Ordinarily, Larry White is nothing short of a Texas gentleman (and a Cowboys fan, but we can forgive that trespass). But as the president and CEO of Toshiba America Business Solutions took the stage at the Bellagio Hotel in Las Vegas for the 2023 LEAD Beyond conference Sept. 12-14, he uncorked a chorus of “F-bombs” that provided pearl-clutching, monocle-smashing moments for even the most liberal of sensibilities.
Obviously, White did nothing of the sort; his presentation to the 800 attendees—including 200-plus dealers, direct marketplace operations and end-user clients, was decidedly PG-13. The “F” words simply followed the theme of his opening day keynote talking points: Fiduciary, Future, Function, Friendship and Philanthropy (perhaps White was going for the old English spelling, though its etymology is Greek). Matters not, as White was clearly on a roll.
It had been five years, 2018, since Toshiba had welcomed its reseller partners and end-users for a meeting of the minds and White expressed relief in being able to visit with industry friends face to face. But he alluded to the changed business realities of hybrid operations and work-from-home scenarios, noting, “Who knew that casual Fridays would morph into casual Monday through Fridays?”
Since White furnished the outline, we’ll annotate the highlights of each “F-bomb”:
Fiduciary: White didn’t sugarcoat the company’s 2020-2021 performances. The supply chain difficulties made TABS dig deep into its reserves, to the tune of $37.5 million, which accounted for 100% of the company’s losses, with much of that attributed to flying product from factories in Asia to the United States.
TABS options, he said, were to either absorb the expense to deliver much-needed gear to resellers or stand pat and hope for the best.
“At TABS, hope is not a business strategy, so we chose the former,” he said. Given the choice, he would do it again.
The supply chain situation has normalized and the OEM’s profitability returned. In FY 2022, the company grew revenue 9% year over year and 26% over the previous year. TABS now stands at 92% of pre-COVID revenues.
Ensuring the company’s future was the driving force behind the announced joint venture (JV) between TABS and Ricoh. Not only will the pairing produce manufacturing efficiencies, but it will also open the door to innovation opportunities for an entity that has a combined worldwide market share of about 30% while yielding incredible supply chain diversification opportunities. Will it force the hand of other OEMs to seek our partnership benefits, including a possible addition to the TABS-Ricoh JV? Stay tuned.
Future: Alluding to analyst forecasts of 3%-9% print volume decreases in the coming years, White offered a contrasting viewpoint. He feels print is not only relevant, but essential to business. As a physical presence, one not replicated by digital, print “engages our senses, creates lasting impressions, is tangible, tactile and interactive.” A printed document never needs a Wi-Fi signal, he said dryly, and TABS sees print for what it is, a $65 billion opportunity.
White believes his company’s recent results underscore this notion: Q1 of the calendar year represented TABS’ largest market share in the history of the company, and Q2 was its largest on record. Accentuating print with dovetailing diversifications—managed services, solutions, digital signage and label and receipt printers—provides incremental revenue that requires the least amount of startup investments.
“Today we sit at a critical juncture between physical and digital information,” White maintained. “The seamless interchange of that information is where we can add groundbreaking value to clients.”
TABS’ services and solutions business has been sizzling. For example, its managed print-as-a-service (MPaaS) platform grew by 10% last year and the company doubled its transactions, adding more than 7,000 new devices. In 2023, the company is adding more than 1,000 new devices per month. White noted that the non-Toshiba devices managed by his company now outpace TABS’ devices.
“Even more impressive is we have a 98% retention rate for customers that have an MPS agreement with us,” he noted.
TABS’ solutions revenue is also up double digits year over year, with 5,700 software transactions and increased revenue per transaction. The OEM is leveraging the huge migration to the cloud by driving continuous innovations. White provided an example of how partnering with Kelley Connect led the dealer to a lucrative deal with a food industry client that included a DocuWare order for more than $300,000 in wholesale revenue alone. While the deal was inked in 2020, it continues to grow, with more than $120,000 tallied in the past year.
“It’s a tribute to Kelley looking beyond the MFP sale, taking a consultative approach and bringing digital technology and information to the customer,” White added.
TABS’ robust portfolio for smart printing and optimizing workflows allows resellers to address what White termed a $114 billion market opportunity with an average growth rate of 10.4%. The company’s thermal printer line addresses barcodes, which are everywhere (just ask Amazon) as well as health care, pharmacy, retail, manufacturing, and logistics—a treasure trove of opportunities. TABS grew its thermal business by nearly 69% last year, copping major takedowns in the delivery service and retail sectors.
Upselling is the key: White pointed to McDonald’s as a master of the value-add, from “would you like fries with that,” to “would you like to make it a combo” and now “would you like to supersize it?”
“They manage the upsell in such simple terms,” he said. “So, the question is, do you want to supersize your sales?”
Function: Noting that there is a deeply functional side to doing business together, White emphasized that TABS is wholly committed to being an easy partner with which to conduct business. The firm will continue to focus on the agility and responsiveness that differentiates it from the OEM crowd. From digital transformation products such as its ecommerce platform to sales enablement tools and recruiting/retention resources, TABS is seeking to propel its reseller community.
One such example is TABS has forged contracts with government entities (GSA) that will provide dealers with access to the world’s largest purchasing entity. Its dealer business has rose 26% in the last two years, and White provided many dealer testimonials that speak to how TABS has simplified the course of business.
Friendship: “At the end of the day,” White exclaimed, “who you do business with matters.”
It’s all about forging deep, meaningful relationships with TABS’ business partners, where both sides are heavily invested in one another. The wins and losses are keenly felt and shared. COVID held a mirror up to the faces of partners, showing that when the chips are down, it became clear who businesses could count on. As White observed, TABS wants its values to reflect how it does business, and that image is of an OEM that places its reseller partners above all else.
“With Toshiba, the partnership is a promise, and if there’s nothing else you walk away with today, it’s that we’re committed to being the partner you are proud to do business with,” he said. “Who we are, what we stand for and how we do business matters deeply to us. And we are deeply committed to our vision to empower people, innovation and information.”
Philanthropy: Giving back has long been a staple of the industry, and White saluted several organizations—including the Patriots Pack, The Cannata Report and Atlantic Tomorrow’s Office—for the financial commitments they’ve made to help those in need. For its part, TABS has made contributions many causes, from supporting STEM (science, technology, engineering and math) on the K-12 level to backing the Ocean Institute in its educational mission, as well as assisting veterans and their spouses. The manufacturer also played a role in helping schools provide printed materials for home learning during the pandemic.
Lastly, through the leadership of TABS team member, Maegan Lujan, the company pledged to match $10,000 in attendee donations to Orangewood Foundation. Lujan serves as a Board Member for the nonprofit and brings her own experience of being a former foster youth to her role. Orangewood works with youth ages 16-24 across Orange County experiencing homelessness and other challenges and supports them as they prepare for adulthood. They connect youth to food and transitional housing, life skills development, educational scholarships, and employment opportunities to help them thrive.
