How’s business?
Gondek: We had a great year last year and are off to a huge year already. Right now we’re looking at the numbers of how we’re going to finish our first quarter and really can’t be much happier about the results.
What do you attribute your performance of the last two years to?
Gondek: We started preparing for the [economic] downturn before it hit and made significant adjustments allowing us to invest and ramp up while being more efficient. We didn’t cut people, but hired. We actually took advantage of everybody else cutting people and found some great talent in sales and service. We hired two guys who were service managers for our competitors, now they’re senior level service technicians with us.
You’re a smaller dealer, what allows you to compete against bigger dealers and direct branches in your market?
Gondek: They worry more about us than we worry about them. Nobody up here comes close to us in service and support as far as response time and how we deal with our clients and the expertise levels we have. We go up against the biggest direct people and win more than half the time. Our philosophy is a lot different; we’ve been doing the same thing for years—we solve customers’ problems.
Our sales people aren’t allowed to give a customer a quote unless they’ve done a walkthrough and an analysis of their organization, and look at different ways of improving their operation.
We have people call us all the time wanting a quote over the phone or emailed and we turn them away. We’ll give them a quote if we can come in and evaluate their needs, but we’re not going to give a quote based on us not doing our job. That works pretty well for us. Once they see what we do compared with everyone else, we typically blow them away.
You’ve got a broad blend of customers from small businesses to national accounts, that’s pretty good for a smaller dealer.
Gondek: We don’t use any of our manufacturer partners for their national account programs. We manage clients with machines all over the United States. We do everything from here. We monitor their service and work directly with other dealers to arrange for service out of our area. Besides the national accounts we sell to everyone down to the little one machine mom and pop operations. How we take care of them is why we’re successful. Everyone takes care of their big customers pretty well, but we want to take care of our small customers too because that one machine is mission critical to them. I received a call from a woman the other day who works out of her home; her machine was down and she had to get to New York to deliver a proposal. We were there in under an hour. That’s how we judge ourselves because everybody pushes those smaller accounts aside.
How did Advanced get into MPS?
Gondek: We got into it about six years ago by beta testing a few sites just to see how we handled it and what kind of margins were there. We built the program slowly. We have a director that focuses only on managed print services. We have real-time live monitoring of devices and map to floor plans for our accounts. That’s where the ‘Wow’ factor is. When we meet with the head of IT, we pull out an iPad and show them their floor plan with all the machines and then take paper out of one that’s in blue or ready state, which then turns to yellow state or needing attention when we remove the paper from the machine, and they’re blown away.
What were some of the lessons learned early on with MPS that you don’t make now?
Gondek: We over analyzed to the point where we did too many reports. Once we show people a certain level of where they’re at with their fleet and their numbers, those 20 pages of data aren’t necessary. They flip to the last page to see what the price is.
They’re already sold when they see how we monitor equipment. We have an MPS contract that people have been trying to get their hands on for a long time, but we keep it close to the vest. It’s all customer focused. MPS is still not easy. There are too many dealers out there who don’t have the infrastructure or support in place to sell MPS or document management solutions. There’s still a lot of confusion in the marketplace. We’re dealing with accounts all the time that had done MPS with another company and now they’re gun shy because you’re supposed to get what you pay for, but that’s not always the case.
What’s the biggest complaint they tend to have with their previous MPS provider?
Gondek: They don’t see the numbers so they don’t know what they’re doing. We just met with a company who has 300 printers and have been asking their vendor for print volume data for six months and can’t get it.
They also don’t have the ability to make changes. Our plan allows clients to make changes any time they want. They can add machines and pull them off. That’s what they need. Printers are such a commodity and come and go. We can go into the biggest Fortune 500 account and ask how many printers they have. They’ll give us that number and we’ll run software that tells a different story and the number we come up with typically isn’t even close to theirs. Printers are a moving target and if you have a contract that moves with it, that’s what customers need.
Was it difficult getting customers to embrace the MPS concept?
Gondek: We offer what we call asset management. Last year we went in and saved an account 20 percent without selling them anything and didn’t take over their printers because they didn’t need our MPS services. We just did an asset management analysis and relocated all their assets so that they were used properly in the right locations and that reduced their expenses. We had one company where we reduced their expenses by $100,000 a year.
