At the risk of ending up on Bernie Sanders’ newsletter distribution list, we operate under a capitalist system that enables businesses to acquire vast amounts of properties, resources (both tangible and intellectual) and advantages of scale. This can create a distinct chasm between the haves and the have nots. But we’re not here to cry “unfair”; capitalize we can, and capitalize we must in order to claim our earned share of the open market.
And that entails looking for an edge.
Look all around you. The industry is shrinking, and dwindling print volumes have companies seeking out managed services and ancillary offerings to counter the volume trend. Many have opted out and sold to industry consolidators or local competitors in order to take money off the table or garner those advantages of scale. The pending sale of DEX Imaging to Staples indicates the scope of competition extends beyond fellow dealers, value-added resellers or manufacturer-direct operations.
If your long-range plans do not include selling out to the well-fortified concerns, certain questions should be raised. How do you compete with them, or how do you enhance the value proposition that you offer to clients? How can you garner those resources that can put you on par with larger competitors?
Start by joining an industry peer group.
SDG members attend the Bob Bondurant School of High Performance Driving event in Arizona
Competitive issues aside, there are numerous benefits that can be derived from membership, particularly in the realm of best practices. These organizations typically meet on a quarterly basis with an agenda that covers anything ranging from sales to service and admin. Most groups try to limit their size to between 40 and 50 independent dealerships. In order to address competitive concerns, there are geographic restrictions that prevent the addition of rival companies, though oftentimes incumbent dealers will give the OK to onboard a new member if he/she is not viewed as a direct competitor.
Best Practices
There are a number of robust peer organizations, including the Copier Dealers Association (CDA), the most senior of the groups. The Business Technology Association (BTA) has sprouted a pair of peer groups relevant to the office technology space: the Select Dealer Group (SDG) and the PRO Dealer Group, a relative newcomer. The similarities are more important than their differences; it’s all about a core of dealers gathering to discuss their common business challenges and discovering new and exciting ways to do business, from implementing the most mundane of changes to exchanging truly business-altering ideas. Best of all, the relationships that can be forged foster year-round communications and collaboration not limited to quarterly gatherings.
Ray Belanger,
Bay Copy
The SDG sprouted up around 2003, when the BTA’s John Hansen and John Hey reached out to a number of dealers who had expressed interest in forming a new group. A small core of about 11 dealers (five of which are still active) met in Denver for exploratory talks, and the group quickly grew before reaching its current level of 45 members. The gathering’s working title was called the “BTA Elite Dealer Meeting,” and its original mission and purpose statement was “An organization of Independent Dealers that want to learn more about how to run a successful business.” One of those founding dealers was Ray Belanger, the president and CEO of Bay Copy, based in Rockland, MA.
Belanger notes that while each meeting will have a theme, such as sales, it is not limited to those types of discussions. SDG membership are polled in advance to help set up an agenda, and meetings take place three times a year, twice in cities that have airport access to allow for quick one-day or day-and-a-half meetings. Once a year, a meeting is held in a destination city (in February, the group convened in Clearwater, FL). Sometimes a dealer will host a meeting and provide a tour of his/her facility. Sponsors who support the meeting are afforded the opportunity to make a presentation on a topic of interest common to members.
One of the most-valued tools at these meetings is benchmarking. All members report their financials and are measured to the established model (in this case, the ProFinance Model for Success). A consultant group handles the benchmarking and ensures the performance metrics are followed using a common language for measuring areas such as costs.
“Sometimes the discussions are conceptual in nature, but others can get pretty granular in terms of details,” Belanger said. “A dealer may give details surrounding a program they’re doing and talk about the results. They can be pretty deep dives.
“(Benchmarking) really helps force some discipline on your business by making you report to the financial model and look objectively at how you’re doing compared to rest of the group.”
Ray Belanger, Bay Copy
There’s ample value to be found outside of the meetings. If Belanger is experiencing an issue that he’s not confronted in the past, he can easily poll the membership or send out an email and be assured of getting at least a few responses within an hour or two. It is a two-way street of give and take.
Finding Your Place
Chip Miceli,
Pulse Technology
The key is finding a group that is aligned with your purposes. Take Chip Miceli, the president and co-owner of Pulse Technology (formerly Des Plaines Office Equipment) in Elk Grove Village, IL. Miceli is a member of SDG and American Co-op, the latter an intimate group of about 20 predominantly Sharp dealers who only discuss best practices. In addition, Miceli is involved in the IBPI buyer’s group, and is investigating the possibility of joining another buyer’s group.
