June 2023 Office Technology

CONTENTS

FEATURE ARTICLES

10

Refreshing Expansion Dealers embrace water coolers for diversification

by Brent Hoskins

Office

Technology

Magazine

Where there is change, there is opportunity. The rise of the pointof-use water purification system is one such opportunity. This article includes profiles of three dealerships focused on their strides in the water cooler business.

16

Toshiba & Ricoh Join Forces

New joint venture

announced May 19

Compiled by Elizabeth Marvel

Office Technology Magazine

On May 19, 2023, in Japan, Toshiba Tec Corp. (TTEC) and Ricoh Corp. announced the creation of a new joint venture (JV) between the companies. Larry White, president and CEO of Toshiba America Business Solutions (TABS), held a virtual press conference explaining the announcement.

Q&A: Michael Hannon

FP executive addresses postage meter opportunity

Compiled by Brent Hoskins

Office Technology Magazine

Recently, Office Technology magazine interviewed Michael Hannon, managing director for North America at FP Mailing Solutions, a provider of mailroom and shipping solutions with products in more than 230,000 mailrooms worldwide. Founded in 1923, FP is celebrating its 100th year.

PRINCIPAL ISSUES

24 DocuWorld 2023

DocuWare hosts partner conference May 4-5

by Elizabeth Marvel Office Technology

COURTS & CAPITOLS

25

Hiring & Firing Best practices to consider for both situations

by Robert C. Goldberg BTA General Counsel

Finding and retaining good employees is a challenge every dealer faces. Hiring someone who is already trained allows for an immediate contribution to the organization without the time and expense of bringing an unfamiliar individual on board.

DEALERS HELPING DEALERS

27

MPS Success

Dealers share their experiences & CPC rates

Compiled by Brent Hoskins

Office Technology Magazine

This article includes two related questions submitted by a dealer member as part of BTA’s Dealers Helping Dealers resource, and several of the answers received. These answers and many others can be found in the members-only section of the BTA website.

29

The Future of Selling Can artificial

intelligence replace salespeople?

by Troy Harrison

Troy Harrison & Associates

The sales profession is facing an entirely new type of competition. Whether it will be a game-changer is yet to be seen. The topic of a recent LinkedIn poll was: “Can salespeople be replaced by artificial intelligence (AI) in five years?”

DEPARTMENTS

Magazine

DocuWare hosted DocuWorld 2023, its 23rd-annual partner conference, May 4-5, 2023, in Orlando, Florida. The event consisted of a general session by company executives, a keynote address by Shari Levitin, breakout sessions, sponsor exhibits and networking opportunities.

26

National Conference to Be Held Aug. 30-31

This year’s BTA National Conference will be held Aug. 30-31 at the Renaissance Boston Waterfront Hotel in Boston, Massachusetts.

Co-hosted by BTA East and BTA Mid-America, this year’s national conference will feature: a keynote address by 1980 U.S. Olympic Hockey Team Captain Mike Eruzione, a featured speaker, three additional educational sessions presented by industry leaders, a diversification dealer panel discussion, four breakout sessions, time to network with peers and exhibiting sponsors during breaks, and a dinner cruise aboard the Spirit of Boston.

The event will kick off at 7:30 a.m. on Wednesday, Aug. 30, with breakfast, followed by opening comments and the keynote address, “Miracle on Ice: Insight Into Leadership & Teamwork.” During the keynote, Eruzione, captain of the 1980 “Miracle on Ice” U.S. Olympic hockey team, will show attendees how they can draw on their teams’ experiences to take their dealerships to new heights, ensuring they are on pace to win in today’s competitive business environment.

Following the keynote, attendees will have the opportunity to visit with exhibitors or attend one of three breakout sessions:

(1)“The New Office Battleground: Building a Successful Business for the Future of Office Print,” presented by Robert Palmer of IDC;

(2) “Prospecting to Win,” presented by Rick Lambert of selltowin and In2communications; and (3) “Why You Should Consider the VoIP Opportunity,” a dealer panel with the moderator and panelists to be announced. After the breakouts, BTA General Counsel Bob Goldberg will present his educational session, “Those Were the Years.” Lunch will follow Goldberg’s session.

