Page 1


Gobin’s Market Dedication Catches Attention of Customers and Competitors


Why Your Dealership’s Service Experience May Not Be As Great As You Think Leasing and Financing Insiders Foresee Growth Successful MPS Transformation Budgeting and Forecasting Customer Service Matters

PO Box 2240 Suite 729 Toluca Lake, CA 91610-0240 USA tel: 818-505-0022 fax: 818-505-9972 email:

rvice Exc Se

ENX Magazine

Office Technology Service Excellence Award


m Awar inu

ence Plat ell

inner •

JUNE 2017

engage ‘n exchange



Connecting People, Ideas and Products in the Document Imaging Industry since 1994

We would like to thank those of you who have sent us address change information. HELP US CONSERVE NATURAL RESOURCES To correct or delete your address from our subscription list, please call, fax or email us.


NEW A3 Color MFP


100 PAGES PER MINUTE Fastest in its Class*

High-speed color printing for SMB and departments Shown with optional accessories

WorkForce Enterprise WF-C20590 ÂŽ

New Opportunities. New Sales. New Profits. The new Epson WorkForce Enterprise WF-C20590 offers a unique way to increase your sales and attract new customers. Fully network and MPS compliant and with PrecisionCoreÂŽ Line Head Technology for high-speed printing and low energy use, the WF-C20590 can be installed with any 110V outlet. To learn more about our business products and how they can increase your sales, visit

RETHINK EPSON * Compared to best-selling A3 Color MFPs with MSRP of $41,000 or less. Competitive data gathered from manufacturer websites and third-party industry services as of Nov. 2016. PrecisionCore and WorkForce are registered trademarks and EPSON Exceed Your Vision is a registered logomark of Seiko Epson Corporation. Copyright 2017 Epson America, Inc.



BUILD FOR TOMORROW To thrive tomorrow, we must innovate today. Welcome the new Mobile App from GreatAmerica. Entering credit applications and generating quick payment quotes are now in the palm of your hand.

In This Issue



Samsung Positions Technologies for Next Generation Workforce While Transitioning to HP By Erik Cagle



52 6 | June 2017


STATE OF THE INDUSTRY Getting the Most from Leasing Depends on the Fund Source By Michael Nadeau


DEALER SPOTLIGHT Gobin’s Market Dedication Catches Attention of Customers and Competitors By Erik Cagle


SALES & MARKETING Why Your Dealership’s Service Experience May Not Be As Great As You Think—And What to Do About It By Darrell Amy


MARKET INTELLIGENCE Leasing and Financing Insiders Foresee Growth as Confidence in the Economy Rises By Michael Nadeau


SERVICE EXCELLENCE PLATINUM AWARD WINNER Service Mantra Employed By Diversified Business Solutions Harkens Back to Era of Customer First By Erik Cagle

46 48 52 54

MANAGED SERVICES Successful MPS Transformation By Charles Lamb



BUSINESS MANAGEMENT Budgeting and Forecasting — What It Is and Why Do It! By J. Mark DeNicola SERVICE MANAGEMENT Customer Service Matters By Ken Edmonds TECHNICAL TIPS Xerox DC250 style: How to Replace the Direct Pipe Assembly By Britt Horvat

We Saw It In ENX Magazine



DARRELL AMY is dedicated to helping copier dealers integrate the latest sales and marketing strategies to win with 24 years of industry experience. He is the Chief Marketing Strategist of Dealer Marketing (, a team dedicated to helping independent dealers win with digital marketing services, including website design, search engine optimization, blogging, social media management, and calls-to-action. He’s also the co-founder of the Social Sales Academy (, helping dealers integrate social selling into their existing sales processes. Darrell is a regular speaker at industry events and the co-host of the new podcast, Selling from the Heart (

Susan Neimes Publisher & Managing Editor

Erik Cagle Editorial Director

J. MARK DeNICOLA, CPA/CGMA/CMA has served 24 years as the CFO and executive director, sales/marketing for Thermocopy, a Knoxville-based business technology company. His core disciplines include acquisition analysis, budgeting, management, new business development, sales management, and business start-ups. Mark has recently been recognized by Corporate Vision Magazine as their 2017 CFO of the Year – USA. He can be contacted at

Michael Nadeau Contributing Editor

KEN EDMONDS is currently employed as a District Service Manager for a major copier manufacturer. He has an extensive background in the imaging business, having owned a successful dealership, serving as service manager for multiple dealerships, and as a Document Solutions Specialist for Sharp Electronics. He has more than 40 years of experience in the electronics and computer fields. For further information email him at

Ronelle Ingram Contributing Editor

CHARLES LAMB is the President and CEO of Mps&it Sales Consulting. His firm delivers proven methodologies and processes that assist dealer principals seeking a successful transformation into the managed services space. He’s created complementary solutions including Funnelmaker, Gatekeeper, and Shield IT services. For more info, call 888.823.0006, e-mail him at, or visit

Christina Kim Editor

engage ‘n ex engage ‘n exchange engage ‘n exchange

México & Latin America

La Revista del Distribuidor Dealer Source

engage ‘n exchange

TECHNICAL ARTICLE CONTRIBUTOR BRITT HORVAT works for The Parts Drop, a company whose primary business is providing parts, supplies and information for Xerox brand copiers, printers and fax machines. You can find more information, including many of Britt’s past ENX articles on their website

8 | June 2017

Corporate Office

Susan Neimes - Erik Cagle - 10153 1/2 Riverside Drive, Suite 729 Toluca Lake, CA 91602 tel. 818-505-0022 • fax. 818-505-9972 ENX Magazine is published monthly by Affinity Business Communications, Inc. Any inquiries should be sent to: or mailed to the corporate office. Copyright ©2017 by ENX Magazine printed in the U.S.A. All reproduction in whole or part is prohibited without written permission. Cover photo from

We Saw It In ENX Magazine

PRINT. REPLACE. REPEAT. No More Running out of Toner With Axess Auto Toner Fulfillment, we make cartridge replacement automatic for your customers





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CS-306ci CS-356ci CS-406ci Color Multifunction Systems AirPrint







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Color Copy, Print, Scan w/ Network, Duplex, Fax (Opt)

Color Copy, Print, Scan with Network, Fax (Option)

• 22ppm (BW/Clr) (5521CDW) • 27ppm (BW/Clr) (5526CDW)

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1900 CS-406ci

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Up to 150 280 FREE! DP-5100 $ Rebate Rebate


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$ 550 SSpaelec!ial $500 SSpaelec!ial Rebate Rebate



Color Copy, Print, Scan, with Network, Duplex

Color Copy, Print, Scan, with Network, Duplex

Color Copy, Print, Scan, Fax, with Network, Duplex

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B&W Printer with Network and Duplex

• 32ppm BW/Color • 250-Sheet Tray • 50-Sheet MPT • 75-Sheet RADF • Wireless Printing • 33.6 Kbps Fax

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• 22ppm (BW/Color) (P5021CDW) • 27ppm (BW/Color) (P5021CDW) • 512MB Memory • 250-Sheet Paper Drawer • 50-Sheet MPT

• 40 pages per minute • 250-Sheet Tray
















P2235DW P5021CDW





120 290 $

37 B&W Printer with Duplex and Network

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All supplies & Parts available for prompt delivery! ENX Magazine |

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.

Copiers • Printers • MFPs • Faxes • Scanners E m a il: info @ n u w o rld in m

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FACTORY REFURB SALE! MFC-7860DW • 27pages per minute (Copy/Print) • 32MB Memory










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B&W Laser All-in-One | 21ppm | 32MB Memory.....

B&W AIO | 32ppm | Duplex | Wireless Network.....


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MFC-9330CDW Color Digital MFC | 23ppm | Duplex | W-Network...

21/21ppm Color MFP • Duplex Unit (MC210D), 2nd 520-Sheet Tray (MC210S1)


• 26ppm BW (M266N) • 31ppm BW (M316N) • 35ppm BW (M354N) • 2 x 500-Sheet Paper Drawers, 100-Sheet MPT



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• 62.1” Diagonal • 4-Panel Electronic Board

$949 $1159 UB-5835


• 40 pages per minute • 500-sheet paper drawers


Interactive Elite Electronic White Boards

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MX-C300W • 30 pages per minute

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DR-C225 25ppm B&W/ Grayscale/ Color (Simplex)

40ppm Desktop Scanner







Multifunctions • 1GB RAM Memory • 50-Sheet Auto Reverse • 250 Sheets Tray Document Feeder (Input Capacity) • 600 x 600 dpi Resolution • 100 Sheets (Bypass)



MP501SPF...............................$2275 MP2501SP...............................$1869 MP2554SP...............................$2855

MPC306SPF............................$1975 MPC2004.................................$2649 MPC2504.................................$3845

BIG SALE! 3600SF............................................... $50 REBATE! 3610SF............................................... $40 REBATE! 4510DN.............................................. $100 REBATE! 4510SF............................................... BIG SALE! 5200DN.............................................. BIG SALE! 5210SR.............................................. $100 REBATE! 5300DN.............................................. $150 REBATE! 5310DN..............................................

$75 REBATE! SP C250DN.............................................. $30 REBATE! SP C340DN.............................................. BIG SALE! SP C342DN.............................................. $100 REBATE! SP C440DN.............................................. BIG SALE! SP 5200S................................................. BIG SALE! SP 5210SF............................................... $125 REBATE! SP C250SF............................................... BIG SALE! SP C252SF...............................................






36-inch Large Format Printers

IPF PRO2000 IPF PRO4000/MFP IPF PRO2000MFP IPF PRO4000S/MFP 24-inch Large Format Printers

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SD375......80-100-130 sheets per minute SD440..............60-130 sheets per minute SD710..............60-135 sheets per minute


300mm/s / 256K Mem.

CT-S601 Image shown: CT-S801







LASERJET M506N......................................................$150 REBATE LASERJET M506DN...................................................$180 REBATE LASERJET M506X......................................................$200 REBATE COLOR LASERJET M477FNW..........................................BIG SALE! COLOR LASERJET M477FDN...........................................BIG SALE! COLOR LASERJET M477FDW..........................................BIG SALE! LASERJET M225DN..........................................................BIG SALE! LASERJET M402N......................................................$100 REBATE COLOR LASERJET M553N.........................................$120 REBATE COLOR LASERJET M553DN......................................$160 REBATE COLOR LASERJET M553X.........................................$240 REBATE COLOR LASERJET M452NW............................................BIG SALE! COLOR LASERJET M452DN.............................................BIG SALE! COLOR LASERJET M277DW............................................BIG SALE!

350 $885 $400 $600 $825 $800


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Digital Duplicators

Image shown: SD375




31 page per minute B&W Copier


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65ppm B&W Duplex, Network-Ready Printers

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Duplex & 40GB HDD, CMY Color Toner Set




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52ppm B&W Duplex, Network-Ready Printers



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B&W Laser Printer | 42ppm | Duplex | W-Network..





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Parts Order Hotline: 562.977.4949

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.

NBS / ENX | June 2017

Since 1985

Your Prime Source T EL: 800.729.8320

FAX: 800.829.0292



MF236N MF247DW MF249DW







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Both models can only be sold to 3P Authorized Dealers!

125 135








B&W Laser Duplex Printers with Wireless Network • 30ppm (LBP251DW) • 35ppm (LBP253DW)


75 125 $






B&W Laser Duplex Printer with Network • 45 pages per minute • 550 Sheets + 100-Sheet Multipurpose Tray







• Up to 35 pages per minute • 256MB Memory • 500 Sheets + 50-Sheet MPT • Duplex Versatility • 33.6 Kbps Fax Super G3 (D1550)




200 150 $REBATE



375 200 $REBATE





135 $150




Color Laser Duplex Printer with Wireless Network • 28/28ppm (BW/Color) • 250 Sheets + 50-Sheet Multipurpose Tray

B&W Laser Duplex Printers with Network

210 175 $REBATE





• 33.6Kbps • 19ppm Print (L100) • 26ppm Print (L190)

• Duplex (L190)

Image Shown: FAXPHONE L190



Both models can only be sold to 3P Authorized Dealers!

