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The #1 Sourcing Publication in the Document Imaging Industry

Serving The Document Imaging Industry Since 1994

Published by Affinity Business Communications, Inc.

May 2011 Volume 18 No.05

Business Profile

ď Ą Guarding Color Profitability

1

Service Call Avoidance Fix or Fiction

3

How Many Dealers Does it Take to Sell MPS?

2

ENX Magazine PO Box 2240 Suite 729 Toluca Lake, CA 91610-0240 USA tel: 818-505-0022 fax: 818-505-9972 email: enx@pacbell.net website: www.enxmag.com 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.

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www.mse.com © Copyright © Copyright 2011 © Copyright Micro 2011Solutions Micro 2011Solutions Micro Enterprises. Solutions Enterprises. AllEnterprises. rights Allreserved. rights Allreserved. rights All trademarks reserved. All trademarks All referenced trademarks referenced are referenced registered are registered trademarks are registered trademarks of their trademarks of respective their of respective their owners. respective owners. All model owners. All designations model Alldesignations modelare designations for compatibility are for compatibility are forpurposes compatibility purposes only. purposes only. only. © Copyright 2011 Micro Solutions Enterprises. All rights reserved. All trademarks referenced are registered trademarks of their respective owners. All model designations are for compatibility purposes only.


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Ricoh_SP4100_Single_05_2011_ENX_USA 3/30/2011 5:46 PM Page 1

COMPONENTS AVAILABLE FOR THESE ENGINES: Brother MFC-9320, TN 210, 230 MFC-9840, TN 110, 115 Canon imageCLASS D480, EP-104 MF1150, 1170, 1180, EP-120 MF4150, 4270 4350, 4370, 4380, 4690, EP-104 MF 7280, 7460, 7470, 7480, EP-105 MF 8350C, 8050C, EP-118 MF 9170C, 9150C, 8450C, EP-111 Canon imageRUNNER C3100, 3170 C3220, 3200 C4080, 5180 HP M 2727 MFP M 3035 MFP M 4345 MFP M 5035 MFP CM 1312 MFP CM 1415 MFP CM 2320 MFP CM 3530 MFP CM 4540 MFP

Ricoh MPC-2000, 2500, 3000 MPC-3500, 4500 SP-3300 SP-410, 411, CL 4000 SP-4100, 4110, 4210 SPC-220, 221, 222 SPC-310, 311, 312 SPC-330 SPC-810, 811 Samsung CLX-6220, 6250 MFP SCX-4828, 4826 SCX 5530, 5330 MFP SCX-5635, 5835 MFP SCX-5935 MFP Sharp DX-B 350, 450 P AR-208 MX 2300, 2700 Toshiba e-Studio 242, 212, 182, 181 (T1810) 205, 255, 305, 355, 455 (T4530)

Konica Minolta Bizhub 20 40 360, 420, 421 500, 501 C20

Xerox Phaser 3100 MFP 3635 MFP 6110 MFP 6115 MFP 6180 MFP 7400 7760

Konica Minolta Magicolor 1600 4650 4690, 4695 MFP

Xerox WorkCentre M-20 4118 3220, 3210 MFP

Kyocera FS-3140 MFP, 3040, TK-350, 352, 354 FS-1028 MFP, 1128, TK-130, 132, 134 FS-1128 MFP FS-C 1020 MFP FS-1320, 1370, TK-170, 172, 174

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Lexmark C-736, 734 C-760, 762 C-780, 782 C-935, 930 X-364, 363, 264 X-738, 736, 734 MFP X-832, 830 Okidata B-2500, 2520, 2540 MB 260, 280, 290 C-9800, 9600 CX-2032 MFP

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IN THIS ISSUE

We Saw It In ENX Magazine

IN THIS ISSUE

ENX Staff

Contributing Writers

• Business Profile: National Sales Associates

Susan Neimes

MAY 2011

Page 28

• MPS Trends and Directions by Mike Huster

Page 18

• How Many Dealers Does It Take to Sell MPS? by Scott Cullen

Page 22 Scott Cullen

Contributing Editor

Publisher & Editor

• An Inside Look at MWAi’s New Technology Patent by Scott Cullen

Page 32

• The New Normal by Bill Melo

Page 34

• Is Anyone Guarding Your Color Profitability? by Joseph Wagner

Page 38 Mike Huster

Ronelle Ingram Contributing Editor

Photizo Group

• Service Call Avoidance - Fix or Fiction? by Bud Karakey

Page 48

• Copier Sales Reps Using IPads by Andy Slawetsky

Page 52

• Calculating Your Service Burden Rate by Ronelle Ingram

Page 66

Julia Gonzales

Bud Karakey

Graphic Designer

Christina Kim Administration

• Printer Tech Tip by Laser Pros

Page 68

• Free Tech Help by Smarka!

Page 70

• Products & Industry News

Page 56

• Display Advertisers Index

Page 58

• Calendar of Industry Events

Page 65

Bei Services

Bill Melo Toshiba

ENX Magazine PO Box 2240 STE #729 Toluca Lake, CA 91610-0240 (tel] 818-505-0022 • 800-850-4949 (fax) 818-505-9972 email: enx@pacbell.net

www.enxmag.com Britt Horvat The Parts Drop

10

enx magazine

Joseph Wagner Katun

Andy Slawetsky Industry Analysts


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WE ARE CURRENTLY BUYING... Canon 6025 6030 6035 6045 6050 6060 6080 6150 6230 6545 6551 6560 6650 7500 7850 8530 8580 GP200 IR105 IR210 IR330 IR400 IR600 IR2200 IR2800 IR3300 IR5000 IR6000 IR5020 IR6020 IR7200 IR8500 IR550 IR2220 IR2230 IR2830 IR3320 IR 3530 IR8070 IR9070 IR7086 IR7095 IR7105 IR3025 IR3030 IR3035 IR3045 IR3570 IR4570 IR5570 IR6570 IR 8070 IR 9070

Konica 7075 7085 7155 7165 7145 7255 7272

Kyocera KM 6030 8030 3035 3050 4035 4050 5035 5050 5530

Minolta 6000 6001 8015 Di2010 2510 3010 3510 5510 7210 Di251 Di351 Di450 Di470 Di520 Di550 Di551 Di620 Di650 Di750 Di850

Pitney Bowes C600 C650 C850 DL460 DL550 DL650

Konica Minolta BH200 BH250 BH350 BH360 BH500 BH600 BZ 750 BH 920 BH950 BZ1050 BHC550 BHC650 C250 C350 C450 C500

Gestetner 3255 3265 3355 3532 4532 3370 5385 5390 5502 6002 DSM651 DSM660 DSM675 3502 4502 DSM622 3532 4532 DSM 735 745 755 765 775 790 DSC525 530 535 545

Lanier 5255 5265 5355 5365 5455 5470 5480 5555 5565 5580 5635 5645 6272 6483 LD122 035 045 335 345 255 265 275 190 425C 430C 435C 445C

Kodak

Panasonic

IS50 90 95

7160 7760 7781

Savin 9955 9965 2055DP 2060 2070 2070DP 2545 2560 2575 4027 4051 4045 4060 4075 2535 4022 4035 4045 8035 8045 8055 8060 8065 8075 8090 C2525 C3030 C3535 C4540

Ricoh 7950 7960 7970 AF550 AF551 AF650 AF700 AF1045 AF1055<1.5m AF1060 AF1075 AF2027 AF2051 AF2060 AF2075 FW240 FW270 FW770 FW860 AF1035 2022 2035 2045 3035 3045 MP3500 4500 5000 5500 6000 6500 7000 7500 9000 1100 1350 MPC2500 3000 3500 4500

Sharp AR651 AR810 350 355 450 455 550 620 700 MXM 350 450 550 620 700

Toshiba E350 E450 E520 E550 E600 E650 E720 E810 E850 E232 352 452 353 453 900

All equivalent models accepted as well

This is only a subset of our buy list

Please call for models not listed

We Carry A Large Inventory Of All Brands And Models

Phone 973-365-9900

1-800-240-7677

Fax 973-473-8800 enx magazine

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enx magazine

NUW041411 13 May 2011


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enx magazine

PAN041311 15 May 2011


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enx magazine

04.14.11

17


FOCUS ON MPS

We Saw It In ENX Magazine

MAY 2011

MPS TRENDS AND DIRECTIONS By Mike Huster

T

he opportunities today look different than what was available 10 or even 5 years ago in the managed print services (MPS) industry. In change and uncertainty there are enough possibilities for each firm to find its own unique opportunities. The question is, are you “prepared” and “qualified” for these special opportunities? Have you or will you recognize them when they appear? This column examines several of the MPS trends that Photizo Group has observed that are likely to affect your decisions in the near future. These have been gleaned from several sources: Photizo Group’s 2011 Outlook webinar, Photizo’s Q3 2010 MPS Insights Journal issue on Trends and various brainstorming sessions we have had on the subject.

1. Monthly charges paid for device management will plunge “I believe that device management is going to become food/water/shelter in managed print, I really think that it is going to be table stakes,” declared Doug Johnson, Senior Vice President of MPS for Supplies Network. Commoditization of the imaging device management software market is most evident in the fierce price competition. Most office technology resellers have considered these solutions as a cost of doing business in an attempt to streamline costly overhead and allow for scale of economy during growth as opposed to a revenue source, e.g. charging for assessments. Due to this perspective, dealers and resellers have been very price conscious in choosing their solution. While there are significant differences among the industry’s software companies, device management is becoming a standard functionality. Commoditization has made this business model unsustainable long term, raising questions about how companies such as PrintFleet and Print Audit will retain longterm value in the device management space. The recent acquisition of FMAudit by eCommerce Industries (ECi) signaled a change in the marketplace and device management firms will need to provide broader functionality, partner or seek acquisition as the market evolves, or face increasing market pressures.

ductivity improvements to be had as the optimization of the entire fleet. Solutions are coming around that will allow providers to enable document workflow without becoming deep workflow experts, without getting into the software, and without integrating with the client’s ERP system. This trend will require domain experts in multiple verticals. The three verticals that have had the most attention are financial services, legal and healthcare. Multiple press releases by Xerox and HP healthcare verticals are evidence of this trend. This past January, Xerox bought WaterWare in a bid to store customers’ electronic medical records (EMR). The medical industry is fraught with compliance issues and regulations (HITECH and American Recovery and Reinvestment Act) and they are looking to automate even more and move forward with initiatives focused on EMR.

3. Stage 3 and Stage 4 (Business Process Optimization (BPO) and Information Technology Outsourcing (ITO)) will become increasingly important for dealers and IT resellers to maintain healthy margins. Whereas Stage 3 is predominantly document-centric (although it may be electronic rather than paper-based), BPO and ITO may not have a document component. As a result, this new stage (or convergence of MPS and non-MPS stages) requires an entirely new set of skills and partnerships. It is with this backdrop that Photizo has formulated what we call Stage 4. With Stage 4, vendors move beyond just providing a solution to manage the documents involved in a business process, to offering outsourced management of the complete business process. This convergence presents an opportunity for dealers who have an understanding of their client’s document processes to help them make the transition to more efficient business processes. Vendors not only broaden the scope of their MPS engagement, they will drive a regular stream of high value ongoing revenue as outsourced providers.

2. Basic MPS gets bypassed for projects in document workflow. 4. Multiple factors will contribute to a pre“When you get a client to a certain level with MPS, you had bet- cipitous decline in cut paper. ter be ready for something greater than MPS because all of a sudden you have improved their business practice for them and they want to know what else you can do for them. MPS has provided the opportunity to become a business advisor not just another vendor,” says Michael Greenburg, owner of Printology. The next level for MPS vendors is becoming educated and prepared to look at document life cycle management using document workflow analysis. There are as much savings and pro-

Networking, cloud computing, and user demographics are all contributing to the growth of the MPS industry and the eventual paperless office. Networking and cloud computing have advanced to the point where large companies recognize that imaging is not part of their core and have or are planning to outsource their printers, copiers, MFPs, scanners to MPS providers. continued on 19

18

enx magazine


FOCUS ON MPS

We Saw It In ENX Magazine

MAY 2011

continued from 18

The misnomer “Paper free in ‘93” has come and gone. The above factors are contributing to a revival of the paperless office. While Photizo does not believe we will reach a paperless office, we believe we will reach a “less paper” office. The combination of cloud computing, portable data access (such as the iPad), almost universal wireless and/or cellular access, and the ultimate transition from our current workforce to the next generation of workers who have always been Web device-centric (and don’t see a need to print) will result in a seismic shift in printing volumes. Whether this comes in 10 or 20 years, it surely will occur.

5. International MPS adoption will be swift. While MPS requires a broad set of tools and skills, the components are available to compile and implement nearly anywhere in the world. North America and Europe are early leaders, but other regions will grow quickly. Asia Pacific, followed by Latin America will experience rapid expansion in the MPS space. Photizo Group’s latest 2010 Market Share and Forecast Analysis shows 6 of the top 10 fastest growing countries are from the Asia Pacific region. The region’s average CAGR from 2009 to 2014 is estimated to be an impressive 41 percent. Three drivers will be seen in Asia Pac: (1) an increase in MPS offerings by the OEM vendors intensifying market competition, (2) an increase of MPS providers in the channel and an emergence of software, solutions, and infrastructure providers forming an MPS ecosystem, and (3) customer awareness and demand. Europe is highly fragmented and the MPS market dynamics vary by country. Currently, MPS penetration is still below 25 percent of the market. Europe represents the largest growth opportunity for MPS. The implication is that winning a strong position in the European MPS market will be key to future growth for vendors. European channels will embrace MPS, driving significant MPS growth. This means that cross-country channel programs (e.g., Office Depot and Xerox) will emerge to support regional MPS customers.