After lunch, John Lowery and Casey Lowery of Applied Innovation will present their educational session, “Purpose & Culture.” A break will follow, giving attendees time to visit with peers and exhibiting sponsors. A diversification dealer panel, “Making Strides: Inspiring Stories of Diversification” (moderator and panelists to be announced), will follow the break, wrapping up the first day’s educational sessions. From 6 to 9 p.m., attendees will enjoy a dinner cruise aboard the Spirit of Boston.

The second day of the conference will begin at 7:30 a.m. on Thursday, Aug. 31, with breakfast, followed by the featured speaker, SEAC John Wayne Troxell, retired U.S. Army senior noncommissioned officer and founder of PME Hard Consulting LLC. He will present “How to Transform Your Business,” focusing on what dealers can do to maximize their potential, distance themselves from the competition, stay at the cutting edge of markets and build cohesion within their organizations. Exhibit time will follow the session. Then, from 10 to 11 a.m., dealers can choose to have more networking time, attend the Palmer or VoIP panel breakout sessions repeated from the first day, or Lambert’s second breakout, “LinkedIn to Win Team Road Map.”

At 11 a.m., the final education session will be held. Tami Beach of HP Inc. will present, “The Impact of Megatrends on Your Dealership & Customers.” After Beach’s session, the event will wrap up with closing comments and prize drawings.

Two-for-one BTA member dealer registration is only $199. That price includes the Wednesday and Thursday educational sessions; breakfast on both days; and Wednesday’s lunch and dinner cruise.

For more information on the 2023 BTA National Conference, see pages two and three, or visit www.bta.org/BTABoston. n

— Brent Hoskins

Executive Director/BTA Editor/Office Technology

Brent Hoskins brent@bta.org

(816) 303-4040

Associate Editor

Elizabeth Marvel elizabeth@bta.org

(816) 303-4060

Contributing Writers

Bob Goldberg, General Counsel Business Technology Association

Troy Harrison, Troy Harrison & Associates www.troyharrison.com

Business Technology Association

12411 Wornall Road

Kansas City, MO 64145

(816) 941-3100 www.bta.org

Member Services: (800) 505-2821

BTA Legal Hotline: (312) 648-2300

Valerie Briseno Marketing Director valerie@bta.org

Brian Smith

Membership Sales Representative brian@bta.org

Photo Credits: Adobe Stock. Cover created by Bruce Quade, Brand X Studio. ©2023 by the Business Technology Association. All Rights Reserved. No part of this publication may be reproduced by any means without the written permission of the publisher. Every effort is made to ensure the accuracy of published material. However, the publisher assumes no liability for errors in articles nor are opinions expressed necessarily those of the publisher.

FLASHBACK

The association’s magazine cover 61 years ago this month — the NOMDA Spokesman, June 1962.

Is It Time to Give Back to Your Association?

On this beautiful May morning as I sit in my home office writing my last President’s Message, I am reminded of what Mark Twain once said: “The two most important days of your life are the day you were born and the day you find out why.” For me, the former was half a century ago. I am fortunate that the latter came early in life.

I was only 14 years old when I realized the power of contributing to others, the power of influence and the power to change. I have known since that young age that, for me, life was best lived with a heart focused on elevating others. There is no doubt this is why I was drawn to become a volunteer in this great organization.

It was none other than [2018-19 BTA President] John Eckstrom who initially introduced me to the idea of volunteering. John petitioned me while we were attending an IBPI meeting in Orlando, Florida. The meeting was held in conjunction with one of the Business Technology Association’s (BTA’s) Spring Break events — similar to the upcoming 2023 BTA National Conference, to be held Aug. 30-31 in Boston, Massachusetts (see pages two, three and six for details).

Admittedly, at the time of John’s invitation, I was young in this industry. I had less than a decade of experience in sales leadership. This fact caused me to pause initially as I questioned the value that I could offer BTA, as I had only recently become an owner and managing partner at RITE Technology.

John persisted relentlessly while helping me to see that as a BTA volunteer board member, I would simply be an advisor and ease into a more active role if desired. I can recall being motivated by the idea of interacting closely with other men and women

who were leading organizations like mine. This thought, combined with an internal compulsion to contribute to the success of others, led me to say “yes.”

As I ponder these memories while typing this message, I am so very grateful I chose this path. I look back over this journey and it is storied with great friendships that have not just made an impact in my business but, more importantly, on my soul.

