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CONTENTS Volume 14 No. 2

FEATURE ARTICLES 10

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Workflow Solutions Facilitating streamlined business processes

COURTS & CAPITOLS The Owners’ Contract It will help to resolve future disputes

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By Brent Hoskins Office Technology Magazine

By Robert C. Goldberg BTA General Counsel

It is beyond the box. It is also beyond the current focus of many office technology dealerships. However, it is not beyond the purview of virtually every office.

Take a look at any paper-based business process and you will be looking at it — document workflow. You will also be looking at a revenue opportunity that could be the catalyst to take your dealership to new heights. Increasingly, software vendors are introducing workflow solutions that are capturing the interest of dealers.

Problems arise in even the most successful of businesses. Many of these problems could be avoided with some advanced planning and written agreements in place.

PRINCIPAL ISSUES Direct Mail Making it work for your dealership

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By Jim Kahrs Prosperity Plus Management Consulting Inc.

Transition to Color Study reveals growth market opportunites

With the technological advances of the Internet and e-mail, direct mail is still the most reliable method of reaching prospects and customers.

How can direct mail work for your dealership?

by Keith Kmetz IDC

O f f ic e equipm ent d eal ers have known that the hardcopy opportunity is gradually shifting from black-and-white-only devices to color-capable ones. IDC’s market forecast proves that color-capable MFPs are quickly gaining traction in the market. In fact, they are expected to more than double in unit shipments from 2006 to 2011. Perhaps more impressively, color’s percentage of the laser-based MFP market has made considerable gains over the last several years.

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A Decisive Differentiator Print management ‘a must’ in today’s market

by Chip Miceli Des Plaines Office Equipment

Saying that technology is a “differentiator” in today’s fast-changing business environment is stating the obvious. Yet for those of us in the business of providing document generation solutions, there are several technological advances that will significantly benefit us. These new technologies enable small- and mid-sized companies to provide advanced print management and service techniques. It is the proactive dealer who will ultimately be the most successful in the decade ahead.

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SELLING SOLUTIONS Beating the Price Trap 29 Unique value gives your prospect a reason to pay more

by Tim McMahon & Tom Kramer Strategy Mapping Selling

Every professional salesperson would rather use his (or her) skills to win solid, profitable business than cutting price over and over to (hopefully) win a deal.

DEPARTMENTS Business Technology Association

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September-November Education Calendar BTA Membership Application

6

Executive Director’s Page

8

BTA President’s Message

30

Advertiser Index

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EXECUTIVE DIRECTOR’S PAGE

Cannata Event Has Admirable Objective n June 26, I had the privilege of attending the 22nd Annual Awards Presentation and Charity Benefit Dinner hosted by The Cannata Report, the publication of Marketing Research Consultants Inc. (MRC) Of course, the real host is the man behind MRC, Frank Cannata, who is somewhat of a legend in the industry, in terms of his role in reporting on the product launches of manufacturers, the dealer channel and the office technology industry in general.

I’ve known Frank for a number of years and always welcome the opportunity to visit with him or just say hello. Like a few others who cover this industry, I tend to see him at nearly every manufacturer-hosted national dealer meeting I attend. He is always among the first to ask questions in press conferences and he never hesitates to express his views on manufacturer product launches, distribution strategies, etc. There is always a keen interest in what he has to say.

The recent dinner, held in Belleville, N.J., was very nice. As always, it was a one-of-akind event in this industry with guests representing virtually every leading manufacturer and several leading dealerships.

While the dinner was focused on the task of presenting awards to manufacturers, based on the results of an MRC survey of dealers, there is a particularly noteworthy function of this annual event that deserves recognition. That is, while he has hosted an awards event for 22 years, Frank tells me that in 1999 he made the decision to make the dinner a charitable fundraising event. In that first year — it was the 14th annual

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awards dinner — the beneficiary was Childhelp USA, an organization devoted to helping abused children and battered women. The dinner raised $35,000.

In 2000, Childhelp USA remained the beneficiary. Then, in 2001, the dinner raised funds for the V Foundation, an organization dedicated to cancer research. And, in 2002, the beneficiary was a group called Windows of Hope, a 9/11 charitable organization. In 2003-2006, the V Foundation returned as the beneficiary, joined by a scholarship fund for Seton Hall University students studying abroad. Seton Hall is Frank’s alma mater. The beneficiary of this year’s dinner was the Glide Foundation, an organization dedicated to assisting the underprivileged in San Francisco. This is the foundation that lent assistance to Chris Gardner when he and his son found themselves homeless. You may recall that Gardner’s story is told in the book and motion picture, “The Pursuit of Happyness.” The dinner raised $56,000.

I would imagine that this annual dinner could have continued on without being a charitable event. However, clearly, it would not have impacted so many lives, helping students, those facing illness, the homeless or those who have been abused or battered. It would not have provided these charitable organizations with a total of $404,000 to date.

No one attending these dinners through the years has given with the hope of being recognized. Yet, as I began to understand the full impact Frank’s efforts have had on others, I felt compelled to share what I have learned. I commend Frank on his decision to make the dinner more than an awards event.

Likewise, I commend those who have supported Frank’s efforts through the years with their charitable giving.

— Brent Hoskins

Executive Director/BTA Editor/Office Technology Brent Hoskins brent@bta.org (816) 303-4040 Associate Editor Elizabeth Marvel elizabeth@bta.org (816) 303-4060 Contributing Writers Robert C. Goldberg, General Counsel Business Technology Association Jim Kahrs, Prosperity Plus Management Consulting Inc. www.prosperityplus.com Keith Kmetz, IDC www.idc.com Tim McMahon & Tom Kramer, Strategy Mapping Selling www.strategymappingselling.com Chip Miceli, Des Plaines Office Equipment www.dpoe.com

®

Business Technology Association 12411 Wornall Road Kansas City, MO 64145 (816) 941-3100 www.bta.org Member Services: (800) 505-2821 BTA Legal Hotline: (800) 869-6688 Valerie Briseno Membership Marketing Manager valerie@bta.org Gary Hedberg Accounting Manager gary@bta.org Mary Hopkins Accounting Clerk mary@bta.org Cathy Kenton Membership Sales Representative cathy@bta.org ©2007 by the Business Technology Association. All Rights Reserved. No part of this publication may be reproduced by any means without the written permission of the publisher. Every effort is made to ensure the accuracy of published material.

However, the publisher assumes no liability for errors in articles nor are opinions expressed necessarily those of the publisher.

Toshiba May 07

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©2007 Toshiba America Business Solutions, Inc. Electronic Imaging Division. All rights reserved.

AFTER EIGHT WINS IT ’S HARD TO BE HUMBLE The people have spoken. And for the eighth time, Toshiba was voted #1 for Overall Performance by the BTA. Toshiba was honored with four Channel Choice Awards, the most of any equipment manufacturer, including awards for Superior Performance, Digital Product Line, Corporate Support and Marketing Distribution. While we may be tempted to brag, we’ll just let the dealers do it for us.

To become part of the winning Toshiba team, call us at 949-462-6601.

