Being a copier dealership just isn’t the same in 2015. Whether we want to admit it or not, deep down, it’s a fact that all Office Equipment Dealers (OEDs) know all too well – and when I say deep down, I’m talking about the bottom line.
The chart below from EDA Data, which tracks office equipment leases, shows an overall downward trend for new device placements in the past year alone. While there does seem to be a slight uptick in placements of used devices, the current decline in new device sales means that there will be fewer used devices available in future years.
We’ve all seen it – as deals become increasingly competitive, hardware margins are shrinking, along with CPC rates. Meanwhile, volumes are shrinking, thanks to the paperless office push and general movement towards digitization of everything. Entire industries that used to be production print powerhouses are starting to shift towards digital. In reality, we know paper and MFPs won’t completely disappear from most offices any time soon, but in order to remain relevant (and profitable), something’s gotta give.
So what’s an OED to do? Well, the answer is obvious: find new sources of revenue.
Many of us have already tapped into managed print services (MPS), document management, back file scanning and business process improvement (BPO) – perhaps rebranding as a “Solutions Provider,” a term so broad that Winvale CEO Kevin Lancaster advised businesses discard completely at this year’s Mid-Atlantic Inbound Marketing Summit. I’ve seen other dealers take on water filtration systems and digital signage, but it’s going to take more to move the needle in the face of shrinking page counts and the move to digital.
Since you read the title of this blog, you probably know where I’m going next – Managed IT Services! While print budgets seem to be shrinking, IT budgets are on the rise. Computerworld predicts that IT budgets will see an average increase of over 13% in 2015. Adding Managed Services (MS) to your dealership’s offerings may sound like a no-brainer, especially if you’re lucky enough to garner the support of a partner like Continuum, but you must do so strategically to be successful.
Here are the 3 most important components of success I’ve identified through Meridian’s journey from a copier dealership and “Solutions Provider,” to a full-fledged Managed Services Provider (MSP).
1. Clear direction and messaging
First and foremost, before you introduce your new status as an MSP, you must establish clarity about your new product/service offering(s). Managed IT services is almost as broad a term as Solutions Provider, so nail down and document what your managed services offerings do and do not include.
Some things to think about include:
- Who are your ideal prospects and target market(s)? (# of users, # of servers, industries, etc)
- What are your help desk hours?
- What kinds of issues will be solved remotely via help desk, and what issues will require on-site support?
- Will you offer support for cloud services (hint: YES!), and what does that look like?
- Will you support niche line-of-business applications?
- Will you take on project work for clients whose networks you don’t yet manage?
It’s essential that you nail down the key aspects and clearly define your managed services offerings, as they will drive your ability to succeed. Plus, lack of clarity can hurt your credibility in the eyes of both clients and employees. On the other hand, equipping your employees with clear messaging about managed services empowers them to identify new MS sales leads, which I’ll discuss more below.
2. Ongoing training for all
It may seem obvious, but training is an essential part of your successful transition to an MSP. Of course, you’ll need appropriate training for your Network Operations Center (NOC) and technical staff to enable them to appropriately support your MS clients, but it shouldn’t stop there.
Managed services sales are different from copier sales, so be ready for some extensive, ongoing training. Your MS sales training must be a comprehensive soup-to-nuts curriculum, including your offerings, value propositions, target markets and your MS sales process – which will be different from your copier sales process. For my team, a combination of group trainings and 1:1 role-plays has proven to be a winning formula for sales training, along with designating a dedicated training resource to structure and measure the program.
Make sure your sales teams also have an understanding of the current technology buzzwords and how they do or do not apply to your managed IT services offerings. For example, even if you don’t plan on supporting BYOD, your reps should be able to talk intelligently on the subject to a certain extent, without making promises they can’t keep. A lack of clarity combined with a creative rep could land you in a sticky situation; so make sure your sales team is not only clear on your capabilities, but also knows when to bring in technical support or a specialist to answer the tricky questions.
In addition to training the employees who are directly responsible for the success of your dealership’s managed services division, you should also train your other teams. From your copier techs, to dispatch and customer service reps, training your entire team not only ensures buy-in, but also creates a built-in source of sales opportunities for your MS offerings. It helps to embed employees who are more familiar with MS among those who are less familiar with them.
My marketing team recently spent a few months working alongside our CPC IT help desk team, who troubleshoots networking issues for our copier clients. This helped me identify opportunities for our copier help desk techs to introduce managed services to copier clients who fit our MS target prospect profiles. Together, we worked with the help desk team to find low-pressure ways to start the conversation and qualify leads. Having a program to compensate non-sales employees for uncovering new sales opportunities definitely helps encourage participation, as well. However, if you don’t spend the time explaining and training those employees on your offerings, you won’t reap the full benefits of such a program.
3. Don’t abandon your bread and butter
Last, but certainly not least, don’t forget about the business unit that got you here in the first place – office equipment. The truth is, many of your office equipment clients may never be good managed services prospects, and that’s okay. They’re still a valuable component of your dealership’s success and you must be sure to treat them as such.
As you create content like blogs, white papers, and guides to educate clients and improve your website’s SEO, make sure you’ve got a good mix of topics that relate to all of your product and service offerings. Showcase your ability to be a multi-functional business partner to your clients, rather than simply a copier vendor or their “IT guy.” Clients will appreciate your unique perspective, even if some of your services aren’t a fit for them.
For example, although we have a GSA contract for copiers and a local award from US Communities, Meridian’s IT offerings aren’t a good fit for our office equipment clients in large federal and state/local government agencies. However, the technical expertise that we’ve gained as an MSP enables us to better understand their evolving needs, such as integration between cloud services like Microsoft Office 365 and MFDs.
What challenges has your dealership encountered in transitioning to an MSP? What tactics have proven successful for you? I’d love to hear your thoughts – continue the conversation with me on LinkedIn or Twitter!
UPCOMING WEBINAR: Increasing the Value of Your Business- Even If You're Not Planning to Sell Right Now
Join Mike Dudek of Zygoquest and Mitch Morgan of Growth Achievement Partners for an informative session that will assist you and other OEDs with increasing business value. Dudek and his partner Rich Wisniewski have advised hundreds of sellers on making the most of the business value. Morgan, and his partner Chris Ryne, have built (with Continuum) the Business Model for Managed Services assisting MSP’s with the metrics to enhance operating performance and value. Register for tomorrow's OE webinar at 2 PM EST!
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