To all BTA presidents who have come before me — including John, Bob Evans and Tim Renegar — I am forever grateful for your leadership paving the way. To those who are now leading — Don Risser, Adam Gregory and Debra Dennis (who will join the national officer team on July 1) — I celebrate your service.

BTA is the amazing resource that it is today because of people like each of you who are caring enough to consider the value of a seed sown for our futures. That legacy lives on as the baton of BTA leadership passes on in July.

Like me, many of you had the fortunate experience of hearing the wisdom of industry great Mike Riordan when he spoke at BTA’s Spring Break event this March in Orlando. Among many things, he taught us to not live our lives caged by imaginary bars or limiting beliefs. Together, let’s choose to follow Mike’s counsel and reach for the stars with hope and optimism for the future of our industry. Do not stop at hope and optimism — be like Mike who so eloquently exemplifies that it is better to give back.

In my final request as BTA president, I ask that you consider this: Is it your time to step into the ranks of BTA volunteer leadership? Are you ready to help forge BTA’s future, ensuring a thriving association for many years to come? Talk with your BTA district board leaders to get the process started today. n

— David Polimeni

2022-2023 Board of Directors

President

David Polimeni RITE Technology Sarasota, Florida dpolimeni@ritefl.com

President-Elect

Don Risser DCS Technologies Corp. Franklin, Ohio don.risser@dcs-tech.com

Vice President

Adam Gregory Advanced Business Solutions LLC St. Augustine, Florida adam@goabsinc.com

Immediate Past President

Tim Renegar Kelly Office Solutions Winston-Salem, North Carolina trenegar@kellyofficesolutions.com

BTA East Mike Ardry Automated Business Solutions Warwick, Rhode Island mardry@absne.com

Mike Boyle BASE Technologies Inc. Bethel, Connecticut mboyle@baseinc.com

BTA Mid-America

Brantly Fowler Zeno Office Solutions Inc. Midland, Texas bfowler@zenotx.com

Greg Quirk JQ Office Equipment Omaha, Nebraska gquirk@jqoffice.com

BTA Southeast Debra Dennis CopyPro Inc. Greenville, North Carolina ddennis@copypro.net

Jim Buck Carolina Business Equipment Inc. Columbia, South Carolina jimb@cbesc.com

BTA West Dan Bombard Yuma Office Equipment, a Fruth Group Company Yuma, Arizona daniel@yumaofficeequipment.com

Mike McGuirk ProCopy Office Solutions Inc. Mesa, Arizona mmcguirk@procopyoffice.com

Ex-Officio/General Counsel

Robert C. Goldberg Schoenberg Finkel Beederman Bell & Glazer LLC Chicago, Illinois robert.goldberg@sfbbg.com

Boost your business performance with Toshiba's cloud and print solutions.

Productivity and focus increase with printed materials. So, how can you optimize your print environment? Toshiba offers a wide range of e-STUDIO™ multi-functional printers that bring the right mix of speed, ease, and security to enhance productivity across your business operations. We understand that every business is unique, and that's why we offer customized solutions to help streamline any organization. Discover more at business.toshiba.com

Refreshing Expansion

Dealers embrace water coolers for diversification

by: Brent Hoskins, Office Technology Magazine

Where there is change there is opportunity. The rise of the point-of-use water purification system, steadily displacing the dinosaur of the industry — the water-jug cooler — is one such opportunity.

Below are profiles of three dealerships focused on their strides in the water cooler business. If you are considering the opportunity, perhaps the insight and guidance they provide will be well received.

Kelly Office Solutions

If you are familiar with Kelly Office Solutions, based in Winston-Salem, North Carolina, then you know that the dealership’s president and co-owner, Tim Renegar, is grooming his two sons to one day lead the company. The brothers are responsible for the dealership’s diversification strategies. Today, Blake Renegar manages the IT division, while Brice Renegar manages the water division.

The dealership primarily focuses on products from Ricoh, Konica Minolta, Brother and Epson, but looking at its water division in particular, it also sells water and ice products from Wellsys, Follett, Manitowoc and FloWater. In addition, the division sells air purifiers and coffee makers. “Currently, we have about 1,200 machines in the field,” says Brice Renegar. “Our goal is eight machines a person per month.” The division has three people focused on sales, and two techs handling installation and maintenance.