6. The pace of mergers and acquisitions for aftermarket supplies and channel participants increases. Katun acquired Media Science’s toner business, Clover acquired ERS and NER Data’s imaging supplies division and Image1, and then Golden Gate Capital invested in Clover and West Point Products. The flurry of acquisition activity in aftermarket supplies has not stopped and the likelihood of it continuing is high. It appears the third-party supplies business (reman or refill, etc.) is gaining credibility in the equity funding market, based on Golden Gate’s action. This will complete another critical piece in the industry infrastructure to enable non-equipment manufacturers to provide high-quality supplies as part of their MPS programs. This along with other industry developments is adding pressure to the printer industry that should drive adoption of MPS by OEMs and non-OEMS.

7. Xerox moves beyond their core business and becomes more ACS-like. Xerox picked up Global Imaging Systems (SMB expansion in 2007) followed by Veenman (2008), Irish Business Systems (2010) and now Concept Group (SMB expansion in 2011). They are buying channel and in most cases their moves have hurt their competitors. Their largest acquisition was ACS in September 2009. ACS has turned into a boon for Xerox as it has provided higher profit potential and additional MPS opportunity. The impetus behind this acquisition was HP buying EDS and Dell buying Perot Systems. All three of these acquisitions show MPS converging with IT managed services and BPO. With the success that Xerox has had with ACS, the company will continue to move in that direction as evidenced by the recent partnership with Office Depot in Europe.

8. Unconventional market entrants will invade the MPS industry. The imaging market is wide open for new approaches and participants. Unconventional market entrants such as consumables and office supplies vendors are coming up with their own MPS programs, some of which are quite sophisticated. Some have powerful new MPS tools and sales approaches that empower dealers to loosen their OEM ties. Hybrid dealers have come from the reman industry, equipment financing companies, infrastructure providers or any other company that can put together all the pieces of MPS and provide a one-stop shop to customers to manage the entire print lifecycle from hardware, consumables, tracking, digitization, and workflow management. MPS involves consulting and puts all MPS entrants, be it OEMs or other players, at the same starting point. Printing will no longer remain the exclusive domain of the OEM providers.

9. Cloud and mobile printing will change you and your business. Smartphone sales are exploding with approximately 175M units sold globally in 2009, up 24 percent over 2008. Smartphone sales will exceed PC sales by 2012. The number one requested feature for the iPhone and iPad is to print. Smartphones are not the only devices that need to print; there are readers (Kindle, Sony, iREX), netbooks (Verizon, Psion, ASUS), and tablets (Entourage, Android, iPad). Cloud printing is made up of three services: cloud print services (EFI PrintMe, HP ePrint, Google CloudPrint), mobile print services (Apple AirPrint, Global Graphics/Intel) and wireless connections to select print models (HP ePrint, Epson PrintJini). At CeBIT 2011 a new Cloud Printing Alliance was started with the support of Brother, Dell, Konica Minolta, Kyocera Mita and Oki. The impact on end users, IT and print providers is extensive. Besides the technology implementation across multiple platforms, multiple locations (airports, hotels, conference centers, company locations, etc.) the security issue must be addressed. continued on 54 enx magazine

19


FOCUS ON MPS

20

enx magazine

We Saw It In ENX Magazine

MAY 2011


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FOCUS ON MPS

We Saw It In ENX Magazine

MAY 2011

How Many Dealers Does It Take To Sell MPS? By Scott Cullen

I

f you talk to the managed print services pundits, few dealers are doing it effectively, although you can bet the house that number will grow over time with education and experience. Industry estimates of how many dealers are offering managed print services are in the 25-30 percent range although no concrete figures exist on how many are truly doing it effectively. It’s not for lack of educational opportunities, because there are plenty of those to be found even if one might question the value of education provided by OEMs who may be somewhat biased in their approach since for many of them the name of the game is still moving hardware. At least they’re pointing their dealers in the right direction. Then there’s the consulting community and the services and solutions providers as well as companies like Parts Now! who offer their own spin on entering and succeeding in the MPS arena. To answer the question, ‘How many dealers (where dealers = number of people in an organization) does it take to sell MPS?’ we spoke with dealers who seem to have figured out the model and are reaping the rewards along with consultants who possess some very distinct opinions on what it takes to sell MPS. Oklahoma Office Systems, Inc. (OOSI) in Oklahoma City has experimented with different approaches to managed print during the past seven years and Principal Ron Carr reveals the best thing he ever did was create a separate division within the company to focus on MPS. “There are a few dealers that have converted their teams, but it is difficult to do especially for [employees] with longevity,” says Carr. “That’s the reason why if it’s a separate focus and totally driven in that direction, it doesn’t allow them to back up and say, ‘Oh well, you want to buy a copier, I’ll just sell you a copier.’ Because a typical copier rep is going to be driven by their compensation plans of moving that particular box and once it gets into negatives or something that’s going to take a 90-120 day cycle, they’re going to back off.” The personnel in OOSI’s MPS division aren’t from the industry and are focused on new business rather than OOSI’s existing customer base. They assist OOSI hardware sales reps on calls, but none have existing relationships within the company’s current customer base. “We haven’t taken anybody in the past seven years who was a current employee and said, ‘Now you’re going to do it,’” says Carr although two of his veteran reps embraced the MPS concept early on and have been successful with it. American Office Solutions (AOS) in Clarklake, Michigan is another traditional copier dealership that has made a successful transition to selling managed print services. Perhaps the biggest boon to AOS’s MPS sales efforts has been the addition of an IT consultant to supplement their sales efforts. The need for a specialist was clear to AOS President and CEO Ted McEldowney

when he realized his sales force wasn’t effectively communicating with IT personnel. “The sales guys are sales guys and have that mentality,” explains McEldowney. “Every time they had a meeting and the director of IT was there asking them questions, they didn’t have a clue what he was talking about.” The solution was taking AOS’s top service tech, a tech responsible for solutions and networking, and sending him out with the sales reps on sales calls. This required some training and learning how to listen and answer questions directly. He now sits in on every MPS sales call, and is ready, willing, and able to respond to any IT-related questions that would normally be over the heads of AOS’s traditional sales reps. “When we go into a meeting, we have an IT guy, just like their IT guy sitting across the table answering his questions,” says McEldowney. Professional Business Systems (PBS) in Bentonville, Arkansas has found their MPS champion in house. It’s a senior rep whose compensation is attached to MPS. While some consultants and dealers frown upon this approach, it seems to be working for PBS. “He knows the sales cycle is longer so he’s more committed to keeping his head down to get the deal done,” says Matt Mawby, president. This is a strategy that’s filtering down to PBS’s sales force. “The only way this can be successful is by attaching it to their comp plan,” opines Mawby. “They’ve got to see it as almost a punishment. If they don’t see activity in their territory, they’re going to lose the right [to sell it]. That’s how we did it with color. We let them taste it for awhile and then said, ‘If you don’t sell it, you’re going to lose the right.’” Finding an MPS champion among a dealership’s existing sales force is not always easy and dealer principles that have been able to do that should consider themselves fortunate. “Having dealt with a lot of successful hybrid resellers—guys who have transitioned to this model and been successful with it—there’s pretty unanimous agreement when you ask how many of your sales guys are going to transition to MPS sales guys. The consistent answer is, if one in ten turns into a good MPS sales guy, you did pretty well,” says Ed Crowley, CEO of Photizo Group. As far as Crowley is considered, it takes one MPS consultant per dealership or one per branch if a dealer has multiple branches. continued on 24

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FOCUS ON MPS

continued from 22

We Saw It In ENX Magazine

MAY 2011

How Many Dealers Does It Take To Sell MPS?

“Start out with one guy who can be successful,” he recommends. “Once you have one who is successful, it’s going to do a couple of things for you; it’s going to show you who else in your organization can say, ‘Yes I can do that too,’ the other thing it does is let you manage your investment. You’re not trying to churn the whole sales force all at once.” There will be mistakes along the way and dealers who have successfully made the transition have certainly made their share. One of the most common is thinking because someone is successful selling hardware they can be successful selling services too. “They’ve got a guy busting it out on hardware sales and he’s a great producer so they think he’s going to be great at selling this and they find nine times out of ten they’re not,” notes Crowley. It’s a very different set of skills. It’s almost a warning flag. If they’re really good at selling hardware or transactional sales, they may not be so good at selling services. That’s probably the biggest mistake, taking their best sales guy and putting them into this role.” Crowley acknowledges he’s speaking generally and some dealer principles, like Mawby, have been able to do just that. He also feels that an MPS consultant needs to have a certain kind of attitude.

“Look for the missionaries who really like to make the customer’s business better and that makes them happy more than just getting the deal,” states Crowley. “Surprisingly most resellers I talk to will find one person on their staff who can do it. Often times it’s a younger person not as set in their ways. In some cases to really build up the momentum they’re going to have to hire from the outside.” Crowley says when hiring from the outside look for people who have been successful in a relationship-type sales model or someone in a services business. “You can teach basic sales skills,” contends Crowley. “It’s a little harder to teach relationship building. Look for people with strong relationship-building skills, and then you’ll need to train them. Obviously you have to look at the gamut, understanding services, understanding technology, understanding the sales model; there’s sales training associated with each one of those, you’ll need to tailor it to what your sales force needs.” And where are those people? “All over the place,” says Crowley. “Some have been in everything from finance companies to banking organizations—high service, customer relationship types of organizations. Some have come from clients. I know dealers who have found people who are good at internal client relationship building. They mancontinued on 26

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SINCE 2007

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FOCUS ON MPS continued from 24

We Saw It In ENX Magazine

MAY 2011

How Many Dealers Does It Take To Sell MPS?

age to bring them out of the client and put them into that role. They’re out there, and more so than ever because of the economic situation.” Joe Barganier, an MPS consultant with MT Business Technologies in Mansfield, Ohio, and president of the Managed Print Services Association (MPSA), knows a thing or two about managed print services. He’s a strong advocate of bringing in an MPS specialist. Using Barganier’s rule of thumb, the magic number is one MPS specialist to every 10 sales reps. However, he acknowledges that a lot of the industry emphasis on MPS doesn’t necessarily fit the business model of the sub-$10 million dealer.

He too acknowledges that traditional copier sales reps aren’t likely to go that extra mile to sell MPS. “I call it economic comfort level,” says Callinan. “You have one rep, he wants to make his $70 grand a year, another wants to make $90 grand, another $150 grand. Guess what they do to make their $70, $90, or $150 grand? The least possible. So they do what they’re comfortable with—sell segment three copiers. For years we’ve been trying to get them to sell content management or software, or whatever, but they keep selling the same devices because they can make their economic comfort level doing that. Until they can’t make their economic comfort level, they’re not going to adapt new things and MPS is new.”

“If you’re a copier dealer that doesn’t have 10 reps, and only have one, you’ve got problems,” opines Barganier. “When you bring on a new offering or two or focus in different areas like MPS you have to dedicate a body. If you only have six guys, you still have to get that one because none of the six you have are going to go after it, nor can you afford to retrain them if they’re successful and have them get out of their productivity mode to pursue something new. That’s core and we all try to go around it because that’s painful.”

Callinan underscores some of the earlier comments by noting another reason you need MPS specialists is because the copier rep is paying the bills.

Barganier recommends finding someone with a printer background, preferably non HP, which coincidentally happens to be the background of many of the current MPS consultants plying their trade in the industry. He’s seen a lot of ex Lexmark and ex QMS people who have been in the field competing against HP, selling network printers, selling network printing strategies, and selling printing strategies enter the business.

He doesn’t believe it’s necessary for the copier rep to be part of the MPS sale either.

“They have a natural tendency to pick up managed print,” he says. He also agrees with Crowley that sometimes it’s an individual with a good head for business, who may not have any experience in the printer or office technology industry selling hardware. “In my organization two of our best guys came from outside of the industry,” states Barganier. One ran a logistics company and the other came out of an auto dealership doing finance type work. Both of those guys took to it like a duck to water.” Has it surprised Barganier that individuals with this background can sell MPS? “It didn’t surprise me that these people could be good at that; what surprised me was, being a printer geek, how with the support of a champion they could adapt to it so quickly.” Tom Callinan, president of Strategy Development, has long been an advocate of hiring dedicated MPS specialists to do the MPS dirty work. “A, they absolutely must have specialists, but the number one thing is commitment. The first area you see MPS fail is when senior management isn’t engaged. Top level management driving the program is what makes it successful.” 26

enx magazine

“He’s out selling copiers,” says Callinan. “He pays for the admin and the owner’s salary, so the last thing you want to do is stop that guy from selling copiers. That’s why you hire specialists—it’s less of a cash flow hit than trying to transform your copier guys.”

“There are two types of sales,” notes Callinan. “The copier is a replacement, fairly commoditized sale. One thing about selling, the more the risk, the higher the level the decision is made. Buying a copier is not a high risk decision, therefore it’s a very low-level decision maker. Moving to MPS and outsourcing your processes is a higher risk than a normal sale which means you’re dealing with a different decision maker, usually IT or a senior level manager versus purchasing or facilities.” The challenge Callinan sees through his consulting and educational sessions is that many dealers, including those reading this article, will continue to make mistakes when trying to figure out how many people in their organization can sell MPS. As he points out, his organization and others can help dealers minimize mistakes and accelerate the time involved in making the transition to an MPS sales model, but still some clients feel they can take the basic template and tweak it to their liking. “Some will take our template, go back to their dealership, and before they’ve sold their first MPS deal, they [think] they’re experts and start tweaking the process,” reveals Callinan. “‘I don’t like this, I’m going to do it this way,’ and before you know it, what started out as an orange becomes an apple.” Going back to the original question of how many dealers does it take to sell MPS, the general consensus is one—and that person is an MPS specialist, not a successful copier sales rep turned MPS specialist. Of course there are exceptions to the rule, but let’s go with that answer for now. u Scott Cullen has been writing about office technology and dealer issues since 1986.


