Customer focused Business Model For MPS20 Apr, 2009 By: BY A. Craig Stimmel imageSource
Customer focused Business Model For MPS
Change is always upon us. And for imaging OEMs and resellers, it’s already here – in the form of managed print services (MPS).
Why so much “buzz” about managed print services? Partly it’s a result of the demand for cost savings. And, I doubt that many people today will argue the wisdom or need of finding practical cost reduction solutions for their business or their customers. The need to better
manage operations and reduce cost is becoming critical as companies strive (or insist upon) efficiency. And profit, of course.
Businesses large and small have always strived to be cost efficient, especially regarding in what they pay out in terms of operating costs. This isn’t new.
My MPS Definition
A service offered by OEM’s and/or their resellers to streamline the management & costs associated with printing, imaging software-as-a-service, and hosted telephony. MPS includes OEM or reseller professionals who work with customers to assist in the design, implementation &
managing of the imaging & printing infrastructure that is tailored to a customer’s specific needs. It’s much like seeing hardware management as a service relationship. And you lock in the customer of all the parts, paper, toner, ink, etc. for those printers over the life of the
contract and deliver it all seamlessly. Most resellers believe today that the margin is in the service and the consumables – not in printer hardware.
Thus, for many larger customers, it is no longer OK to just sell network printers, networking the designated users onto one or multiple imaging devices, and begin or continue to charge for clicks. This now older approach is being superseded by a far more sophisticated service
offered by both resellers and the OEM’s themselves – essential and comprehensive Managed Print Services.
Savvy corporate offices are doing their level best to wring profit or minimize losses out of every segment of their operations. If they haven’t before, they’re closely monitoring the cost of supplies and other similar spending. Many want to reduce the number of service &
leasing contracts they have with different vendors as well. You might be surprised to learn that corporate IT professionals are one of the biggest advocates for having someone else to call when one of the machines needs troubleshooting – even fixing paper jams. They’d rather
concentrate on other aspects of their job, including installations vs. deal with smaller, problematic imaging hardware/software repairs.
With MPS, resellers can measure the usage of various imaging equipment, positioning themselves to make recommendations as to what hardware works best in a location or needs to be swapped or replaced with another device. This means that with MPS, you have an opportunity to
upgrade resident accounts, big time. Imagine having a 10,000 imaging product installed base. This can mean up to 60,000 potential upgrades or new installs as the end-user’s imaging product utilization becomes better known. Imagine the number of clicks that this opportunity
represents. If you figure a printer has an average of 3,000 prints per month, the potential of this reseller selling managed print is 2.2 billion clicks.
MPS can quickly gain market position as it is a “go to market strategy” known by many end users – particularly those with copier lease and service agreements. Resellers can substantially enhance the value proposition they provide their customers while building sales and
profitable revenue for their firm.
HOW IT WORKS
Using MPS technology, resellers can access printers and copiers in operation at an end-user’s site. Resellers can use this information to build a detailed report and proposals to demonstrate where efficiencies and cost savings can be gained through a MPS solution. By
tracking these reports and identifying key factors that suggest change may be needed, you will be able to 1) move equipment from one site to another within a company; 2) upgrade the equipment ; 3) identify problem areas that end user training could resolve, etc. Your customer
will receive these reports which constantly reinforces the fact that his/her decision to go with the MPS option was a very good one. That’s the message you want to deliver.
GETTING STARTED 101
1. Look at your customer base and identify what customers are good candidates for MPS. You will need to help them understand MSP’s value proposition and what kind of savings MSP will mean to them.
2. Determine how you’ll go to market. Who will sell MPS? Is it existing sales staff or a directed sales staff dedicated to MPS? Or to identify individuals in your sales organization that exhibit sales skills suitable to marketing MPS – dividing their time between traditional
& MPS opportunities.
3. Get educated on MPS. Become knowledgeable about MPS vendors, training (possibly through the Business Technology Association) or the OEM’s themselves.
4. Become comfortable selling “solutions” vs. a piece of equipment. Your sales people will need to think differently as they approach “solution selling” as a key to potentially tripling your revenue opportunity with just your existing account base.
Image what other opportunities out there exist and you’ll have a good idea of what the future can mean to your company.
QUESTIONS & ANSWERS
So if the majority of resellers acknowledge that managed print services are such a great idea, why haven’t they been signing up in droves? Is it fear for the unknown? Or a reluctance to get involved until someone else ideally in a similar market has built a successful MPS
The answer is likely a little of each. Some resellers feel undercapitalized to handle a slow ramp-up of a new business tool such as MPS. Or they perceive that they do not have the people resources in the tech & business development areas to handle the marketing,
implementation and maintenance of these MPS systems.
Of course, that is the no decision, decision. Thinking maybe it’s best that we don’t do a thing until someone else does it close by and proves the business model (it’s been proven!).
So guess what? They’re doing that right now – selling in our backyards. Xerox, for example, is pushing hard to become “the” MPS vendor of choice. And there are numerous others in your market that are going after new customers, such as PrintFleet and Digital Gateway, to name
but a few.
Yet, as has happened in the past, some resellers will find themselves behind the latest industry trend and having to play catch up football to try and regain lost market share.
Commit yourself to becoming knowledgeable about MPS. Base whatever decision you make on actual facts; review information from researchers & analysts; consider bringing in an industry consultant.
A. Craig Stimmel, CMC, MBA, President of Strategic Planning & Implementation Associates, Inc. For more information contact Craig at: CSimmel@SPIAinc.com