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BTA PRESIDENT’S MESSAGE ®

Are IT Certifications On Your ‘To Do’ List? n recent months, the Business Technology Association (BTA) has unveiled two new classroom training c ourse s — P roS o lutions and, most recently, the BTA Print Management Workshop. Both have been well received and reflect our strong commitment to bringing cutting-edge educational programs to the association’s members.

While sales and service training play an important role in a dealership’s success, there is another area that has become of particular importance — training to assist sales reps and service technicians to prepare for the industry’s various IT certification examinations. Such certifications as CompTIA’s CDIA+ and Microsoft’s MCSE have become commonplace in today’s office technology industry. Oftentimes, having personnel with these and other important credentials can be the determining factor as the dealership strives to advance in today’s connected workplace. They can help dealers distinguish themselves from the competition and provide easier access to IT decision makers.

I’m pleased to announce that BTA is now providing its member dealers with a means for their employees to more affordably pursue these certifications. Specifically, we have established a relationship with Clearwater, Fla.-based Specialized Solutions Inc. (www.specializedsolutions.com), a provider of multi-media interactive, self-paced training programs. Th e company i s a Microsoft Certified Partner, a cornerstone on several CompTIA advisory committees and on e of only tw o approved onlin e training providers listed as an EC-Council

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Authorized Training Center. Now, a number of Specialized Solutions’ study programs, each designed to help students prepare for certification examinations, are available at a discount to BTA members.

The online course offerings include five study programs designed to help individuals prepare for CompTIA certification examinations — A+, Network+, CDIA+, Security+ and Project+. There are also four study programs for Microsoft certification examinations — Microsoft C er tified Desktop Support Technician (MCDST), Microsoft Certified Systems Administrator (MCSA), MCSA with A+ and Network+, and Microsoft Certified Systems Engineer (MCSE). And finally, there is a study program for the ECCouncil’s Security5 certification exams and the International Information Systems Security Certification Consortium’s Certified Information Systems Security Professional (CISSP) exam. Again, all of these online study programs are offered at a significant discount to BTA members.

In addition, Specialized Solutions offers the option of six-month, one-year or twoyear subscriptions. These allow users to access all course offerings for the defined period of time. They, too, are offered at a discount to BTA members.

If you have been thinking about pursuing industry certifications for some of your employe es, now i s th e tim e to move forward. For more information or to register, visit the BTA Web site (www.bta.org) and click on “Education & Certification” on the home page. Then click on “Certification Study Programs.” You may also register for courses by visiting Specialized Solutions at http://bta.oncourselearning.com.

— Shannon Oliver

2007-2008 Board of Directors President Shannon Oliver 25 Wheaton Circle Greensboro, NC 27406 shannon@bta.org President-Elect Ronelle Ingram Steven Enterprises Inc. 17952 Sky Park Circle Ste. E Irvine, CA 92614 ronellei@msn.com Vice President Bill James WJS Enterprises Inc. 3315 Ridgelake Drive P.O. Box 6620 Metairie, LA 70009 bjames@wjsenterprises.com BTA East Thomas Chin Accolade Technologies LLC 31 Mamaroneck Ave. Ste. 508 White Plains, NY 10601 tchin@accotech.com BTA Mid-America Mike Blake Corporate Business Systems LLC 2018 S. Stoughton Road Madison, WI 53716 mblake@corpbussystems.com BTA Southeast Jerry Jackson All South Copiers (ASC) 1325 Cobb International Blvd.

Ste. A Kennesaw, GA 30152 jerry@ascopiers.com BTA West Rock Janecek Burtronics Business Systems Inc. 216 S. Arrowhead Ave. P.O. Box 1170 San Bernardino, CA 92408 rjanecek@burtronics.com Ex-Officio/General Counsel Robert C. Goldberg Schoenberg Finkle Newman & Rosenberg Ltd. 222 S. Riverside Plaza Ste. 2100 Chicago, IL 60606 robert.goldberg@sfnr.com

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Workflow Solutions Facilitating streamlined business processes by: Brent Hoskins, Office Technology Magazine

t is beyond the box. It is also beyond the current focus of many office technology dealerships. However, it is not beyond the purview of virtually every office. Take a look at any paper-based business process and you will be looking at it — document workflow. You will also be looking at a revenue opportunity that could be the catalyst to take your dealership to new heights.

Certainly, the word “workflow” has become common in the office technology industry.

Today, manufacturers and industry analysts frequently talk about the importance of assessing the customer’s workflow. Inherent to the task is the need to step outside of the traditional “speeds and feeds” sales strategy. Instead, the dealership that is focused on workflow is acting more as a consultant to customers, conducting needs assessments and providing ways to boost business process efficiencies.

Increasingly, software vendors in the industry are marketing workflow solutions that are capturing the interest of dealers and end-users. Are you among them? Does your dealership have a strategy in place to help your customers automate their manual paper-based processes? Or, do your customers still see you simply as a provider of hardware and aftermarket service and supplies? Perhaps it is time for you to contemplate these questions.

As with anything that is initially conceptual in nature, the place to begin is with a definition. What is document work-

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flow? Dan Lucarini, senior director of marketing for Captaris, which produces a business process management solution called Captaris Workflow 6.5, offers a definition. “The concept of document workflow is very simple,” he says. “A document needs to go through a process involving people, tasks and approvals. The tasks are the ‘work’ and the process is the ‘flow.’”

Of course, paper-based workflows reflective of Lucarini’s definition are common and routine in the workplace, so why automate the process?

The answer is simple, he says.

“By applying computer-based workflow technology to a manual process and automating mundane human tasks, office workers have realized they can make serious gains in productivity, reduce costs and better ensure legislative compliance.”

Brian LaPointe, director of strategic solutions for Laserfiche, which offers the Laserfiche Workflow Suite as part of its software lineup, illustrates the value of automating document workflow by citing a recent situation he observed. He visited an office that had five fax machines receiving orders from field locations. The fax transmissions were gathered by a person who would manually deliver them to the desks of various order processors. “If they could take some of the steps out of that business process, perhaps they could eliminate the need for one full-time employee or re-assign that employee to other tasks,” he says. “If the faxes came in electronically, they could

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be routed into a system and workf low technology,” he “What our software does go directly to the right says. “Our experience across is take your business person. So, for example, if the thousand s of custom ers process that everyone has order came from ABC Comechoes that research.” pany, it would go directly to The problem lies with the already agreed to across the clerk who handles that workers. “The number one the business and just company’s orders.” obstacle to implementing models it electronically ...