120 165 $REBATE


• 19/19ppm • SCAN (BW/Color) • FAX (MF634CDW) • 28/28ppm (BW/Color) (MF731CDW) • Wireless Network





• 26ppm (BW/Color (MF810Cdn) • 36ppm (BW/Color (MF820Cdn) • 550 Sheets + 1-Sheet Multipurpose Tray • Duplex Versatility MF820CDN can only be sold to 3P Authorized Dealers!

• 28/28ppm (BW/Color) • 1200 x 1200 dpi Resolution (Print) • 250-Sheet Cassette, 50-Sheet Multipurpose Tray • 50-Sheet Duplex DF • 1GB Memory (Copy/Print) • UFR II (Host-Based), PCL 5c/6, Adobe PS (MF735CDW) • Duplex, Wireless Network • 33.6 Kbps Fax Speed



• 58ppm (LBP351DN) • 65ppm (LBP352DN) • 500 Sheets + 100-Sheet Multipurpose Tray • 1GB Memory

LBP253DW can only be sold to 3P Authorized Dealers!



D1520 D1550 • PRINT • COPY • SCAN • FAX

• 24ppm (MF236N) • 28ppm (MF247DW, MF249DW) • 600 x 600 dpi Resolution • 250-Sheet Cassette + 1-Sheet Multipurpose Tray • 512MB Memory (Copy/Print) • Duplex, Wireless Network (MF247DW, REBATE MF249DW) MF236N














Color Laser Duplex Printer with Network • 40/40ppm (BW/Color) • 550 Sheets + 100-Sheet Multipurpose Tray




All supplies & Parts available for prompt delivery! ENX Magazine |

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.

Copiers • Printers • MFPs • Faxes • Scanners E m a il: info @ n u w o rld in m

Order Online!

Blind Drop Shipping

Same Day Shipping



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CLX-8640ND / CLX-8650ND

Color Duplex Copy, Print, Color Scan, Fax, Network • 40 pages per minute (BW/Color) (CLX-8640ND) • 51 pages per minute (BW/Color) (CLX-8650ND) • 520-Sheet Cassette + 100-Sheet Multipurpose Tray




$300 $500

Color Duplex, Copy, Print, Scan, Fax, Wireless Network • 19/19ppm (BW/Color) (C1860FW) • 27/27ppm (BW/Color) (C2670FW) SL-C2670FW



B&W Duplex, Copy, Print, Color Scan, Fax, Network • 35 pages per minute • 250-Sheet Input Capacity • 50-Sheet ADF • 33.6 Kbps Fax


Color Laser Printer with Network • 35/35ppm (BW/Color) • 500-Sheet Input Capacity • 9600 x 600 dpi Resolution


SCX-5935NX • 35 pages per minute • 500-Sheet Input Cassette, 50-Sheet Multipurpose Tray




B&W Duplex Copy, Print, Scan, Fax, Wireless Network

• 21 pages per minute • Up to 1200 x 1200 dpi Res. • 150-Sheet Input Capacity • 33.6 Kbps Fax Speed


B&W Duplex Copy, Print, Color Scan, Fax, Network • 42 pages per minute • 550-Sheet Input Capacity • 100-Sheet MPT • 33.6 Kbps Fax Speed

B&W Copy, Print, Color Scan, Fax, Network • 30 pages per minute • 520-Sheet Input Cassette (x2), 100-Sheet Multipurpose Tray



Color Duplex Laser Printer with Wireless Network • 27/27ppm (BW/Color) • Duplex Built-In • 250-Sheet Input Capacity


• 55 pages per minute • 520-Sheet Input Cap. • 100-Sheet MPT • 33.6 Kbps Fax Speed (Option)

Color Copy, Print, Color Scan, Fax, Network • 28/28 pages per minute (BW/Color) • 520-Sheet Input Cassette (x2), 100-Sheet Multipurpose Tray



B&W Duplex Laser Printer with Network • 35 pages per minute • Duplex Automatic • 250 Sheets • 1200 x 1200 Resolution



B&W Duplex Copy, Print, Scan, Fax, Wireless Network • 29 pages per minute • Up to 4800 x 600 dpi Res. • 250-Sheet Input Capacity • 33.6 Kbps Fax Speed




B&W Duplex Copy, Print, Color Scan, Fax (Opt), Network

SL-M3870FW SL-M4070FR

B&W Duplex, Copy, Print, Color Scan, Fax, Network • 40 pages per minute SL-M3870FW





l Specia Sale!



Quarterly Rebates

Dealer SPIFF Program

B&W Copy, Print, Color Scan, Fax, Network


SL-C1860FW SL-C2670FW

POS Rebates

B&W Duplex Laser Printer with Wireless Network • 40 pages per minute • Duplex Automatic • LCD 2 Line • 1200 x 1200 dpi Resolution







B&W Duplex Copy, Print, Color Scan, Fax, Network • 47 pages per minute • 550-Sheet Input Capacity • 100-Sheet MPT • 33.6 Kbps Fax Speed





B&W Duplex Laser Printer with Network • 42 pages per minute • Duplex Built-In • LCD 2 Line


B&W Duplex Copy, Print, Color Scan, Fax, Network • 47 pages per minute • 550-Sheet Input Capacity • 100-Sheet MPT • 33.6 Kbps Fax Speed



B&W Duplex Laser Printer with Network, Touch Screen • 47 pages per minute • Duplex Automatic • 550-Sheet Capacity


Parts Order Hotline: 562.977.4949

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.

NBS / ENX | June 2017



Since 1985





Comprehensive up to 3-Year Warranty

MPS3537MC+MFP ES8473X MFP 37/35ppm in BW/Color

35/35ppm in BW/Color

Direct OKI Tech Support Access

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35/35ppm in BW/Color







ES5473 MFP

31/31ppm (BW/Color)





42/42ppm (BW/Color)




Three available configurations: - ES8473 - Desktop - ES8473C - Floor Standing - ES8473X - Expanded

55 pages per minute in BW

45 pages per minute in BW (Print)






MPS3537MC+ Wireless 37/35ppm (BW/Color)




*Comes with a full set of standard toners




42/42ppm (BW/Color)



MPS4242MCFX+ MFP 42/42ppm (BW/Color)













MPS4242MCF+ Wireless



55 pages per minute in BW





MPS5502MB+MFP ES7412 Printer

55ppm (BW)





• Robust performance with up to 35ppm color (Print/Copy) • 7” Touch Panel with user-friendly functionality • 3-year on-site parts & labor warranty






MPS5501B Printer ES5162LP MFP

It’s as true for your customers as it is for you - when you’re looking for a competitive edge, it’s the small things that set you apart. Meet the ES8473 - A3 performance and efficiency at a size and cost you’d expect from an A4 device - available through Nuworld. Key features include:




Professional Marketing Support

Smaller Size. Smaller Price. Bigger Output.




Service Labor Reimbursement


ES9465 MFP

35/35ppm (BW/Color)





MPS5502MBF+ MFP 55ppm (BW)





ES9475 MFP

50/50ppm (BW/Color)





ES5112 Printer 47ppm (BW)





TEL: 800.729.8320 • FAX: 800.729.0292 • INFO@NUWORLDINC.COM • WWW.NUWORLDINC.COM

ENX Magazine |

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.


A Wholly owned subsidiary of Nuworld Business Systems




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B&W Copy, Print, Scan, Fax (Option)

PACKAGE 1: All Models + RADF + Stand + Toner + Developer PACKAGE 2: All Models + DSDF + Stand + Toner + Developer • 20 pages per minute (2008A) • 25 pages per minute (2508A) • 30 pages per minute (3008A) • Standard 1,200-Sheet Capacity • Automatic Duplex • 100-Sheet RADF (Option) or 300-Sheet DSDF (Option)



$ Rebate

All Models + RADF + Stand + Toners (CMYK) • 20/20ppm (Color/B&W) (2000AC) • 25/25ppm (Color/B&W) (2500AC) • 250-Sheet Paper Drawer • Automatic Duplex • 100-Sheet RADF (Option)



$ Rebate







Color Copy, Print, Scan, Fax (Option)

PACKAGE 1: All Models + RADF + Stand + Toner + Developer PACKAGE 2: All Models + DSDF + Stand + Toner + Developer • 35 pages per minute (3508A) • 45 pages per minute (4508A) • 50 pages per minute (5008A) • Standard 1,200-Sheet Capacity • Automatic Duplex • 100-Sheet RADF (Option) or 300-Sheet DSDF (Option)




B&W Copy, Print, Scan, Fax (Option)



2505AC/3005AC/3505AC Color Copy, Print, Scan, Fax (Option) PACKAGE 1&2: All Models + RADF or DSDF + Stand + Toners (CMYK) • 25/25ppm (Color/B&W) (2505AC) • 30/30ppm (Color/B&W) (3005AC) • 35/35ppm (Color/B&W) (3505AC) • 100-Sheet RADF (Option) or 300-Sheet DSDF (Option)



$ Rebate





Color Copy, Print, Scan, Fax (Option) PACKAGE 1&2: All Models + RADF or DSDF + Stand + Toners (CMYK) • 45/45ppm (Color/B&W) (4505AC) • 50/50ppm (Color/B&W) (5005AC) • 100-Sheet RADF (Option) or 300-Sheet DSDF (Option)



$ Rebate




TEL: 800.729.8320 • FAX: 800.729.0292 • INFO@NUWORLDINC.COM • WWW.NUWORLDINC.COM Price and availability subject to change without notice. Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners. If you no longer wish to receive these communications, please contact us at the phone number above.

NBS / ENX | June 2017

Michael Nadeau

State of the Industry News Briefing

Getting the Most from Leasing Depends on the Fund Source


ealers have several choices for funding sources: a financial firm that specializes in equipment leasing, a bank, or in-house. Most dealers use a combination of these options as it gives them the greatest flexibility in meeting their customers’ needs, and it sets up a little competition on rates among lessors. Leasing specialists boast a deeper understanding of the channel’s needs, the products it sells, and its market. “What we don’t want to be is just a leasing company. We want to understand what [our clients] are trying to do and align with those goals. A high percent of their business is repeat customers, and those customers go back to them based on how the equipment worked, how they performed, and how we performed,” said Michael D’Errico, Office Imaging Commercial Leader at CIT. “We have to be a part of why that customer goes back. That’s really more a cultural thing.” Being focused allows for operational advantages, too. “We have our whole servicing in one building, from origination through booking, credit, customer service, collections, end of lease, and everything in between—accounting, financial reporting, marketing,” said D’Errico. ”It makes us consistent in our service and also it makes our whole employee base understand the business, so it drives the culture.” Those advantages of pure-play lessors must be weighed against higher rates. “The biggest objection we hear is about our rates. We’re competitive, but not the lowest,” said Jennie Fisher, Senior Vice President and General Manager, Office Equipment Group at GreatAmerica Financial Services. She added that dealers that work with GreatAmerica do so because they appreciate the added value the company can bring for the term of the lease. That value is embodied in what GreatAmerica calls its Customers for Life principle. “We have always understood that the protection of our dealers’ customer base is vital,” said Fisher. “Our innovative products, programs, and tools help our dealers achieve their goals and differentiate in their markets. An example is our industry leadership with technology integrations that allow our dealers to run their

business more effective and efficient, while remaining in their system of choice.” Bob Hunter, Senior Vice President of Sales, Office Technology for Lessor at DLL, agrees. “The biggest asset a dealer has is its customer base,” he said. He sees DLL’s role as a partner that can help the dealer attract and retain customers, and it is well positioned to do so because Bob Hunter, DLL DLL is focused solely on vendor finance, and Hunter’s group only on the office equipment industry. “We continue to invest in the segment and in longterm relationships with dealers,” he said. Those investments are designed to provide total solutions that can accommodate small to large lease deals. Much of DLL’s investment is going into technology. “It’s about We have always understood that the how we connect. That could be APIs [applicaprotection of our tion programming indealers’ customer terfaces] that allow difbase is vital. ferent systems to talk to Jennie Fisher, each other or mobile enGreatAmerica ablement,” said Hunter. Banks tend to have the lowest cost of funds and better fund availability because of their depository nature. That could be a big advantage for dealers who need to price aggressively. The disadvantages of dealing with a bank-owned lessor are the additional regulations. “It creates some challenges at times from credit underwriting and structuring transactions,” said Fred Carollo, Vice President of Originations, Office Products at EverBank Commercial Finance. EverBank started out as an independent and was acquired by a bank, and Carollo believes this allows the company to offer the advantages of both. “As an indepen- Fred Carollo, EverBank dent, we developed a lot Commercial Finance continued on page 18

