wal*Mart and In-n-Out employees get paid because your end user, and thousands of others, went their job.

You think sales people don't do anything?

You think your "job" isn't important?

You think we need more "change"?

When we sell, we change something, we always have - hopefully for the better.

Go Change Something.

The Economic "Crisis" Hits Home - American Express Part Duex

Third-Party Lenders IBM, De Lage Landen Cut Channel Credit

First it strikes customers and prospects, now the channel. 

From a Channel Web article, dated 11.10.08, by Scott Campbell - 

"Within the last week, Jay Tipton, vice president of Technology Specialists, saw credit lines cut by both American Express and IBM, moves that forced him to scramble to find replacement lines. "It takes time away from selling for me to work on this," Tipton said. "I don't know what I'm going to do. That's what I have to figure out."

Tipton said he got a call from American Express last week informing him that his line, which approached $30,000, had been reduced to about $10,000.

Technology Specialists used the line mostly to pay recurring bills, he said. "It got cut down to where things started bouncing," he said..." American Express told Tipton it was concerned that his monthly charges were too high. He said a slow summer caused him to delay a payment, but he had caught up by October." 

 And this regarding an entity I have written about before, De Lage Landen Financial: 

"...Meanwhile, Michael Bidwell, vice president of Know Problem Business Technologies, said a $25,000 credit line he had with De Lage Landen Financial Services through D&H Distributing was cut overnight last week,

"I ordered on Monday. I ordered on Tuesday. When I tried to order on Wednesday, they called to tell me it came back refused," Bidwell said. Bidwell said he called both parties, who blamed each other over the ending of the program. "They point fingers at each other but they never sent an e-mail or placed a call to their dealers," 

Bidwell said. It's likely that De Lage Landen pulled the program because it didn't make economic sense for the lender with so few customers utilizing it. Calls to De Lage Landen were not returned..." 

 For the independents and smaller channel VARs this is an issue. For your customers, this is an issue. For the larger hardware providers, K/M, RiKON, CBS, Xerox , this could become an issue - if not already.

Did Ricoh or Canon Win Regarding IKON?

Armchair quarterbacks - from some who have actually been on the field -

Over at the Document Imaging Networking Executives group on LikedIn, a discussion is brewing regarding the buyout.

The question posed by group founder, Jamie Schorr:

"Did Ricoh really “win” IKON over Canon or did Canon make a decision not to play?"

One of the responses to this question from Joe Salkin , Vice President of Sales and General Manager at Duplicating Products, seems pretty poignant:

"Canon made a decision not to play. Canon was given the option to compete for the business but decided not to bid. Canon has never wanted to own IKON or anyone else for that matter however I am sure they didn't want Ricoh to have IKON either. If Canon wanted to buy IKON they could have years ago at a much lower price.

Over the last 3 years IKON's business with Canon had shrunk about 30% based on increase sales of color by Konica Minolta Color products sold by IKON vs. Canon products, and by Canon not replacing the Production Color products that Xerox picked off. 2nd I don't think Canon had much faith in IKON's Management Team, or their ability to manage their sales force. Therefore I don't think Canon wanted the headaches that came with the buy of IKON. Remember just 5 years ago IKON was a $7B company and today they won't do $4B.

I do believe Canon is going to miss the 2500 sales reps on the street, and all the business that IKON got for Canon in National Accounts that Canon will now never be able to get on their own. However over the next 5 years you will see Canon introduce new and better products, get their costs more in line with the competitors, buy up dealers across the country, and open CBS stores across the country to replace IKON/Canon sales. They will take a shot over the next 5 years but each year that will be less and less until Canon makes all or most of it up.

Last but not least Canon made up a huge part of IKON's install base and many of those customers are loyal Canon users, like Canon products, feel Canon products are the best, and will want to stay with Canon products. Therefore while IKON/Ricoh will do everything in their power over the next 4 years to flip that base to Ricoh I can assure you many and maybe most of that base will want to stay a Canon user, therefore those customers will leave IKON/Ricoh and buy from either CBS but most likely a Canon Independent Dealer to stay with Canon.