The demand for water purification systems in the workplace is on the rise, Renegar says. “For the past 50 years, the water-jug cooler has been the crème de la crème of water outside of the tap,” he says. “However, starting in about 2016 — and especially during the COVID-19 pandemic — water purification became more in demand. People started to figure out that moving to purification systems provided better-quality water and was a lot more eco-friendly [eliminating the plastic water jugs and the use of gas for regular pickup and delivery of the jugs].”

In terms of water quality, one only needs to think about the nature of water-jug coolers, Renegar says. “The five-gallon jug

has nothing to combat bacterial growth,” he explains. “It’s an open-air system. When you release the tap, you see the air bubbles go into the system. Those bubbles are basically just the air from your room. All of the dust and particles in the air are now in the water.”

A water purification system using reverse osmosis provides a stark contrast, Renegar says. “There is absolutely zero parts per million [bacterial] growth because in our systems we have an LED UV light in the tank,” he says. “It’s constantly sterilizing the water. It doesn’t allow any growth to happen.”

Reverse osmosis? Renegar explains. “Reverse osmosis is the process of purifying water through a membrane,” he says. “The membrane’s pore size is 0.0001 microns, so very, very small. To give you a sense of the size, a human hair is about 40 to 60 microns. It’s like pushing water through a wall, which means everything outside of pure H2O gets flushed down the drain. The only thing that actually makes it through is purified water.”

The next step involves a BioSure filter, which puts electrolytes and minerals back into the water, while increasing the pH level as well, Renegar says. “It puts calcium, potassium, magnesium and about 15 other elements in the water. Think of it like you are drinking a little vitamin pill. We have learned that it actually helps your body fight off infections. It keeps people healthier and at work longer; they are not spreading viruses back and forth using the water system [the dealership offers products that have antimicrobial agents baked into the cooler’s plastic and recessed nozzles]. Therefore, it makes your business more efficient.”

Once they understand the process, customers are quick to embrace their water system upgrade, Renegar says. “My goal is to set up a demo unit,” he says. “If you can get a demo into a customer’s building, eight out of 10 times they’re going to keep it. The goal is a one-week demo, but we have learned that it is advantageous to go back out on day three. It’s fresh on their minds, they are still getting used to it and

Marvin

Copier Dealers across the country have successfully added water dispensers as a natural product line extension for their existing business.

Pure Water Technology® o ers a comprehensive program to help YOU become SUCCESSFUL in the multi-billion dollar B2B drinking water industry.

Benefits:

Increased customer loyalty

High profit recurring revenue model

Low cost of entry

Sales and marketing start-up kit

Financing options

they love it. So, we go back in on day three and try to close the deal right then and there. You go in to check on the unit, grab the decision maker and get the deal done instead of waiting a full week.”

New Jersey Office Systems

“If you can get a demo into a customer’s building, eight out of 10 times they’re going to keep it. The goal is a one-week demo, but we have learned that it is advantageous to go back out on day

Seven-and-a-half years ago, Shawn Donelson established his dealership, New Jersey Office Systems (NJOS), based in Cranbury, New Jersey. “I wanted to have complete control over support, service and the deals,” he said, referencing the change he sought from his years working for others. “So, I made the decision to go out on my own. I wanted to run my own company.”

NJOS, a Kyocera-authorized dealership, is not limiting itself to imaging devices. “Everyone knows print counts are going down,” Donelson says. “So, we’ve added other services over the years, such as VoIP. During one of the BTA events, we met with Wellsys [a brand of Quench U.S.A. Inc., which is owned by Culligan Water]. They referred me to a few dealers offering water. I spoke to them and they convinced me that it would be a good addition. As a matter of fact, a couple of them said they were doing so well with water — selling more water than copiers — that they actually sold their copier businesses and are now just selling water.”

This is a new venture for NJOS. “We signed on in December,” he says, referring to the Water Logic [another Quench brand] water purification systems and ice machines now sold by the dealership. “We went live at the beginning of March.” NJOS also brought on two niche water brands — Brio and Borg & Overstrom.

Donelson sees the products, in part, as a way to win more imaging deals. “You’re out prospecting, talking to a customer about their copiers and they are, say, one or two years into a five-year lease,” he says. “Now we can offer another product and get our foot in the door, letting them see our service and how our company operates. That gives us a ‘soft in’ when that copier lease expires.”