16 | June 2017

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Getting the Most from Leasing Depends on the Fund Source of creative financing products that we’ve been able to keep,” he said. “We now have the benefits of being bank-owned, which include pricing and consistency of having capital.” Some manufacturers have their own captive leasing and financing units to support the placement of their products in businesses. “There’s nobody that knows the asset, the equipment, better than the OEM, and that translates into, in many cases, a lower financing rate. They have such keen knowledge of the secondary markets that they are able to successfully remarket that asset, and they know the customer needs. Having in-house finance capability many times presents an advantage for the captive manufacturer or vendor,” said Ralph Petta, President and CEO of the Equipment Leasing Ralph Petta, ELFA and Finance Association (ELFA). Canon Financial Services (CFS) is one example. “As a captive, our charter is to support and assist with the placement of Canon equipment and to create unique financing options that support the overall health and profit margins of the manufacturer,” said Dominic Janney, Vice President of Sales and Servicing for CFS. “We understand the complexity of the sales of all our equipment types and work closely with all the sales channels to offer products that will result in the placement of more Canon equipment.” He added that all CFS products and promotions are created in collaboration with Canon’s direct and indirect channel partners. ”This open and direct dialogue with our partners presents us with opportunities to expand our products, create unique programs, and allow us to develop quicker and more efficient processes which will ultimately lead to inDominic Janney, CFS. creased sales,” said Janney. A few dealers provide their own funding for leases, either exclusively or alongside options from leasing partners. For some, the decision was made out of necessity. “You have to go back to 2008,” said Mike Sarelson, President and Owner of Commonwealth Digital Office Solutions. “That’s when the financial crisis hit, and almost everybody was being turned down. We were really scared—all of our machines were financed and we couldn’t get financing. We had no choice. Fortunately, we had the money to do it.” That decision has paid off for Commonwealth. Its in-house lease portfolio is now $10 million, although the company still works with other lessors for accounts that don’t meet its criteria for in-house financing. “We only take 60-month leases and we only take new businesses,” said Sarelson. He added that 60-month leases are preferable to 36-month leases because “The interest rates are just not high enough for us to bother with.” For Commonwealth, the hard part of setting up an in-house leasing unit was the initial investment. The company did not have 18 | June 2017

We don’t bump the rate to the customer, and we don’t bump the rate to the salesman. Mike Sarelson, Commonwealth

to hire additional staff. One person handles the paperwork for both in-house and outside leasing, and the sales team works out terms with customers. Commonwealth already had people doing collections and rolled collections for leases into their duties. The Commonwealth sales team plays a big role in the leasing process. “Our sales guys can go directly to the leasing companies,” said Sarelson. “They can call DLL, Everbank, Wells Fargo, and they can negotiate a cheaper rate. We don’t bump the rate to the customer, and we don’t bump the rate to the salesman. I don’t know if there’s any other dealer that does it like that.” For Sarelson, this approach keeps the monthly lease rate lower for the customer, and it takes pressure off of sales to discount to meet a competitor’s price, which in turn would eat into commissions. Even without bumping the rates, he sees plenty of upside in the interest earned from the lease and the tax benefits. “You get interest plus depreciation on the equipment, so the tax benefits are fabulous. On a $10 million portfolio you can get $500,000 tax free. It’s a great place to put money. When you own your own leasing company, you have the product on both ends. You’re the seller and the buyer, you can’t get hurt. It’s not the best return in the world, but it’s very, very safe.” Gordon Flesch is one of the largest dealerships in the US, and it has used its own captive leasing unit, GFC Leasing, for 50 of its 60-year history. The reason can be summed up in one word: control. “We could have used third parties, but we would have had no control over the customer’s experience,” said Mike Ullsperger, Vice President of Leasing at Gordon Flesch. “Doing our own leasing allows us to meet GFC’s and customers’ expectations on invoicing and servicing. We want the leasing experience to be similar to the sales and service experience.” Ullsperger said that Gordon Flesch will use a third-party lessor in certain situations, such as when the transaction is extremely price sensitive. “We have to have a minimum yield,” he said.

We want the leasing experience to be similar to the sales and service experience. Mike Ullsperger, Gordon Flesch continued on page 20 We Saw It In ENX Magazine



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Getting the Most from Leasing Depends on the Fund Source “We’ll utilize financial institutions or CFS in these instances, because they have access to lower-cost capital.” GFC Leasing currently has about 8,600 leases in its portfolio, and once a lease is in the portfolio, it’s never sold, said Ullsperger. About 75 percent of Gordon Flesch’s customers have leases. All sales reps at Gordon Flesch go through a training program that stresses the value of GFC Leasing products and teaches the components of leasing, said Ullsperger. This training helps them understand things like how flexible they can be with terms, or when to offer quarterly or monthly payments.

Working with Lessors

When it comes to the core underlying qualities of a strong dealer/lessor relationship, CIT’s D’Errico summed it up in three words: “alignment and trust.” He continued: “Trust meaning capability and integrity. It’s the trust that you’re going to take care of their customers during the three, to four, to five-year term of that lease. The customer will have a positive experience during that and will want to stay with that copier provider for their next equipment deal.” 20 | June 2017

You can’t have alignment or trust if the lessor does not understand the dealer both culturally and from a business perspective. “If you’re talking to a family‑owned business and the goal is to pass it along in their family, they want to approach their business in their community a certain way, versus those who are Michael D’Errico, looking to operate for three to four CIT years and then sell the dealership,” said D’Errico. “How they go to market, what’s important to them on the two examples, are very different. We have to make sure we are aligning what they need from their finance partner with what we offer them.” To ensure that alignment, the CIT sales team focuses on the dealers’ goals. “‘What are your goals?’ It’s a more thoughtful question. You’re going to learn more about them and that’s a better opportunity to align,” said D’Errico. “It also gives us insight into what we should be developing, or the things that we do today that match up that they’re not even aware of. If we ask a standard question, we’re going to get a standard answer, and we’ll never get to a more important partnership and resolution that way. But asking more thoughtful questions has worked very well for us.” ♦

We have to make sure we are aligning what they need from their finance partner with what we offer them.

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Samsung Positions Technologies for Next Generation Workforce While Transitioning to HP


usiness as usual. That was the prime takeaway delivered in Phoenix during Samsung Electronics America’s Printing Solutions National Dealer Meeting in March. The 1,000lb. gorilla in the room was HP’s acquisition of Samsung’s printing business, which is expected to be completed later this year. Samsung Electronics America may have garnered a reputation as a disruptive player in the printing solutions universe for the BTA channel, but when it comes to the transition of its product and service portfolio to HP, the plan is to make the process as seamless as possible for its loyal clientele. But the end is not in sight for Samsung’s printing solutions division. In fact, Samsung rolled out a number of new A4 technologies in Phoenix, along with a 2.0 refresh of its Samsung Printing App Center. The company is also ramping up its dealer recruitment activities, a clear sign that Samsung’s portfolio isn’t going away anytime soon.

Matt Smith, Vice President and head of Printing Solutions at Samsung Electronics Americas 22 | June 2017

Matt Smith at Samsung Dealer Meeting 2017

Among those on hand for the dealer meeting were a pair of key architects at the fore of Samsung’s technologies initiative: Matt Smith, Vice President and head of Printing Solutions at Samsung Electronics Americas, and Eddie Castillo, Senior Director of Sales and Marketing for Printing Solutions. They recently sat down with ENX Magazine to discuss a range of topics: the HP acquisition and its transition process, Samsung’s voracious technology appetite, its goal to garner 20 percent of copier market share within five years and the targeting of the Millennial generation with current and future offerings. Tells us about your career with Samsung. CASTILLO: I’ve been here for nearly 10 years. I’ve worked as an engineer for 23 years in the industry. I’ve had the pleasure of working with Matt—he brought me over to printer marketing two and a half years ago. I’ve been supporting Matt as we move this business forward. We Saw It In ENX Magazine

SMITH: Eddie comes from a solution background; he’s been supporting print the whole 10 years—don’t let him fool you. He came from a technical background; he’s been that secret, shiny star by going into enterprise accounts and having us work seamlessly with mobile phones, displays, memory, and all the other stuff inside of Samsung. He’s been working with the other IT technologies. SMITH: I just hit three years at Samsung. Before Samsung, I worked at HP for four years running their channel marketing organization in the Americas. I spent 15 years at Intel as an engineer, started in the ranks designing servers and networking, moved into sales, and got an MBA. I was looking to go someplace that was a little more disruptive, where we could gain traction instead of already having it. I love Samsung’s speed and nimbleness. I got the opportunity to be a general manager and have service, solutions, distribution, and end-user sales, all in one orcontinued on page 24

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Samsung Positions Technologies for Next Generation Workforce While Transitioning to HP ganization. I’ve been doing that for three years, and led the transition from A4 to A3 to high-end A3 that went into a lot of enterprise businesses. What can you tell us about the value that the Samsung Printer Division will bring to HP? SMITH: Let’s talk about the value that Samsung brings to the dealers. Over my three years of talking to dealers, I inquired as to why they partnered with Samsung. With that question, I get three answers all the time. One, a lot of these print copier guys in the market, they want to augment their print business. They want to get into the IT side of it, to get into the print side but transition to large format displays and monitors, tablets, and phones. Dealers also want a full portfolio. They know there’s a transition going on from A3 to A4. They needed flexibility and we gave them that. Dealers don’t always know how Samsung is going to disrupt the market, but they look at phones, refrigerators, memory—you name it— from an appliance perspective. Whenever Samsung gets into a market, they win. The other thing is, [Samsung] has really filled in the HP portfolio. They want to go disrupt the $55 billion copier market and that’s what we’re doing. My team is mostly from the A3 copier market. Most of the guys are seasoned veterans with an average tenure of 23 years in the copier market, and a lot of them have the scale and experience of working with these copier dealers and know how to support them. The other thing they value is our nimbleness and know-how in being flexible with the market. At Samsung, when you ask for something custom, unique, and special, we can get it done in 24 or 48 hours. What will be different about your engagement with BTA dealers after the deal is completed? SMITH: When you look at our goals as an organization right now, our top organizational goals are all the same: a smooth, seamless transition for our dealers to HP. That is job number one. We don’t want any impact, we don’t want them to see any difference from the day before the 24 | June 2017

transaction to the day phins, Roger Williams, after it. The other thing Direct Energy—all deals we were able we want to bring to to get with the entire HP is the most solid package. All of those relationships with BTA things came together dealers. We want hapfor enterprise wins py dealers, profitable that we’ve enjoyed dealers, and growing over the last 12-18 dealers; that is what we months. are expecting to bring over to [HP]. After the What were some of transaction, we plan on the major product getting back onto our rollouts at Samsung’s market-share-grasping dealer meeting in Eddie Castillo, Sr. Director of Sales nature. Our goal rePhoenix? and Marketing for Printing Solutions mains to be 20 percent CASTILLO: Some at Samsung Electronics Americas of the copier market in of the innovations we three to five years. We demonstrated at our still want to offer IT products and the full national dealer meeting are going to be portfolio. There’s no question right now rolling out this quarter and Q3. Hardthat we’re focused on making things as ware such as the M5360RX, a 55-ppm smooth as possible for our dealers. As A4 device, which is complementary to soon as we get over there and things are our M5370LX. We’re also introducing a working, we expect to get back on the new engine our dealers have been cravramp we’ve been on from a growth pering—a 40-ppm color device C4010MD, spective. printer-only engine. To complement What has the Samsung team delivered to that, we’re introducing an MFP, which is the C4062FX color desktop. These are get the attention of the likes of an HP? the three spots in the mid-market print SMITH: When I look at what we’ve delivered as an organization, we’ve been space that our dealers have been seeking. We’ll be delivering at the end of May incredibly successful, potentially too successful, and that’s the reason we’re in and the first couple weeks of June. We’re also introducing the SmartUX Printing acquisition right now. We have jumped App Center 2.0 as part of our solution from an A4-only OEM to our dealers, to portfolio, which is allowing dealers to an A3 and A4 full portfolio for the BTA channel. We’ve recognized that to do this place their own applications based on correctly, we had to be exclusive to those the Smart UX platform that they’ll be able to share and sell to other dealers. dealers, we had to have restrictive prodAmong those offerings, we’re also introucts for them, and we had to under-distribute the product so that the dealers can ducing the Smart UX Printing Kiosk. We make money with us. We’re also focused demonstrated a Smart G Suite connector, and we demonstrated the Smart OMR on the Millennial workforce, providing solution for education, Smart Security solutions that enable users to bring their Manager, SmartUX Mobile, and Mobile own device to work, that are optimized Dynamic Workflow. We had a lot of for tablets, and that deliver the quality, innovations at the dealer meeting. All reliability and aesthetics that people are counting on from innovative products for new products and solutions that we’ll position to our dealers to take advantage today’s office environment. of in the months to come. I’ve seen a significant shift in the enterprise. When I came here three years What was the initial reaction to the ago, we were winning a lot of SMB busi- transaction from the dealer base, and did the meeting help to clarify the funess. We’ve since been able to get major ture? installations for Mayo, the Miami Dolcontinued on page 26