“You really have to go to a meeting and see if you’ll gel with the people who are there,” Miceli said. “With some group meetings I attended, I realized I wouldn’t be learning much, but there would be information that I could be sharing. I don’t have a problem with that, but I need to take some information home with me, too.”
That’s partly what drove Miceli to join American Co-op, which consists of several larger dealers, including Marco and Centric Business Systems. “The more groups you’re involved in, the more opportunities you’ll have to learn how other organizations do different things,” he said. “I’m a fast learner, so I’m always looking for opportunities to learn and share new things.”
After my first SDG meeting, I had about 20 things I wanted to come back and change at my dealership.
Chip Miceli, Pulse Technology
Miceli’s takeaways include finding different methods of compensation with commission, ideas on how to lay out a showroom and insight into office setups. “After my first SDG meeting, I had about 20 things I wanted to come back and change at my dealership,” he said. “I learned pretty quickly that I needed to start out with two I can implement, then move down to the next two ideas.
“If you join one of these groups and don’t come home with anything of value, then you’re either in the wrong group or you’re not paying attention.”
Screening Process
Deb Dellaposta,
Doing Better Business
Deb Dellaposta, president and CEO of Doing Better Business in Altoona, PA, was named the first female president of SDG last summer. She has been a member for more than 10 years, having been previously acquainted with fellow SDG members through the GreatAmerica dealer council, along with several fellow Ricoh dealers. Dellaposta said the group recently added a pair of new members and may onboard a third at its next meeting. Acquired members have dropped from the rolls, creating vacancies within SDG, and Dellaposta said the organization is always on the lookout for potential new members who can add value.
“It’s not easy to get into; applicants have to be vetted and we need to make sure there are no (geographic) conflicts,” she said. “When we applied, there was a conflict with an existing member, but they agreed to let us in. And we’ve actually let in other members who were on the border with us. But we think there’s more to be gained from sharing than being antagonistic.”
Dellaposta works up surveys to analyze the previous meeting and gets feedback for future topics. They key, she says, is having members who are willing to pitch in, be transparent and show their financial numbers (for those particulars-shy dealers, take heart—the stats are presented to all members in a blind fashion). It helps that SDG members take a proactive approach in pre- and post-meeting participation to ensure maximum value.
The real ‘ah-hah’ moment is when you get your benchmarking numbers. We really have to manage to these numbers and educate all of our staff. We’ve made it a part of our culture at Doing Better Business.
Deb Dellaposta, Doing Better Business
While Dellaposta loves the benefits that come with having 40-odd dealer friends a phone call away, one core value is derived from benchmarking. “The real ‘ah-hah’ moment is when you get your benchmarking numbers,” she said. “We really have to manage to these numbers and educate all of our staff. We’ve made it a part of our culture at Doing Better Business. We’re continuously educating our people on why these benchmarks are important and what they mean. It’s not just all about profit, it’s making sure we have a viable business that’s going to be sustained.”
Deb Dellaposta (front, right) chats with members of Select Dealer Group during a meeting
Dellaposta did not take note of any particularly high or low performance numbers from Doing Better Business’ performance. She said the dealer typically thrives in areas of service, and like any dealer, Dellaposta doesn’t want to be satisfied with just hitting the base standards.
“Benchmarks are just the bare minimum, they’re not goals,” she said. “The high-profit and best-performing dealers are blowing out the benchmarks. It’s something you analyze and say ‘How can we do better?’ One of the greatest challenges is supply expense. It’s very hard to hit that benchmark.”
Ability to Transform
Jerry Blaine,
LDI Color ToolBox
Jerry Blaine is a well-traveled dealer executive, having spent many years with the CDA. The founder, president and CEO of New York City’s LDI Color ToolBox believes the CDA has played a transformative role for both the dealership and his own growth courtesy of the collective experience within the group. As LDI does a lot of business outside the geographies where it has operations, Blaine is in the process of forging service agreements with CDA members who can address needs for LDI clients in more than 100 cities nationwide.
Given the size and scope of many members, Blaine is not as concerned with geographic requirements. After all, many of the bigger dealers have competitive scenarios with fellow members beyond their base operations. Blaine hopes, and is confident, the CDA will eliminate the geographic requirement, and that members should be judged primarily on their ability to contribute to the group.
“The benefits far outweigh any considerations of territoriality or giving out secrets,” Blaine said. “I don’t think there are many secrets in the business, anyway. In order to survive these days, businesses have to be way more sophisticated to be successful. All of the knowledge you’re going to get is incremental. And as far as geography, any particular aspect of your business that you don’t want your competitor to know, you probably don’t want anybody to know.”