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PROFILE

We Saw It In ENX Magazine

MAY 2011

BUSINESS PROFILE:

N ational Sales Associates TM

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NSA’s ECO-Certified brand of compatible toner cartridges is the perfect image for tomorrow’s environment.” This is a quote from NSA’s national sales manager Joe Thaete, an industry expert devoted to promoting NSA’s EcoCertified laser toner cartridges. “The Eco-Certified brand is a great solution for our customers looking for a fresh packaging approach that combines great quality at a competitive price,” says Thaete. Joe is the perfect fit to a team of professionals already in the recycling business that started with computer data tapes interestingly called Re-Certified Tape. The green approach of total product recycling continues to be at the forefront of NSA’s overall strategy. Established in 2003, NSA’s founders Len Crann, Joe Endyke, and Steve Morse brought over 20 years of industry experience into their new venture. They originally focused on magnetic tape media (ReCertified Tape) and providing data center services to Fortune 500 companies. Their industry contacts and manufacturing acumen quickly enabled them to expand to compatible office equipment supplies.

NSA custom packages products for office products stores, re-sellers, VARs, managed print dealers and distributors of all sizes.

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NSA has now Trademarked their attractive four color ECO-Certified packaging as a constant reminder to all that economy and ecology go hand in hand. Enhancing this recycling effort, NSA also offers a no charge empties core recovery service and an empties buyback program. National Sales Associates (NSA) wants to be your one-stop supplies distributor, offering nearly 10,000 compatible and OEM supply choices. All are ready for same day shipping from NSA’s multiple warehousing facilities throughout the USA. Many readers may already be selling and using NSA products.

NSA Sales Team 28

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Founders: Len Crann, President & Joe Endyke, VP of Business Development

The large offering of products is accomplished by blending experience in manufacturing, purchasing, distribution and logistics with experienced professionals in sales and marketing. The product lineup includes NSA’s ECOCertified Toner, IBM branded HP compatibles, re-certified magnetic tape cartridges and a full spectrum of OEM products— all at competitive wholesale pricing.

“NSA’s purchasing professionals have access to scores of product lines manufactured by ISO9001 and ISO14001 partners both domestic and international.” Joe Thaete, National Sales Manager explains, “NSA is able to source products from highly qualified manufacturers that share our value and eco concept. We are not restricted to a single re-manufacturing outlet but do choose only those companies that can meet our strict requirements. Our extensive production background enables our product specialists to visit, continually monitor and hold each of our manufacturing partners to be fully accountable for the quality of each product leaving their plant. Our insistence has always been to build to specification, not to price. Our strict adherence to this policy enables NSA to provide a 100% quality guarantee on all products we offer. Our No Risk - No Hassle quality guarantee ensures that our re-sellers can be confident in always providing quality products to their end users.” Proving the point, in 2010 NSA’s manufacturing partners were honored by being selected by Recharger Magazine’s Reader’s Choice as the winner of Best Quality Ink- jets, and were nominated for Best Quality Toner and Best Green Company. NSA also maintains a 98%+ customer satisfaction that includes a near perfect print performance ratio. This includes cartridge quality and page yield. continued on 30


M

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www.NSAToner.com enx magazine

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PROFILE

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MAY 2011

BUSINESS PROFILE:

N ational Sales Associates “Quality has to be the first priority,” states Thaete, “But customer service also has to excel in a service industry. NSA works with Eco-Certified resellers to build customized product and price lists. NSA creates individualized internet pricing catalogs for the 10,000+ SKU offerings for authorized resellers.” Thaete continues, “Rather than making NSA’s buyers wade through thousands of product part numbers, descriptions, yields and multi-columns of pricing options, we customize our reseller’s buying lists. NSA can modify these customized online ordering options to include any of our reseller’s purchasing needs. This allows quick and easy identification for online, fax or telephone ordering of products.”

Global product sourcing enables NSA to negotiate extremely competitive pricing with manufacturers throughout the world. Together NSA consistently offers their resellers extraordinary pricing on compatible supplies. Their reselling partners are able to increase their margins up to 50% over OEM products. Additionally, the ECO-Certified branded packaging emphasizes NSA’s ongoing commitment to earth friendly recycling. National Sales Manager Joe Thaete encourages, “Make one call to NSA and you will understand that our message and enthusiasm are real. We can provide you with an excellent quality product, packaged in our Eco-Certified box, at a price that is competitive.”

NSA has both in-house and field sales representatives offering their resellers dedicated sales contacts who quickly learn to understand their particular needs. These NSA professionals keep track of all their resellers’ drop shipThe entire National Sales Associates ping needs, with greater than 98% Eco-Certified Packaging staff, including 13 in-house and field same day shipping fulfillment rate. This reduces the need for their resellers to carry inventory of the sales reps, shares this enthusiasm and looks forward to disproducts that NSA can drop ship directly to their customers. cussing your supply and service needs. Leading with ECOOnline ordering, tracking and invoicing are available as well as Certified products, IBM branded HP products and magnetic EDI capabilities. NSA also has distribution centers in five tapes, NSA offers same day drop shipping and 100% product states. NSA re-sellers are confident that their customers will guarantee. receive their orders in a timely manner. The toner business is challenging, and you need to differentiate NSA’s industry professional sales reps also offer Toner Sales to succeed. It’s easy to see why business continues to grow at 101 which assist their resellers by providing product knowl- NSA. u by Ronelle Ingram edge, selling techniques, and answers to frequently Contact asked questions. The more knowledge and product National Sales Associates familiarity their resellers have, the easier it is for 51 Glenn Street them to close sales and gain new customers. Lawrence, MA 01843 tel. 866 670 2345 NSA is very sensitive to the need of being able to fax. 866 670 2346 offer their wholesalers customized pricing for bid email: mail@nsainc.net requests. As your business partner, NSA will do website: www.nsatoner.com everything possible to help you win the bid. This includes guaranteed pricing during the bidding process. NSA is large enough to support all of your needs, yet small enough to be flexible. NSA continually offers sales on overstocked items, manufacturer’s rebates, special promotions, core buy-backs and other specialized programs.

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enx magazine

31


INDUSTRY NEWS

We Saw It In ENX Magazine

MAY 2011

Patent No Longer Pending: An Inside Look at MWAi’s New Technology Patent By Scott Cullen

I

n late March, MWA Intelligence was awarded a patent by the U.S. Patent Office for ‘the automation of service call creation and dispatch from a field output asset.’ For anyone keeping score, that’s U.S. patent number 7,769,619.

I understand the patent was first submitted by Imaging Portals, a company MWAi acquired in 2007. How relevant is it in today’s market?

This patent covers a process for automating management of a service contract for a business machine such as a copier, printer, scanner, fax, or MFP associated with a user. A key component of the patent is its ability to capture data via device near the machine itself.

Stramaglio: This was born out of the Imaging Portals relationship and of course we bought all of the assets when we purchased them in 2007.

To get a better understanding of the patent and what it means to MWAi and the dealer community, we spoke with MWAi President and CEO Mike Stramaglio.

Stramaglio: We didn’t have to tweak it, the market tweaked itself. Ironically enough, the patent when it was originally filed, was highly conceptual. It was so far ahead of where we knew the market would be, so we had a very fortunate vision.

What does this patent mean to MWAi? Stramaglio: It’s a pretty phenomenal patent. The original filing was in 1999 and more formally in 2000, so the patent went through some serious scrutiny for 10 ½ years before it was approved and awarded. It’s a very important process patent. What the patent does is, it isolates as part of the process essentially any service contract type of activity that’s tied to the billable event. Where you have a machine and a service contract in place and the service contract is billable based upon the exchange of information between the two, that’s the process we own. That’s a very powerful process and a critically important filing. How will it specifically affect your products? Stramaglio: When you look at most of the functionality between the service contract, the servicing of a particular end user, or device related Web-enabled communication, we own that patent. So theoretically we pretty much put a footprint on anything where data is communicated via the Web and between a service contract or service personnel and a device. What exactly will this patent do? Stramaglio: We asked our attorney and this is probably the best way to communicate it: “ This patent covers systems and methods for managing a service contract for a business machine, such as a printer or copier. A data capture device monitors the business machine. When certain events occur at the business machine, such as a usage count, error, or lapsed time period, the data capture device (which is located near the machine) logs the event and provides notification. The event is then reported to the user automatically and electronically. The events that trigger reporting are set or modified by the user via a Web interface.” Basically that’s MPS.

Have you had to tweak it to make it relevant to today?

Are these capabilities in this patent something you’ve been offering all along without it being patented? Stramaglio: This is something that MWAi has been offering and other companies have been offering, but there was no patent awarded until now. We’re feeling secure in the fact that we have the patent and of course we’ll use it as protection for our business and for encouraging others to look at what we’re doing and be careful with what they’re doing. Now that you’ve made this announcement do you think there are going to be any noticeable changes in the marketplace? Stramaglio: What we’d like to think is we have a licensable event. If somebody is doing something we’re doing and is in compliance with this patent, we’ll be able to speak to those folks and say, ‘Hey we’d like you to study this.’ I’m not really thrilled with the idea of using this as a litigious type of thing. I’m more interested in emphasizing the importance of protecting our business. You’re quoted in your press release that ‘this patent in conjunction with our other technologies allows MWAi to pursue new opportunities with vigor.’ What new opportunities might you be pursuing now or do you mean this just gives you a stronger product portfolio as you take your products to market? Stramaglio: What I meant was the patent is an effective tool to encourage other partners you work with to feel more comfortable with what they’re doing with you. If you can imagine RIM, EFI, or Intel, the more patents we file the more confidence they have working with us. How might this patent affect MWAi’s products going forward? Stramaglio: The patent itself will allow us to move more quickly down certain paths where we may have been a little continued on 54

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enx magazine

33


OEM STATE OF BUSINESS

We Saw It In ENX Magazine

MAY 2011

THE NEW NORMAL By Bill Melo

I

an Davis of McKinsey and Company recently said, “It is increasingly clear that the current downturn is fundamentally different from recessions of recent decades. We are experiencing not merely another turn of the business cycle, but a restructuring of the economic order.” This restructured economy is what I like to refer to as “the new normal.” As a society, we’ve witnessed a major shift with the adoption of the notion of “frugality chic.” Thriftiness has been embraced wholeheartedly by individual consumers and businesses alike. In addition, we’ve witnessed the emergence of the green consumer who is leery of green marketing and more interested in green solutions and savings. Finally, in the digital age with rapidly evolving technologies, people desire and require more control. There is a greater awareness and need for information security, and individuals and businesses must have confidence that the products they purchase will help protect the sensitive information that is important to them.

The document imaging industry is not immune to this new normal. The traditional multifunction product (MFP) business is in the late maturity stage and there has been a steady decline in the number of units shipped since 2007. Similarly, as the economy declined over recent years and jobs were lost, we witnessed a sharp decrease in page volumes per device. These trends require that document imaging industry professionals – from dealers to manufacturers – adapt, evolve and ultimately shift the way they view and do business. What once worked is no longer a viable strategy in this environment. Consider this: for every $1 spent on A3 technology, end-users spend $3 on A4 devices. Similarly, for every page printed to an A3 device, three are printed to an A4. Those that define themselves as managed document services (MDS) providers see those statistics and realize an immediate quadrupling of market opportunity. Why only bring in revenue from pages printed to devices sold when you can generate revenue whenever a customer prints to any and all devices? According to Gartner, “By 2012, 70 percent of businesses with more than 250 employees in North America and Western Europe will acquire printers, copiers, MFPs and associated supplies as part of a managed print service contract.” Therefore, it is critical that dealers take a brand agnostic approach and secure MDS contracts now, with or without hardware attached. This shift in approach leads to an almost immediate expansion of a dealer’s customer base, increases their share of wallet, and improves customer “stickiness.” When the hardware lease does come up for renewal, it is highly likely they will not only be invited to bid, but also secure the contract based on the value provided by the MDS relationship. At Toshiba, we take a holistic approach to the document envi-

ronment through a very customercentric approach. We listen to the needs and concerns of each individual business and tailor solutions to directly address their unique requirements. This also means looking beyond fleet optimization to improving information security, reducing environmental impact, and managing printing at the user level rather than the device level. Ultimately, this provides more significant rewards, protections and cost-savings to customers. Two of the proprietary solutions Toshiba dealers can deploy are the Encompass Security Vulnerability Assessment and the Encompass Green Report. The Encompass Security Vulnerability Assessment identifies a customer’s current vulnerabilities such as data on the device, device access and user authentication, document security and end-of-life security. Dealers can then remedy current vulnerabilities and implement policies for moving forward. This means implementing end-user education, affecting change in employee practices and employing digital rights management tools to fully secure a company’s intellectual property. The Encompass Green Report identifies a customer’s eco-footprint. Unlike other competitive tools, the Green Report uses actual customer data to identify how many trees and other natural resources are consumed, as well as how much carbon dioxide and solid waste are produced. From there, dealers can recommend specific strategies for reducing use and waste, and improving recycling. In addition, Toshiba has several recycling programs available. Once dealers decide to define themselves as MDS providers, the next and likely most difficult challenge is developing and implementing the infrastructure to support sales growth. Recognizing this as one of the most difficult hurdles to overcome, Toshiba is devoted to helping dealers through this transformation with advanced training programs and dedicated corporate and field support. For example, many dealers may not have the resources or the training on a variety of devices to feel they can service customers properly with a brand-agnostic MDS program. Another obstacle is that potential MDS customers are physically too far away to provide the proper level of service support. Toshiba addresses these challenges by providing on-site service for all of these scenarios, and the dealer is billed a monthly flat fee plus consumables. This is a great way to augment a dealer’s internal service offering, optimize dealer training and parts inventory management, and allow for national accounts opportunities. Similarly, cost-per-copy (CPC) billing is a new challenge that requires infrastructure and automated meter capture tools. continued on 36

34

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OEM STATE OF BUSINESS

We Saw It In ENX Magazine

MAY 2011

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37


MANAGING PROFIT

We Saw It In ENX Magazine

MAY 2011

IS ANYONE GUARDING YOUR COLOR PROFITABILITY? By Joseph Wagner

A

nother trade show, another convention, and another industry roundtable…I may be just imagining it, but it seems these things get smaller every year. The MPS Advocate has arrived and now has the floor. I must admit, I didn’t fully understand him when he first started to speak at these things years ago, but what he says today makes sense…I’d better listen to him intently now. The Digital Doctor is in attendance as usual, though his message has long since become stale. I give him the courtesy nod to acknowledge that he’s here and certainly wasn’t entirely wrong when he had the podium over a decade ago. Meanwhile, the Printer and Copier guys are arguing over what’s left on the snacks and refreshment table…I see Commander Convergence is attempting once again to get these guys to work together. They all really should pay attention to this MPS guy. It’s relevant. By the way, has anyone seen Professor Paperless? The office equipment industry is indeed interesting - essentially flat, still contracting at many levels, certainly mature, and yet continues to evolve. Over the years, there have been many discussions about the next big industry disruptor. Some of these have materialized as predicted, while others still wait for a day that may never come. Undeniably, color is here to stay and the transition continues at a methodical, evolutionary rate.