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Samsung Positions Technologies for Next Generation Workforce While Transitioning to HP Smart UX environment is going for the long term, they’ll be behind it. CASTILLO: Since word got out about the transaction with HP, more dealers are excited to be part of this whole transaction. It’s helping our recruiting strategy and we’ve seen an uptick in business since the meeting.

Eddie Castillo at Samsung Dealer Meeting 2017

SMITH: Most of our dealers have been through acquisitions before. They know that while we may not have all of the answers today or tomorrow, we’ll figure things out over time. It’s an opportunity for them as the market changes, that there’s some margin and growth opportunities for them. A significant amount of dealers already have great HP relationships—they love the HP brand, the HP team and they like the scale. Those dealers are getting a lot more excited. There are also some dealers who are cautious. They’re looking at what Samsung did for the BTA dealership, which is restricted product, under-distributed, exclusive, and want to make sure HP is going to follow that. They’re kind of in a waitand-see mode. Overall, dealers were able to see and hear from HP executives that were confirming and reiterating the same thing Samsung has been saying from a longterm perspective regarding the portfolio. What are you doing to ensure and support the smooth transition over to HP? SMITH: It’s all about the four Ps—people, programs, processes, and products. A lot of our dealers know our service technicians, our solutions, our sales and marketing people. We’re working to ensure all dealers have a smooth move over to HP when it comes to these areas. With partner contracts, dealers will know they are HP-enabled with the Samsung portfolio on day one. All of our partners have been given contracts to transfer over so we are in the system and loaded inside 26 | June 2017

of HP on the first day. As for programs, we’ve held them stable and consistent and are working to ensure everyone enrolled in our programs has a smooth transition. It’s the same thing on processes, the claiming of back-end, claiming our smash, claiming any dollars and marketing development. It’s really the process in which we go through our daily operation. Lastly, with products, it’s about which ones are moving over, how they will be branded, part number changes and how they will be distributed. There’s an endless number of work streams in place to make sure the phone numbers don’t change, the people don’t change, the offices don’t change, the email contacts don’t change. By focusing on the four Ps, we’ll create a seamless transition for our dealers. As Samsung is still recruiting dealers, what does this say about the future of the product line? SMITH: Dealers continue to show excitement about the future of the product line. Our recruiting efforts have actually increased, as we’ve had a lot of people reach out to us that want to be a part of what’s happening between Samsung and HP. The portfolio’s not moving. We’ll continue to invest in the Smart UX platform. That interface, that experience is not going anywhere. It goes back to the original reason dealers chose Samsung: they want access to a full portfolio of products, and that portfolio just got bigger. Our recruiting strategy really hasn’t changed, nor has the message that goes along with it. Now that people feel comfortable that the

Provide some insight as to how Samsung’s product line is embracing the Millennial generation SMITH: This has been our strategy for a long period of time. Ever since we brought out Smart UX, Millennials have been the target of the change. When we go after enterprise wins and the dealer reps we approach, we’re much more successful with the enterprises that are Millennial focused. It’s where our platform is most impactful. Millennials are going to represent a significant amount of the workforce by 2025. They love to bring their own device to work. They want it their way. They want a corporation or an IT to work around them, not the other way around. They are mobile anywhere, anytime. The Smart UX platform allows you to work better with a display, a tablet, or a phone. It’s customizable. Our new A4 are smaller MFPs that allow for a more distributive model, which matches up with that desire to work anywhere, anytime. Our products are part of an optimized workflow. What are Samsung’s goals leading up to and beyond the completion of the transaction? SMITH: The HP news is a short-term distraction from the goal, but the goal hasn’t changed. We want to be 20 percent of this market in a short period of time. We want to be a unique platform for unique customers around an innovative platform or solution that meets the requirements of this next generation workforce. CASTILLO: We’re putting out some bold, aggressive goals that we’re all behind. We’re going to position 20 percent MS within HP and will continue to innovate around the Smart UX platform as we develop unique, customizable solutions for our enterprise customers. I think that is something HP will embrace as we move over. ♦

We Saw It In ENX Magazine

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DealerBriefing Spotlight News

Gobin’s Market Dedication Catches Attention of Customers and Competitors


ifty years is a long time for a shingle to hang in an evolving business climate, but Bob Gobin has his mother—who grew so bored with playing bridge in the afternoon that she opened her own small office supply company—to thank for planting the seeds of what would become Gobin’s Business Solutions, a pillar in the dealership community of southeastern Colorado. Bob Gobin entered the family business in the late 1970s after graduating from Colorado State University-Fort Collins. He’d worked for a savings and loan company and spent some time with an accounting firm before joining Gobin’s. At the time, it wasn’t unusual for businesses to

Bob Gobin, President of Gobin’s Inc. 28 | June 2017

cold call via a knock on the prospect’s front door, and Bob Gobin did just that, procuring a little more than $1 million in business from a large defense contractor. The gumption Gobin showed in obtaining that huge chunk of business provided a gateway to pacts with other governmental operations in the area. Expansion has also been a key to the company’s growth, as Gobin’s has branch offices in Alamosa, Canon City, Colorado Springs, La Junta, Lamar, and Salida, in addition to the Pueblo headquarters. Today, the company enjoys just north of $11 million in annual revenue, carrying products and services from vendors such as Canon, Konica Minolta, and Lexmark. The dealership has been highly decorated in recent years. In 2010, Gobin’s garnered the GreatAmerica Dealer of Distinction award, given to market leaders who exemplify qualities like ethical business conduct, the highest degree of customer care, and loyalty to worthy business partners. Another kudos Gobin’s has earned for more than 25 years running is the Pro-Tech service gold standard award from Konica Minolta. We checked in with Bob Gobin to learn about how the company has concentrated its focus more to better serve customers, and he shared how the company earned its wings with customers--and competitors--in the educational space. How has business been this year? What are your best opportunities for growth? We Saw It In ENX Magazine

GOBIN: Our last fiscal year was very good; we hit our revenue target, but more importantly, our bottom line was better than it’s ever been. That’s a result of having sold off our office supply and furniture division and focusing on what we do best, which is business equipment and solutions. It was a decision we agonized over for quite a long time. The argument some people made was that office supplies and furniture covered a lot of overhead. And that was true, but I pointed out that they also generate a lot of overhead. It’s a decision we probably should have made five years earlier. This year, we’ve set an ambitious revenue target, but we think we’re going to hit that. We have budgeted for some additional expenses that will probably impact our bottom line, but that’s by design. Hopefully, it will bear fruit in the future. What does Gobin’s pride itself on? GOBIN: The fact that we’re dedicated to this geographical area. The management and ownership all live in this geographical area, and most employees were born and raised in this area. We truly pride ourselves on being good corporate citizens. A lot of the employees are volunteering their time for community projects and nonprofits, and we provide a lot of financial support to community projects. We’re devoted to where we work and the people that we serve. Do you follow any vertical markets? GOBIN: It’s fairly comprehensive. One vertical we really dominate continued on page 30


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Gobin’s Market Dedication Catches Attention of Customers and Competitors

Gobin’s Team

is the educational market. I think that’s somewhat due to the fact we have committed some of our employees to helping out projects in the schools. Most employees were born and raised in the area, so they have connections that are still involved in the school districts that we serve. What are some of your newer areas of business? GOBIN: This year, we’re moving into the production print area with Canon. We’re also trying to strengthen our solutions offering. We’ve been selective with what we’ve done with the solutions and we’ve tried to focus on just a few solutions: document management, Canon’s uniFLOW product, a few of the Lexmark solutions. We want to avoid getting into the trap of the solution of the month. We’re excited about moving into production print--we’re a month in and we think we’ve done our homework. It’s a little too early to know what’s going to happen. We’ve had a long history with Canon, dating back to 1985. Is there a product or solution that you are looking to add in the near future? GOBIN: We’ve been sitting on the managed network service sideline for about five years now and we’ve made the decision that this is the year we’re going to jump in. We’re looking to acquire an IT company and move into that arena. We have identified some acquisition targets 30 | June 2017

for the IT company, but have not acquired anyone, yet. We think we’ve done our homework, we’ve tried to hire the type of technicians and support people who can transition into that type of business, but our business plan is to acquire an IT company and partner with somebody like a Collabrance. I visited with a number of fellow dealers that have been down this road and we hope we’ve kind of learned from what they’ve done. Another area we’re looking at is trying to integrate our document management solution with our MPS solution, where our clients can add document management for an incremental cost to their MPS click cost. We’re trying to do the same thing with uniFLOW. We haven’t quite got that figured out yet, but it’s an idea that LMI presented to us. We’re exploring that and we think there’s a good opportunity there. If we can figure out a way to integrate the document management solution into our MPS, where customers are paying a small incremental increase in their click charge, it takes us out of competing at that fourth decimal level. It could be a selling differentiator for us. What was your dealership’s most significant accomplishment or biggest win last year? GOBIN: I think it would be a couple of larger deals that we were able to land

last year. One was a company that we’d been after for years: it was about 40 machines involved throughout the state that we were able to work with. Another that sticks in my mind is a larger school district in Colorado Springs where we won the contract four years ago. We kind of snuck up on some of the branches and the dealers in Colorado Springs at that time, because we were the new kid on the block, but we were able to get that contract. This go-around [for the renewal], we knew it was going to be a dogfight. At the first pre-bid meeting, there were 27 different dealers and branches at the meeting. Still, we were able to win the contract back, and it wasn’t a price-based award. We provided some solutions and good service over the previous four years. We were told when we were awarded the bid that [the school district] was leaning toward [a manufacturer], but our final presentation by the team was very good and we won the contract. What do you look for in your employees? How do you recruit and retain good ones? GOBIN: The number one thing is, do they fit our culture? We utilize a program that GreatAmerica provides called PathShare HR Services. They provide us with consulting and have a seven-step interview process that we utilize. As they

We Saw It In ENX Magazine

continued on page 31

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say, culture trumps everything. We feel we can bring somebody in and teach and mentor them the skills they need to be effective in the business. We’re really dedicated to doing what’s right for the customers. We always emphasize to all of our employees to treat your customer like you would want to be treated. Take ownership if there’s a problem, and if we need to talk about the solution afterwards, that’s fine, but nobody’s job is in jeopardy if we’re doing what’s right for our clients. We don’t want to have to hide behind the stack of corn cans at Safeway when one of our customers comes into the store.

