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In a Comparative World, Where do You Stand?

9 Oct, 2009 By: Bud Karakey imageSource

In a Comparative World, Where do You Stand?

Throughout life there seems to be a comparison for
everything we do. From who walked or talked first as a child to who now makes
more money.  While comparisons may seem
trivial to some people, it’s really how we keep score and often is essential
information in our capitalistic society. I’m not talking about “keeping up with
the Jones’” but more on a professional level of how we compare or compete in
business. If you want to be the best of the best, you do need someone or
something to compare against. This gives you a marker of where you stand and
the challenges you may face ahead if you want to be better. Remember the movie
Wall Street with Gordon Gekko’s “Greed is Good” quote? Perhaps not with those
same methods, but we do know that working smart to increase profits is an
underlying motive to compete in business. First, however, you need the best

Statistic Comparisons

With this in mind, let’s take a deeper look into what
comparisons, or more importantly, “Statistical Comparisons” provide us. style='mso-spacerun:yes'>  In today’s data rich world, you can find
statistics on nearly everything we come in contact with; from sporting
statistics of players, to service information on automobiles. We use this
information in making buying decisions, maybe placing bets on a horse in a

Statistical comparisons provide us great tools to look at
problems and sometimes the solutions to correct them. Over the past few decades
many companies, including our channel, recognized the value of this statistical
data and provided an unbiased third-party review of this statistical
information. From Consumer Reports, Buyers Lab to BEI Services, this data
allows consumers and related companies to feel comfortable that the information
they are looking at is factual, impartial, and well balanced. style='mso-spacerun:yes'> 

Many dealers use this data remarkably well as it relates to
their service departments. So well that they are the dealers who seem to win
all the awards, maintain the highest margins and still prosper in these trying
times. Like a professional athlete striving to break a record knows exactly
what is required to surpass the mark, dealers should know what marks to exceed
to achieve their goals and the next level of success. Dealers need to use
compiled data to their advantage, reviewing “check points” to ensure their
dealership is not off balance and is running productively; that operations and
services are on track.

Margins Affected

If you’re a dealer selling a machine to a customer, you need
to know exactly how that machine is going to perform. style='mso-spacerun:yes'>  More importantly, you need to know the volume
band sweet spot for that machine and if it’s the best piece of equipment for
the job. Statistics show that only 13% of Digital Segment 4 and 4% of Digital
Segment 3 equipment are placed in their appropriate sweet spots. style='mso-spacerun:yes'> 

Additionally, 45% of segment 4 machines are placed in
segment 2 volume bands with a service cost per page of 1.3 cents, and 47% of
the segment 3 are averaging 2447 pages per month at a service cost per page of
0.019 while the sweet spot is 0.00284. 
If the proper statistics had been considered, smaller machines would
have been placed, costing the customers less money and making you much higher
margins. To make this point even more clear, in one popular model consisting of
23,216 machines, there was more than a 650% swing in service costs, from the
low end of the spectrum to the sweet spot for that model. style='mso-spacerun:yes'>  Do you think that affects margins? style='mso-spacerun:yes'> 

While statistics like
these are not uncommon, I find it very surprising more businesses don’t
subscribe and operate their companies and “manage by the numbers” on a more
frequent basis.  Using data like this can
have dramatic effect on how and where you need to place machines and the
margins you make on them. Not only can this statistical data tell you the
performance criteria of models, but also how your technician(s) performance is
on specific models

Example: Interesting Database Statistics

• The worst
performing technicians on any given model normally does most of the
service calls on those models costing dealers thousands monthly

The average
company can’t account for 35% of technician manpower

• The average
number of managed copies/prints per technician is 1,163,495

• The average
number of calls per month per technician is 66.1

• The average
service call length is 75 minute and 52 seconds

The average
travel time is 31 minutes and 51 seconds

The average
number of calls per day, per tech is 3.7

Within our industry we have a number of great affiliations
that bring businesses together and allow them to freely share and compare ideas
and Best Practices.  Within these groups
and forums, some classes are given, speakers and experts in their field present
material and are listened to with great enthusiasm. style='mso-spacerun:yes'>  Most of us have attended a number of these
gatherings and found at least some of them very informative and educational.
However, an accurate way of measuring the health of your company is by
comparing it against others statistically, i.e., service performance based
measurements you can compare yourself against…current statistical information
that allows you to compare your performance against the rest of the industry
worldwide, on a specific subject matter to let you know exactly where you
stand, good or bad, and as importantly, why. 

Statistical comparisons are benchmarks to help you achieve
that next level of success, giving you information you can use to decease
costs, increase margins, and keep your customers happy. How do you know, in
anything, what is good or bad unless you have something to compare it to?

Bud Karakey is VP of
Operations for BEI Services, Inc. Contact him at
bud.karakey@BEIServices.com or
visit BEI Services
for company



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