MPS is easy when you can show somebody that you don’t necessarily have to buy things. It’s not just buying cut-rate toner to get a lower price; if you utilize your assets properly and deploy them properly based on their life cycles and capabilities, typically you save customers a lot of money.
Who in your dealership sells MPS and what kind of skills do they have to do that?
Gondek: All our sales reps sell it, but you have to be CDIA+ to work here. We pay for that and if we hire you, you have six months to get that [accreditation]. And we have a support staff behind them that oversees all the MPS.
Are you thinking about managed network services?
Gondek: We’re doing it. We have two full-time IT guys and a software specialist. We’re not big enough to where we could spend a quarter million or a half million dollars to build the infrastructure. If you don’t have the proper infrastructure, you’re just going to fail. You can’t be all things to all people so we partnered with what we think is the best IT support company in our area and we use them quite a bit. We do the first-level support here and our IT partner handles the second level support. It’s transparent if the customer needs a higher level of support, but for all intents and purposes it’s from us.
What is the biggest challenge facing Advanced Copy Technologies in 2013?
Gondek: We’re going through reorganization and rebranding. We have three divisions that we’re spinning off, so it’s making sure we don’t become dysfunctional and not putting up walls that are too high between these divisions that overlap. That’s a big challenge because in a corporate environment if you were in one area, you didn’t work closely with another. That’s still an issue we see with most of the major manufacturers. Our biggest challenge is to continue our growth while rebranding these offerings into the different divisions and making sure that our support levels don’t deteriorate as our employees move into new roles. That’s easier said than done.
What do you like best about your job?
Gondek: I love the interaction, I love seeing clients and solving their problems. I’m very active in our account base. If I get two or three complaints a year, and we have over 3,000 accounts, that’s a lot. This business is a lot of fun and everybody who works here has fun.
What do you like least?
Gondek: E-mail, it’s evil. Since we started talking about 14 e-mails have come in. Used to be if somebody needed something from you, they’d pick up the phone and you’d have a conversation. With e-mail they’re more demanding. A lot of e-mail goes out with no thought process behind it whatsoever, whereas if they called you they’d think more about what they’re going to say or request. I’m one of those guys who sorts through them all. If somebody sends me something I answer it.
Do you expect to grow this year and if so, by how much?
Gondek: Last year we grew 15 percent and that was great. We focus on managing that number to 15% to 20%. If we start growing any faster than that we slow it down because the infrastructure needs to always be ahead of that growth curve or pain creeps in, usually being felt first by your customers. We can’t be all things to all people. We don’t do many bids anymore because there’s no margin and we were doing a million to a million half a year in bid revenue a few years ago. We refocused our strategy on our strengths and now we are winning more new accounts than ever. Growth is there whether we want it or not, it’s just deciding which clients are right for us.
We will turn away business if it’s not the right fit for us and for the prospect and they appreciate our honesty. We’re not huge, our goal has always been to be the best service provider in the market and we are by far. There’s a certain level of client that will seek us out and once they find us they’ll never leave. And then there are people who will call us and say ‘I can get this for $20 less,’ and I say ‘are you getting two network guys coming in to set this up for you at 10:15 Thursday as you requested?’
Speaking of growth, I understand you’re now offering 3D printers and that’s growing like mad?
Gondek: We’re probably two years ahead of most people in the market when it comes to new technologies. Almost a year ago we started selling 3D printers. We’ve been told we’re the first copier company in the U.S. to sell 3D. Our sales and service people are all trained, and we have a strong support infrastructure in place. It’s very exciting because we see 3D adding a lot of incremental revenue.
If you hadn’t gotten into this business what do you think you would have done instead?
Gondek: I got in this industry by accident. I was a VP of a construction company and they went through an acquisition and had all sorts of issues. All my friends worked in the industry, and I interviewed with a big company in the industry and didn’t like them. I won’t tell you who they are, they became huge, but I just didn’t like their style. Then there was a little company down the street that needed some help and it was Gestetner. Nine months after they hired me I was branch manager, then became district manager, and regional manager in just a couple of years and I’ve been having fun ever since.