Who do you see as your biggest competition, and how do you differentiate your company from them? GOBIN: The Globals and the [OEM] branches. We don’t buy into the fact that other independent dealers are the bad guys. I think that the competition we primarily see is the branches we compete against. We’ve got Toshiba, Ricoh, Konica Minolta—all of the tier one manufacturers are in the Colorado Springs market. The fact that we are involved in the community and are locally owned and dedicated to this geographical area is the differentiator we like to emphasize.

What was your biggest challenge in the past year? GOBIN: Over the last couple years, really, the challenge has been moving our sales team from a hardware-centric to solution-centric team. We’ve worked hard at that and will continue to, as we still have a long ways to go. We’re making progress. The little details of designing the comp plan that motivates the solutions sales, the little things like that, we’re still tweaking and working on.

What are your goals for this year? GOBIN: Number one is customer retention. All but our Colorado Springs markets are markets that are not growing. They’re pretty stable markets, so it’s paramount that we retain all the customers we have in those areas and additional net new. We’re going to make the plunge into the managed network service arena, that’s a goal for this year. We’ll also continue to work on our solutions offering. We Saw It In ENX Magazine

We had high single-digit growth in 2016, and we’re forecasting low double-digit growth in 2017. How do you view the industry changing in the future and what are you doing to adapt? GOBIN: We’re going to see the manufacturers change their distribution strategy to where they prefer to work with the larger dealers and let the larger dealers acquire the smaller dealers. It seems some of the marketing programs that are starting to roll out for the manufacturers are indicating that’s the direction they’re heading. You’re going to see the rollup of larger dealers buying smaller dealers continue. I think what we need to do is make sure we’re at that critical mass, that we get the manufacturers’ attention and have the volume and the size that puts us in that category where the manufacturers will recognize and support us. What keeps you motivated and excited about the work that you do? GOBIN: I like the industry and I like the people I’m working with. I still enjoy going to work; I’m getting up toward retirement age, but I still enjoy suiting up and going into battle. ♦ June 2017 |


Darrell Amy

Sales Briefing & Marketing News

Why Your Dealership’s Service Experience May Not Be As Great As You Think—And What to Do About It


sk an independent copier dealership what sets them apart and you get a consistent answer: “We deliver outstanding customer service.” There’s no question that the key value we bring is great customer service. Excellent customer service is the lifeblood of growth, sales recruiting, and profitability. Dealer Principals depend on good service to keep clients renewing. Service Managers require excellent service to reduce re-visits and maximize customer satisfaction. Sales Managers find it easier to recruit reps to sell for a company that has a great service reputation. What makes up excellent service? Here are some typical answers: ● Responding quickly. ● Stocking parts so machines can be fixed on the first call. ● Answering the phone with a live human being. But here’s the challenge: buyers and influencers are changing. According to a recent New York Times article, the average age of an office worker is 42—but the average age of a network administrator is just 36. And that’s the average age. That means many network administrators are in their 20s. What younger customers want may be different than the traditional foundations of great customer service. Millennials want support online and instantly. They might view having to call you as a hassle, and prefer to chat online. They might not want to wait for your technician to show up. Instead, they might prefer to see a video that shows them how to resolve the issue themselves.

32 | June 2017

Today’s customer is digitally connected and mobile. As customer demographics get younger, many dealerships have not adapted. While the dealership may be providing a great support experience in the eyes of Baby Boomer leadership, younger customers may not feel as satisfied as you think they do.

The New Definition of Great Service: Customer Experience

Today’s customers aren’t looking for great service. They’re expecting a great experience. The Harvard Business Review defines customer experience as follows: The sum-totality of how customers engage with your company and brand, not just in a snapshot in time, but throughout the entire arc of being a customer. As copier dealers, we need to consider how customers of all ages experience our dealerships. Consider how the customer service experience has changed in other industries: ● Banking: This industry has a rich legacy of smiles and handshakes. However, in the middle of a busy day, would you rather call the bank to find out your balance or check online? I can’t remember the last time I walked through the doors of my bank. I certainly don’t want to call them. ● Airport: The recent headlines about United show that the airline business has some huge service leadership issues. That said, I’ve been flying to visit dealers for 20 years, and in that time I’ve seen the service change drastically. Would you rather choose a flight on your computer or talk to a flight agent? Even if I wasn’t on We Saw It In ENX Magazine

hold for 10 minutes, I’d rather evaluate all of my options on a computer instead of trying to sort out flight details over the phone. And when I get to the airport I no longer look to the televisions for flight updates. Instead, I pick up my phone. ● Car Service: Getting my car serviced is such a hassle. I don’t have time to do it during the week. And I certainly don’t want to spend my Saturday sitting in a waiting room— even if it’s a nice waiting room with fresh coffee and leather seats. This week I noticed that Lincoln is upping their service game. Rather than making you schedule an appointment and sit in a waiting room, they will actually come pick your car up, service it, and then return it. ● Taxi: As a frequent traveler, I’m so thankful for Uber. Gone are the days of calling a cab, hoping they show up, not knowing the fare, and wondering if they take a credit card. Uber lets me request a ride, track the driver, see my progress toward the destination, and then pay online. ● Hotel: How frustrating is it to spend the day traveling and then have to stand in line to get your hotel room? With mobile check-in, I’m able to avoid the line. And in some hotels, my phone becomes my room key, allowing me to bypass the friendly front desk staff all together. Can you see how customer expectations have evolved? The hard question we have to ask ourselves in the independent copier dealers world is this: how are we going to meet these new expectations? What if just answering the phone is no longer enough? continued on page 34


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Why Your Dealership’s Service Experience May Not Be As Great As You Think—And What to Do About It YOUR Dealership Experience

What kind of experience do your clients have with your dealership? Most likely you have a friendly, knowledgeable, and helpful staff. But in today’s world, you also have to consider your online service experience.

Where Are the Gaps?

As the Chief Marketing Strategist for Dealer Marketing, every day I have the opportunity to evaluate dealerships’ websites and social media. Most dealers haven’t scratched the surface yet in terms of providing a great online experience. We urgently need to fix this if we are going to continue to provide a great service experience for today’s digitally-connected customers. Following are a few gaps that I see:

Phone vs. Live Chat

I talk to dealer principals every day. At least 7 out of 10 brag, “We answer the phone with a live person.” In today’s world of 800 numbers, auto-attendants, and voicemail trees, this is undoubtedly a good thing. You don’t want to shuffle all of your callers to voicemail. However, do you have someone paying the same level of attention to clients that want to interact with you through your website? Consider Microsoft’s recent research from their 2017 Global Services Report: “When engaging with a brand or organization for customer service, 65% of 18 – 34-year-olds’ interactions now begin online compared to 55% across all age groups and 46% of consumers ages 55+.” Think about the way we communicate today. Texting is fast, easy, and convenient. Even my retired parents text messages. Why is texting to popular? If I make a phone call I have to commit an unknown block of time to that call. If I text, I’m committing less than five seconds. Live chat allows you to serve website visitors with the same level of customer service they get on the phone. The same person that answers support calls can field live chat. Many times issues can be resolved remotely. If not, your service dispatcher can gather the details they need to place a service call over the chat message. 34 | June 2017

On-Site Training vs. Video Support

What if your customers didn’t have to wait for someone to come to their office to train them how to use the features on their machines? Instead, what if they could easily find support videos on your website that showed them how to change toner, remove a misfeed, or scan a document? Your service dispatch could also direct visitors to special videos during a live chat. Not only would this be tremendously helpful to customers, it could also reduce the need for on-site service calls. Most OEM’s have a library of support videos on YouTube. Our team is currently working on a project to serve these videos up on dealer websites. The goal is to improve the client experience while reducing service calls.

Desktops vs. Mobile Phones

While over 50 percent of internet traffic comes from mobile devices, a typical copier dealer can expect about 15-25 percent of their traffic to come from mobile. Most of this traffic is going to customer service pages. The reason is simple: users walk up to a broken copier and pull out their phone looking for service. How should you deal with this information? First, your dealership website must be mobile-responsive. It needs to function well on both desktop and mobile devices. Next, your mobile website needs to have the service links displayed prominently at the top of the page. Your phone number should also be there. Finally, click-to-call should be enabled, allowing a mobile visitor to call you just by clicking on your number.

Social Service

Here’s another interesting data point from Microsoft’s Global Services Report: 52 percent of 18-34-year-old consumers have used social media to ask a customer service question. What does that mean? Younger customers bypass traditional customer service channels and go to platforms like Twitter or Facebook to find answers to their questions. They also go to these platforms to vent their frustration. Copier dealers need to start looking at social media as more than a marketing and selling platform. Sites like Twitter and Facebook are communication plat-

forms that are deeply woven into our society. At a minimum, service dispatchers and managers should be logged into common social media platforms in order to pay attention to incoming messages. We find that it is becoming more common to find incoming messages from people looking for support.

Reactive Service vs. Proactive Service

The best service call is the one that doesn’t have to happen. Remote monitoring with tools like FM Audit, Print Audit, and Print Fleet allow you to monitor devices remotely so that you can resolve issues before they occur. As you master this skill-set, it flows naturally from printers into the entire network. For many dealers, my fear is that service issues are being dealt with proactively, but the client is rarely notified of your great work. You need to make sure you get credit for the work you do. If you remotely mediate a service issue, you should tell your client about it. It lets them know you’re paying attention and delivering value for the service contract. If you don’t show that you provided service, how will they know that they need it?

Action Plan

What should you do? 1. Evaluate Your Online Customer Service Experience. You may want to ask for honest feedback from some of your current customers. Pay special attention to how easy it is to place a service call from a mobile device. Identify areas for improvement in the online service experience and work with your web development and service management system teams to continually enhance the online experience. 2. Consider Adding Live Chat. And if you do, make sure you have procedures in place to ensure it is monitored. There’s nothing worse than showing live chat as an option on your website and then not having anyone there to field questions. 3. Pay Attention to Social Media Make sure your service managers and dispatchers are logged into your company Twitter and Facebook pages. You can also configure message notifications to

We Saw It In ENX Magazine

continued on page 53

Michael Nadeau

Market Intelligence News Briefing

Leasing and Financing Insiders Foresee Growth as Confidence in the Economy Rises


espite low interest rates and plenty of available capital, the market for leased or financed office equipment has been flat for the past few years. The missing ingredient has been confidence in the economy, the lack of which has caused some business owners to scale back or put off investments in equipment. But that may change in 2017 and 2018. Financial firms, dealers, and market watchers agree that confidence in the economy is on the rise, and businesses are now more willing to take advantage of accessible capital at favorable rates. That’s critical for growth in a market where the vast majority of equipment is sold through lease arrangements. The source of this new optimism is the expectation that the new, business-friendly administration in Washington will make the right moves to spur growth. This presents a welcome opportunity for dealers who, as a group, have struggled to grow equipment sales for the past few years. That opportunity is bolstered by strong competition among leasing and financing providers for dealers’ business, and by new programs offered by those institutions that take into

account the way dealers sell and package products and services. “I see so many leasing companies pushing for business from us, from every dealer,” said Mike Sarelson, President and Owner of Commonwealth Digital Office Solutions. “It’s very competitive. I’ve never seen the rates lower. It’s a dealer’s world for dealing with leasing companies and getting good rates.”