Despite the opportunity to successful document workWe have the ability to save time and money, “most flow is organizational reinteract ... with a lot of their systems ...” people aren’t doing a thing to sistance to change,” says — Darren Knipp improve their workflow,” says Lucarini. “The weakest link Perceptive Software Inc. LaPointe. “They are keeping in a workflow chain is the everything in the file cabinet. person who refuses to give It’s all about manual processes, whether it’s the accounting up his or her paper or file folders.” department, HR department, legal or some other core area of Assuming any resistance to change can be overcome for a their business.” specific workflow, how can the implementation of a softLucarini shares a similar assessment. “According to one ware-based workflow solution help a company to streamline study, less than 5 percent of the processes involving docu- business processes? “What our software does is take your ments and people have been automated using document business process that everyone has already agreed to across the business and just models it electronically,” says Darren Knipp, director of product marketing for Perceptive Software Inc., makers of ImageNow, an enterprise document management solution with workflow capabilities. Knipp adds: “Initially, we recommend to customers, ‘Get comfortable with the new electronic workflow and then we’ll come back later and help you optimize that, once you get used to the basics of having an electronic business process.’”

In addition, Knipp notes that ImageNow works in concert with existing software applications, enhancing day-to-day business processes. “We have the ability to interact very dynamically with a lot of their systems, because a lot of times they want to populate the list of people who can approve a particular document type from another application, such as SAP,” he explains. “So, not only are we getting rid of ‘sneaker-net’ coordination, but we are also changing the workflow so that there is less manual data entry.”

Knipp further explains how ImageNow could assist in the workflow of, as an example, incoming invoices. “Our workflow has the notion of queues, which are basically a place where documents get placed and actions can be taken,” he says. “So, there could be an approval queue based on an individual’s last name to say, ‘this employee can process it as long as it is less than X amount.’ The employee would open the invoice in our workflow viewer, review it and then process that invoice into the company’s host application.”

Another capability of ImageNow provides yet another example of the functionality of automated workflow. Knipp 12 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | A u g u s t 2 0 0 7

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What’s different about Kodak i1200 and i1300 Series Scanners? It’s what’s inside: a heavy-duty metal paper transport that’s reliable scan after scan. What else makes these scanners rock? Take our insider’s “tour” and find out. Just visit www.kodak.com/go/heavymetalOTM. Or, contact your authorized distributor—Cranel Imaging, Ingram Micro, New Wave Technologies, Promark Technology or Tech Data.

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perform various document notes that the company “We have office processes before delivering recently added a digital sigequipment companies the information into your nature capability to its proand others that have enterprise repositories or duct. “So, instead of having business applications.” to print something out to shifted their businesses Meanwhile, as noted , get someone to sign it, you to have a nice balance of Laserfiche markets its Workcan sign it [electronically] selling equipment and a flow Suite, also designed to throughout the workflow technology solutions group automate document-cenprocess and , if a change doing customer workflow implementations.” tered business processes. occurs, it will invalidate the — Brian LaPointe LaPointe describes the typsignature and the document Laserfiche ical scenario of an accounts will be routed back through payable situation in which the workflow again,” he exemployees in remote offices send in invoices for centralized plains. “If I send something back to you and I signed it and you make a change and you want to sign it, then the software processing. Using NSi AutoStore, or some similar scanning will route it back to me so that I can review the change and solution, he says, the employees can log in at an MFP control panel and scan the invoices to a specific location. “That trigsign it again.”

While the various examples shared by Knipp pro- gers the workflow,” he explains. “The invoice is electronically vide a sense of the capabilities of a workflow solution, it sent to the accounting department for review then to the should be noted that Perceptive Software historically has manager for approval. You can see the whole digital process utilized direct sales. However, says Lee Ann Hawley, the happening and track the progress.”

LaPointe notes that developing expertise in custom workcompany’s director of alliances and sales operations, “We flows for, as an example, the healthcare industry can be parare open to partnering with technology dealerships.”

There are other companies, perhaps more familiar to BTA ticularly lucrative. “When you figure it out, developing channel dealers, that offer workflow capabilities, in some expertise in custom workflows can be a source of great cases as a component of another document solution. For value,” he says. “We have office equipment companies and example, as noted, Captaris Inc. offers Captaris Workflow others that have shifted their businesses to have a nice 6.5, which can be integrated with its Alchemy document balance of selling equipment and a technology solutions management and RightFax solutions. “It goes way beyond group doing custom workflow implementations.”

And finally, yet another example of a workflow solution the simple MFP document routing applications, such as scanning and ‘send to,’” says Lucarini. “It is a full-blown busi- comes from DocuWare, a provider of integrated document ness process management system that not only creates a management software. The company offers CONTENTtask list and controls the flow to other people, but also FOLDER, an add-on module to its DocuWare 5 product. The includes powerful features such as audit logs of all actions, a module allows, for example, an accounting clerk to have all workflow simulator so you can test before you deploy, a invoices automatically placed in an electronic folder on his management dashboard with key performance indicators, (or her) desktop, explains DocuWare President Gregory integrations with Microsoft Office SharePoint Server and a Schloemer, noting that the clerk can have an index structure in place that will then automatically forward copies of robust workflow development functionality.”

Another company increasingly familiar to dealers is invoices to designated individuals based on cost centers and Notable Solutions Inc. (NSi), which offers AutoStore 4.6 direct areas of responsibility. “So, if you are responsible for Cost to dealers and through its relationships with various MFP Center 4800, all invoices for your cost center will show up on manufacturers, in some cases under private labels. The your desktop for your approval,” he explains. “Once reviewed, company promotes on its Web site: “AutoStore-enabled work- you simply place your stamp on it along with your electronic flows allow one to streamline information management, right signature. This process then automatically forwards the from where the documents enter the workflow. Use Auto- invoice on to the next person for further processing; for Store 4.6 to instantly and securely capture electronic or paper example, to the accounting manager for payment.”

Clearly, the number of opportunities to sell workflow documents from anywhere, in any source or format, and 14 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | A u g u s t 2 0 0 7

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s olutions i s on th e ri se. nities available to dealers, “It requires 12 to 18 Howe ver, some may ask, Tehranchi emphasizes that months of patience for “What is the payoff for the selling today’s workflow soyou to become proficient dealer?� LaPointe cites the lutions — or any software“good margins on the softbased solutions — requires a at it. I’m not talking about ware� along with the reality commitment to training and my product specifically. that once one department investment in developing the I’m talking about being automates its workf low, ability to effectively pursue proficient at selling a other departments at the custhe market opportunity. solution, whatever that solution might be.� tomer location generally “When dealers take on a new — Ali Tehranchi follow suit. “So, you have this hardware product, they inNotable Solutions Inc. lifelong revenue stream,� he vest in learning about the says. “In addition, the annual product and how to sell it,� maintenance contracts are renewable. We have 80 to 90 he explains. “When you take on a software product, that percent renewal rates on our software.� investment is bigger. Remember, you are talking about a soluLaPointe also points to what he refers to as the “golden tion, you are not talking about a box anymore. goose� associated with the implementation of workflow solu“Dealers need to be patient in making the necessary investtions — professional services. “You can get $1,500 a day doing ment,� continues Tehranchi. “It requires 12 to 18 months of the installation, implementation of the workflow, training, patience for you to become proficient at it. I’m not talking etc.,� he says. “Actually, you can make more money from the about my product specifically. I’m talking about being profiprofessional services than you can from selling the software.� cient at selling a solution, whatever that solution might be.

