The Magnificent Seven – Tips to Successful Supply Management31 Aug, 2015 By: Sarah Henderson, Dir., MPS Operations, Clover Imaging
The early days of Managed Print Services were often compared to the old Wild West. This was a popular analogy because for many resellers it seemed that placing printers under an MPS agreement was like a “land grab.” As the market has matured and many MPS agreements are cycling into the second or third contract, many dealers have said that they often feel under siege by their customers driving even lower “Cost Per” pricing.
The performance and affiliated management of the imaging supplies / toner cartridge can represent up to 70% of a standard Cost-Per-Page calculation for MPS. To help you ward off profit “bandits” within your MPS contracts, I have prepared a reference list of the tips for successful supply management.
- Supply Selection
It may sound simple, but would you walk into a gunfight without a full chamber of ammunition?Dealers may even be surprised on how a simple audit of the imaging supplies they are placing under MPS contracts may result in more profits. This audit should focus on the key areas of yield and failure rates.
Select the highest yield cartridge that is available for the device under contract. Look for extended yield cartridges that are designed for Managed Print Services by your supplier. If you have not reviewed your product SKUs lately, you may be missing out on new products that have been released that can provide more impressions per cartridge.
It is also imperative that you partner with suppliers that have lower failure rates and can address issues immediately. Just because a cartridge may have a lower acquisition cost, does not mean the overall of “total cost of ownership” is your best option. Understand and factor in the cost to replace failed cartridges in administrative time and customer satisfaction. Also look for a supplier that invests in Research and Development and continually perfects their remanufacturing processes down to producing the highest quality print for your customers.
- Inventory Management
While a stockpile of something can come in handy during a siege, the goal of MPS is to wean your customers off the need for “safety stock” via just-in-time supplies fulfillment. As we all know, that is not the easiest goal to accomplish for several reasons. First and foremost, dealers need to maximize the investment they have made in their remote monitoring software to understand the ability to provide alerting and reporting. Companies like PrintFleet and FM Audit have worked to improve this functionality for users in order to reduce duplicate information and to provide more accurate reporting. Yet many dealers still rely on the end user calling in to tell them they need a toner cartridge. Bare minimum; utilize the remote monitoring software to verify the need for that cartridge.
- Software Utilization / Integration
The next step in inventory management within MPS is to also call out for help. Look for partners who can pull the remote monitoring software into action, such as an order entry. For FM Audit and eAutomate users, ECi has worked to push alerts from FM Audit into eAutomate to create a supply quote. At the Clover Imaging Group, we have also invested in an Auto-Toner Fulfillment platform that works to create one alert, per notification, that also integrates with our software platforms for more efficient order entry.
Regardless of how you fulfill on the front end, all dealers should be auditing their toner swap reports to determine “rouge” end users. While not always intentional, end users who move cartridges between machines, swap out a cartridge early or simply call in prior to a true “empty” can spell havoc on supplies fulfillment. By working to educate your customers on how to best interact with the machines, dealers will benefit via increased profits and a more positive customer experience.
- Vendor Integration
On the back end of your software integration it is also key that your vendor can integrate and support you. If you are an MPS dealer who pushes through orders via the ECi ESN, you should be utilizing PO Processor and Receiver. Look for partners who will integrate with your ERP and accounting software. Without this critical set you may be wasting costly administrative time related to supplies documentation, creating POs or chasing order notifications. Look for partners who are experienced in these integrations and can help guide your administrative and operational teams through process improvements, if needed.
- Labeling Conventions
In the old western movies, the heroes often ride off into the direction of a setting sun to guide themselves to the next adventure. Unfortunately in the world of MPS, just getting the toner cartridge to the right location is not enough these days. You must also ensure that the supplies get to the right device at the time it is needed. This requires some work on the dealers’ part in making sure assets are properly identified, tagged, locations noted, etc.
But after that work is done, it is also key that the end user have that identifying information when they receive the supply. Look for a partner with labeling conventions to meet the needs of your program. This can be a separate label on the exterior of the package, specialized notes on the packing slip, or a combination of these solutions. Onboarding customers is best achieved by showing them where to look and what to expect as they receive supplThis will help mitigate the need for toner stockpiles, double shipments, and end user calls.
- Recycling Solutions
When is the last time someone told you that they would pay you for your trash? Or better yet, provided you with a complimentary value-add sustainability program to help you differentiate? If you are currently not recycling laser imaging cartridges because you think it may be too time consuming or costly, you need to look at this area of your business again.
Partner with an imaging supplies provider that offers a recycling and buy-back program. This will not require you to go out and collect empties, sort or store them. For example, the Clover Imaging Group can provide a simple web-based integration where customers can simply download return labels at no cost. If those cartridges are part of a buy-back program, you will be paid on those returns. Regardless of whom you partner with, do your research on their ability to help you extend sustainability and green programs to your customers. Look for the ability of partners to provide sustainability reports and documentation on their green practices. One area of innovative sustainability that the Clover Imaging Group has a partner in is the reforestation efforts via the PrintReleaf exchange. Simply put, by planting trees to replace consumed paper of and for your end user, a dealer can take way objections or “guilt” from print output.
- Sales & Marketing Support
As much as the Managed Print Services business model is about print management, all too often you may run into objections about the actual imaging supplies. Look for an imaging supplies partner that can provide you with the necessary materials and training to support your sales efforts. Obviously, having support materials for the core product of imaging supplies is key, but also seek out how your partner can help you close more business.
The materials to look for can include product sales training, MPS sales training, marketing flyers and even end user facing materials that can be dispatched via email or your website. At the Clover Imaging Group, we have invested in not only sales training, but an integrated marketing platform for dealers to help promote MPS and beyond.
Key to implementing any of these action items is working with partners that are investing in your business with you. Select a team of product and process experts who offer you the value-adds and ways to differentiate in your market in order to be more profitable.
Sarah Henderson is the Director, MPS Operations, for the Clover Imaging Group. For company information visit www.clovertech.com.