Moving from Flat to Up

Last year was flat for the entire equipment leasing and financing industry, not just for office equipment, according to Ralph Petta, President and CEO of the Equipment Leasing and Finance Association (ELFA). “The industry in the US is about a trillion dollars in volume, and this is everything from copiers to telecommunications equipment to commercial aircraft,” he said. “The trillion dollars is about two-thirds of overall business fixed investment in equipment. So overall, in the US businesses spend about $1.5 trillion in residential and commercial equipment and software.” ELFA is a key source of data for the equipment leasing industry. It surveys its members—all of which are involved in leasing and financing—each year to take

Credit quality has been good for the last five years, ever since the economy stabilized. Fred Carollo, EverBank Commercial Finance

the pulse of the industry. The 110 members who respond to the Survey of Equip- Michael D’Errico, CIT ment Finance Activity represent about $120 to $130 billion in financing volume. Those responding from the office equipment sector comprise approximately 4 percent of all financing dollars captured in the survey, according to Petta. Extrapolating that out, the total leasing market-volume for office equipment in 2015 (the last year for which ELFA has complete data) is $40 to $50 billion. “Most of that is in the dealer channel,” said Petta. “To the extent that the dealer or vendor offers a financing program, that program is typically offered by one of our members.” Lessors are starting to see the effects of the positive attitude. “For the first time in several years, we see some of the dealers being optimistic in terms of growth,” said Michael D’Errico, Office Imaging Market Leader at CIT. “We haven’t really seen the numbers behind that yet, but we’re still early into the year.” He added that CIT expects to grow both its dealer and manufacturer programs this year. While the lease market has been flat, lease performance has been good over the past few years. This reduces risk for lessors, and it is a big reason why they are eager to expand continued on page 38

36 | June 2017

We Saw It In ENX Magazine

Leasing and Financing Insiders Foresee Growth as Confidence in the Economy Rises You have all your business associations, you have all these contractors and subcontractors to all the big guys. They are all really good credit-worthy companies, said Bob Hunter, DLL Sarelson. ”We rarely get turn-downs.” Some states that had been most impacted in the 2009 financial crisis, affecting the credit-worthiness of businesses there, have rebounded and returned to normal portfolio performance standards, said Bob Hunter, Senior Vice President of Sales, Office Technology for Lessor at DLL. Those states include Florida, Nevada, and California. Other areas are still in a down cycle, Hunter added. “There are challenges in oil-dependent markets such as Texas, Louisiana, and the Dakotas,” he said, adding that those areas will continue to struggle until the price of oil goes above $40 a barrel.

The dealers will have to go through an educational process with their customers [to understand how to handle higher rates]. their business. ”Credit quality has been good for the last five years, ever since the economy stabilized,” said Fred Carollo, Vice President of Originations, Office Products at EverBank Commercial Finance. “As a result, portfolio performance has been outstanding in the industry and for us specifically. That’s a reflection of the credit quality.” Washington, DC-based dealer Commonwealth Digital, for example, has a $10 million in-house lease portfolio, and its over-90-day past Mike Sarelson, due is less than $5,000, according Commonwealth to Sarelson. “You better choose wisely if you’re going into the leasing business. Every once in awhile you have a problem. People go out of business. People have issues.” Good credit quality has been offset a bit by low interest rates, but that may change soon. “It continues to be a historically low interest rate environment that all of us are experiencing,” said Carollo. “We are all starting to feel that we are about to be in a slight or moderate rate increase environment. A lot of things affect it, but we’ve seen a slight raise, and we are watching what the Fed is doing, too.” The recent minor rise in interest rates resulted in a slight decline in portfolio performance, but not enough to concern lessors or dealers. “In such a historically low rate environment, that was expected,” said Carollo. Geography can make a difference in terms of rates, capital availability, and portfolio performance. “This particular area lives off the federal government. 38 | June 2017

Potential Clouds on the Horizon?

Everyone ENX spoke with tempered their optimism with a bit of caution, recognizing that the positive climate they see is based on yet-to-be fulfilled expectations. “I have made a few speeches lately, and I’m inserting the words ‘irrational exuberance’ to describe the seeming disconnect between perception and reality,” said Petta. “Do people feel good just because of government officials’ pronouncements and things they read, or is that going to be tempered by the continued inability of Congress to make things happen and agree on policy?” Petta also noted that we haven’t had a recession in seven or eight years. “We’re pretty long in the tooth in the business cycle. Does it mean things are going to start pulling back in 2017 or 2018? If that were to occur, our industry and others would be impacted,” he said. “Things are going well, but there’s that little undercurrent that reminds us that things have been good for so long that they cannot remain that way indefinitely. ”

And what happens if the Fed raises interest rates? While there is some concern about how that will affect business, the consensus is that the effect would be minimal. “As interest rates pick up a little bit, the pricing situation might be a little different,” said Petta. “It might create some opportunities or it might create some challenges. Right now margins for office equipment and other types of equipment are compressed. The margins are so thin because cost of funds is low. In short, despite gradually rising interest rates, it’s a good time to lease and finance equipment.” Petta continued: “Some within the leasing and finance business are welcoming the rise because they feel it gives them a leg up to finance the asset because it will become too expensive for the business to get a commercial and industrial loan. Finance companies feel that they are in a position to be able to offer very competitive pricing and compete even better because the end user is going to have to absorb higher interest in a bank loan.” “Prior to 2016, it was commonplace for competitive finance companies to lower lease rates in an attempt to buy more market share,” said Dominic Janney, Vice President of Sales and Servicing for Canon Financial Services (CFS). “We began to see market lease rates level off during the first three quarters of 2016, as the financial markets began to prepare for potential movement by the Fed to raise interest rates.” For the first nine months of 2016, the three-year swap rate (the benchmark borrowing rate) stayed close to the 1.00 percent range, according to Janney. “Since September 2016, the three-year swap rate has increased 76 base points, from 1.05 percent to 1.81 percent on March 31 of this year. This increase has resulted in

We Saw It In ENX Magazine

The total leasing market-volume for office equipment in 2015 is $40 to $50 billion. Ralph Petta, ELFA continued on page 40


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Leasing and Financing Insiders Foresee Growth as Confidence in the Economy Rises Prior to 2016, it was commonplace for competitive finance companies to lower lease rates in an attempt to buy more market share. Dominic Janney, Canon Financial Services.

several finance companies raising their leasing rates for the first time in several years.” He expects this trend to continue as interest rates are forecasted to increase for the remainder of 2017. “It’s a rising-rate environment. That’s clearly all over the news, but it’s still at a low. We don’t think that’s going to be an impact to the end‑user customer. I think the level of leasing in the office imaging market will still remain strong,” said D’Errico. Hunter notes that interest rates rise when the economy is doing well, but he understands why some partners that have cost-per-copy charges based on very low interest rates could be concerned. “The dealers will have to go through an educational process with their customers [to understand how to handle higher rates],” he said. That might require deconstructing bundled leases to more clearly define how much is hardware, consumables, or software. The introduction of the new accounting standards will also put pressure on the market to deconstruct bundled leases for large end-users.

Looking Ahead

Despite knowing the potential risks to the economy, the office equipment industry is excited about the next 12 to 24 months. “Our customers are upbeat, the market is upbeat. People are feeling better. They are spending more money. 2017 will be a big plus for everybody,” said Sarelson. Lessors that saw a strong 2016 expect more growth in 2017. “Capital availability for end users has come back to where we were before the recession hit, and this is a good thing!” said Fisher. “Our credit quality remains strong and chargeoffs are at historical lows, adding to our bottom line.” She added that GreatAmerica expects to see its 24-year record of Jennie Fisher, GreatAmerica growth to continue next year. Fisher believes that GreatAmerica will succeed by focusing on what it does well. “There appears to be less uncertainty in the economy now that the election dust has settled and the Fed has sent quite a clear signal of their intentions over the next year. In spite of these factors which we are unable to control, our focus remains on helping our customers and providing as much value to them as we can,” she said. That seems to be the best advice for both lessors and dealers. The economy, politics, interest rates, and consumer confidence will always present a degree of uncertainty. Staying focused on delivering value is the best hedge against the risks they present. ♦ We Saw It In ENX Magazine

Erik Cagle

Office Technology Service Excellence Award


Service Excellence Platinum Award Winner News Briefing

Service Mantra Employed By Diversified Business Solutions Harkens Back to Era of Customer First


eople of a certain age fondly recall the days when their parents would pull into a service station primarily to fill up the gas tank. A small cadre of service attendees would storm the car like a NASCAR pit crew, washing the windshield, checking fluid levels, and ensuring the tires were properly inflated. A smile and a hearty wave later, it was back to the open road. Sadly, customer service has endured its share of bad press recently, and quality service can be the exception rather than the rule in some business circles. “In the outside world, it’s a struggle to find quality customer service in everyday business,” said Jeff Theilacker, president of San Diego-based Diversified Business Solutions (DBS). Both Theilacker and Joe Prazak, the firm’s director of service, believe that society as a whole has accepted this diminishing level of customer service as a fact of life. In some sectors, service is a premium offering. DBS has served the greater San Diego area’s small- and medium-sized business (SMB) community as an independent copier dealer for nearly 45 years,

Jeff Theilacker, left, President of Diversified Business Solutions, and Joe Prazak, Director of Service. 42 | June 2017

providing copiers, printers, multifunctional devices, managed print services, and document management software while using customer service as its overarching value proposition. The dealership has raised customer service to an art form, and its performance in this area has earned the company this month’s BEI/ENX Service Excellence Platinum Award. DBS has peaked at No. 14 among the 185 dealers tracked by BEI and enjoys an average response time of 1.8 hours. The firm, which debuted in 1973, was purchased by Jeff and Rachel Theilacker 11 years ago. DBS serves clients from the Mexican border north to Camp Pendleton and Oceanside. It sources and services equipment from vendors including Toshiba, HP, OKI and Lexmark, along with Square 9 and Laserfiche document management, and Kodak and Fujitsu scanners, among other gear. Toshiba is one of DBS’ longest-running partners. “The copiers and printers we service are broad based,” Theilacker observed. “Color is beyond what I thought it would be, and customers are mostly buying color units. Toshiba did a good job structuring the way their devices were built that there were only two families of color, but each covers about a dozen models. That makes it possible for the customers to streamline the different speeds, but it also makes it easier on us, because there’s only two families of parts we need to carry.” With $3 million in annual revenue, DBS enjoys a rich mixture of small- and medium-sized clients including law firms, courts, We Saw It In ENX Magazine

government agencies, education, mortgage originators, accounting/ CPA firms and manufacturers, to name a few. The dealer isn’t vertically driven; rather, it focuses on how to best assist the SMB set from the back-office perspective. “Our service approach is highly flexible and customized,” Theilacker explained. “Our whole goal is to be the firm that can create a program that works for our customer. As an example, we do just-in-time ordering, so we literally hold no equipment stock here, aside from loaners and demonstration machines. One reason is it’s an economically good choice. Another reason is, at end of each period, quarter, month or year, I don’t have inventory I’m trying to shove down someone’s throat. They get to choose, with our help, what is best for their business. If there’s an emergency situation, we loan them something until we get them the exact thing that they were looking for.” Experience is a key factor in DBS’ success. Many employees—particularly the technicians—boast at least 15 years in the field, with the Theilackers and Prazak bringing 25-plus years to the table. The client-facing employee is more than equipped to handle any and all needs. “We’re not hiring 20- or 30-year-olds with zero experience, putting them in the field after they’ve been here a month, and expecting them to take care of people,” Theilacker said. “We put a lot of thought and effort into what we’re putting in front of clients.” Some observers may be surprised to know that an organization as successful as DBS has a continued on page 44

