If the last 12 months have taught us anything, it’s that the things one can truly count on continue to diminish. This is what makes those few constants all the more comforting and reassuring.
Outside the windows of CBE Office Solutions in Irvine, California, and its four branch locations, the pandemic continues to have a deleterious effect on the usual flow of business in the state’s southern region. But it only takes one phone call to CBE for clients to discover a refuge of familiarity and relief in a business partner that makes darn sure the phone won’t ring more than twice before being picked up.
Everyone who has dealt with CBE is familiar with Karen, the firm’s dispatcher for nearly 25 years. She’s Facebook friends with a number of clients who consider her to be family. Then there’s Lisa on the supply side, another employee who’s been on the job seemingly forever, always ready to deliver that toner when needed.
It may seem trite to say a dealership is fueled by friendly and knowledgeable staff who know you by name. But that ability to cultivate deep-rooted relationships with customers, vendors and suppliers has enabled CBE to thrive even during the most difficult of economic turbulence. Faith is a two-way street between dealer and client, the ideal avenue toward mutual growth.
“My customers are quite comfortable with our sales, service technicians and staff, many of whom have been with me 15 to 25 years,” notes Tarek Hafiz, president of CBE, who founded the firm in 1993. “There’s something about hearing a familiar voice in troubling times that makes them feel safe and assured. It has helped us continue to grow, even during bad times. Our employees believe in what they do, and I give them complete autonomy to make decisions on behalf of the company. I know they’re always going to do right by the customer.”
Those relationships extend to CBE’s manufacturer roster, an august list that includes Sharp, Canon, Ricoh and HP. The dealer primarily services Southern California from San Diego to northern Los Angeles, with two branches serving the City of Angels (City of Industry and Torrance), along with offices in Santa Clarita and Ontario. Acquisitions of Pacific Equipment and QLAN Corporation have aided in its growth through the years.
In addition to managed print and IT, CBE offers production print, telephony, security cameras, mailroom equipment and interactive white boards. Its range of client verticals touches education, government, health care, hospitality, banking/finance, legal, logistics and manufacturing, among others. This breadth of services has enabled CBE to reach the $45 million plateau.
Bold Stroke
During 2019, Hafiz made a bold move in joining the Flex Technology Group (FTG) family of companies to leverage FTG’s collective strengths. This provides more enticements for his staff of 150 employees and deepens the resources CBE can offer its clients (more on this shortly). The road Hafiz has taken to build from the ground floor to a $45 million performer speaks volumes to his penchant for leaving no stone unturned in finding ways to proliferate word of the company’s value proposition.
Road to America
The Egyptian-born Hafiz moved to Kuwait with his family at the age of nine, as his father, an accountant, took a job there. The elder Hafiz saw a great opportunity selling photocopiers in a country the size of Orange County, where each manufacturer had a single representation. His father opted for selling Canon and later became a sales manager.
At the age of 18, Tarek Hafiz moved to the United States to continue his education and develop a career. He worked in construction, department stores and swap meets before getting a job selling life insurance. In truth, he wasn’t crazy about “telling someone when they die, we’ll take care of your family…I didn’t feel good about that.” Around that time, his father paid a visit to the states and encouraged him to try a career in copiers. While Hafiz didn’t exactly embrace that idea, either, he was young and married and needed a vocation that could put food on the table. So he joined forces with FKM Copier Products in 1985.
Craving the chance to become a manager, Hafiz opened Cell Business Equipment in 1993, using warehouse space in the building owned by his brother’s company, Cell Micro. This allowed Hafiz to secure business with leasing companies and access the credit he needed to get started.
Timing is Everything
Fortunate timing has enabled Hafiz and CBE to establish critical OEM relationships that have paved the way to formidable growth, which at one juncture saw the company gaining 25% year over year. For instance, when IKON Office Solutions dissolved its relationship with Sharp, Hafiz was able to forge an agreement with the manufacturer despite being a small $2 million performer at the time. Ricoh helped fill in the gap of segment five and six equipment, and Hafiz had a soft spot in his heart for Canon, which paved the way for his father’s success. So Canon and Samsung (later acquired by HP) followed in a two-year interval.
What impressed Sharp most about CBE was its core of young, hard-working team members who were willing to learn and take the next step in their development. Mindful of the cost to onboard experienced industry professionals, Hafiz’s MO was to hire young, hungry candidates right out of school.
“I’ve always believed it’s better to hire young people from outside the industry and develop them to do things your way,” he said. “People with a lot of experience also have bad habits, and at that time I couldn’t afford to hire the big guns. And all of these people we developed are the ones who helped build CBE.
“All of these manufacturers believed in us and the way we do business, and they put in the resources to help us grow,” Hafiz added.
Hafiz also had a few nontraditional marketing tricks up his sleeve; ideas that would certainly be viewed as unconventional through a 21st-century lens. He decided to sink some advertising dollars into radio spots on news-focused stations such as KFWB and KNX, and also bought ads during Los Angeles Dodgers games.
