For anyone who’s ever owned a puppy, the somewhat odd but apt correlation between young dogs and managed print services (MPS) is undeniable. Both require significant attention; neglect can produce disastrous results. They need to be nurtured and constantly monitored to avoid developing bad habits. That also means a good deal of training. Plus, both will reveal telltale signs of trouble if you know what you’re doing.
In the end, taking on either requires a great deal of responsibility to produce healthy growth. It’s a long-term commitment, one not to be taken lightly.
OK, enough of the analogies. In this week’s installment of our State of the Industry focus on MPS, we asked our dealer panel to provide their prognosis for the future of the service, as well as their moving-forward strategy to flourish where others fail.
The future looks bright for MPS, in the estimation of Ray Belanger, president of Bay Copy in Rockland, Massachusetts. The key to continuing down the road of profitability, he feels, is closely monitoring what clients are seeking and finding creative solutions to meet those needs.
“When we encounter a situation such as the Ninestar ban, it is a reminder of the importance of diversification in carrying multiple product lines,” Belanger noted. “Some dealers have gone into IT or supplies as a means of supplementing whatever declining income they experience from declining MPS sales.”
State of Readiness
Monitoring the MPS market isn’t easy. In the words of Mason Smith, the president and CEO of MTS Office Systems in Anderson, South Carolina, he keeps his “head on a swivel” to determine what MPS may look like in 15 years. Still, Smith’s company is bracing for sales growth, and he’s currently hiring new reps to help facilitate it. He’s read all of the projections for future volume, but finds it curious that, in the southeast, many clients are not cutting back on output. Quite the opposite, actually; he’s seeing increases, as client verticals such as religion seem to have a voracious appetite for print.
“I think we still have a long runway for MPS,” he said. “As long as you have clients that are willing to talk to you about their frustrations with managing devices. Some just need to consolidate a couple of devices into one to be more cost-effective. Gaining net-new clients and not losing our larger, older customers has been the key for us.”
Dan Larkin, solutions sales director for Marco of St. Cloud, Minnesota, sees product diversification and digital transformation as pillars inside of the MPS umbrella. While managing the environment remains a high-level priority for dealers, how it’s managed has evolved.
“If you still define managed print as simply dispatching a technician to a service call, that’s losing mind share,” Larkin noted. “But if you redefine it as outsourcing end-user support, that’s highly relevant to clients because it allows them to focus on their core competencies.”
The totality of MPS, done right, opens a world of new dimensions, according to TJ DeBello, vice president of sales for Houston-based Stargel Office Solutions. The dealer plans to remain agile, customer-focused and proactive in adopting emerging technologies.
“The future of MPS is about embracing the digital transformation, expanding our service portfolio to include document management as a whole, not just printers, or a subscription-based model pricing, and prioritizing data security and sustainability,” DeBello said.
Laser Focus
There’s a lot to be said when it comes to how much a dealer focuses on MPS. For Flex Technology Group (FTG) of Mesa, Arizona, it’s a high priority as opposed to a side offering, according to Jeff Wilson, vice president of business development. That alone separates FTG from other dealers and OEM direct operations.
“We don’t get sidetracked by things the same way they might, and because of that, we can maintain greater focus,” he said. “If a manufacturer is experiencing a slowdown in hardware sales or shrinking margins, their approach may be to pull away from offerings like MPS and concentrate more on their hardware business, creating a possible risk for MPS. For us, our core business is services/MPS, and being hardware-neutral means we don’t care who you bought your hardware from or where. We’ll take it on and maintain it.”
Evolving with the needs of customers is the primary game plan for imageOne of Oak Park, Michigan. Despite the volume declines, President Josh Britton believes the incremental downtrend is offset by the fact that MPS has a “long tail” and isn’t in any immediate danger. He sees ample growth opportunity, from new business market share to expanded offerings.
“The next evolution is digital software as a service, workflow automation and business process automation,” he said. “These are all areas we’re looking to invest in, and our primary focus is how do the values that make us unique translate for customers? Where can we deliver the same kind of experience and have the same level of value impact? Those are the growth opportunities.”
MPS has had its share of defectors, notes Hunter Woolfolk, co-president of DOCUmation in San Antonio, Texas. Some dealers marketed it extensively, but the client experience was so poor, the defections prompted these providers to pull away from MPS. Profitability becomes an issue, he said, when sales reps are only selling maintenance, or month to month for small-ticket items.
“The thing that drives [sales reps] is the big A3s, because that’s still a large-enough revenue to hit their president’s club targets and potentially larger commissions,” he said. “It seems like our industry really got away from MPS as a focus. For us, whether its printing, scanning or IT devices, we give them excellent service. It’s in our DNA, and we have a stranglehold on the printing business.”