COLOR – THE GROWTH ENGINE OF A MATURE MARKET A quick review of current U.S. market trends and projections for laser-based equipment and marking supplies (courtesy of Infotrends) reinforces color’s expanding foothold in the office environment. While the US installed base of monochrome equipment still dominates at roughly 80% of total, its gradual projected annual decline of 3-4% combined with the 10-11% projected annual growth rate of the color installed base over the next few years translates into color capturing an impressive 26% of the total installed base total by 2013. Similarly, images produced on color equipment are projected to grow at a 12-14% rate over the next few years, while total monochrome images are forecasted to decline at a 3-6% rate per year – resulting in color images representing 35% of all

images produced by 2013. Further, the total value of color marking supplies (at point of sale) is projected to increase by 8-9% per year, while the total value of monochrome marking supplies is projected to decrease by 6-8% per year – translating into color marking supplies representing almost 65% of the total US supplies market by 2013. While these trends are not especially surprising, they do nicely reinforce the significance of color today and the projected preeminence color will have in just a few years. Yet not all is positive in the color arena. While the value-per-page (price-perpage) of monochrome marking supplies is projected to remain relatively stable going forward, the value-per-page of color marking supplies is projected to decline by 3-5% over each of the next 3 years – which would represent about a 21% decline in value-per-page of color from 2008 to 2013. Whether driven by fundamental changes to the installed base (e.g. shifts to higher speed / lower price-per-page segments or changes in OEM market share) or by the very nature of increased competitive pressure (intensified OEM vs. OEM price competition for share of market or increased proliferation of aftermarket supplies), the expected color supplies value-perpage erosion should also come as no surprise, since the growth engine within this mature industry will eventually cool and reach a mature, more competitive stage itself. Classic business life-cycle theory. FINANCIAL IMPACT NOTE: With an assumed supplies gross margin of 45% across both monochrome and color segments, a 3% color value erosion per year without comparable cost erosion - combined with the growth of the color category to 65% of total in three years - represents a negative 3.45 percentage point impact to your organization’s supplies profitability. More disconcerting than the current and predicted value-perpage erosion of color supplies is that this trend may not be accompanied by an equal degree of cost-per-page reduction over the same time period – particularly given a relative scarcity and/or inconsistent quality of OEM-alternative color supplies

continued on 40 38

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MANAGING PROFIT

We Saw It In ENX Magazine

MAY 2011

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continued from 38

IS ANYONE GUARDING YOUR COLOR PROFITABILITY? options. Obviously and somewhat ominously, the combination here has the potential to severely compress your color supplies profitability over the next three years – most certainly impacting the financial health of your dealership as color increasingly becomes the prevailing driver of your supplies revenue.

TECHNOLOGICAL AND PERCEPTION BARRIERS STILL FACING THE AFTERMARKET With every evolutionary shift within the office equipment industry, the OEM-alternative supplies market (a.k.a. “the aftermarket”) has adapted to maintain its value position in the industry - providing dealers lower-cost products at varying price and quality levels, thereby representing an important cost-relief mechanism in the industry to help dealers maintain profitability or enhance competitiveness. Color will be no different…eventually. Of course, we know OEM-alternative color supplies have been available for quite some time now - particularly in the printer arena and typically in the form of remanufactured all-in-one cartridges. Yet we also know the road for the color aftermarket has been treacherous thus far, with wide ranging product quality/reliability offered to the industry – particularly in the early days.

In a general sense, while the aftermarket has made recent strides in product quality, considerable variability in this area certainly still exists – particularly as the aftermarket often struggles to bring quick (sometimes premature) OEM-alternative solutions to the latest, hot color models. Regardless of product quality and reliability, gaps in the aftermarket product offering remain in the color space – particularly in copier-legacy OEM portfolios where full product design (toner, components, and cartridge) is often required, but also in some niche printer-legacy OEM lines where full component solutions and/or sufficient core access remain elusive. Moreover, end-users continue to have a heightened sensitivity to color print quality, so the early missteps of color aftermarket products and the current variability of aftermarket color product quality, undoubtedly continues to fuel end-user reluctance to select (or accept) something in a non-OEM box. A leaking color cartridge or a print quality defect associated to a cartridge that arrived in a different or “premium” box will most certainly be noticed by an end-user – even if the one from the OEM box occasionally has an issue of its own. Worthy of note, from an office equipment dealer perspective, it was only a few years ago that the majority of service managers I spoke with about aftermarket color products would share their concerns along three similar themes: continued on 42

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enx magazine


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MANAGING PROFIT

We Saw It In ENX Magazine

MAY 2011

continued from 40

IS ANYONE GUARDING YOUR COLOR PROFITABILITY? (1) “I’m afraid of all aftermarket color products.” (2) “I just don’t believe the aftermarket can develop color products at the same quality level.” (3) “My technicians aren’t fully comfortable with color machines yet, so even the best-quality aftermarket color products will be blamed anyway.” With the combination of variable product quality, product offering gaps, end-user sensitivity, and reseller apprehension, it’s no wonder industry sources continue to estimate the aftermarket penetration of the total US color supplies market at only a tiny fraction (approximately one-fifth to one-sixth) of aftermarket monochrome supplies penetration. Moreover, the color penetration rates are not projected to mushroom to the estimated monochrome levels of 25 to 30% market share anytime soon, and are actually estimated to remain relatively flat for the next few years. Although we can certainly understand and continue to respect both end-user sensitivity and reseller/dealer apprehension to the color aftermarket, I have always wondered if the core elements and sentiments of these objections weren’t similarly heard when the aftermarket first began offering replacement parts in the late 1970s – or photoreceptors in the 1980s – or began to introduce viable monochrome toners in the early 1990s – or made the digital transition with the industry rough 10 years ago. I suspect similar objections and skepticism existed at each of these points…just as I have faith that the aftermarket will continue to evolve with the industry through color and managed print. Despite the technological complexity of color supplies and end-user / reseller apprehension, very soon the color segment of the industry will represent the lion’s share of the total supplies business and will itself mature – accelerating competitive pressure inside a flat to declining industry.

CHOOSE YOUR COLOR GUARDIAN, BUT CHOOSE WISELY With recent product quality improvements, continued aftermarket color product offering expansion, and increasing price / cost pressure, both end-user attitudes and reseller / dealer apprehension appear to be steadily changing. Interestingly, many of the same office equipment dealer service managers – reluctant to even field test aftermarket color supplies a few years ago – now increasingly rely on the aftermarket for a portion of their color needs, either to offset the cost of their growing color supplies category or in an effort to capture a slice of the huge profit opportunity converting from OEM supplies represents. Recognizing the likely price and margin pressures facing their color business, the challenge for office equipment dealers today is no longer IF they should utilize aftermarket color supplies sourcing, but rather WHO to partner with and HOW to select this partner. Making the decision to leverage your color supplies business is certainly the important first step, but selecting the right color partner for your business can have far greater impli-

cations – for better or worse. The following are some important elements to consider when assessing a potential aftermarket color partner: • LONGEVITY AND REPUTATION: In a very real sense, you are entrusting your growing and most important product segment to another organization that may or may not have your best interests in mind. Certainly, an aftermarket organization with an established brand and a reputation for quality, reliability, and support – as well as a degree of longevity in the industry – is a very good place to start. • REASONABLE VS. UNREAL PRICING: By definition, any aftermarket color product will need to provide a reasonable level of cost-savings over the comparable OEM product. However, be skeptical of extremely low price points from potential aftermarket sources – as this could be a signal that this company is simply a sourcing organization, with little to no testing and qualification processes to ensure the product quality and consistency essential for color supplies. Sometimes the price is indeed too good to be true and sometimes a product’s low cost is offset by the true cost of the product when it doesn’t perform to your end-user expectations. Increased service calls are the most obvious afterpurchase cost consequence, while lower actual product yields are not always so noticeable. • QUALITY AND RELIABILITY: Are quality and reliability fundamental cornerstones of the potential aftermarket color partner’s value proposition…and do they LIVE it? A product flyer that touts “high-quality” or a product box that boldly proclaims “Premium,” needs to be taken with extreme skepticism. Most important here is to understand the company’s new product qualification processes, independent testing capabilities, and quality assurance protocols. For example, do they: P

Actually develop products or simply source them?

P Have a comprehensive product testing facility that incorporates not only the classic xerographic print quality measurement practices (e.g. yields, image density, fusing, etc.), but also includes color-specific print quality assessment capability (e.g. L*a*b* values, gloss, hue, chroma, etc.)? P Perform extensive compatibility testing of their products – to ensure seamless product performance when installed before or after OEM supplies…or (especially important for color supplies) work effectively when combined with other CMYK OEM supplies? P Rigorously test their products and the related OEM products in multiple environmental conditions and also assess their performance impact to the machine and other components? P Have factory-trained technicians to run and oversee all testing, supported by teams of chemists, engineers, continued on 44

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Manufacturing OEM and Aftermarket Toner Products Since enx magazine

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MANAGING PROFIT

We Saw It In ENX Magazine

MAY 2011

continued from 42

IS ANYONE GUARDING YOUR COLOR PROFITABILITY? and product managers? P Have a clear and customer-friendly technical support team and warranty policy – that not only covers you in the event of a possible product issue, but also investigates for root cause to understand how to improve the product if there is any fundamental issue? By the way, be wary of new aftermarket color products that are “first-to-market,”as you (and your customers) may actually be beta testing a partially developed product. PRODUCT OFFERING: In an environment where the printer and copier/multi-function worlds have essentially converged, breadth of color product offering has become increasingly important. Further, given the managed print world of today, you can most certainly expect to capture or inherit color equipment populations across unfamiliar OEM lines and platforms – ranging from the most common HP color printers, to legacy copier/multifunction devices, or to niche color printer applications. Does the product offering of your potential aftermarket color partner have the product range of quality color products you will likely need?

GUARD YOUR PROFITIABILITY THROUGH MEASURED CONVERSION

While selecting the right color partner for your needs is obviously critically important, pragmatically converting a portion of your OEM color supplies - specifically which product types and to what degree - to this trusted OEM-alternative color source is likely equally important. Whether you utilize aftermarket color supplies for (1) legacy printer applications, (2) unfamiliar OEM equipment acquired through a recent MPS victories, (3) secondary, non-authorized OEM equipment lines, (4) your primary, authorized OEM equipment models late in their life-cycles, or (5) your primary authorized OEM equipment models still early in their lifecycles – the decision is obviously entirely up to you and based on what OEM commitments you may have in place, profitability targets you need to achieve, and degree of trust you have established with your aftermarket color partner. However, that being stated, it should be clear at this point in this mature, yet ever-changing industry that the steady growth and mainstreaming of color represents both an opportunity and threat to your organization – particularly as the category itself matures and predictable competitive price pressures escalate without an equal degree of cost relief. If you haven’t done so already, qualifying and subsequently leveraging even a small portion of your color supplies with a trustworthy aftermarket color partner today will position you to offset expected profit continued on 46

44

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Brand names and trademarks are the properties of their respective holders and are referred here for descriptive purposes only.

MANAGING PROFIT

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MAY 2011

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IS ANYONE GUARDING YOUR COLOR PROFITABILITY? erosion in what will soon be your largest supplies category – potentially having a powerful impact on your organization’s overall profitability now and in the next few years. Take the bottom-line profitability erosion estimate presented earlier as an example. With color growing to 65% of your supplies business in three years and forecasted value-per-page erosion of roughly 3% annually, your expected profitability impact would approximate a reduction of 3.45 percentage points without any cost-relief. Assume over this three-year period, you successfully convert 20% of your OEM color dependence to your aftermarket color partner and achieve an average cost savings of 25% on this con-

verted supplies business. The impact of this measured conversion to your organization would be considerable – representing (as displayed in the table below) almost 2 full percentage points to your organization’s profitability. While these 2 percentage point gains don’t fully offset the estimated 3.45 point profitability erosion driven by increased price pressure in color, these 2 points just may represent the difference between financial health and financial crisis. Perhaps most important of all, partnering with a viable aftermarket color supplier for a meaningful fraction of your color business will not only directly impact your profitability, but from a broader and more theoretical perspective, will also help generate increased competitive pressure on OEM color supplies

PROFITABILITY IMPACT OF CONVERTING ONLY A PORTION OF YOUR COLOR SUPPLIES % CONVERSION OF OEM COLOR SUPPLIES

20% COST SAVINGS ~ OPERATING PROFIT % IMPACT

25% COST SAVINGS ~ OPERATING PROFIT % IMPACT

30% COST SAVINGS ~ OPERATING PROFIT % IMPACT

10%

+0.79%

+0.98%

+1.18%

15%

+1.18%

+1.47%

+1.77%

20%

+1.57%

+1.96%

+2.36%

25%

+1.96%

+2.45%

+2.94% continued on 55

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MANAGING PROFIT

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SERVICE MANAGEMENT

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MAY 2011

Service Call Avoidance – Fix or Fiction? By Bud Karakey

R

ecently while working with one of our customers, the question was asked on how effective “Call Avoidance” was, and should they make the effort to staff for this position. For those of you not familiar with the term “Call Avoidance”, it’s the capability to work with the customer remotely to avoid sending a technician on site. This is normally done by the assigned technician calling the customer and working with them directly over the phone to correct their issues, or a help-desk person trying to avoid the call prior to sending a tech on site.