In other words in 5 years from now the big winner out of all this might just be Canon. They kept 75% of their base, and picked up additional share by opening up new CBS stores, buying up dealers, and being more aggressive on the product and marketing end of the business model and they were not the ones who paid the $1.7B for the mess that Ricoh just got. Canon will lose share in the National Account game but they will get back the placements in accounts that pay more for their products.

The next 5 years will be interesting. One thing I can guarantee you Canon will not lay down and just give up share, they are going to be coming out swinging harder than you have ever seen them. From a person who sell both Ricoh and Canon today its the best thing that could have ever happened."

HP Card and Discounts - Total Care Access Card

Interesting...what is this thing they speak of?


I hadn't heard of this, but I saw a quick announcement and decided to pass it along.

In a nutshell, this looks like a "membership" card offering discounts and goodies - if anyone has seen or used it, let me know.

The HP Total Care Access Card provides exclusive access to software, services and discounts from HP and industry-leading vendors, making it easier for small businesses to manage, protect and grow their businesses while saving money.

"Our small business customers have told us they want to work smarter, protect their resources, and grow their names and businesses while simultaneously saving money, and so we've created the HP Total Care Access Card," said John Dayan, vice president, Worldwide Marketing Operations, Personal Systems Group, HP. "By combining HP's strengths with those of select partners, we can offer simple financing, security, energy savings, marketing, online backup and storage solutions in a single package."

Original article, here.

Managed Print Services and the Economic Environment - Good or Bad?

MPS cuts costs - so why are your not phones ringing off the hook?


Jim Lyons and the crew over at Photozio are asking you, me, all of us, how is the world treating you?

From Jim's post:

"...The Photizo Group is taking a ground-level view, too and in addition to more scientific approaches, we're going straight to our web visitors with a simply online survey. The purpose of this study is to gain your thoughts and views regarding how the current economic climate will impact the demand and opportunity for Managed Print Services (MPS). In return for responding to this survey, we will provide you with a copy of our September issue of the MPS Insights Journal, the only publication which focuses exclusively upon MPS best practices, issues, and user profiles..."


Head over and let them know how it's going in the "trenches". It's only five questions.

Ursula M. Burns- Xerox President - Shares Six Lessons Learned

She helped Xerox rebound, now shares six lessons learned, in the face of new challenges.

Burns climbed the ladder after joining the "X" in 1980.

And when Xerox was going through it's "troubles" back in the beginning of the decade - she negotiated with unions to reduce thousands of jobs. Not an easy task.

-"Right when you think you're set ... you get snafued," said Burns, who rose to the No. 2 spot at the iconic company in 2007. "You can hardly ever relax."-

Here are six lessons she learned from earlier troubles at Xerox.

Communicate. "Whenever you're in a crisis you have to talk," she said. And that doesn't mean dumbing down the challenges the company faces. Workers respond when executives are truthful.

Know the culture. Xerox has worked to build diversity of all kinds to gain a wide array of perspectives. That's a key part of its success, Burns said.

But it also has been bureaucratic and slow to change. Burns said navigating tough times requires embracing the best of the corporate culture and stripping away those parts that can hurt growth.

Have a vision. Xerox was beat up by the press amid its financial struggles. So, Xerox wrote a pretend front-page story that showed how it should be portrayed in the best of times.

"That was our aspirational vision," Burns said.

People matter. The best strategy devised by legions of consultants is worthless without a work force willing to adapt.

"When you're really in trouble, the people are what saves you."

Customers matter, too. "The customer is the center of the universe," Burns said. Xerox used to develop technology and expect customers to adjust. That didn't work. Customers aren't always right, she said, "but you can't tell them they're wrong."

Leadership is key. A bad leader will quickly destroy any progress. Good leaders are humble, focused and human. They "put the enterprise before themselves," she said.

Nov 11, 2008 (The News & Observer - McClatchy-Tribune Information Services via COMTEX)