In an era where smaller dealers are struggling or selling out, it’s insane why anyone would want to start an office technology dealership from scratch in 2012. But that’s what Mark Wild did with Upstream Office Solutions, a Tampa-based office technology dealership, which is growing rapidly thanks in part to its mission of delivering flexible, cost-effective solutions that provide true value to Upstream’s clients. Equally important is that this is a dealership owned and operated by a veteran of the industry that knows how to sell and who people like doing business with.
Mark Wild,
President
Upstream Office Solutions, Tampa, FL
Wild entered the business in the UK in 1986 when he left an $80 a week job in a fiberglass making company. In 1992 he moved to Toronto Canada, then in 2000 moved back to the UK, and then in 2007, moved back to the U.S. as a 50 percent owner of Danwood America before a falling out led to his departure and taking a job as regional sales manager for a large Kyocera dealer. When his non-compete with Danwood America expired in 2012, he started Upstream, where he generated over $1.2 million in the first year from scratch.
Knowing the challenges, why would anyone want to start an office technology dealership in 2012?
Wild: I can’t work for somebody else. [The last dealership where] I worked they were absolutely mortified when I left. While I was there two branches went from $400K the previous year to $1.6 million. I’m 48, but at some point in my mid-fifties I want the option to retire and what could I do between now and then to maximize that? We were going to invest in property, but the market is in the tank so we decided to do what we do best.
What made Tampa a good location to locate your business?
Wild: I was already in Tampa and didn’t want to be in a tourist location like Orlando. Tampa was the only place we looked at.
Who are your customers?
Wild: The majority of our customers are SMBs with 1-25 pieces of equipment.
Why do they buy from you?
Wild: A lot of them were my old customers from when I was with Danwood. They have a very good memory. The thing with this business is that it’s the same as it was back in 1986. You pick up the phone and call people.
It’s not one big thing you do right and everybody comes back, it’s hundreds of little things. If you say you’re going to do something, you do it. You back up your promises and don’t try and gouge customers. It’s all the basic stuff that everybody talks about, but they get lazy and don’t do it. We think we do everything the right way. Humans at the end of the line, we call people back straightaway, service them quickly, and send them toner when FM audit tells us to send it.
Who are your competitors?
Wild: It’s different every time.
Even though you sell a lot of hardware, you don’t walk into a prospect trying to sell them a box?
Wild: We go in through the MPS program side. If you go in through the MFP/copier side the reaction is we’ve got a copier, we’ve got three years left on the lease. But we go in with the point of view that you have desktop printers in your office and how much is it costing you to feed them? What if we come up with a plan that either takes over the ones you have or replaces them with more economical ones so that you’re paying less or the same as what you’re paying now just for toner—except we include everything.
We get in that way and as you go down that road you automatically bring the copiers into the equation. When we do that, two thirds of the time we’re not competing against anybody.
When you’re approaching these prospects with an MPS type of program, haven’t they heard that pitch before?
Wild: The biggest thing I’ve found with MPS, and I’ve been selling MPS effectively for 20-odd years, is that everybody talks about it, but not many truly understand it; the reality is hardly anybody is selling it properly. They think it has to be 100 machines plus. MPS is sometimes one machine.
We’ve upgraded a lot of customers of this dealership that was bought out by Xerox. They’ve had a lot of issues and are easy targets. I’m going into those customers who have 1, 2, 3 copiers where the previous dealer had the accounts for 5, 10, 15 years, and they still have un-supported desktop printers around the office. Even though they have their own ‘penny a page program’, 9 times out of 10 they’ve just got the copiers. We go in and turn a 3-machine account into a 15-machine account.
Do prospects understand MPS?
Wild: They’ve probably had sales people who spoke to them about it, but they make it so complicated. I teach my guys to say, “you’ve got these printers on your desk, you feed them with toner, when they break you throw them away and replace them. Do you have any idea what that’s costing you?” 9 times out of 10 they don’t. We then ask, “would you like to find out if there’s a better way?” We do the print audit, the physical audit, and put it all together for them. Sometimes we keep the machines they have if it’s economical, sometimes we replace some of them, and sometimes we replace all of them.
What do you use for tracking?
Wild: We’ve used FM Audit from the beginning to manage the consumables and meter count collection. It’s about 90 percent efficient. Everything we put out we put on the network so it’s completely covered.
You sell Toshiba, Sharp, and Kyocera, why are those lines a good fit for you?
Wild: Kyocera printers are by far the most cost effective of any printer right now. The MPS program where we’re charging a penny and a half a page, all include the lease and the service, so you need a machine that costs you .5 or.6 otherwise you can’t make any money. A lot of the machines out there, the HP’s and the Lexmark’s, cost you a penny a page so you can’t do it.
We’ve had the Kyocera printers since day one and were an authorized reseller. When we first opened I could not get a dealership with anybody. Tampa is a tough area. You’ve got Dex, Zeno, and all the manufacturers’ direct branches here, so the manufacturers see a small startup company as ‘Why bother, what are they going to do?’ So we became a reseller through a wholesaler for Toshiba and Sharp. About three months ago we became fully authorized with Toshiba. For a full upright copier we sell Toshiba, if it’s a desktop printer, Kyocera, and Sharp if nothing else fits.
Your primary leasing partner is Everbank, but I understand you had some issues finding a leasing partner at the beginning?
Wild: When we first started, most weren’t interested. Then all of a sudden they see the growth and we’re now quite popular.
What are the biggest challenges you faced in starting up this business?
Wild: Cash flow and finding good sales people.
How are you finding good sales people?
Wild: We’re starting to bring in younger people and teaching them from scratch. They go out on cold calls, book appointments, and I go out and help them close them. Getting experienced sales people is a pain because they have bad habits. If there’s a good sales guy out there, he’s got a MIF that he can farm and it’s easy. A good sales guy making six figures is not going to leave a cushy number to write new business.
What do you like about this business that keeps you coming back and persevering through all the ups and downs you’ve experienced?
Wild: I’ve never found a job that can pay consistently what this job pays. I’ve always made a very good living, I know the business, and I enjoy it.
How do you see Upstream growing over the next three years?
Wild: Our original plan was a million in the first year, which we achieved, $2 million in the second year, which we’re well on target for, and $3 million in the third.
What’s it going to take to accomplish that?
Wild: Finding good sales people. This year I’ll probably do 70 percent of the $2 million on my own and the rest will be from the reps. We’ve got a couple of really good guys now and the plan is to find them a couple of younger guys who do the leg work for them. Through controlled growth and organically building the sales team that $3 million next year won’t be an issue.