I also recently read somewhere the industry has established a “service call avoidance goal of 50%.” So being the data guy that I am I ran this through “the BEI Services data gauntlet” to prove if this actually could be accomplished based on current factual statistics. The question is how do you address this claim and what data do we need to look at? This is relatively a very simple question: “What types of service calls require human intervention at the customer location besides adding toner?” I have spoken to a number of companies who have “active” Call Avoidance practices established at their dealerships and there are a number of small variances in their practices, but they all have relatively similar rates in failure percentages as shown below. Today BEI Services maintains the largest database in the world when it comes to imaging devices and service performance of those devices. In the last 365 days we processed more than 17.8 million service calls on over 3.9 million devices of nearly 40,000 technicians. I used this data to validate the effectiveness of call avoidance for both studies, and I hope this report helps shed some light on the subject.

Using the same data above, we found that 34.6% of the service calls needed parts, leaving a possible 65.4% of the calls to be avoidable. Okay, that makes sense… But I know from all the years I’ve been in this industry that a large percentage of service calls require a technician to just clean the machines. So to figure out a methodology of what a Call Avoid should be, I did two separate studies to validate what could be considered avoidable. First, what were the call lengths of the calls that were avoidable in that 1.9% service calls above? This would allow me to compare all the service calls based on those times and establish a percentage of total calls that could be avoided. The table below shows all the service call length of the avoided calls in 10minute time bands. Call Avoid Requiring Another Open Call Days to failure 0 (same day) 1 2 3 4 5 6 7 Totals

Minutes

The next stage in this study was to determine what percentage of the completed service calls required parts to be installed. Our data excludes consumables, so these types of service calls would normally require a technician to make the trip to the customer locations to install the parts.

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Calls 32,579 27,137 10,364 9,942 8,375 7,779 8,281 8,637 113,114

Avoidable Call Times in Minutes

For this study I used a one-year period and only dealerships that had a helpdesk or phone-fix call type. We had 17,576,147 service calls, and of these calls only 349,573 (1.9%) were marked as phone-fix or help-desk avoids. Then I looked at the actual success of the avoided calls and found 32.4% of the calls that were avoided had another service call created on the same piece of equipment within 7 days, by our standards making them a failure attempt, with the majority (17.1%) failing within first day. In this part of the study, this equates to a 67.8% overall successful for Call Avoidance attempts. But this is only on the 1.9% of the total service calls.

www.laserprinterparts.com

Percentage failed 9.3% 7.8% 3.0% 2.8% 2.4% 2.2% 2.4% 2.5% 32.4%

Service Calls

Percentage of Percentage of avoidable calls Total Calls (17,576,147)

0-9

197,863

56.6%

0.00000355%

10- 19

81,250

23.2%

0.00000132%

20 - 29

22,321

6.4%

0.00000036%

30 - 39

13,495

3.9%

0.00000022%

40 -49

7,680

2.2%

0.00000012%

50 +

27,054

7.7%

0.00000044%

In the above case, we can assume with relative certainty that the majority of avoidable calls can be completed in less than 30 minutes at a rate of 86.2% (56.6% + 23.2% + 6.5). But to be certain these numbers would hold up, I checked the non-avoidable calls as well, and I even split out the calls with parts so I would not count the calls with parts twice. continued on 50


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SERVICE MANAGEMENT

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PRINTERS

Service Call Avoidance – Fix or Fiction?

Non-Avoidable call times in minutes Minutes Service % with Service % with Total % Calls with no Parts Calls with Parts no Parts Parts 0-9 10- 19 20 - 29 30 - 39 40 -49 50 +

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CSI

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Customer Services, Inc.

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FAXES

As you can see from the numbers in the table above, more than 49% (6.8% + 7.1% + 35.2%) of service calls with no parts took longer than 30 minutes to complete. The total calls for both non-part calls greater than 30 minutes and calls that required parts (the 34.6% above) adds up to more than 80% of the total call load, well above the 50% goal of avoidable calls. The conclusion of this study is the following. An active Call Avoidance practice in a dealership makes sense if you consistently measure your effectiveness and maintain an effective rate of success of above 60%. I would call that a FIX and worth investing in. As for “service call avoidance goal of 50%,” our study was based using a majority of MFPs and higher end printers. While 50% is an admirable goal, I cannot see how it can be achieved with 34.6% of service calls requiring parts, and 49.1% not requiring parts but taking more than 30 minutes to complete (totaling over 83%). I would call this FICTION by today’s standards. I could see these possibilities if the goal is for printers only since the majority of parts are replaced with the cartridge. Perhaps the claim should have been “the printer industry” rather than ”the industry”. u

Bud Karakey is Vice President of Operations of BEI Services. Prior to that position, he was with MWAi for 16 years as one of the founding members of ADS Communications, which is now part of MWAi. He can be reached at bud.karakey@beiservices.com.


SERVICE MANAGEMENT

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MAY 2011

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COPIER SALES REPS USING IPADS By Andy Slawetsky

I

n the imaging industry, sales reps are often the most critical link between the customer and the dealer, reseller and manufacturer. Not only are they responsible for managing their current clients, they’re also charged with finding new ones. You train them, you often pay them a base salary and you send them out the door armed with their good looks, charm and whatever information they have in their pitch-book. You sell technology. Yes, at the end of the day you want to put ink on paper, but this isn’t the same era I sold in where you walked into random offices and asked when their leases expire. As cutthroat as things were in the 90s when I did it, the competitive pressure today is far worse. Alternative channels with inexpensive A4 products are eating your reps for breakfast. Do they know how to sell against these? Do they know the limitations of these machines on a product-by-product basis? Do they have access to the tools you’re paying for them to use 24/7? Are you leveraging available technology to help them better manage their territory and their day and to simply make them better than the competition? It may be time to take a look at how your sales people do their jobs and consider the return you are getting on one of your biggest investments. Here’s a solution we’ve put together for dealers, resellers and branches. You can add bits and pieces of this on your own, but as a whole, this modular solution has been proven to increase sales considerably. How do we know this? Because our partner, the largest reseller in his brand domain in the U.S., is the developer of one of these components I’m going to discuss how he saw his revenue nearly hit an all time high last year in one of the worst economic conditions any of us have seen in this industry. Here’s the program in a nutshell. First, you arm your sales force with iPads. Don’t stop reading yet; I’m going to justify this expense. You can also choose other tablets but since we’ve been doing this with iPads, I’m going to focus on them. Have you ever seen how people get in the presence of these things? They become downright giddy. I was at a Canon event last week and a colleague was showing the Canon CEO his review of the announcement of one of the most expensive products Canon ever developed. It was on his blog minutes after the event and he put the iPad in front of this executive, who immediately said, “Is that the new iPad???” My colleague was trying to explain he wasn’t showing him the device, but that this was his positive review of their significant announcement and it was already on the Internet. This Canon executive couldn’t get past it and was totally gaga over the iPad. I don’t think he even knows what he was being shown. We’re talking about a guy that can buy as many iPads as he wants or even build his own version, yet he couldn’t see past that device. That’s how powerful these things are. When your rep pulls one of these out in front of the customer, there is an immediate wow factor and he’s instantly got the cus-

tomer’s attention. Imagine your rep now showing case studies and videos from your brand to the customer. Then follow this up with some perspectives on the competition where he can show the customer beautiful sideby-side charts that highlight areas where your device is more reliable than your competitor’s. And before your rep went into that office, imagine that he or she was able to take advantage of their time spent in the waiting area, looking up your products and the competition identifying holes in your competitor’s line to exploit as well as advantages in your own that they can tout. Maybe your device uses polymerized toner and theirs uses pulverized and your rep uses that five minute waiting period to review the product comparison that will help him or her explain that your device uses a more advanced imaging system that requires lower fusing temperatures, which in turn means lower energy consumption and a greener process. Green sells, doesn’t it? OK, so now your rep’s got the customer’s attention, showed them great marketing videos on an amazing screen as well as competitive strengths of your product. They went into that meeting prepared with research that took seconds, not hours to obtain and it was all there in a slick, polished manner at their fingertips. But wait, there’s more! How about putting together a proposal on the spot by filling in a few cells in a document right on that iPad and better yet, filling out and signing an order right there, digitally, and having it submitted to your fulfillment department before your rep is even out of the building? So here comes the best part. What’s the number one gripe about your sales force? They come back at the end of the day, hand you a stack of cards of people they supposedly met with and you have no idea what they were really doing or where they were. You know they’re not always out there working 9 to 5. How many times have you seen your reps walk in at the end of the day with hair clippings on their shoulder or raccoon eyes from the sunglasses they wore while getting in a quick nine of golf; or maybe they took in a movie or a nap… Our partner developed an app that follows your rep throughout the day from nine to five. This app allows you to see where the rep went, the path they took to get there and how long they were at the account. Within the first two weeks of using this app, our partner found two of his reps were at a competitor’s location, obviously looking for another job. It’s nice to be able to get rid of someone before they have a chance to steal your data and customer list. Many of you may be thinking this is a bit too “Big Brother” and you trust your people. Let me ask you this: is your sales force the same as it was five years ago or have you hired, fired or continued on 53

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continued from 52

maybe lost a few people here and there during that time? That’s what I thought. You obviously don’t need to check up on your strong performers, but how about those reps who are underperforming or new? This solution allows you to go through their day with them and try to identify ways to make them more efficient. Maybe you’ll find that you’ve got a rep that crosses his territory four or five times a day and spends hours driving. Now you can help him plan more efficiently, before he or she goes out; less time driving, more time in front of customers and prospects. Better yet, tie it into the CRM you’re using (and if you’re not, what are you waiting for?). The greatest benefit to this solution in my opinion is what it does for your new hires. When you tell this kid sitting in front of you that you’re going to give them an iPad loaded with sales tools and it will track them throughout their day, any rep that was going to waste your time and ultimately burn you will never come back for a second interview. You’ll eliminate those candidates that were going to waste six months of your time then go on unemployment when you found they weren’t meeting your goals. Now you can hire reps that don’t care if you’re going to track them because they intend to work for you, 9 to 5 like you hired them to do. If they don’t want to work in an environment where you might check on them if they’re not hitting their numbers, do you want them working for you? And that kid that’s just not going to make it? Now you find out in 30 days instead of six months. Think about that. By identi-

fying a rep that’s not performing in 30 days instead of six months, you’re possibly eliminating five months of time in which this territory would have remained open. You’re also going to be better protected against competitors raiding your accounts because you won’t have someone managing them that isn’t making an effort. This is how my partner had one of his best years ever in a down market. He’s staffed with a sales force that is efficient, smart and willing to do the job. He can manage them better when they’re struggling and avoid hiring those reps that might be short timers and job hoppers. You know what I mean—the ones that suck the life right out of your office. This approach leverages available technology. It makes your rep look polished and sophisticated and it gives your company the appearance of success and a clear understanding as to how to use technology to improve efficiency. Using one of these ideas shows customers that your company leverages technology to improve workflow. You’re putting your money where your company’s mouth is. This approach will help your rep initiate discussions about workflow because they’re holding a customer workflow enhancement right in front of the customer’s nose – instant credibility. Some of the things I discussed in this article can only be found through us but a lot of it is something you can do on your own. Arming your sales force with tablets is a great first step. continued on 54 enx magazine

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continued from 32

An Inside Look at MWAi’s New Technology Patent

reluctant, where we didn’t feel totally confident that the process belonged to us. [In that case] you exercise a little more caution with where you invest. Now we can feel a lot more comfortable with the areas we know we need to expand upon and we’re going to do it. Things like the products we have in development or with proof of concept with Intel, it just makes everything go more quickly. And you’ve got more patents pending? Stramaglio: We have a couple of related patents in the MeSH and wireless areas but those are more technology patents. This is the first one we have that is more business process patent, which in effect has a pretty serious contribution to our ability to go forward. This basically incorporates many technologies under the process umbrella. u 54

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continued from 53

COPIER SALES REPS USING IPADS Adding your CRM and figuring out how to put your videos and brochures on there is another. Even with this minimal investment, you still gain many of the advantages discussed in this article. The point is, your rep will look smarter and more successful than the competition because they’re leveraging technology. You can easily pay for this through increased sales and decreased turnover. At the end of the year, your reps make more and so do you. Everyone wins. For more information about some of the products and services I mentioned in this article, or advice on how to set this up on your own, feel free to drop me a line at andy@industryanalysts.com. u

Andy Slawetsky is President of Industry Analysts, Inc. Much of the company’s research and testing results can be viewed on their website www.industryanalysts.com.

continued from 19

MPS Trends and Directions The total process can be rolled into an MPS contract and let print manufacturers handle the details. In conclusion, when entering a new market or trying to flourish in a market, it is important to stay up-to-date on the trends. MPS is rapidly evolving and your business’ ability to stay ahead of the curve can determine its success. Each trend listed above can be viewed as either an opportunity or a threat. It is up to you to determine which one it will be. u

Mike Huster is a senior consultant and partner of Photizo Group. Mike has been in the hardcopy and technology industry for over 25 years, working for IBM and Lexmark before helping start Photizo. Prior to joining Photizo, Mike worked at Lexmark International in various management and staff roles in Worldwide Marketing, eCommerce, and Lexmark Electronics. Prior to that, Huster spent 15 years at IBM where he held management positions in sales and marketing, R&D and engineering. Huster earned a B.S. in Mechanical Engineering from the University of Cincinnati, an MBA from the University of Kentucky, and an M.S. in Mechanical Engineering from Georgia Institute of Technology.