Ali Tehranchi, president and CEO of NSi, shares a similar You educate yourself, sell a few, learn from those few, get observation. “What it does for you is provide a long-term success stories and build on those success scenario that enables you to go back to the same customer stories. It doesn’t happen overnight.� and get services revenue for facilitating their workflow,� he Brent Hoskins, executive director says. “Some of the dealers we know charge between $1,800 to of the Business Technology Association, $2,500 for services. That’s equivalent to a whole lot of clicks.� is editor of Office Technology magazine. He While he is encouraging in terms of the revenue opportucan be reached at brent@bta.org.

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Transition to Color Study reveals growth market opportunities by: Keith Kmetz, IDC

ffice equipment dealers have known that the hardcopy opportunity is gradually shifting from black-and-white-only devices to color-capable ones. IDC’s market forecast proves that color-capable MFPs are quickly gaining traction in the market. In fact, they are expected to more than double in unit shipments from 2006 to 2011 (see chart). Perhaps more impressively, color’s percentage of the laser-based MFP market has made considerable gains over the last several years. Five years ago, color shipments were a minuscule piece of this market. Since then, color’s share has more than tripled and its momentum is expected to build beyond the forecast period. Color MFPs’ revenue share is even more impressive. On the other hand, the demand for black-and-white MFPs is projected to peak during the forecast period and then steadily decline thereafter.

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Where Do I Go From Here?

Clearly, it is essential for dealers to begin the transition to color, if they have not already, in order to represent the kind of hardcopy products customers will demand in the future.

But the numbers alone only point toward the market’s direction. The true need is to better understand: Who wants color devices?

What is important to these customers regarding their color requirements?

What are the next steps to take to achieve success with your color strategy?

Recently, IDC completed an extensive analysis of the office color opportunity by surveying more than 1,600 users 16 | w w w . o f f i c e t e c h n o l o g y m a g . c o m | A u g u s t 2 0 0 7

and buyers of color hardcopy equipment. The study’s findings help reveal where vendors and their channel partners can find lucrative opportunities within this growth market.

Customers Who Want Color The first tier of customers who are most likely to adopt c olor are cl assif ied as “customer-interfacing ” workers.

These individuals are typically marketing/salespeople, administrators/executives or any other role that supports a customer. Their interest in color is somewhat predictable.

These “customer-interfacing” workers’ primary role is to ensure the customer’s satisfaction with the company and its products/services. In the opinion of many of these workers, color helps them achieve this important objective.

Our study of the office color opportunity revealed that the benefits gained from using color revolved around selling to customers. These benefits were described as improved communication that enhanced the company or its brand and ultimately led to winning business.

Interestingly, color is not just for producing customerfacing documents. A second tier customer group for office color was also discovered in internal support departments.

These color users include not only the print/copy shop, but also accounting/finance; IS/IT; engineering/R&D; and HR departments. In these environments, color may not always be used to communicate externally with customers, but it is used to provide visually-stimulating information as part of general business operations within the company.

IDC’s research also found that there are vertical market opportunities for color. Users and buyers within banking,

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Speed is equated with getting the job retail and wholesale had the highest ...

The customers who done and getting immediate gratification. percentage of “definitely buying” color Once the button is pushed or the mouse is hardcopy devices (printers or MFPs) want color include clicked, the user wants the job produced within the next 12-month period. In everyone ... The key is as quickly as possible in order to move on addition to these two verticals, other to seek out users and to other work tasks. industries such as real estate, insurance, industries where color Buyers and users are also interested finance, health care and education can provide a high in having wide media flexibility. This can showed the highest levels of color page return on investment. mean paper tray capacities, support for volume activity. various sizes (3-by-5-inch postcards to Quite frankly, the customers who want color include everyone, whether the need lies within 11-by-17-inch tabloid paper) and types of media (plain, card specific job responsibilities (e.g., sales) or within industry. stock, photo paper, etc.). This may not mean that the user The key is to seek out users and industries where color can actually requires all this media support, but indicates the user’s desire for the device to address any potential output provide a high return on investment. need, even if its actual usage is very rare. The good news is that IDC research indicates that color page volumes are Points to Emphasize When Selling Color The findings of what is important to potential color cus- increasing, so the potential for increased “clicks” looks tomers is not surprising. However, it is important to note the promising with color. underlying meaning of what these customers are saying about “OK, I’m Sold. What’s Next?” these essential features of their color hardware equipment.

The first thing is to be realistic. While color offers users IDC sees the top-ranked features by buyers and users of many benefits, IDC does not expect color to overtake the color hardcopy devices as reliability, quality, cost, speed and black-and-white market anytime soon. In fact, IDC projects paper flexibility.

Reliability is a given. Any IT director or purchasing that color MFP units will still be about 30 percent of the laseragent bringing hardcopy equipment into his (or her) work- based MFP market in 2011. Until color hardware and per-page place wants to be assured that the device will operate with costs are more in line with what is currently achieved with little to no downtime. The only time a color printer or MFP black-and-white-only devices, IDC believes that color-capable will be highly visible within the office environment is when devices will remain in the minority. However, color’s growth it is not working. Significant downtime for any machine will potential should not be dismissed. Without a strong color cause users to quickly seek alternatives to get their copy or portfolio, the dealer will be at a competitive disadvantage.

Start with the machines in field (MIF). IDC estimates that print jobs done without hassle.

High quality is also an important feature, but office there are nearly 40 million black-and-white-only laser workers are not necessarily seeking exact color matching printers and MFPs in use in the United States. This is a great standards for their documents as demanded by traditional conversion opportunity. If only 10 percent of these macolor users (e.g., color graphics specialists). What office chines were converted to color, that would be four million workers want is good, solid color quality. The red needs to be color devices producing black “clicks” as well as new (and more lucrative) color “clicks.” By the way, if this conversion red, but it may not need to be a specific shade of red.

Costs are important, too, but the aftermarket costs are was achieved, it would be substantially higher than IDC’s increasing in significance. Years ago, the hardware price dif- current color forecasts. I would love to see the market ferential between black-and-white devices and color-capable demonstrate a much higher black-to-color transition than machines was substantial. As a result, a primary inhibitor to what we are currently forecasting.

Your customers’ color cost concerns are legitimate and need adopting color was identified as the difference in hardware pricing. Today, IDC sees the hardware price delta shrinking to be addressed. Seek ways to alleviate their concerns about between black-and-white and color capable devices. bringing more color into their copy/print environments.

However, today’s primary concern about color usage revolves Perhaps this can be done with more aggressive color page around the cost to produce the page. Color pages are still volume monitoring and/or other controls on color usage, so that the customer does not incur substantial increases in total multiple times more costly than black-only pages.