Service Mantra Employed By Diversified Business Solutions Harkens Back to Era of Customer First technician crew of only six, but with a first call effectiveness rate of 63 percent, the results speak to their effectiveness. Another key element, aside from their experience, Prazak noted, is that technicians carry comprehensive inventory to increase efficiency and effectiveness. “We try to do everything we can to allow techs to get it right the first time, to help them and not hinder them,” Prazak said. “Our motto is to under-promise and over-deliver. Our first-call effectiveness is so good, we have techs waiting for calls to come in. Because of that, we have a good response time.” Personal service is a philosophy that permeates all aspects of DBS’ operation. An example of this: toner is personally delivered to customers rather than shipped from a neighboring state. DBS may come out on the losing end from a cost perspective, but the personalized approach builds equity in the eyes of the customer. “One of our mottos is ‘training for life,’” Theilacker noted. “We tell customers that when they get a new employee, call us and we’ll come out and train them. We’re trying to make them feel we’ll do almost anything they need us to do.” The upshot of offering the value-adds as part of the overall service proposition is that DBS can measure how much clients value their service. When clients opt out, they soon find the missing customer-care component has a measurable impact, and DBS enjoys a high percentage of return business. Finding quality employees, not surprisingly, is among the toughest chores for DBS. Theilacker seeks out individuals who understand the value of customer service, rather than experienced candidates who exhibits indifference toward the philosophy. Knowledge can be imparted, but attitude is innate. The San Diego market is hotly contested from the dealer standpoint, but DBS has found its sweet spot within the SMB space. Still, the competition is practically knocking on DBS’ door; one manufacturer purchased a dealership and moved the business into the same complex as DBS. That created more than a little frustration for Theilacker and Co., but instead of worrying what the competition was doing, DBS chose to concen44 | June 2017

trate on its core competencies and let the customer decide which was best. In doing so, DBS has sought out technologies to make its operation more effective. The fleet of filing cabinets is long gone and the dealership is utilizing software to enhance internal efficiencies and strengthen its go-to-market approach. As a smaller operation, DBS is nimble and responsive, and the firm has avoided the cardinal sin of trying to be all things to all customers. By focusing on the MFP business, along with support and software, DBS is able to score high grades in a concentrated core of offerings. The BEI program, first initiated at DBS in 2006, has gone a long way toward quantifying the company’s claims of service excellence. Initially, the dealership used it as a measuring stick to get a better grasp on its cost-per-copy challenge. Prazak said the company had a difficult time obtaining benchmark figures from the manufacturing community. Through BEI, the dealer found areas where it could dial back its charges and other aspects where the firm could be more aggressive in its pricing structure. “When we first got BEI and looked at their top performers, we were like wow, how can we do that, how can we get there?” Theilacker said. “In the beginning, some of those numbers were shocking to us, because I thought some of our numbers were pretty bad. When we compared them to the world population, I thought we were doing a bad job, and we were.” “There’s definitely been an uptrend from when we first got BEI until now,” Prazak added. “We were performing well below the national average on a consistent basis when we first deployed BEI, and now we’re consistently performing above average.” First, DBS had to learn the ins-andouts of BEI as a productive tool. The dealer instituted a bonus program, with first-call effectiveness as the highest level benchmark employees can be paid on. The uptick along the key metrics has bolstered confidence and satisfaction for customers, employees, and DBS management alike. But quoting performance stats won’t quell the fears of a client battling a deadline. That’s when the calm, reassuring

OTSEA Platinum award winners score in the top fifteen percent of all dealers evaluated. The evaluations are based on First Call Effectiveness (FCE), Call Back (CB) and Hold for Parts (HP) percentage, MCBV (Mean Copies Between Visits) and Technician Grading. Tech Grading encompasses Time accountability and Time management along with individual HP, CB and MCBV rates. Any dealer on a supported ERP platform can be evaluated free of charge. The FCE evaluation is based on BEI Services industry standard , not the popular version using total calls which is a less accurate measurement. For a detailed explanation and FCE calculation comparison tool, contact voice of a trusted partner comes into play. “When you call us, you get a person who will go out of their way to find someone who can give you an answer,” Theilacker said. “We will call [a tech] on their cell phone, hunt them down in the office, find someone who can help. That’s a big deal. We also have local supplies and parts; with most manufacturer locations, their parts and supplies are not in San Diego county and if they need a part, you’re looking at a 24-hour turn time, minimum. Lastly, it’s service and attitude. People hear it in our voices.” ♦

About the Dealership 1. President/Owner: Jeff Theilacker 2. Service Manager: Joe Prazak 3. Number of Techs: 6 4. Number of Devices Serviced: 1,000 Why They’re a Platinum Award Winner • First-Call Effectiveness: 63% • Call Back Rate: 28% • Hold for Parts Rate: 9% • Ranking: 14th overall of the 185+ dealers

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Charles Lamb

Managed Services News Briefing

Successful MPS Transformation


ecently, in a workshop at the Las Vegas ITEX trade show, I shared my high-level process to successfully transform a dealership from traditional hardware sales to managed services. I have refined my transformation process over the last 10 years, and for most dealers it takes about one year to execute. One of the biggest discoveries I’ve made during these last 10 years is that not everyone is able to make this transformation successfully. If a company’s sales process is weak or undisciplined, that must be changed before a successful MPS transformation can take place. At the ITEX show, I overheard some dealers say, “We gave up on MPS!” Others said, “We’re trying, but we’re not really getting MPS deals.” A few said that they were successful—but after they explained what they were doing, it was clear they weren’t really selling MPS. Managed Print Services DOES NOT mean just selling a large order of print hardware with a maintenance agreement. It’s much bigger than that. MPS is a big deal, in more ways than one. It’s big because

of the value it provides to the right customer. It’s bigger still because of all the moving parts involved in any one MPS deal with all the responsibility required by the participating dealer. Most don’t understand its value, and most don’t realize the full breadth and depth of responsibility for delivering even a single MPS program. In this business, it’s the survival of the fittest and it always will be. During my seminar, I could occasionally hear dealer comments from the front rows, especially when I discussed some of the points I’d discovered in my 10 years. I’d like to share some of the comments I heard during some of the slides and points of discovery. One of the biggest discoveries around the room was when I shared my initial point that a dealer must define exactly what they want, personally, from their business—this is the very nucleus of a successful MPS transformation. Dealers typically assume they know what they want: to be “well off” (whatever that is) and enjoy their career. But what I want to know specifically is “when the business is through with you, what then?” Getting

someone to define that day is accomplished with much difficulty. What do you want from your years spent running your business and what does your business look like on that day? Specifically! In the room, it was as if a bunch of LEDs began to flicker and light up throughout the audience, as they started to understand my point. My next point was about leading your company to success and through the transformation. Now that you’ve defined what you want from your business, tell your employees! Don’t let your sales reps make up or create your value proposition, client by client. There is enough creative selling going on in our industry and lots of hollow promises spoken that dealers simply can’t deliver. You owe it to your employees to define what values your company will deliver and to whom. Now, all your sales reps have to do is follow your lead and deliver the value proposition to the targets you’ve defined. In this way, you can drive a greater focus for your market penetration and improve your entire team’s transformation results. This next topic is not a new topic, but the fix is easier than most make it out to be. Simply put, sales reps can’t get to the C-level targets and therefore the MPS transformation fails. I said the fix is easy in theory but not always in reality. If the future of your business demands a steady flow of C-level appointments to sell MPS programs, then doing so should be a major team focus, and you should have a process around achieving those appointments. But often as not, I don’t see this focus. That’s what I meant when continued on page 47

46 | June 2017

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I said the fix was easy. Fix that, and you’ve just created a major competitive advantage and a lead position in your marketplace. Business development and growth has got to move to the top of the list, and if you can’t recite your conversion ratios of appointments to MPS opportunities, then most likely you’re not there yet. It’s way more than just restructuring your comp plan: it has to do greatly with a sales team that has both the mission and talent to make it happen. How discouraging it must be for the super sales reps that are faced with such confusion and lack of leadership around their goto-market execution. This disconnect is self-induced. If you need a powerful business development front end, build it! Why dealers continue to fund sales teams with 80 percent failure rates baffles me. It’s true that getting to the CFO is hard, but it’s NOT IMPOSSIBLE! Your successful transformation demands that your sales engine consistently produce first appointments with decision makers. Shift the failing dollars and BUILD IT!

You will have the strongest competitive advantage out there. To support such a front end, your marketing plan must be in complete alignment and on AUTOPILOT. Meaning, it’s not left up to some college intern working a few hours a week to drive your company’s marketing program. You should have a STRONG marketing strategy executing every day. I’m not talking about driving “likes” on Facebook, I’m talking about an aggressive process which yields appointments through social targeting. If done properly this creates a second wave of C-level appointments to add to your conversion efforts. During the workshop, I explained that they should define what a successful MPS transformation looks like. In the beginning, it’s not hundreds of MPS deals—it might just be one MPS deal per quarter per sales rep, as an example. When you define what success is, and it’s attainable, it makes it much easier for your sales reps to believe that they can get there. Just telling your reps “Go sell MPS and make a lot of money!” is a

We Saw It In ENX Magazine

real let down, because many reps simply can’t visualize that level of success. Finally, I shared one of the most important elements of success: when driving an extremely high level of prospecting activity, momentum and energy is a must. It’s unlikely that a sales rep will find a new MPS opportunity with every conversation they have. While building their MPS pipeline, there must be enough energy, reward, and momentum to get them through the learning curve and the “valley of despair.” In a well-managed sales team, it would be a great idea to reward their activity as strongly as you would the actual closing of the deal. Many dealers hear that and ask me if I’m crazy! The fact is that most dealerships are already funding failing sales reps. The transformation process I speak of is successful with MPS, MNS, document management, or just overall sales excellence. So, if you’ve built a great plan that drives successful transformation, why wouldn’t you fund its success? Reward high activity and achievement and put your money where your future is! ♦ June 2017 |


J. Mark DeNicola

Business Management News Briefing

Budgeting and Forecasting – What It Is and Why Do It!


ast year, as part of a financial forum, I sat on a panel to discuss budgeting and forecasting methods with a room full of head financial managers of their businesses. I was surprised at the number of businesses that do not have a formal process in place to do an annual budget. In fact, there was a high amount of resistance to developing a budget. Some of the reasons given were as follows: • It takes too much time to put together. • Budgets are used to beat up managers. • No actions are taken if the actual number is over or under the projection. • They’ve had bad experiences using budgets at other companies. • The owners and managers of the business do not understand a budget. • They don’t have a crystal ball. Having a Fortune 500 background early in my career, I was indoctrinated with the belief that a formal budgeting process and forecasting were vital to the company’s financial and operating health. In fact, in public companies it is a requirement, because of that important quarterly and annual Earnings Per Share projection. A budget enables the CEO to tell the analysts and stockholders why they hit the projection or not and then forecast future earnings based on revised conditions. Shouldn’t the owner of a private business also have this ability? Let’s define what a budget is and why every company should develop one that includes both revenue and expenses. My definition of a budget is as follows: It is the formal business plan that is developed using historical information and adjusted for the future business environment. It is the operational and financial outcome of the plans/goals that you have set for the next year. The budget is typically finalized in the months before a company’s new fiscal year starts. If possible, it should include all P&L items and, on separate schedules, any required capital expenditures. A company budgets annually and reviews periodically (preferable monthly). There are many reasons to create a budget. Among them are: 1. It is the formal document that formalizes and memorializes your intentions for the direction of the company over a period time. In other

48 | June 2017

words, it is the course charted by company leadership to arrive at a specific destination. 2. It is an educational tool for the company’s managers, helping them to discover the key operational and financial drivers of the business. 3. It is a communications tool to keep everyone in the organization working towards the same goal. 4. It provides the basis to grade the actual performance of your company against planned goals. 5. It is a tool for cash flow forecasting. 6. Though not many executives outside the auditing function might think of using a budget this way, it can also be used for fraud detection. For instance, comparing actual expense numbers to the budget can reveal unusual expenditures, which can be flagged for investigation. For example, the travel budget has been developed using a schedule of planned trips by month during the year. Credit cards by managers are utilized for all travel transactions. Through variance analysis of actual versus budget, the month’s travel expenses are found to be twice the budgeted amount in one of the company’s divisions. The company policy is that all expense categories with more than a 20% variance receive a line item audit. It is found that a manager’s credit card has been used for unauthorized travel. Without a budget number to compare against, the unauthorized travel might never have been discovered. 7. It can be presented to the bank for financing purposes. 8. It reinforces the appearance to financial partners, vendors, and outside investors that the business is sophisticated and “on top” of business matters. 9. It provides a roadmap for cash requirements during the budget period. Knowing the cash requirements means knowing better when financing might need to be secured, and it can also help you adjust payables schedules and plan for capital expenditures. It is not difficult to create a budget. It can be as simple or detailed as you like. Of course, the more detail, the longer the budget takes to complete. The two key components of any P&L budget are revenue and expenses.

We Saw It In ENX Magazine

continued on page 50



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Budgeting and Forecasting – What It Is and Why Do It! Revenue

I would guess every company in our industry creates, at the very least, an equipment revenue budget as the result of the assigned quotas for the sales representatives. Some other components of the revenue budget would be service/supply income, leasing/rental income, solutions income, etcetera.