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continued from 46

IS ANYONE GUARDING YOUR COLOR PROFITABILITY?

HP OEM ON SALE CI

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costs industry-wide…a phenomenon we have all experienced for over thirty years in the monochrome world.

At least until Professor Paperless finally arrives…u Joseph Wagner is Vice President of Katun’s Corporate Marketing And is responsible for marketing strategy, product marketing, marketing communications and market intelligence. Mr. Wagner focuses on the identification of attractive market opportunities, effective product launch methods, and strategic market planning linked to market-specific tactical implementation plans. Mr. Wagner originally came to work for Katun in 1991 as a Marketing Analyst, held positions as a Senior Product Marketing Manager, Marketing Director for New Business Development and Assistant Vice President for Marketing Development. He left the Company in 2004 to work for Conwed Global Netting Solutions as the Marketing Director for New Business Development. Mr. Wagner holds a B.S. in Marketing and Finance and an MBA from the University of Minnesota.

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Product & Industry News Jamex Inc. Latest Partner Named to Kyocera Mita America’s Developer Support Program ITHACA, NY - April 5, 2011 - Jamex, Inc. today announced that they have become a partner in Kyocera’s Developer Support Program. Jamex develops interface solutions and self-service control devices for most Kyocera multifunctional products (MFPs), including the TASKalfa family of MFPs. The Kyocera Developer Support Program is available to Kyocera Mita America dealers, independent software vendors, select hardware vendors and Kyocera end-user customers. The primary goal of the Developer Support Program is to provide members with a user-friendly portal to Kyocera’s HyPAS software solution platform and detailed specifications to integrate with hardware vendors such as Jamex. Jamex products provide opportunities for cost recovery in libraries, educational institutions, retail chains, government locations, and other vertical markets. Kyocera Mita America dealers can now offer the latest technology of the TASKalfa line to all self service locations. Jamex cost recovery solutions, including cash, stored-value, or credit card vending, are in stock and ready for immediate shipping. For more info visit www.jamexvending.com and www.kyoceramita.com/us. u Uninet opens in the Philippines Los Angeles, CA - UniNet proudly announces the opening of a new distribution center office in the Philippines to further expand its capabilities and market reach in the South East Asian region. The new sales facility is conveniently located in Manila and will carry UniNet’s complete 15,000-product line. It is comprised by sales and warehouse space to broaden UniNet’s means in offering local sales, distribution, and support services, and to meet the growing demand for UniNet product solutions in the Philippines and neighboring countries. UniNet has appointed Kam Woon as National Director to manage operations and sales at the new location. “UniNet expansion in the Philippines intends to further strengthen our product support capabilities to Philippine clients and prospects while reducing logistics cost and inventory. We are also very proud to welcome such an experienced sales team to the UniNet family who will support remanufacturers and service the growing demand for UniNet solutions in the region,” said Nestor Saporiti, CEO. UniNet Philippines is located at 120 E. Rodriguez Jr. Ave. Cor. Ortigas Ave. Brgy. Ugong, Pasig City, Philippines 1604. For more info contact Kam Woon at: woontk@uninetimaging.com. u DocuWare Announces Alliance With Data Strategies Int’l, Inc. Migration Services Provided Newburgh NY, – March 29, 2011 – DocuWare Corporation, DocuWare AG’s US subsidiary, announces an alliance with Houstonbased Data Strategies Int’l, Inc. This alliance will provide Data Strategies’ document archive migration services to the DocuWare environment. “DocuWare Corporation provides Document Management solutions to its target audience consisting of small to mid-size companies, government agencies and departments in large organizations,” explains Greg Schloemer, President of DocuWare Corporation. “An increasing percentage of our new customers are actually replacing a legacy electronic archive with our easy-to-use solution. Having a migration alliance such as Data Strategies to migrate the legacy content to DocuWare enables a smooth transition for our customers.” There is value in performing this data conversion and migration service in the shortest time and most cost efficient way. The primary advantage to the user is that the files from their former system now work seamlessly within the DocuWare environment. They have total access to their complete data in one, central document pool. “We are excited to offer our services to the many DocuWare Partners and their customers,” says Johan de Haas, Data Strate-

May 2011 gies’ COO. “We support over seventy legacy archive formats and our DocuWare export module provides extracted documents and indices in a format ready to be ingested by DocuWare.” For more info on Data Strategies visit www.go-dsi.com or for DocuWare, visit www.docuware.com. u MWAi & US Fleet Tracking Announce Integrated Partnership SCOTTSDALE, AZ (April 5, 2011) – US Fleet Tracking (USFT), a GPS tracking firm based in Oklahoma City, announces that it has partnered with MWA intelligence (MWAi). This partnership will allow MWAi to offer its clients USFT’s TotalView Dispatch powered by USFT. TotalView Dispatch is the perfect companion to MWAi’s state of the art service dispatch system. It will allow dispatchers to not only see service call status real time, but the location of service technicians in relationship to service call locations, as well as real time traffic and weather conditions. TotalView Dispatch has already proven to increase service technician productivity while reducing travel time and mileage expense; ultimately increasing bottom line profits in an already tough economy. “Reducing miles driven between service calls also helps companies to go green,” reports Jack Duncan, USFT’s Director of ERP Integration. “After having a long standing relationship with MWAi, we are happy to be working with them again to offer this exciting technology.” “Adding this capability compliments MWAi’s service dispatch to provide total vehicle fleet management and dealer employee tracking,” said Gavin Williams, Vice President of Sales and Marketing at MWAi. “With USFT’s unique capability of tracking accuracy and interval reporting we can offer a complete integrated solution to provide additional savings and value to our customers.” With the rising cost of gasoline, it is critical that we leverage available technology to allow service dispatchers to make smarter decisions on service call assignments, as well as better control the use of company owned vehicles. For more info on MWA Intelligence, Inc. visit www.mwaintel.com and for US Fleet Tracking visit www.usfleettracking. com. u MSE Awarded Its 16th Patent for Color Laser Sealing Technology VAN NUYS, CA - Micro Solutions Enterprises (MSE), the industry leader for Intelligently Re-EngineeredTM quality compatibles, continues with market innovations as part of their “ Absolute Color Technologies” platform all with the goal of providing the market’s first true alternative to OEM color cartridges. The latest of these patented technologies are companion patents #7693448 and #7903996 which are for designing an angled seal for MSE’S Intelligently Re-Engineered HP compatible color cartridges. The angled seal eliminates the industry issue of seals becoming stuck when toner builds up in the seal channel; which is more endemic in non-magnetic, color cartridges. Luke Goldberg, SVP MSE GLOBAL says of the patents, “Our engineering team has been continually striving to eliminate many of the technological hindrances that have stood in the way of aftermarket success with color laser and this is just one example of that. This technology coupled with our SCS (Secondary Cleaning System), welding, cartridge separation, and gasket sealing all equate to consistency and reliability which has been conspicuously absent from many aftermarket products that are out there today. These patents give our dealers tangible features to convince skeptical end users that finally, there is a viable choice.” MSE is the largest USA based remanufacturer and is acclaimed as one of the leading edge innovators in the marketplace. MSE has pioneered the process of “Intelligent Re-Engineering” as applied to remanufactured printer consumables which is a protocol that employs patented technologies, proprietary processes, and stringent testing methodologies all with the goal of providing the markets best alternative to high cost OEM print consumables. MSE has multiple certifications and accreditations including ISO 9001 AND 14001. Coupled with our engineering prowess MSE also prides itself on offering the highest levels of after sales support to its dealers through its consultative sales and marketing programs. MSE is a global entity with sales and distribution in Canada, Europe (UK and the Netherlands), Israel, Brazil, California, and Pennsylvania. For more info visit www.mse.com. u enx magazine

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Product & Industry News CANON U.S.A. SHOWCASES AWARD-WINNING imageFORMULA SCANNING and imageCLASS MULTIFUNCTION PRODUCTS at the ABA 2011 Legal Technology Conference & Expo Company Will Display Latest Technologies and Solutions at the American Bar Association Techshow CHICAGO, IL, April 11, 2011 –Showcasing high-level document scanning devices and multifunction printers, Canon U.S.A., Inc., a leader in digital imaging, will display its line of award-winning imageFORMULA and imageCLASS solutions at the 2011 American Bar Association (ABA) Techshow Conference in Chicago, IL., from April 11 – 13. Attendees at the Canon U.S.A., booth (#508) will learn how to take advantage of Canon’s imageCLASS and imageFORMULA technologies and experience how they can provide legal organizations with reliable, secure and accurate solutions to help practices effectively serve their clients. “We are excited to demonstrate our efficient and versatile solutions at the ABA 2011 Techshow, an excellent opportunity to bring the benefits of Canon products and solutions to the forefront of this market,” said Jim Rosetta, vice president and general manager, Imaging Systems Group, Canon U.S.A. “With Canon’s line of imageFORMULA and imageCLASS products, we offer the legal sector a more streamlined and secure workflow to better meet the needs of their clients.” Canon will have a variety of its award-winning devices on display during this year’s show, including: imageFORMULA DR-9050C Production Scanner, imageFORMULA P-150 “Scan-tini” Personal Document Scanner, imageCLASS D1170 and imageCLASS LBP6300dn. For more info visit www.usa.canon.com/kyosei. u Muratec Launches the MFX-C2700

patible color cartridges for use in CP 1525 and CM1415 multi-functional printers. These popular HP printer series produce a crisp text and vivid color images, with easy to manage wireless and Ethernet connectivity. ILG’s new releases are compatible to: HP CE320A (black) with 2000 page yield, CE321A (cyan), CE322A (yellow), and CE323A (magenta) with 1300 page yields. These compatible color cartridges are designed for use in HP printer series CP1525, CM1415nw, and CM1415fnw, #128 color. To enhance color print quality, ILG has incorporated the use of the SMART COLOR SYSTEM™ to its color cartridge manufacturing. The System’s advance color technology provides optimum imaging quality, and vivid color output matching OEM. ILG’s Smart Color System™ features two proprietary technologies: The TCB Technology™ with Turbo Cleaning Blade™, a system designed to eliminate the toner build-up; and the Leak Guard System™, a non-split cartridge system with leak proof gasket seal. Both new technologies were added to ILG’s color line as well as to high-yield JUMBO COLOR® cartridges. ILG’s OEM alternative color cartridges offer the same outstanding print quality, and clean streak-proof print that matches OEM in consistency. Joe Shulman, V.P. of client relations commented, “We place heavy emphasis on research and new technology, and take a proactive approach to industry trends. ILG has set a higher standard, and we are in the forefront of innovative technology. The implementation of the SMART COLOR systems™ has positioned ILG as the ‘First-choice supplier’ in color products. For more information on ILG’s Smart Color System™, visit the website: www.ilglaser.com. u New Corporate Members Join Managed Print Services Association Steady association growth reflects strength of MPS market

ILG Releases OEM Alternative Color cartridges No. 128A, Replaces: CE320A, 321A, 322A, 323A cartridges for HP CP1525, CM1415 Color Laser Printers

Columbus, OH – March 28, 2011 – The Managed Print Services Association (MPSA) continues to experience consistent growth with a number of new corporate sponsors. The most recent additions to the MPSA community are: New Platinum Members • Océ North America, a Canon Group Company – Member contact: Tom O’Neill, Director Product Ops & Application Lab, Document Printing Systems • Synnex Corporation – Member contact: James Luquire, Associate Vice President “Océ is excited to join the MPSA,” said Tom O’Neill of Océ. “We see the association becoming the leader in helping establish best practices in MPS for customers and providers as this side of the industry grows and matures. As a group that contains a wide variety of MPS and other managed services providers, it provides a forum to exchange ideas and learn about things that work, and what to avoid. Additionally, Océ is pleased to share our experiences and add another voice to the conversation, as the industry works to define fair and competitive practices that are best for customers and end users of managed services and beneficial for the providers in this business.” New Standard Members • Brother International Corporation – Member contact: Tom Sickles, Senior Product Manager International • Global Printer Services – Member contact: Lance Lansing, Director of Sales and Marketing • NewField IT – Member contact: Ed Mosteller, Vice President - Americas Office “Global Printer Services looks forward to partnering with companies dedicated to the MPS industry. With 15 years experience supplying dealers with remanufactured printers, our goal is to to grow with our partners and provide the support they need to succeed. MPSA will help us stay current with industry trends and news allowing us to better serve our partners,” said Lance Lansing of Global Printer Services Inc. “We are honored to have so many high-caliber companies join us in the effort to support and grow the MPS marketplace. The end result is a stronger association enriched by the ideas and experience of a wider range of corporate members,” said MPSA President Joe Barganier, For more information about the Managed Print Services Association, visit http://yourmpsa.com/.u

WOODLAND HILLS, Calif. — ILG (International Laser Group) releases the HP color #128 series CE320A, 321A, 322A, and 323A com-

To Read the complete unedited versions of Press Releases submitted each month, please visit www.enxmag.com. u