His timing was uncanny—right around the time Hafiz was trying to get the word out about his new copier dealership, the O.J. Simpson murder trial was engulfing the entire nation. With the internet not fully developed, people were glued to the TV, radio and newspaper, craving the latest information on testimony and developments. As a result, Hafiz reaped an audience much larger than his investment probably warranted, and the exposure “made us look like a huge company.”
CBE also leveraged the burgeoning fax broadcasting practice of the mid-1990s. The company sent out 300,000–400,000 faxes between Friday morning and Monday morning, promoting the company’s cost-per-copy (CPC) program. CPC was not very popular at the time, but Hafiz wanted to be different. As for the fax broadcasts, they generated so much interest initially that Hafiz needed four people to answer the phones.
While Hafiz has cut back on radio and magazine advertising, and relies on digital marketing firms to assist in outreach for sales reps, he still favors some of the more traditional mediums.
“I’m always fascinated by business and new ideas that I’m willing to try,” he noted. “The idea of advertising, placing ads and seeing my name in a magazine used to excite me—in fact it still does. I think newspaper ads are wonderful. To this day, I’m still one of those people who reads the paper, whether it’s the Los Angeles Times or Wall Street Journal. I receive them on my phone and computer, but I still like to sit on the couch, have a cup of coffee and read the paper.”
The Next Level
Although the company was still achieving impressive growth and garnering more steam from the introduction of managed IT in 2016, Hafiz was concerned that CBE had plateaued in terms of growth potential. He was looking for a partnership that could enable him to carry on that family-type environment he’d cultivated while providing the dealership more firepower. Hafiz vetted four options before deciding Flex Technology Group checked off all the boxes.
Hafiz loved that FTG enabled him to provide employees with greater benefits, including an improved 401K and a strong health insurance plan. He maintained operational autonomy, without needing to adjust his compensation plan, while enjoying FTG’s expansive managed print service program that enables CBE to do business with much bigger companies. Having member companies across the country gives Hafiz more flexibility to provide for clients with facilities outside of California, ensuring they can receive the same quality of service regardless of location.
Members of the FTG family meet once a month and share best practices, success stories and insights into all aspects of the business that Hafiz can implement within his own operations. His team members are motivated to learn new ideas, and given Hafiz’s penchant for trying anything new or even unorthodox, the platform provides a comprehensive resource.
“In business, you’re either going up or sliding down, and I didn’t want to get to the point where we lost momentum,” Hafiz noted. “Flex gives me the flexibility to continue to run CBE as a local business, but have the resources of a megadealer. We’re a $45 million dealer with a $400 million company supporting us. And instead of having 65 salespeople, we’re part of a team of 700 people. The motivation, the learning and various programs and training that we have access to is much bigger and better.”
Joining the FTG collective, with the pandemic only a short year away, was fortuitous timing once again. The 2020 campaign proved to be a rollercoaster for CBE—a normal first quarter followed by a sharp dip in the second quarter. The third quarter saw CBE rebound, with a slight downturn to cap off the year. Hafiz followed the practices of many dealers, providing deferred payment schedules and other relief measures for clients.
Landmark Deal
One of the saving graces for CBE in 2020 was the signing of a pact worth nearly $2 million with a school district, the single-largest deal in company history. The company has doubled down in its efforts to generate more revenue with existing and net-new business, finding creative ways to touch base with customers. The pandemic has proven to be a UV light, so to speak, that illuminates high-performing salespeople. Hafiz believes the most successful reps can thrive in any environment and truly separate themselves from those who may throw up their hands, believing to be defeated by the pandemic.
Temperature-scanning devices, which CBE added around mid-year, were extremely popular and tough to keep stocked. As CBE populated its client base with the offering, it provided an opening to revisit areas in which the dealer could address other needs. And Hafiz’s reps were more than happy to open conversations.
“The successful reps are willing to take that extra step to connect with customers and prospects,” he noted. “We find our customers are eager to speak with us; they want to continue doing business. If we can find ways to help them save money or provide better equipment and tools for the business, they’re willing to listen. And since some salespeople at our competitors are feeling defeated, it’s opened the door for us to grow our business.”
Eyeing the Future
Looking ahead, Hafiz sees more growth opportunities for his company, and the industry in general, during the second half of 2021. He’s eyeing the possibility of adding more offices in Los Angeles and San Diego, likely after the pandemic subsides. Hafiz also wouldn’t rule out future acquisitions and will definitely focus on promoting its enhanced managed IT offering to the company’s slate of print customers.
While Hafiz is certain that the post-pandemic office will include a hybrid makeup, fostering that relationship and continued trust with the customer will enable the most favorable outcome. “If we continue down the road we’re on, tweak a few things as we go, we’ll figure out what the new normal is going to look like,” he said. “We need to get those vaccines and get back to the office to figure out what’s going to work and what we’ll need to change. Right now, it’s impossible to get a straight answer. But if we keep working hard, the customer’s business will be waiting for us when we get to the other side.”