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document production costs. Additionally, Do not forget printers either. IDC sees Dealers may also want a managed print services agreement with single-function color printers as a viable your customer might open up opportunimarket for dealers. While MFPs are to examine their color ties within these accounts, particularly if expected to drive much of the overall portfolios to ensure that color is to play a more prominent role in market growth versus printers, there the line is complete the organization. will still be more color printers (nearly and can address Dealers may also want to examine 1.19 million) shipped than color MFPs the color requirements their color portfolios to ensure that the (686,200) in 2011. Additionally, many of of their customer base. line is complete and can address the today’s copier vendors are offering a color requirements of their customer single-function color printer line so that base. This may mean having a range of products starting their dealers can provide a complete set of single-function from a “good output quality with low operating cost” and multifunction color devices. product to a “high output quality with higher operating Keith Kmetz is the vice president of hardcopy peripherals cost” product. Remember, the needs of the customer are solutions and services programs for IDC. varied and focus on the device’s “essentials” (e.g., reliability, He has been conducting research quality, cost and speed) identified earlier as most important. and consulting in the office An emphasis on these key features and how your product technology market since 1995. lineup addresses them will have a major influence on cusHe can be reached at kkmetz@idc.com. tomers’ interest in adopting more color devices.

Visit www.idc.com.

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A Decisive Differentiator Print management ‘a must’ in today’s market by: Chip Miceli, Des Plaines Office Equipment

aying that technology is a “differentiator” in today’s fast-changing business environment is stating the obvious. Yet for those of us in the business of providing document generation solutions, there are several technological advances that will significantly benefit us.

Advanced technology is good news for our industry, because new Internet applications offer the potential to dramatically increase the value of service and convenience that we offer to our clients, while also helping to level the playing field where the “industry giants” are concerned.

How, you might ask?

For a long time, it has seemed that the big players in our industry have a deeper “bag of tricks” from which to draw. These new technologies enable small- and mid-sized companies to provide advanced print management and service techniques.

Traditionally, most of us evaluate our ability to provide good service on two categories: rapidness of response and customer satisfaction. Having a team of technicians who arrive on site and fix the problem quickly is an excellent beginning and usually results in a satisfied client. And, of course, selling equipment that does not require many service calls is even better.

This traditional “sell and serve” model of doing business is more reactive than proactive, and it is the proactive dealer who will ultimately be the most successful in the decade ahead. New technological applications are allowing us to become more proactive — which ultimately benefits our clients (often resulting in more business) and upgrades the industry in general.

A good client for most document solutions companies could be a manufacturer, real estate agency, bank, law firm or school. Often, our dealings with these clients include initial arrangements to sell or lease equipment, including copiers, facsimiles, traditional printers and multifunction printers. We would further look to support the sale with strong service contracts and maintain an ongoing relationship with our clients so that we remain “top of mind” when

S

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they need us again — or are having a conversation with a fellow business owner who says, “I am looking to buy a copier or MFP. Do you know anyone?”

What is changing in our industry is the increasing interest in print management; for any dealer looking to provide true added value to clients, this is a must. Not offering a comprehensive print management program to clients is roughly the equivalent of trying to run a business in today’s climate without a computer.

Articles are springing up in the mainstream media about the issue of print management. Business sections of traditional newspapers are now carrying stories about how wasteful the small, “bargain” $79 desktop printers can be — and how otherwise intelligent end-user business owners are lulled by the low price tag and think they are doing themselves

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Piecing Ideas Together.

The BPCA was founded in 1963 with the vision of forming a best practices organization that unites leaders of independently-owned office equipment dealers. The concept is quite simple - bring the leaders of these companies together so that they can share ideas, learn from each other, and take their businesses to the next level.

Our members will attest that it’s well worth the investment by making each of them better leaders and bringing more value to their dealerships.

Feel like there’s something missing from your organization? Let BPCA bring together all the pieces of the puzzle.

“Better Dealers Through Learning and Idea Exchange.”

If you’d like more information about our organization and how to join, please send us an email or give us a call.

Phone: 800.897.0250 Email: info@businessproductscouncil.org Website: www.businessproductscouncil.org Membership Director BPCA c/o BTA 12411 Wornall Road Kansas City, MO 64145

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usage and generate reports, which is the and their bottom line a huge favor. That The dealer should ultimate in customer service. belief is typically short-lived. One or Take the hypothetical case of an offtwo trips to the corner office supply always be looking for ice technology dealer in Cleveland, who store to purchase $32.50 replacement ways to recommend an has a law firm client with four offices in cartridges quickly shows the business even more economical, the greater Cleveland area. In all, the owner that the per-page cost of docuefficient means of firm has 21 copiers ( four of which are ment generation on this “bargain” is document generation color), 10 MFPs and a variety of other astronomical, and that the business for the client. miscellaneous office equipment. The owner would have been better off to firm’s document generation exceeds purchase a $2,000 MFP with 75 percent lower per-page document costs that would have paid for 650,000 annually.

The dealer should always be looking for ways to recomitself in nine months.

In defense of the department and office product stores mend an even more economical, efficient means of docuthat sell the $79 specials, however, the issue becomes less m ent gen eration for th e client. It may b e that th e one of “Do they have any value?” than “Did anyone explain recommendations do not include the need to upgrade equipment, but simply to redistribute the flow of documents to the end-user what his per-page cost would be?”

For some individuals and perhaps even a small business, among existing equipment. If the law firm client sees a way that $79 printer may be an acceptable solution. Someone that his firm can save 20 percent annually on document genwho communicates primarily electronically and needs to eration costs, he will be a loyal client for a long, long time.

It is in this realm that the Internet and its Web-based generate a minimum of documents, say 100 per month, may software applications are helping dealers catapult forward find this a very acceptable solution.

The sales clerk behind the desk at the office superstore in what they can offer clients. First, in the area of print manmight not know to ask that question. But any dealer worth agement, new software enables remote monitoring of client his (or her) salt should know better — and must ask the equipment; in the same hypothetical law firm, this software question. We do ourselves no favors by making the “quick would enable the client to monitor use of copiers, small sale” at the expense of the better solution for the client. We desktop printers and to make ongoing evaluations as to how must always seek to educate clients about the difference they are being used. If one desktop printer is making 300 between price and value. The client who buys a piece of color copies per week, this information will show up and the equipment that does not fit his needs will not be happy, no program makes recommendations for modifying usage. The report might suggest that the desktop should not be used matter how superior a service record it comes with.

Providing print management counseling will soon be a but that a more efficient cost-per-unit machine be substinecessity for all of us in this industry. Those who do not take tuted. In these cases, the software application is evaluating the client’s existing equipment, so the client benefits these next steps will get left by the wayside.

Initial print management strategies usually involve on- tremendously from this type of service.

These software applications can provide detail down to site visits, detailed analysis of the client’s existing equipment, evaluating the use of each piece, evaluating if it is the level of “here is your current usage, here is how you being used efficiently, looking for the lowest per-page cost should change machines, here is where your use is too much and then providing detailed recommendations of steps for a machine and here is where it is underutilized.”

As impressive as that might be to either a new or existing toward improving efficiencies.

Dealers should not be hesitant to approach clients on this client, consider adding this option to the menu: the ability topic. In the end, a client who feels you are looking after his to remotely monitor your client’s equipment, evaluate when best interests will be more inclined to do repeat business it needs a service call or new toner or when it has too many with you. You will have gone beyond that image of being misfeeds. One software application allows a technician to sit at a computer or “Help Desk” and look at screens all day to “just a salesman.”

