When Mike Marusic joined the ranks of the overemployed and assumed the role of Dynabook president, it wasn’t just a matter of streamlining the corporate reporting process. The president and CEO of Sharp Imaging and Information Company of America—parent company of Dynabook—sees a really strong opportunity for Dynabook and Sharp dealers to leverage the strengths of the OEM’s document business to realize significant opportunities and grow their share of the laptop market. And he sees a clear path to accomplishing it.
In this edition of Two-Minute Drill, Marusic details some of the built-in advantages dealers have over the IT and value-added reseller channels, particularly the ability to bring laptops under service contracts with existing clients. Dealers already have solid relationships within government and education accounts, and the Dynabook adds a potentially lucrative element that can be baked into a recurring revenue deal. When you add in Sharp’s strong relationship with industry distributors, it makes for a compelling ancillary for dealers to expand within accounts and fend off would-be competitors.
How will Dynabook’s new structure benefit the imaging and dealer community?
Marusic: Dynabook itself remains a separate legal entity and that’s why we had to do the announcement explaining my role as president of the company. The biggest difference is reporting structure. Now the Dynabook team will be reporting into me as part of SIICA. This will allow us to really leverage all the people, programs, training and state contracts across the document space into Dynabook. The big advantage to dealers is simplicity of doing business across all of the Sharp channels. We really see that as the big opportunity.
Given your deep understanding of product development and market expansion, how can you bolster Dynabook’s B2B sales strategy in a hotly contested market?
Marusic: The one advantage document dealers have is the control over contracts and school districts. They’re in that world every day. The model of the copier industry is to support the hardware, provide maintenance and get recurring revenue contracts. They don’t do an install and disappear, which is the MO of the IT channel or the VAR integrator channel. For the document dealers, it’s the ability to go in and provide that extra support.
Our dealers do quite well in school districts. They can say to that client, “While we’re here making sure that your MFP and printer functions perfectly, we also have the ability to do the hot swap and support your Dynabooks. We can put them under the same contract, manage it the same way and you’ll have one company supporting them.” That really is an opportunity for the dealers, to put everything under one contract and control all of the IT. One of the big challenges everyone’s facing, and I always say this about MPS…do you ever pause and wonder, “How did those HPs get in the building in the first place?” A lot of that happens through the IT reseller channel, and they’re getting more tech savvy and beginning to understand how to support an MPS contract. This is a way to block an IT reseller from entering your customer by having the ability to support a pretty straightforward technology. How they design and make a laptop is complex. How you use and support a laptop is very straightforward. So the document channel has a real opportunity here to leverage that knowledge.
How would you characterize Dynabook’s growth during its five years under the Sharp umbrella?
Marusic: When we acquired the business from Toshiba, it was not in a very strong position. I think people understood that. So for the first few years, the team did a good job of stabilizing it. Now it’s been on a growth pattern. The same team, is still running it day to day, and they’ve done a great job of building that business up. When you look at the industry, there is a lot of share that we can go grab. We’re not one of the top players and we understand that. What we’ve seen is good, profitable growth in the business since we acquired it. What we’re able to offer resellers is really not a commoditized product where you’re competing with 45 other companies selling the same laptop, and the price just keeps coming down and down and down. This allows us to differentiate ourselves.
What we’re beginning to see now is larger contracts with some major companies and government agencies. Our biggest customer currently is a government agency that allows us to sell tens of thousands of laptops to a particular customer.
Can you share any of your goals for Dynabook’s immediate and long-term future?
Marusic: We have three portfolios at Sharp for the B2B space: the document, display and laptop businesses. Dynabook’s opportunity is twofold: they can tap into a very strong IT distribution strategy that we have for A/V. We have a strong presence with Ingram Micro, D&H, TD SYNNEX—all of the major distributors that support that industry. At the same time, we’re unique in the industry that we provide the only outlet through the document channel for a self-contained, one company approach. The Dynabook team has a huge opportunity to leverage our assets: our contracts, infrastructure and recurring billing. When you think about seat licenses, recurring revenue models and IT-as-a-service, that’s all basically built into our DNA on the copier side. The opportunity’s there for Dynabook to tap into something most competitors don’t have built into their operation: a recurring revenue model, billing system, deployment system and support system. That simply doesn’t exist in the ITV seller community. The ability to put a managed services contract with a Dynabook notebook is an avenue that the laptop industry really doesn’t have within its own ecosystem. So that’s a huge advantage for us. Our goal is to tap into it and leverage it.
