Tarek Hafiz, president of Cell Business Equipment (CBE) in Irvine, California, is one lucky guy. He’s got a thriving office technology dealership that sells Canon, Ricoh, and Sharp products, and this year celebrates the 20th anniversary of his company. Through high times and lean times, CBE has persevered. Much of that credit goes to Hafiz who not only takes pride in his business, but in the team he’s assembled that continues to be instrumental in building CBE into a $20+ million dealership.
I spoke recently with Hafiz about himself, his business, industry trends and opportunities, and the people who make up CBE.
I’ve always been curious, where did the name Cell Business Equipment come from?
Hafiz: I started in the warehouse of my brother’s company. He owned a computer company called Cell Micro and I started selling copiers while working for him. Because I was a small company I knew other companies wouldn’t approve me to do business with them so I used the name Cell Business Equipment. After he sold the company I got stuck with the name. I started by selling used equipment, Konica and Mita, which is what I sold as a sales rep. In 1995 we became a CopyStar dealer and when Mita filed for bankruptcy around 1999 I became a Sharp dealer. In 2006 we became a Ricoh dealer and in 2010 we added the Canon line.
Tarek Hafiz, president of Cell Business Equipment (CBE)
How did you get into this business in the first place?
Hafiz: I worked as a sales rep for a copier company in Irvine. My father sold copiers back in Kuwait. He sold Canon, Xerox, and Sharp so I had toner in my blood while growing up.
In 2010 you became a Canon dealer, today it makes up more than 50 percent of your total hardware sales. How did that happen?
Hafiz: The name recognition of Canon in the color arena is very strong and the Canon customer is loyal to the brand. None of the other manufacturers can compete with the programs that Canon has today. They provide rebates, incentives they give to our sales reps, and they give us [products] we can sell with their bundled pricing. Some manufacturers will give you stuff that you’ll never use and it gets stuck in your warehouse so you don’t buy that bundle. The Canon bundle is a bundle you can take and sell the same day. The way the rebate is set up is to reward you based on today’s deal not based on hitting quota at the end of the fiscal year. So when your sales rep walks into your office and says, ‘I have this deal, can I do it?’ you can. With other manufacturers the rebate is done at the end of the fiscal so sometimes you cannot hit that number. If you don’t hit that number you lose money.
Sharp has been going through some tough times of late, is that affecting your Sharp placements?
Hafiz: Absolutely not. It only comes up if another sales rep mentions it, but overall we have no issues.
What kind of potential do you see in your market and with your customers for Sharp’s display products, an area they’re placing an increased focus on?
Hafiz: It’s absolutely huge and we have it in all three of our showrooms. It gives us an opportunity to take the focus away from the copier and show something else that’s exciting that people will love to see because it’s a new technology, and then we can say, ‘By the way we sell copiers too.’
Who do you have selling the display products?
Hafiz: Everybody.
You also sell mailing equipment. Do you have specialists to sell into that market or do your general line sales people sell that equipment too?
Hafiz: Yes, everybody sells it, but it’s a struggle because copier people don’t understand the mailing equipment buying cycle and Pitney Bowes has control of that market.
But you still think mailing equipment is worthwhile?
Hafiz: We try to give the customer a variety of options so they have one place where they can shop to get everything they need.
When did you first start offering MPS and how is that segment of your business doing?
Hafiz: This is our fourth year and we’re just starting to see a payoff. As of the end of last month we have close to 1,600 printers under print management.
What was the biggest mistake you made when first offering MPS?
Hafiz: As a copier company you tend to take deals you sometimes shouldn’t take, and in print management you can get hurt pretty badly when you take a bad deal.
Do you see an opportunity to move into IT services?
Hafiz: One of the goals for 2013 is to expand IT services. We’re still having a tough time understanding that business so we’re looking into perhaps buying a small IT company to bring their experience in and have them teach us how to grow that segment of our business.
Let’s talk about the people at CBE, I know you’re proud of the way that CBE has successfully cross-trained five generations of workers (Silent, Boomers, Gen X, Y and Z) to create a positive workflow of emerging technologies. Why have you found that important to do and do you think you’re unique among your peers in focusing on that?
Hafiz: I think we are unique in that we don’t lose people. Some of my sales people have been here for 17-18 years and most have been with me at least 7 or 8 years. The reason for that is we’ve blended different levels of experience and we give an opportunity for all our sales people to go out and get the business.
For example, we have a person who has a niche in the hotel business. That’s all he does. We didn’t ask him to go out and do that, he found it himself and that’s what he enjoys so any hotel in Southern California is basically his. We don’t limit him to a territory. We have young guys who go out and do complete demos on their iPads. We have the older generation who still bring out the brochures and invite the customer to our showroom for a demo. That mix of experience has helped us to grow as a company and we’ve been growing at least 10 percent a year.
I hear you have a great work environment and you truly make an effort to build camaraderie among your employees?
Hafiz: We go out and do things together as a company—basketball games like the Clippers or Lakers, Angels’ baseball games…we’ll take 40 or 50 people and celebrate who we are. We have a nice Christmas party and in the summer we have a picnic for our employees.
What is the biggest challenge facing CBE today?
Hafiz: The growing pains and being able to compete with the manufacturers. Every manufacturer has a location or two in L.A. and Orange County.
How do you deal with that challenge?
Hafiz: I tell my guys we are better because we are a service provider and decisions are made here. I work 8-5, Monday-Friday, so we can make decisions on the spot. The manufacturer has to call back East to make a decision. We deliver faster than the manufacturer and we joke around and say we can deliver faster than they can deliver a pizza.
When you’re not busy running your business how do you relax?
Hafiz: I hang out with my kids, I jog, go to the beach. I like to be outdoors. I live in Southern California where the weather is amazing. I like to attend Clippers games, watch sports on television, especially soccer. I have a few shows on T.V. I enjoy and I like to watch movies.
What’s next for CBE?
Hafiz: We’re about to open our fourth branch in Riverside. We hope to continue our growth and open an office in the Ventura area and continue providing different technologies to our customer base.
If you weren’t doing this what do you think you’d be doing?
Hafiz: I don’t know. I love what I’m doing. I love to wake up every morning and be with the people who work here.
Contact CBE Office Solutions
4A Mason, Irvine, CA 92618
T:(949) 830-1400 F: (949) 951-7193
www.cbeofficesolutions.com