The Internet and some Web-based software applications monitor problems with off-site equipment even before the coming into play are making print management easier. Soft- call for service comes in.

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flag” a piece of equipment that will soon train your service technicians to be at the As technology evolves, need service. How much better is it for a forefront of this technological explosion. client to receive a call or e-mail that tells As dealers, you should investigate what it presents additional him “Our records show that…” and to technology can do for your company in business opportunities head off problems before they arise? the areas of print management and for dealers, while at the These applications have similar opporservice. If the applications seem approsame time “raising the tunities for service as well. New software priate for your business, you should invest bar” for ... acceptable that is e-automated can track and log the necessary time and funds to get your industry standards ... service calls and track the service record technicians up to speed in these areas. It remotely. Additionally, software is under goes back to the difference between cost development that will allow end-users to communicate with and value. Staying technologically proficient is not only necestheir dealers via equipment keyboards. sary, it is great value for your company.

As technology evolves, it presents additional business oppor- Chip Miceli is president of Des Plaines Office tunities for dealers, while at the same time “raising the bar” for Equipment (DPOE), based in Elk Grove what the minimum acceptable industry standards will be.

Village, Ill., with other locations in the Dealers who are not making a concerted effort to stay Chicago area. For more than 50 years, ahead of technology are hurting themselves. Unfortunately, it DPOE has provided document generation seems to be the one area that gets pushed to the background solutions to the Chicago area and beyond. in favor of other capital expenditures. It is money well spent to Visit www.dpoe.com.

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COURTS & CAPITOLS

The Owners’ Contract It will help to resolve future disputes by: Robert C. Goldberg, General Counsel for the Business Technology Association

e’s my best friend and partner, how could he do this?” “I never thought my own brother would be so irresponsible with our business.” “We totally trust each other.

Why would we bother with contracts? His handshake is good enough for me!”

Similar comments initiate many of my appointments, which sometimes end in litigation, but always lead to hard feelings, family disruptions and business problems. Even though the courts may find a verbal contract enforceable, proving which terms were agreed upon is extremely difficult, especially with the complexity of today’s business world. Problems arise in the most successful of businesses, as well as those in trouble, and many could be avoided with some advanced planning and written agreements in place. While this may sound like a pitch for legal services, the fact is that contracts drawn up at the inception of a venture outlining duties, organization and the like are relatively inexpensive to generate and certainly are cheap when compared to the cost of litigation.

What issues, then, should be formalized by a contract? Most importantly, everyone works better when they know what they are supposed to do and for what they will be held accountable.

With specific duties assigned, such as personnel, dispute resolution, buying and selling issues and remuneration, there can be no later dispute over accomplishments or failures. Contracts do not preclude discussions, the sharing of ideas or even debates. They do, however, avoid lawsuits. Furthermore, agreements are not forever and can be modified if circumstances change and the parties agree.

The first step for a business, after your business plan is established, is to outline the parameters of the venture. Is it to be a partnership and, if so, is it equal in all matters? Is it to be a corporation and, if so, how are shares apportioned? Can these shares be resold and, if so, under what circumstances? Similarly, in a Limited Liability Company (LLC), what are the membership control agreements?

Starting a new business means entering new vendor agreements as well. These agreements need to be thoroughly examined, for even if a new venture is organized correctly, a poor

“H

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supplier agreement could result in a disaster. You should be determining what the supplier promises to deliver for the investment you are going to make. Are there limitations on the representation of competing products? How can the agreement be terminated? When all of these issues are addressed at the outset, there can be no surprises as the business proceeds.

As much as none of us like to think about wills and the ending they imply, the same is true of the end of a business. Some thought must be put into the possible dissolution of this endeavor. If one wants to leave, how much is his (or her) share worth? In addition, can the sale or transfer of shares be restricted? Do you have to accept your partner’s obnoxious son as your partner?

The issue comes down to valuing the ownership interest. Is there a fair market value or a book value based on a percentage of gross revenue? Some companies enforce a yearly meeting policy for the sole purpose of evaluating their businesses.

Sometimes, independent appraisals of various aspects of the business are the most equitable manner of establishing a value.

Much depends on the type of business and the people involved.

The important thing is that these judgments are made in the planning stages of the venture; there can be no argument later that the value is skewed toward one partner or the other.

This brings us to the matter of dispute resolution. Unless this is a one-person company, conflicts will arise. If a mechanism is put in place prior to the problem, a speedier outcome is guaranteed.

Many family businesses establish a family council to address issues. Some businesses mandate arbitration, others less formal measures such as mediation. What is most important is that everyone understands the manner in which the dispute will be settled. Just as a honeymooning couple is unlikely to believe a prenuptial agreement would ever be necessary for them, fledgling business partners believe only great things will follow. Be smart; get it in writing and save the handshakes for the Super Bowl!

Robert C. Goldberg is general counsel for the Business Technology Association. He can be reached at robert.goldberg@sfnr.com.

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EDUCATION CALENDAR BUSINESS TECHNOLOGY ASSOCIATION • August 2007

EDUCATION CALENDAR September 10-11 BTA Print Management Workshop

Las Vegas, NV Taught by Tom Callinan of Strategy Development, this two-day workshop is designed to provide dealerships with the tools they need to establish a print management strategy. The workshop will cover: understanding the print space, getting the appointment, presenting a value proposition, conducting an assessment and much more.

October 1-2

BTA ProSolutions Little Rock, AR Software vendors teach you about their technology. However, your clients don’t care about technology — they want their business problems solved. This course, taught by Darrell Amy of Dealer Marketing Systems, will help you understand your clients’ business problems, so you can provide solutions.

26

FIX: Cost Management for Service Workshop Waynesville, NC Learn proven service management and customer service strategies to use in your company. Costing out the service hour, effective and profitable maintenance agreements, efficient vehicle operations, reducing personnel turnover, competitive compensation plans and identifying profit-making opportunities through the service operation are issues that are critical for success.

26-27 BTA Southeast “Fall Colors” Conference

Waynesville, NC Come see the gorgeous fall colors in the beautiful mountains of western North Carolina. The conference begins Friday evening, Oct. 26, with cocktails and hors d’oeuvres. Education sessions will be held on Saturday morning, Oct. 27. Cocktails and dinner will be served Saturday evening. For more details, hotel information or to register, visit www.btasoutheast.org or call (800) 234-8996.

November 14-15 BTA ProFinance

Cleveland, OH Analyze current business practices and evaluate strengths and weaknesses. Participants will explore important issues surrounding profitability benchmarks, asset management, expense controls and employee productivity. They will leave with a clear set of benchmarks and proven strategies for successful implementation.

For additional information or to register for courses visit www.bta.org or call (800) 843-5059. BTA offers dealer members a $250 discount coupon toward FIX and ProFinance. Members may use their $150 discount coupons for ProSolutions and the BTA Print Management Workshop. www.of ficetechnologymag.com | August 2007 | 25

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MEMBERSHIP APPLICATION PART I – COMPANY INFORMATION Company Name: Street Address:

PO Box:

City:

State/Province:

Phone: (

)

Fax: (

ZIP/Postal Code:

)

Country:

Web Address:

May BTA include your fax number in the online BTA Membership Directory? Yes No May BTA include your e-mail address in the online BTA Membership Directory? Yes No BTA does not share fax numbers or e-mail addresses with outside parties.