The benefits far outweigh any considerations of territoriality or giving out secrets. I don’t think there are many secrets in the business, anyway.
Jerry Blaine, LDI Color ToolBox
Blaine credits the CDA with providing his first deep dive into managed services knowledge back in the day, which provided invaluable insight into the ins and outs, best practices and pitfalls to avoid. Conversely, members were able to benefit from Blaine’s thought leadership in areas such as digital and production print, areas in which he was an early adopter.
One of the greatest intangibles that has provided tremendous satisfaction for Blaine is the CDA’s scholarship fund, which has awarded more than 50 scholarships a year to the employees of member companies. “We’ve been able to partner with members to really accelerate giving, both in terms of financial aid and volunteerism for those organizations that benefit multiple communities,” he noted.
Finding Variety
One of the newest peer organizations assembled by the BTA is the PRO Dealer Group (PDG), which has been in existence for five years. Bob Doucette, president of Smart Technologies in Daytona Beach, FL, and president-elect of PDG, had been a member of the seven-member Peer Dealers faction of Ricoh dealers for 19 years. Wanting to get a little more perspective from the national level, Doucette reached out to Brent Hoskins at BTA, who guided him to the newly formed organization.
One of the benefits in joining PDG is that Doucette now has more insight into manufacturers such as Xerox and KYOCERA, and has garnered a better perspective about all of the OEMs and what his fellow members think of their strengths and weaknesses. And despite being a newer group, the members quickly fell into a comfort zone in trading ideas and best practices. Members will send a list of questions in advance, and the group will take about a half-dozen of the most-frequently asked questions and address them in an open session.
These dealers can give you insights into how some of (OEM’s) programs work. It gives you a little bit of an edge to negotiate with the manufacturer when you know what they’re capable of doing.
Bob Doucette, Smart Technologies
Doucette likes that the group has a nice variety of members, both large and small, and in the course of discussions, they will assess whether certain ideas that a large dealer may have can be scaled to fit the needs of small- or medium-sized members.
One of the biggest benefits for Doucette has been gleaning ideas regarding compensation plans and how to go to market. He’s been able to reap significant savings through back-office best practices that have aided in billing, inventory and key insights into garnering more profitability on the service end.
“One other piece that has been helpful is talking to a dealer who has experience with a manufacturer that you might be just starting to work with,” Doucette said. “These dealers can give you insights into how some of (OEM’s) programs work. It gives you a little bit of an edge to negotiate with the manufacturer when you know what they’re capable of doing.”
Dean Swenson,
The Swenson Group
A peer group can be particularly useful to a dealer that has made substantial changes in its business model.Take The Swenson Group (TSG) of Livermore, CA. For the first 10 years of its existence, the company operated as a Xerox agent—no service or post-sale fulfillment, only sales. When TSG left Xerox, President and CEO Dean Swenson recast his organization as an office technology dealer. Swenson was well versed in sales, but service department, infrastructure, software, tools, processes and training were all new to TSG. That’s where the Select Dealer Group (SDG) came in handy.
“The wealth of knowledge and experience I have learned from SDG has helped us in our path, and we haven’t had to recreate the wheel as much as we would have,” Swenson said. “We certainly would have fell into a lot of potholes without it. Someone once asked me why I became President of SDG, and I said I had to give back. The organization has helped TSG immensely, so getting involved and taking a role in leadership responsibility was the right thing to do. I was able to get even more members involved and help shape the group going forward.”
These dealers can give you insights into how some of (OEM’s) programs work. It gives you a little bit of an edge to negotiate with the manufacturer when you know what they’re capable of doing.
Dean Swenson, The Swenson Group
Like other dealers, Swenson tries to bring home from meetings a handful of actionable items instead of an unwieldly laundry list. He seeks to find out more about members who are performing better than TSG and learn ways to improve through documentation, processes, strategy or implementation. From HR hiring policies to MPS strategies for implementation, SDG has provided invaluable guidance for Swenson and TSG.
“We have a lot of high-quality dealers in the group, but it’s ironic because we all do things differently,” he said. “For example, TSG bundles service with the lease in 99 percent of our contracts. It makes all the sense in the world to me, for our clients’ ease of use and for a defensive posture if competitors try to buy us out. Meanwhile, another dealer bills their own service religiously; he’s vigilant in that decision and they are tremendously successful.
“It’s these kinds of differences that really open your eyes to what’s possible. What’s unique about TSG and our ability to bundle contracts, where dealers in other areas say it’s not possible? If a peer is able to do something in their market, then why can’t it be done in mine? It really helps you take the blinders off and think about what is possible.”