Expenses – Fixed and Variable

Fixed expenses are often referred to as overhead items and would include things like utilities, rent, and general and administrative expenses. These are all consistent from month to month, regardless of the revenue volume. Marketing/advertising expenses can also be considered fixed if the company has identified an amount they want to spend for the budgeted period. These expenses can be budgeted evenly through the period, or, if there are known large expenditures in certain periods (for instance, if it is known that half of the advertising budget will be spent in the first quarter), I would budget those items when they are expected to occur for cash flow purposes. Variable expenses fluctuate from month to month as the result of revenue volume changes. For example, the costs associated with equipment sales fluctuate in direct proportion to the amount

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of equipment sold. Other variable expenses would be parts and supply costs, etc. After the P&L budget is completed, you should be able to identify the cash provided from operations for each month. This will help with planning any anticipated capital expenditures and the financing required (if any). The capital expenditure budget should be on a separate schedule and budgeted for the month in which the capital expenditure is required. At Thermocopy we use the budget for comparisons to actual as part of our monthly management meeting. We have identified the key performance metrics that determine the health of the company and review them monthly. Each manager is expected to explain why there are variances, both favorable and unfavorable, from the budgeted number. If the variance is unfavorable, what plan is being implemented to bring the number in line with the budget. These items are all discussed in a very non-threatening manner, and the more a company does this, the less threatening the review becomes. The review is a great communications tool and helps the managers understand the challenges in other departments. It provides a forum to bring all hands on-deck to help solve problems and to celebrate victories. Forecasting is also part of this meeting. A forecast is the expectation of what is happening in your business for the rest of the budgeted period. It should be prepared monthly or quarterly and is a combination of the actual results to that point and the future expectations. I mentioned before that each manager in our monthly managers’ meeting is expected to present the plan for the rest of the year. Things change, that is a given. It would be like wearing blinders if you did not revise the budget numbers in a changing environment, and the forecast allows you do exactly that. Here is a real-life example of using a forecast to deal with an unexpected change. The end of one of our major account contracts ($2,000,000 of equipment revenue) was set to end on August 31, 2016. I had budgeted the implementation period to be June through August if we were awarded the contract again. We were awarded the contract in July, but the company required an extension of the old contract to the end of the year. Wearing blinders would have been using the original budget numbers for the rest of the year and not recognizing that $2,000,000 and all the resulting cash flow was not going to occur. Fortunately, we had a contract in hand and the lease revenue for the additional months. The changes were all considered in the forecast. As the result of the reviews in the managers’ meetings, all departments knew what operational resources were not required until the end of the year and how the revenue and cash forecasts were changed. In conclusion, I believe that a budget should be developed for every business, no matter how large or small. There really is no excuse not to have a full P&L budget of some sort. Used correctly, it can lead to higher profits, provide a framework for financial decisions, and ensure that all teams are working toward the same goal. ♦ We Saw It In ENX Magazine

Ken Edmonds

Service Management News Briefing

Customer Service Matters


oo many times companies fail to consider the impact of customer service decisions. It seems that many believe that doing what is expedient, rather than taking care of their customers, is the best choice. We have had numerous examples of that in the airline industry lately. Have you looked at your service from your customer’s point of view? It could be that decisions are being made that will have a lasting impact on your business.

A Tale of Two Companies

I am going to relate two examples of customer service where I was the customer. Both of the examples have similarities, but the difference in customer service generated two very different reactions.

The Good

The first example occurred more than 15 years ago, and I still remember and talk about it. I took my car to a local mechanic for an oil change. After draining the oil and reinstalling the drain plug, the mechanic forgot to add oil. The engine failed about a mile from the dealership. You may be wondering why I called this the good. It was the

52 | June 2017

mechanic’s response that made this a positive experience. He immediately dispatched a towing company and towed the vehicle back to his shop. He provided us with a loaner to use. He then rebuilt the engine two times, neither of which worked. He then purchased a used engine and installed it, restoring my vehicle to service with an engine that was much newer than the original. The way the mechanic handled the situation made me a customer of his for the remainder of the time I spent in that state. Every dollar I spent on vehicle maintenance went to him. I constantly recommended him to everyone I knew.

The Bad

I recently purchased a new tractor from a local dealer. When it came time, I had the dealer perform the service. I paid significantly more for him to do it at my location, since I didn’t have any way to take the tractor to him. When I got the tractor back, I used it for several days before discovering that a drain plug was missing from the front axle. I notified the dealer, and he said that they didn’t have the plug in stock, but he would order it and I could pick it up the following week. This did not sit well with me. I called the owner of the company several days later and reviewed the situation. I pointed out that I do not work on my tractor and so his mechanic either must have failed to install the plug, or did not tighten it properly. He said that in that case, he would give me the fluid and the plug free. I found his reaction surprisingly inadequate. I had paid for on-site service, and now he required that I drive to his location, pick up the materials, and install them myself. We Saw It In ENX Magazine

This was an extremely shortsighted decision. I will never recommend his dealership to anyone. All of my future business will go to another dealer. If I upgrade my tractor, it will be with another dealer. All because he failed to do what was right. It would have cost him maybe $50.00 in time and mileage to send his mechanic to install the plug. His failure to do that will cost him many thousands of dollars in service on my tractor. Additionally, I will tell everyone I know who is looking for a tractor about his poor customer service. Did you know that the average happy customer tells from four to six individuals about their experience, while an unhappy one tells fifteen to twenty? Your customers have contacts, and they will share their experience with them, whether good or bad.


I am encouraging you to review your customer service policies and methods to see how you would respond in a similar situation. The equipment you sell will fail. The technicians that you hire will make mistakes. All of your customers know this. Your response to these failures can define who you are as a company. It is important that all your employees know and understand the value of a customer to their and your company’s future. Happy customers tend to stay, and unhappy customers leave and warn others about you. By proactively caring for your customers and taking responsibility for your mistakes, your company will benefit in the long term. For a more thorough discussion of the value of a customer, I recommend Customers for Life, by Carl Sewell. ♦

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Continued from page 34

Empties For Sale

Why Your Dealership’s Service Experience May Not Be As Great As You Think go to their email, so nothing falls through the cracks. As customer service expectations continue to evolve, make sure you consider the experience of today’s online, mobile workforce. We need to remember the service philosophy that got us here and find ways to adapt it so we meet the expectations of younger buyers. Making this shift will allow our channel to continue to shine as leaders in providing outstanding customer service. ♦ We Saw It In ENX Magazine

June 2017 |


Britt Horvat

Technical Tips

Xerox DC250 style: How to Replace the Direct Pipe Assembly (Waste Auger Assembly) For Xerox Docucolor 240, 250, 242, 252, 260, WorkCentre 7655, 7665, 7675, 7755, 7765, 7775, Xerox Color 550/560/570, C60/C70, DCP-700/700i/770, Color Press C75/J75


erox deserves some serious kudos where their service manuals are concerned. For most of the decent-sized machines, their books are truly impressive and very thorough. Every oncein-a-while, though, you’ll run across something that you’re sure should be in the book somewhere, but it’s simply missing. We’re going to look at just one such missing piece of info. Each family in the DC250 style has its own service manual, and in none of them will you find a REP (Repair Procedure) dedicated to removing the direct pipe assembly. I figured this meant it’d be straight forward, but it turns out it’s not that easy to remove. It really deserves some instructions. The direct pipe assembly has a series of augers which transport the waste toner away from the

#1. Remove 1 screw (from top center) 54 | June 2017

Direct Pipe Assembly

drum cartridges, developer units, and IBT cleaning assembly, and carry it through tubes to the toner waste container. There are two versions, each of which has a few valid part numbers. The two versions are extremely similar, but they’re not interchangeable because the metal mounting bracket is different. DC250 version: (Part Numbers: DC250DPA, 049k06530, 068K24134, 068K24/136, 068K24137, 049k27440) fits

#2. Loosen 2 screws and swing the Chassis open. We Saw It In ENX Magazine

these models: DC240, DC242, DC250, DC252, DC260, WC7655, 7665, 7675, 7755, 7765, 7775, 550, 560, C60, C70 DC700 version: (Part Numbers: 052K13211, 052K13210, 052K96750, 052K96752) (fits these models: DCP700, DCP770, C75, J75) If you have a clogged or broken direct pipe assembly, various symptoms can appear. Sometimes you’ll hear popping noises as the angled gear (DC250DPG1) starts slipping past the gear on the long drive shaft. Other times, the noise goes unnoticed and the machine starts throwing xxx-xxx fault codes because the main drives get bogged down enough for

#3. Inside the open chassis. continued on page 55

the machine to detect that something isn’t turning right. Another common symptom is a relatively large amount of toner spilling out from behind drum cartridges or the IBT cleaning assembly. Now, let’s see how to get this messy thing out of the machine.


1. First, you’ll need to open the PWB Chassis (the metal frame with a bunch of the logic and driver boards attached to it). While facing the rear of machine, remove the screw near the center top of the chassis (see photo 1), and loosen two screws on your right side of the machine (see photo 2). Then the PWB Chassis will hinge open like a large door, exposing motors, fans, and air ducts (see photo 3). 2. Next remove the 3 ducts (2 or 3 screws on each). There are many screws which you do not need to touch. Try to stick to the ones which attach the augers to the frame. 3. Then go for the metal bracket, which you’ll find behind the center duct (2 screws, see photo 4). 4. Next, you’ll want to shift the waste funnel assembly downward, to allow

#4. Remove the Metal Bracket ( 2 screws)

#5 & #6: Remove one screw and loosen a second screw, then shift the funnel assembly downward, until it clears the direct pipe assembly above it.

#7, #8 & #9: 2 screws near the right end of the direct pipe assembly and 1 near the middle.

clearance for the direct pipe to be freed up. There is one screw on the right side near the top which has to come out. There is a second screw down low on the right which only needs to be loosened. Then shift the funnel assembly downward until it disengages the direct pipe assembly. 5. Next (important!) go to the front of the machine and pull out the drum drawer, the IBT belt module drawer, and the main transport drawer (the one with the fuser and the second BTR assembly on it). It is critical that these 3 drawers be out when you remove or install the direct pipe assembly, as this assembly engages the drum cartridges, DV units, the second BTR assembly, and the IBT cleaner assembly. The direct pipe assembly takes waste toner away from all of them. 6. Now you can remove the direct pipe assembly (5 screws hold the direct pipe assembly to the frame, see photos 7-10). Once all those screws are out, you can very gently work the direct pipe assembly out of its place. It is fairly tight, especially end-to-end, so take your time and be patient. When installing the new one, make sure to check carefully that it’s fully seated in all its ports and all brackets on the unit are flush with the frame. Don’t forget to raise the funnel assembly back up to engage the direct pipe assembly again, and return its screws to their positions so it can’t drop back down later during operation. Now, there is also the matter of “why did this thing get clogged up and break in the first place ???” The most common cause is the toner waste bottle

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#10: 2 more screws from the left end.

not being fully pushed in. If that’s the case, the toner can clog going into the bottle, and then it backs up into the waste augers and stuff starts to break. Another factor can be clumpy toner. If toner is fused by heat inside the toner cartridge to form beads of hard grit, these little “toner rocks” can clog up the system (leaving a toner cartridge in a hot car has been known to create these rocks). Also, we’ve seen that some aftermarket toners do not flow as nicely as the OEM product, so the toner may bind up, especially if it gets a lot of moisture. What if you find that cleaning out the direct pipe assembly and just replacing the angled gear does the trick? If so, you’ll find that an aftermarket gear is available (DC250DPG1), but the OEM part lists don’t assign this gear a part number, as they spare the gears only as part of the complete assembly. There you go! We just filled in one of the few blanks in the DC250 Service Manuals. Hope to see you all again next month. ♦ June 2017 |


JUNE 2017

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ENX JUNE 2017 Digital Magazine  

Connecting People, Ideas and Products in the Office Technology and Document Imaging Industry since 1994

ENX JUNE 2017 Digital Magazine  

Connecting People, Ideas and Products in the Office Technology and Document Imaging Industry since 1994