Contact Names (first name listed receives all mail): Principal Contact:

Title:

E-mail Address:

Sales Contact:

Title:

E-mail Address:

Service Contact:

Title:

E-mail Address:

No. of locations (include parent):

No. of employees (include owners):

Year business was established:

Annual revenue:

PART II – PRODUCT INFORMATION

OEM Authorizations:

Please indicate the products you sell (check all that apply):

Equipment/Products: Audio/Video Presentation Equipment Bar Coding Equipment Binding Equipment/Supplies Cash Registers/Point of Sale Check Writing/Protection Equipment Computers/Accessories/Parts/Supplies Copiers (MFPs), B&W Accessories/Parts/Supplies Copiers (MFPs), Color Accessories/Parts/Supplies Duplicating Equipment/Parts/Supplies Facsimile Equipment/Parts/Supplies Filing Systems/Electronic Organizers Furniture Identification Systems/Labeling Equipment

Mailing/Shipping Equipment/Supplies Networking Products/Services OCR Scanners Office Supplies Paper Handling Equipment Phone Answering Equipment Power Protection Printers, B&W Accessories/Parts/Supplies Printers, Color Accessories/Parts/Supplies Recycled/Remanufactured Equipment/Supplies Security Equipment/Systems Shredders Software Development/Sales/Support Time Recording Equipment

Typewriters/Accessories/Parts/Supplies Other: Services: Circuit Board Repair Consulting Equipment Rental Financing/Leasing Insurance Internet Solutions Publication Service/Repair Training/Education Other:

PART III – MEMBERSHIP Categories, Classifications and Investments Retail Dealer/VAR Memberships

Vendor Associate Memberships

Service Associate Memberships

$430

1-10 Locations

$1,500 Annual Sales up to $5 million

$500 Annual Sales up to $1 million

$885

11-50 Locations

$1,395 51+ Locations $125

$2,000 Annual Sales $5-$10 million

$750 Annual Sales $1-$5 million

$2,500 Annual Sales over $10 million

$950 Annual Sales over $5 million

Branch Location (in addition to parent)

$100 Keylink

$150 Publications Associate

Will your OEM reimburse you for your membership dues? Call BTA at (800) 505-2821 for details.

Payment Enclosed (Make check payable to Business Technology Association)

PART IV – INVESTMENT Annual BTA Dues:

MasterCard Visa American Express

Processing Fee:

$ $ 25

Card Number:

TOTAL:

$

Card Holder’s Name:

Exp. Date:

(Join online at www.bta.org and the processing fee will be waived.)

Membership dues must be submitted in U.S. funds. Dues paid to BTA do not qualify as a charitable tax deduction, but do qualify as a business expense. $45 of the annual dues pays for your subscription to Office Technology magazine.

I hereby apply for BTA membership: Signature: Date: Don’t let my membership lapse! Renew my membership using this credit card number at the end of my membership year.

Return to: Business Technology Association, 12411 Wornall Road, Kansas City, MO 64145 Phone: (800) 505-2821

Fax: (816) 941-4838

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Join online at www.bta.org

AUG 07 OT

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PRINCIPAL ISSUES

Direct Mail Making it work for your dealership by: Jim Kahrs, Prosperity Plus Management Consulting Inc.

he recent change in postal rates has brought renewed att ention to promotional mailings. With all of the technological advances of the Internet and email, direct mail is still the most reliable method of reaching prospects and customers. There are no spam filters or viruses to worr y about. But, how do you take advantage of this promotional tool without driving your staff crazy?

Deciding to do promotional mailings can quickly become an overwhelming task. For me, it conjures up images of the last big mailing we did and the problems it caused. The promotional mail pieces offered by the manufacturer were too expensive or did nothing to build the name of the dealership. So, we designed a piece with pictures of a few machines and a promotional lease price. Once we got the piece printed, it took the majority of the admin staff two weeks to get everything folded, addressed, sorted (we want to get the postal discounts) and mailed. Not only were they upset about having to be in the mailroom, but the rest of their work did not get done and they complained about carpal tunnel syndrome and paper cuts for weeks. Exporting a customer list from the computer system was more difficult than expected and combining it with the newly purchased prospect list was no picnic either. But we made it through and all 15,000 pieces went into the mail.

The good news is that the mailing did make the phone ring.

Though the response rate was less than a quarter of a percent, we got enough new business to justify the costs. However, the dealership principal became further frustrated when he realized that there were a number of leads that never got attention because the sales reps did not have the time to follow up. It is no wonder we do not send direct mail promotions on a regular basis. Who can handle the stress?

T

The Basics Behind a Better Way At Prosperity Plus, we help dealers develop strong promotional programs using the principles laid out in the Hubbard Management System. Promotion, as defined in the Hubbard

Management System, is “the art of offering what will be responded to.”

Response is the key word. In order to get a high response rate, you need to find out what people really want and consider valuable. This is determined by surveying customers and prospects. One of the biggest mistakes you can make is to assume that you know what is wanted and will be responded to. You sur vey dif ferent publics (groups with common characteristics) to find out what they like and dislike, what attributes they look for in a vendor, what factors most influence their purchase decisions, etc. Typical survey questions include: What are you looking for in a vendor? What do you like most about your current system? What do you like least about your current system? What factors influence your purchase decision the most and why?

The results of your surveys are used to create the promotional pieces you will send. There are two key components found in successful promotion pieces — the button and the message. A button is what is used to get the public’s agreement to listen to the message. The message is the communication, the thought or the significance you want to get across. For example, you survey and find out that 70 percent of those asked are looking for a copier/MFP that does not jam. That is the button or the point of agreement with that public. So you use that button with that public and you have agreement that they will listen to what you have to say about copier/MFPs. The button could be “Tired of Copier Jams?” and the message would include things like: the technology behind the system, independent tests showing low incidents of jamming and/or customer testimonials.

The idea is to strike just the right note of agreement using the button and deliver your message to a now-receptive audience.

That is the secret of the promo that gets a response. One key point is to make sure you use the prospect or customer’s terms.

If you change the word “jam” to “misfeed,” because “misfeed” is the “correct” industry term, your mail piece will not get the results it should. It does not align with the audience viewpoint. w w w . o f f i c e t e c h n o l o g y m a g . c o m | A u g u s t 2 0 0 7 | 27

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Getting the Plan in Place comes into play. You must mail to the Now let us put this into practice in your same public multiple times to increase You must mail to the dealership. The first step is to conduct your results. Mailing to a public once same public multiple surveys with the various publics you intend brings in very low response rates. However, times to increase your to promote to. This is best done by drafting hitting the same group three to five times results ... Hitting the a survey and having the sales reps call or is almost impossible to ignore. If you do same group three to visit customers and prospects to get the not already have a database consisting of five times is almost survey questions answered. You will want thousands of prospects (10,000 or more) impossible to ignore. to conduct 50-100 surveys for each public you need to acquire one. Lists are available you intend to target. The results of the for sale through a number of companies. surveys are then tabulated to determine the highest percentage Set up a schedule that hits each prospect once every two to of responses. three months.