Powerful color multifunction solution delivers printing, scanning, copying and faxing to the desktop Plano, Texas (March 30, 2011) - Muratec America, Inc., manufacturer of multifunction office equipment and business productivity solutions, announces today the availability of the MFX-C2700, a desktop color multifunction solution that delivers exceptional printing, scanning, faxing and copying. “We’re pleased to announce the availability of the MFX-C2700, a powerful desktop color MFP that will enable our dealers to profitably attack one of the fastest growing segments of the market,” said Jim D’Emidio, President, Muratec America, Inc. “We believe our dealers should offer a diverse selection of color multifunction solutions in order to meet the ever-changing needs of their customers. While dealers will continue to focus on higher-segment color MFP’s, the MFX-C2700 can fit a profitable niche within their current product line and add an additional revenue source in the current economic climate.” The MFX-C2700 produces color output at up to 27 pages-perminute and monochrome output at up to 31 pages-per-minute. It features a standard 50-sheet reversing automatic document feeder, letter-size platen glass and duplex printing to create a robust, not to mention costeffective, document handling system. MFP solution for restaurants, real estate offices, medical practices, classrooms and creative departments that have the need to produce a wide variety of color documents, however do not have the floor space available for a traditional color MFP,” said D’Emidio. “The MFX-C2700 combines color copying, printing, scanning and faxing into a single, intuitive solution that can be easily installed into any small office or workspace.” The MSRP for the MFX-C2700 is $2,295. Contact Lou Stricklin at 469-429-3481 or lstricklin@muratec.com for more info. u

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May 2011

Display Advertiser Index ACM 03 Authorized National Copystar, Konica Minolta & Toshiba Distributor for Copiers, Printers, Faxes, Supplies and Parts Phone: 800-722-7745 Fax: 800-767-9722 askacm@acmtech.com www.acmtech.com

CSI Customer Service, Inc. 51 Wholesale Canon Copiers, Remanufactured Cartridges, most popular brands. Phone: 888-889-9598 Fax:713-789-1832 anisark@csihouston.com www.csihouston.com Direct Precise Imaging Phone: 888-376-7311 www.directpreciseimaging.com

61

DocuWare Corporation Phone: 888-565-5907 dwsales@docuware.com www.docuware.com

36

E-Automate Phone: 1-866-342-8392 www.digitalgateway.com

25

Electronic Business Machines Copiers/Printers Parts & Supplies Phone: 800-832-6522 Fax: 859-281-6328 www.ebmky.com

69

Escalera Copier Moving Devices Phone: 800-622-1359 Phone: 530-673-6318 Fax: 530-673-6376 www.escalera.com

68

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FMAudit Remote meter reading and Managed Print Services Phone: 573-632-2461 www.fmaudit.com

Copier Careers Copier Employment Placement Phone: 888-733-4868 Fax: 800-464-3434 mail@copiercareers.com

71

Frontier Imaging 20 Distributor of Copier, Printer & Fax Supplies Phone: 888-530-8811 Fax: 310-898-2788 www.frontierimaging.com

Copier Clearance Center Buy & Sell New and Used Copiers Phone: 800-393-6355 Fax: 916-617-2742 copyclear@att.net

49

Copier Network Coast to Coast Service Extensive Canon and Ricoh Selection Phone: (510) 746-2080 www.copiernetwork.com sales@copiernetwork.com

21

All Leasing Services 50 Repo/Offlease Copiers, Printers and Faxes Phone: 949-727-3750 Fax: 949-727-3850 www.alscopiers.com Arlington Phone: 800-887-3040 Fax: 847-689-1616 www.arli.com

47

BEI Services Phone: 307-587-8446 sales@beiservices.com www.beiservices.com

04

Carolina Wholesale Phone: 800-521-4600 Fax: 800-356-9169 www.cwholesale.com

31

Color Imaging 43 800-783-1090 / 800-783-9010 Fax www.colorimaging.com Collins Distributing Phone: 800-727-0884 Fax: 901-396-8614 sales@collinsdistributing.com www.CollinsDistributing.com

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Great America Phone: 800-234-8787 www.greatamerica.com

02

33

Greater Philadelphia Equipment Co. 23 Copiers, Accessories, Fax Options & Print Controllers Phone: 215-788-7111 Fax: 215-788-4445 gpec1@verizon.com I.C.E. International Copier Exchange Wholesaler of Copiers Phone: 888-423-2679 www.copierpoint.com

47

IDS-International Digital Solutions 17 Authorized Toshiba Distributor for Copiers, Printers, Fax OEM Parts & Supplies Phone: 888-372-3700 Fax: 562-921-1167 suzannecarter@idswc.com Image Star Business Support and Nationwide Service Phone: 888-632-5515 Fax: 888-635-7479 sales@imagestar.com www.imagestar.com

40

Industry Analysts Inc. Product Testing Specialists Phone: 585-232-5320 Fax: 585-454-5760 www.indystryanalysts.com

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Ink Direct Genuine OEM Supplies 714-775-8255 / 714-775-5234 Fax www.inkdirects.com

55

Intercom Exporting Inc Minolta Copiers, Parts and Supplies Phone: 800-960-1119 Fax: 954-978-2412

31

Imaging Supplies Coalition When in Doubt, Check it Out! www.ISC-Inc.org

45

ITC Phone: 877-933-5558 Fax: 610-430-1300 www.itcsupplies.com

46

Jamex Copier/Printer/Fax Vending Applications Phone: 800-289-6550 Fax: 607-257-1139 www.jamexvending.com

51

Katun Green Program offers customers a toner cartridge recycling program www.katun.com

41

Mambo Trading Distributor of Copier, Printer, & Fax parts and supplies. Phone: 877-626-2676 Fax: 562-663-9037 ask@mambo-trading.com

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Mars International Wholesaler of Pre-Owned Copiers Phone: 866-866-MARS Fax: 973-777-5889 www.marsintl.com

11

Midwest Copier Exchange Used Copier Wholesaler Phone: 800-863-3693 www.midwestcopier.com

20

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OES Solutions Distributor of Copiers, Copier Parts, and Supplies Phone: 317-867-4999 / 877-637-1240 Fax: 317-867-4920 info@ oes-solutions.com www.oes-solutions.com

54

MSE Phone: 800-418-4968 (US-East Coast) Phone: 888-561-4541 (Canada) Phone: +31-36-522-2601 (Europe) www.mse.com

05

Office Land OEM Parts for Copiers and Printers Phone: 818-778-0100 Fax: 818-778-0101 www.officeland.ws

27

MWA Intelligence, Inc. Phone: 800-875-2371 sales@mwaintel.com www.mwaintelligence.com

08

Parrot Distributing Authorized Panasonic Panaboards and Printers Wholesale Distributor Phone: 800-451-3336 Fax: 423-855-1434 www.parrotdistributing.com

61

Nation Wide Repair Service Complete Office Equipment Repair Service Phone: 866-655-8676 Tech Support: 800-798-1814 www.nwrsinc.com

Parts Drop Copier Parts, Supplies, & Tech info. 201-387-7776 www.partsdrop.com Parts Now USA: 800-886-6688 Canada : 877-246-2133 www.partsnow.com

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NCC - National Copy Cartridge 54 High Profit and Hard to Find Reman Cartridges 800-822-5477 info@nccreman.com

Precision Roller Phone: 800-323-9523 Fax: 800-832-4548 www.precisionroller.com

75

Nectron Phone: 281-240-2222 Fax: 281-240-0468 info@nectron.com www.nectron.com

Niche Equipment Office Machines & Supplies Distributor Phone: 630-629-9220 Phone:877-446-4243 Fax: 630-629-6790 www.nichee.net

Prinko 39 Factory Direct Wholesaler in USA USA: Phone: 626-389-8988/626-389-8989 Fax: 626-389-8986 sales@prinko.cn http://www.prinko.cn China: Phone: 86-756-8526991 / 8529662 Fax: 86-756-8526993 sales@zhprinko.cn http://www.zhprinko.cn

NSA Eco-Certified Quality Toner, Packaging, Product Diversity and Multi-location Distribution Phone: 866-670-2345 www.nsatoner.com

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NuWorld Business Systems 12 - 17 Copier, Printer, Fax & Business Machine Supplies Phone: 800-729-8320 Fax: 800-829-0292 info@nuworldinc.com www.nuworldinc.com

Printer Essentials Remanufacturer of Compatible Copier, Printer, and Fax Supplies. Phone: 800-965-1180 Fax: 775-850-2630 www.printeressentials.com

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Q2 Americaâ&#x20AC;&#x2122;s Fastest Growing Independent Supplier of Copier Parts and Supplies Phone: 888-826-2576 Q2products.com

36

Remax Asia Zhuhai, China October 13-15, 2011 Phone: 86 756 3959281 Fax: 86756 3220717 website: www.visitremax.com

60-61

Ross International Buy and Sell Used Copiers Phone: 800-240-7677 Fax: 973-473-8800 www.ross-international.com

11

STI Phone: 888-STI-STI3 sales@stiwholesale.com www.STIwholesale.com

44

Strategy Development Phone: 610-742-4701 woodard@strategydevelopment.com www.strategydevelopment.com

69

Supplies Network Phone: 877-427-3261 www.suppliesnetwork.com

24

Supplies Wholesaler The Cartridge Experts Phone: 866-817-8795 sales@SuppliesWholesalers.com www.SuppliesWholesalers.com

35

TonerFarm One-stop source of remanufactured laser toners as well as inkjets. We offer a wide array of brands and models, from the ancient to the most modern digital copiers, faxes and computer printers. Phone: 800-550-0366 Fax: 714-441-7080 sales@tonerfarm.com www.tonerfarm.com

67

Toshiba Copier / Print Manufacturer Phone: 800-GO TOSHIBA www.toshiba.com

76

Uninet West Coast: 424-675-3300 East Coast: 631-590-1040 sales@uninetimaging.com www.uninetimaging.com

09

United Supply Wholesaler of OEM Imaging Supplies Phone: 866-212-5884 Fax: 818-885-0511 sales@unitedsupply.com

31

Wal Group, LLC Factory Direct Wholesaler of Premium Laser Toner Cartridges Phone: 877-368-7788 Fax: 626-336-7077 sales@walgroupllc.com

37

World Expo Mandalay Bay Resort & Casino Las Vegas, NV July 20-21, 2011 www.worldexpo.rechargermag.com

72

Ziprint Image Phone: 909-869-0730 Fax: 909-869-0736 sales@ziprintimage.com

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LaserLand Copier Card or Coin-op • Coin-op For Color & B/W Copies. Interface Cable & Base Stand Included - $695! • VendaCard Terminal - $495! • Visa, Discover, Master Card & American Express - $795! Call Now Toll Free: [1] 866-374-9314 E-mail: sales@vendapin.com www.vendapin.com/5596sl.html

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Your One Source for HP and Lexmark Printers and Printer Parts. HP 4345 Q3942A $950 HP 40/4100 Envelope Feeder NEW $120 HP and HP 2400 500 feeder New $105 Lexmark HP P4015 Fuser Refurb Exchange $125 Fusers, and HP 3600 Fuser Refurb Exchange $115 Maintenance HP 4200 Maintenance kit OEM New $195 Kits OEM, 3rd Party and HP 4250 Maintenance Kit OEM New $255 Refurb HP and Lexmark 220V fuser and Maintenance Kit in stock too. Register for resale Login at: accutekimaging.com Call toll free (800) 218-9222 Phone: (909) 628-8300 Fax: (909) 628-8533

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3957 Schaefer Ave. Chino, CA 91710 sales@accutekimaging.com


ENX Business Card Directory

May 2011

Calendar of Industry Events & Trade Shows Let Us Turn Your Overstock Into We are the BIGGEST Independent Reseller of KONICA MINOLTA Machine Consumables

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The Escalera CopyCaddy is the one tool you can not be without when moving and delivering copy machines. Using the Escalera CopyCaddy, one person can easily handle most console copiers.

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• Light-weight custom aluminum extrusion design • Padded surface protects the copy machine. • Height adjustable safety strap • Removable all-terrain wheels • It’s a delivery cart and a ramp • 600 pound capacity • 2 deck sizes available: 30”L x 24.75”W 30”L x 32”W • Optional 10” extension leaf increases deck length to 40”

Escalera, Inc. Phone: 530-673-6318 Toll Free: 800-622-1359 info@escalera.com

BTA’s ProSolutions Workshop St. Louis, MO May 2-3, 2011 www.bta.org/BTAMid AmericaEvent.com

CIFEX Holiday Inn Surfers Paradise Gold Coast, Australia June 12, 2011, 2011 rap@therecycler.com.cn

2011 North American MPS Conference The Peabody Orlando, FL May 2-4, 2011 www.MPSCON FERENCE.com

Reciclamais South American Expo Sao Paulo, Brasil June 14-16, 2011 http://www.recicla mais.com/

BTA Mid-America St. Louis, MO May 3-4, 2011 www.bta.org/ DistrictEvents Interop Las Vegas, NV May 8-12, 2011 www.interop.com Managed Print Services Training Print Management Solutions Group Dallas, TX May 12-13, 2011 www.PrintManagement SolutionsGroup.com United Stationers’ Vision 2011 Conference Dallas, TX May 16-19, 2011 http://www.united vision2011.com/ Ricoh Technology Expo at Convergence 2011 Peabody Hotel Orlando, Florida May 24-25, 2011 http://www.fmaudit. com/events Toners 2011 Santa Monica, CA June 15-17, 2011 www.tonerscon ference.com

CDA - Owner/Principal The Broadmoor Resort Colorado Springs, Colorado July 16-18, 2008 http://www.cdainfo.org/ eventspublic.asp World Expo 2011 Las Vegas, NV July 20-21, 2011 http://events.recharger mag.com/home.aspx CompTIA Breakaway 2011 Washington D.C. August 1-4, 2011 http://www.comptia.org/ breakaway/default.aspx Remax Asia Expo Zhuhai, China October 13-15, 2011 www.visitremax. com.cn BTA Southeast Fall Color Conference Waynesville, NC October 21-22, 2011 www.bta.org/ DistrictEvents BTA East Grand Slam 2011 September 22-23, 2011 www.bta.org/ DistrictEvents BTA West Las Vegas, NV November 17-18, 2011 www.bta.org/ DistrictEvents

