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Business as Usual is no Longer an Option for Imaging Dealers

06 March 2019 | Norm McConkey


 

 

Last week BEI Services shared some numbers from the 4 million devices that flow through their system. The numbers reflect the average monthly page volumes (AMPVs) over the past five years. Some of the numbers are just bad. The rest are terrible. How bad are they? What can we do about it? Let’s dive in.

 

First, let’s look at the page volume decline.

 

Page_Volume_Decline

 

Most of these trend lines are fairly consistent. Production Color as a segment is perhaps the one positive area, if not sporadic. A focus on helping businesses stop outsourcing larger print jobs and bringing them in-house with affordable production is likely the cause of this distinction.

The segment of SF Mono is in full retreat. Makes sense right? Who the heck sells those archaic dinosaurs today? Prevailing logic has been that these pages have been migrating up to the other segments—but the data clearly refutes this. The other segments are also in steady decline.

 

The most troubling trend for Imaging Channel dealers is the remarkably consistent decline of A3 color. It shows a 50% decline in AMPVs over the 5 year period. With the economy growing at a 4% clip over that time, it's even worse.

 

As they say in the infomercials...But wait, there’s more!

Remarkably_Consistent_Decline_of_A3_Color

 

This data set contains over 4 million devices. I’ve highlighted the first three segments, which make up 2.3 million of those devices or roughly 87% of all the devices in the database. Keep in mind these devices are all managed devices, so they are under some sort of MPS, or at a minimum, a service contract.

 

Implications?

  1. Based on volumes, most of these placements would be EASILY managed by an A4 color MFP, with costs of less than $1000, or $2000 for higher volumes.
  2. Those A4 devices are 3x LESS LIKELY to break down, and can easily match per page costs for supply and service contracts.
  3. Placing devices with low page counts will increase your service costs per page, and therefore reduce profits.
  4. A new A3 color MFP placement, with a current AMPV of 5K pages, will be printing 3400 pages per month in five years.

 

Are you still doubting the facts? No dealer is immune to this reality. There are still opportunities to sell (Upsell? Oversell?) A3 hardware, but with each passing year, those opportunities decrease.

 

I think this is great news! Why?

  • You need to change your business/sales strategy, or you will not survive.
  • Most of your competitors probably won’t change, so they will go away.

 

Pages are still being printed. Profits can be made, but if you don’t change your product mix, your sales strategy, and your service model, you won’t be here by the time that A3 device in the above example hits its renewal.

 

Let’s talk about your digital strategy. Let’s do it today.

 

 

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About the Author

Norm McConkey

Norm McConkey has been involved in the print, imaging, and software/tech business since 1993. Holding executive level positions in a number of emerging technology firms, he founded PrintFleet in 2003, and Tangent MTW in 2009. A founding member of the MPSA, an award winning author and presenter, Norm has spoken at various industry events around the world including the Lyra Imaging Symposium, Photizo confernece, ITEX Tradeshow, Regional BTA conferences, Remax Europe, and World Expo. He has been contracted to consult and build go to market and sales training programs with several OEM manufacturers such as Canon USA, and HP, and distributors such as Parts Now and Supplies Network, as well Resellers including Office Depot. Norm’s current project, MPSToolbox (www.mpstoolbox.com), is a software platform which helps technology dealers develop and maintain e-commerce websites.

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