The survey data is used to develop the promo pieces. Since To accomplish this, you need to put a process in place that you have done your homework via surveys, the promo pieces will ensure regular mailings go out every month. The best way can be created in-house. We recommend using postcards for to make this happen is to have the printing and mailing done your mailing campaigns. They are inexpensive to print and mail for you. There are many vendors that will do this for you. One and do not have to be opened to really impact the recipient. of the companies we use will print 5,000 postcards for $400 and The next step is to determine how many pieces to mail, to will mail them for $.26 each. You simply send them the artwork whom and how often. This is where another basic principle you have designed (or it can be designed for you) and a spreadsheet with the names of the prospects to be mailed. There is no need to stop production in your office. You can have 3,000 pieces mailed each month for about $1,000 a month.

When a program like this is done correctly, and in full swing, it is quite possible to get a response rate of 2 percent or more from each mailing. However, there is a much bigger effect created. Many of the people who received your mailings will read them and fully understand the message, but not call immediately because they do not have a need today. Yet they now know you exist. I have had sales reps from dealers that use this plan tell me that it is pretty common for them to go visit a prospect and have the prospect take out a folder with 10 of their postcards in it. The prospect never called but when the rep called them for an appointment, they granted one. You will have prospects on your mailing list tell you that they know who you are but do not know where or how they heard of you.

It is like the effect of dripping water. Each drop seems to do nothing, but the sum of the drips over time cannot be ignored.

So the question to ask yourself is, can my dealership benefit from 60 new leads each and every month? And, of course, the answer is pretty easy when you consider that the $1,000 cost can be recouped in as little as one or two sales. That being said, all that is left to do is start the process.

Jim Kahrs is the founder and president of Prosperity Plus Management Consulting Inc. PPMC works with office technology companies in building revenue and profitability. Kahrs can be reached at rkahrs@prosperityplus.com or (631) 382-7762. Visit www.prosperityplus.com.

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SELLING SOLUTIONS

Beating the Price Trap Unique value gives your prospect a reason to pay more by: Tim McMahon & Tom Kramer, Strategy Mapping Selling

elling is not really very much fun when it is all about price. Every professional salesperson would rather use his (or her) skills to win solid, profitable business rather than cutting price over and over to (hopefully) win a deal. We call this the “Price Trap” and most every office technology sales rep will face this “trap” at some point in his sales career.

Is it true that price is the only thing customers really care about in our marketplace or is there a way to beat the “price trap” and make better sales? Unfortunately, there is no silver bullet solution, but a smart salesperson can manage the price issue and still close more profitable deals. It is going to take a real change of mindset and the courage to “just say no.”

“Most customers are only interested in price.” Do you hear this from your sales team? Of course you do.

No matter what they say or do, the customer seems to always bring it down to price — and keeps pushing the rep to go lower. But before you conclude that price is what it is all about, put yourself in the mind of the prospect. Think about how you act when you are buying something — it is a foolish prospect who does not ask for the lowest possible price, no matter how valuable your product or service is. After all, why would anyone pay more than they have to? Especially when all they have to do is ask for it. But the real question is this: Will the customer still buy from you if your price is not the lowest?

What happens if you say no?

We both began our sales careers some years ago at IBM. In those days, IBM had a fixed price policy — no discounts, no rebates, no free extras or supplies. On top of that, IBM rarely, if ever, had the latest and greatest new office products. There was not a single prospect who failed to ask for a lower price or point out that the competition was offering them a much better deal. Each time we had to say no — our company did not negotiate price. The amazing part was that neither of us ever lost one of those deals. Now you are probably saying to yourself, “ Yes, but you were IBM and you had a lot more leverage than a small company like ours.” Is that really what it was? The big name? Perhaps it was something else. In fact, if you asked most IBM customers why they chose IBM — and often paid more — they would tell you that they made the

S

decision based on the quality of IBM’s people, their expertise and the assurance that IBM would be there for them when they needed support or help. They believed IBM’s competitors could not do as good a job for them.

So, what three things can we learn from this example?

Everyone asks for a lower price — they would be crazy not to — and they will keep asking until you finally say “no.”

Saying “no” does not necessarily mean “no sale.”

Only when you stop talking about price can you begin to focus on creating unique value that gives your prospect a reason to pay more.

“Even when I do tell my customers about the unique quality of our products, our people and our service, it is still about price.”

Once again, you must enter the prospect’s mind. You are telling him how your company is unique and different from your competition, but you are still willing to lower your price to win. To the customer, this means your presentation was just a sales pitch.

After all, what company could realistically afford to offer much more than its competitors and still sell for less? Your willingness to negotiate price is what is killing your value propositions.

Will every prospect buy when you stop negotiating price and sell value instead? Are there customers who only buy on price? Absolutely. Some customers will only buy the minimum w w w . o f f i c e t e c h n o l o g y m a g . c o m | A u g u s t 2 0 0 7 | 29

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acceptable product for the lowest possible or offers. The first offer is your basic lowSome customers will only price. They are commodity buyers. But price brand (or product). The second offer buy the minimum there are even more value buyers who are is the medium-priced offer that is suitable interested in more than just price. You for the customer. The third offer — your acceptable product for cannot do much about the true commodity VIP offering — is a higher-priced brand or the lowest possible price. buyers, but are you turning potential value product that offers superior benefits and But there are ... value buyers into commodity decision-makers by anchors your price in its value. buyers who are interested letting the focus stay on price? After all, if This approach provides a clear choice in more than just price. they are not prepared to believe you, offer a for both the value buyer as well as the measurable difference. Then again, are commodity buyer and positions you as a commodity buyers the people you really want to be selling to? technology expert who is acting with the best interest of the So how do you figure out if you have a commodity or value- customer in mind. More importantly, it allows you to easily buying prospect? One effective technique is telling the pros- and clearly present the relative value to the customer for each pect up front that you are rarely the least expensive vendor, offer — in other words, you show them exactly what they get although you are competitively priced. Tell them that the for their money. reason for this is that you offer your customers more than your Tim McMahon (left photo) is the CEO and founder of Strategy competitors — and what you offer makes buying from you a Mapping Selling. He has more than 30 years of experience better, more cost-effective investment. What you would like to holding senior positions in sales and management with IBM, do is discuss not only your product fit, but also your valueDigital Equipment and Dun & Bradstreet. Tom Kramer (right added services to determine if these will be as valuable to the photo) is an affiliate partner at Strategy Mapping Selling. He has prospect as they are to your other customers. A value-buying more than 30 years of sales, sales management and marketing customer will tend to respond positively to this offer. experience with IBM, the Eastman If you have the luxury of representing multiple brands, Kodak Co. and Canon USA Inc. another potentially effective strategy is recognizing that you They can be reached at have strength in your ability to make multiple offers. Andre info@strategymappingselling.com.

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