*Email ENX with your calendar events at:enx@pacbell.net enx magazine

65


SERVICE MANAGEMENT

We Saw It In ENX Magazine

MAY 2011

Calculating Your Service Burden Rate By Ronelle Ingram

L

ately, a wide variety of businesses have been requesting my help to determine an appropriate labor rate to attach to the various levels of products and services that dealerships offer. I recently talked to the owner and his service manager of a $40,000,000+ authorized dealership with multiple offices in five states. This is a successful company that has been in business for over 30 years. The owner candidly admitted, “I know our hourly labor rate is upwards of $90 per hour. But how do I prove that number to my sales department? We have attended all these MPS and service management seminars. We are told that our service department can make 50%+ profits. The problem is most of these profits are supposed to be charged back to our own sales department.” If your field technicians are regularly assisting with sales, enduser training, setting up equipment, working on MPS bids, doing equipment installations, etc. without the service department receiving their fair share of the revenue, you are reducing the hours the tech is available to generate revenue. Your service department will never be able to achieve 50%+ profitability if their available working hours are given to your sales department. “I have the power to shift some of the cost burdens from the service department to the sales department. But I am receiving pressure to substantiate these high costs of the service burden rate. If I pay a senior OEM factory trained, CompTIA Net+ or CDIA certified tech $20 per hour, how can I prove he actually cost the business $90 per hour?” An additional issue dealers face is the desire to improve their efficiency to reduce their burden rate. The problem is intensified because they are not sure how this burden rate is actually calculated. A small dealer from the Great Lakes area asked me, “I know my techs are costing the company about $85 per hour. That’s what the experts keep telling me. But how can management improve our efficiency when it is a mystery to all of us how this $85 per hour is calculated?” These questions are asked by conscientious dealers who realize just matching the competition’s pricing is not the appropriate way to set your own pricing standards. The need to redefine the structure necessary to accurately calculate an appropriate hourly burden rate is a sign of MPS dealers refining the pricing process. There is no way to appropriately determine the actual cost of any of the services provided by your technical or solutions staff without thoroughly understanding the actual cost of each labor hour. If the labor of a field or in house service technician is used in the performance of duties, it is imperative that the correct labor cost be added to the cost of each required sale. If your company offers any of the following mentioned items,

ask yourself how your company calculates the labor cost that must be anticipated when determining an appropriate cost of these items: • Maintenance agreement • Hourly service call rate • Cost Per Copy • Managed Print Services • Installations • Solution Sales • Training of end users • Warranty work • Sales assistance • Document management services • In shop labor • Bid preparation There is no accurate way to determine the cost, price, or profit of any product or service your company offers that involves a service technician if you do not know how to accurately determine what each hour of your service technician’s labor costs your company. The most common mistake made by those trying to figure out a ballpark estimate of the cost of their own service technician’s burden rate is to take the tech’s hourly wage, add 13% to cover the cost of governmental required fees and then add a little bit more. Usually another $5 or $10 per hour should do. Example: The tech makes $15 per hour X 13% = $2 + $10 misc costs = $27 per hour. A savvy business person immediately knows this rate is too low. Owners, controllers and those returning from a multiday MPS or service seminar are consistently told the cost of the service burden rate is somewhere between $70 - $120 per hour. Some dealers are lulled into passive acceptance believing their operating system automatically calculates the precise click cost of each machine, group of equipment, or customer. Most are totally unaware of what hourly burden rate is being used in the calculations. The pre-designated field, which lists the hourly burden rate, is usually located in an obscure changeable field in the software that has never been changed. Those who obsess over a mil or two are missing the greatest deviance in the pricing process. In most office equipment service departments, labor is your number one cost. Without an accurate service labor rate in the equation that is calculating click cost, the resulting answer has no validation. Your measured pricing and profit calculations are completely oblivious to representing your financial reality. I challenge my readers to actually find someone in your dealership who can tell you what dollar value is being used in the hourly labor rate field. Once found I believe the number will be lower than your actual cost. This means any software generated continued on 67

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SERVICE MANAGEMENT

We Saw It In ENX Magazine

MAY 2011

continued from 66

calculations of click cost are totally bogus without your accurate burden rate being used. The reality is most dealers are not fully aware of the most critical component of their costing formula that determines their supposed cost per click. Your current pricing for Maintenance Agreements, CPC, MPS, installations and even a basic one hour long service call has little actual mathematical justification without knowing your true cost of your hourly service labor burden rate. When calculating your technician’s burden rate you must determine the total hours for which the tech is paid; normally this is 2,080 hours per year. Then figure out how much of that paid time is actually available for paid field work. These paid, unworked hours include: vacation, sick days, holidays, jury duty, mandatory daily breaks, car trouble, training, travel and wait time, and meetings. Additionally there are all those government-mandated taxes including FDIC, workman’s comp, social security and Medicare. Plus most employers have chosen to offer costly perks that workers have come to expect including heath insurance, long term disability, mileage and tuition reimbursement, tools, uniforms, training, 401K, etc. Next, there is the responsibility of every employee who generates revenue within your company to carry a portion of your businesses’ overhead. This normally amounts to another $13 to $17 per hour that must be added to the cost of the hourly burden rate.

Once all these calculations are made, the dealer can adjust for (add to the hourly burden rate) the percentage of profit that is expected. By appropriately adding, subtracting, multiplying and dividing all these pertinent expenses and time allotments you can establish a more realistic cost of each hour that is actually available for a trained technician to be able to generate revenue for your company. The need to understand and be able to calculate the cost of the service hour, or burden rate is essential. There is no accurate way to determine the actual cost of the services provided by the technical staff without fully understanding and being able to mathematically substantiate, the actual cost of your service labor hour. To receive a copy of the Excel spreadsheet Ronelle uses to calculate the service technician’s burden rate call or email Ronelle Ingram @ 714.744.9032 or ronellei@msn.com. u Ronelle Ingram, author of Service With A Smile, also teaches service seminars. She can be reached at ronellei@msn.com

www.laserprinterparts.com W EST C OAST P LATEN

enx magazine

67


TECHNICAL TIPS

SERVICE & PARTS DIRECTORY

MAY 2011

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Printer Tech Tips CP 3525 and CM3530 series printers lacking error code As most stepper motors in HP printers will display error codes if not functioning properly, (59.XY error) the CP3525 and CM3530 printer series have been known to have a faulty pick up motor and only display a 13.3 paper jam (no paper movement) when trying to print from tray 2 or manual input tray. This can be verified by opening the right door and defeating the door open switch (fig 1) to watch for the pick up gears to turn,(fig 2) if not, the RM1-4975 pick up motor assembly need to be replaced.

Figure 1

Figure 2

This Tech Tip is contributed by Laser Pros. Visit their website www.laserpros.com or email any question to scotts@laserpros.com. 68

enx magazine


TECHNICAL TIPS

SERVICE & PARTS DIRECTORY

MAY 2011

for sErVICE, sAVINGs ANd sElECtIoN, Go to

thE

At NWRS, you’ll find circuit board repair and subassembly refurbishing solutions for a wide range of products. Receive unmatched quality services that translate into the lowest costs possible for your service department. Take advantage of our: Product Support and Savings • Full line of Canon copiers • Support on full line or Ricoh and Ricoh family copiers • A select but always increasing group of models for Konica/Minolta, Oce’, Kyocera/Mita and HP • Savings opportunities on circuit boards, staplers, motors, printer boards, fuser assemblies, motherboards, hard disk drives and memory components, control panels and scanner products

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enx magazine

69


TECHNICAL TIPS

SERVICE & PARTS DIRECTORY

MAY 2011

FREE TECH HELP Subject: Minolta C252 transfer unit won’t reset—Part 2 Question: Since the last post, I’ve installed a new transfer belt that won’t reset the indication. But when I put the belt in another machine, it reset it fine. The fuse isn’t blowing. The total on the meter board is 64,500, but the transfer life is 128k? I upgraded f/w, tried a new belt, but no change. Swapped NVRAM, new belt, no change. Swapped main PWB-MFP on back, new belt and still no change. Where in the heck is it saving the transfer unit count? Do I need a bigger hammer? Answer: If you are unable to reset the counter after a new Transfer Belt has been installed, C-FB55, C-FB56, C-FB57, CFB58 error codes may be intermittent. Probable causes are: 1.Electrical noise (static) generated at the transfer belt unit section can affect machine control. To improve the new detection accuracy of the Transfer Kit, the method of installing the point of the contact to the rail has been changed. Install the modified grounding spring onto the frame of the transfer belt unit. Please perform the procedures mentioned in Bulletin Number 5186 (bizhub C250/C250P/C252/C252P) and Bulletin Number 5627 (bizhub C300/C352/C352P). 2. The two terminal plate/contacts that come in contact with the Transfer Belt are contaminated or are not making proper contact preventing the reset fuse from opening. For this, you can clean and adjust the terminal plate/contacts as needed. 3. The wires to the transfer belt unit may be disconnected. Remove the left cover (p/n 4038 1024 04) and verify there are two wires connected to the transfer belt unit connector. The upper connector should be blue and the lower connector should be red. 4. The replacement transfer belt unit is used and was previously installed in another machine. When a new transfer belt unit is installed in a machine, an internal component on the transfer belt unit changes state; this now indicates that the transfer belt unit is used. A new unused transfer belt unit must be installed; this will reset the life counter for this unit. Transfer belt for bizhub C250/C250P/C252/C252P -Item #4038077700 Transfer belt for bizhub C300/C352/C352P Item #9J06R70400 Question: Thanks, but the terminals are already the new kind. No error codes. Just an unusually high (128k now) transfer unit life count for 64,500 total meter and swapped main boards and NVram board (with battery) mounted on the main, but still the same “NEED TO REPLACE TRANSFER UNIT” message. The fuse on the last belt I pulled from another C252 (blown as it should be) was 80ma. So any fuse from 53ma, 60ma and 80ma has worked on other C250 & C252 to reset. Three different re-fused belts, (one new) won’t reset this one. My guess is the previous owner or the wholesaler tried an under-rated fuse and damaged the circuit. But what else can I swap while I have a donor beside it? Answer: I may be mistaken, but I think if you remove the left side cover, next to the power supply towards the rear of the machine you will see a PWB with about a hundred connectors. I believe this is the PWB that controls the print engine. Try swapping this while you have it next to another no-good machine. P.S,: just kidding about the number of connectors; it is probably closer to 40. Question: Good workaround! Hytec support helped me locate 70

enx magazine

a removable EEprom on the M board (left side towards rear). It carries the transfer and fuser counts on it. I was able to put a new fuse /trans belt in a good machine with the problem machine’s EEprom and let it reset the counter. Then I put the EEprom and belt back in the problem machine and it’s no longer complaining to replace transfer unit. It’s possible the power supply is bad on the line that blows the fuse, which is the only 2pin CN at top of M board. Until that’s resolved, every 120k (actually about 65k to 80k equivalent) I’ll have to take their EEprom and a fuse out to lunch for a Vulcan Mind Meld with a good machine. Answer: Great work around. It is a pain to swap that board out, and if swapping the EEprom is all it takes, that is good. Subject: Sharp AR 207: Question: I just changed the toner by using the bottle method, but the toner light won’t go off. I can hear it cycling, but the toner light stays on and the ready light won’t come on. I’ve done this several times in the past, but this time it’s not working. What could it be? Answer: Try another chip, or maybe your toner sensor is toast. Or it may have been extremely under-toned. If it took a long time to tone up, check the toner motor rotation. If it’s a broken gear, it’ll try for days to no avail. Question: The toner light is still on and the upper fuser roller is cold to the touch. The lamp should be starting up and the roller should be hot when the machine is on all this time, right? Is there a connection between the two? Is this the cause of the toner light on? Answer: Pull the toner out and find the toner motor shaft at the inside back wall. It probably snapped where the drive pin hole is drilled. Order a new motor and it will have a steel shaft instead of plastic. Save the gear, spring and pin that fell out in the inside back. You have to remove the board in the back and most of the wiring in the plastic channels. It’s a simple but tedious repair. This usually happens when a newly filled toner is put in, because it’s the most hard to turn. Answer: The shaft problem is only for the AR200 and AR205 series. This is never the case for AR207 series machines. My guess is you did not replace your CRUM chip on your toner when you refilled it so therefore it still thinks it’s empty. Answer: I agree, it’s the chip. Replace it and you’ll be good.u Tips appearing in this section are reprinted courtesy of Smarka! The Copier Tech’s Info Source. Tips are randomly selected from submissions emailed to Smarka! Smarka! and ENX Magazine make no guarantees as to the accuracy of tips presented here. Email your tips to Tips@smarka.com. All tips become public domain.

www.platen.com W EST C OAST P LATEN


ÒWhen the going gets tough, the tough hire an MPS expert.Óª

®

You want to get into managed print services? Well, there are two ways to do it. You can spend a lot of time and money training yourself and your staff in MPS, keeping your fingers crossed that the learning curve isnÕt too steep. Or, you can talk to Copier Careers¨. WeÕve got the largest database of copier professionals anywhere, and weÕll help you find the MPS-experienced sales, service, management, and back office experts your dealership needs to stay competitive in todayÕs market. Because the truth is that you donÕt have to know everything about MPS to succeed at it. You just have to hire somebody who does. To learn more, call (888) 733-4868 or visit www.CopierCareers.com

enx magazine

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STANDARDIZED TEST METHODS Jim Martin, Network Recycling Systems

DEMYSTIFYING MPS: FOLLOW THE MONEY Greg VanDeWalker, GreatAmerica Leasing

SERVICING THE P4015 SERIES Steve Geishirt, Parts Now!

GENERATING SALES LEADS WITH DATABASE MARKETING Greg Buschman, Konica Minolta Business Solutions

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NEED MORE MPS? Register now for the Managed Print Summit on July 19 and Save. More information about this best package deal online!

For details and to register, visit:

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©2011 Toshiba America Business Solutions, Inc. and Toshiba Business Solutions. All rights reserved.


ENX Magazine May 2011