With the launch of the water systems, NJOS replicated its launch of VoIP, which began with an email campaign. “After we sent out that email, we signed between 15 and 20 VoIP contracts almost immediately,” Donelson says. “With water, after sending out an email, we had three or four hot prospects and set up meetings.”

As a newcomer to water systems, Donelson can readily provide advice to other dealers who may be considering the opportunity. “Make sure you have the right location for

— Brice Renegar Kelly Office Solutions

preparations and that you have the right materials,” he says. “You need to make sure you have a dump sink, buckets, water lines, clamps, saddle drains and fittings. There is a whole slew of things you are going to need. Looking back, I wish I had been better prepared in the beginning; I think we would have been a little further along today.”

Donelson also advises dealers to secure an insurance policy protecting against any damage that may occur during installation or leaks. In addition, he says, dealers need to recognize the possible need to partner with an installer. “Some municipalities require that you have a licensed plumber to handle installations [the products tap into water lines like a refrigerator’s ice maker],” he says. “I partnered with an appliance installer who is insured, bonded and licensed. We have a set fee and I just incorporate that into my pricing. We also have two people on staff who are trained to handle installations, but they are not licensed. In situations where we can, I use them.”

Regarding municipalities, Donelson shares a unique strategy for finding prospects. “Look up what they allow for the total dissolved solids in their water — their TDS,” he advises. “Some allow 400 to 500 TDS. When you are using filtered water, you can get that down to between 80 and 110, and when you are using reverse osmosis, it goes down to below 20. The higher a community’s TDS, the more likely businesses are to have an interest in a water [purification] system.”

Donelson is optimistic about the future of NJOS with the water business as a contributor. “By next year, I expect to double our annual revenue with what we’re doing with copiers, water, coffee [another new addition] and VoIP,” he says. “I will probably have three or four water reps added in the next year and may branch that away from NJOS, running the water business as a separate company.”

United Business Systems

When John Kerling, who serves as vice president of United Business Systems (UBS), based in Buffalo, New York, assumed the daily management of the dealership along with his two brothers from their father, Wayne, the elder Kerling had extra time on his hands. So, his entrepreneurial spirit took him in a new direction. “Over the years, a few of his [Wayne’s] dealer friends had gone into the water business and found some real success in it,” Kerling says. “So, he decided he was going to start a water company, Pure Water Technology of Western

three.”

New York. He hired two salespeople and a service tech and started attacking the water business here in Buffalo.”

Today, 15 years later, the water company has 12 employees — five sales reps, a sales manager, a service manager, three techs, one admin and a telemarketer, Kerling says, noting that the day-to-day operations are managed by his mother, Cheryl Kerling, and sister, Jennifer Pohlman. The company, which sells Wellsys water and ice products, as well as ION sparkling water coolers, op erates under the umbrella of UBS, a Canon, Ricoh and Lex mark-authorized dealership. “We’re doing $2-million worth of water business annually,” Kerling says. “I think that in the next three years, we’re going to double that.”

What is the basis for Kerling’s optimism? “With 2,600 to

2,700 units now in the field, we can see what people want,” he says. “When we walk into deals, people want this stuff. The growth is there. Plus, younger people don’t want to drink from a water jug and they don’t want

“Now we can offer another product and get our foot in the door, letting them see our service and how our company operates. That gives us a ‘soft in’ when

next to every water cooler throughout the place. Just the visual of that; it was as if they were begging us to sell to them. Where there is a five-gallon jug, there’s an opportunity.”

The reason UBS entered the water business was the appeal of having another source of recurring revenue, Kerling emphasizes. “We have a set dollar amount every month, ‘to service your machine when it needs to be serviced,’” he says. “Then, once or twice a year, depending on the service schedule, we come out and change your filters [the supplies revenue opportunity], clean and sanitize your machine.”

After the initial lease term on the equipment ends, “it really becomes a great piece of revenue for dealers,” Kerling says. “It’s a ‘buck-out’ term with the leasing company, then you just take over the equipment and start billing the monthly fee yourself,” he says. “It’s different than the copier industry where you are constantly trying to upgrade to the newest technology.”

In the case of UBS and its water company, “we’ve benefitted big time because we started our own leasing company,” Kerling says. “At the end of the day, having our own leasing company has helped us tremendously with recurring revenue because we own all of the paper on the equipment from the beginning.”

It appears that office technology dealers are increasingly recognizing the benefits of diversifying with point-of-use water purification systems, Kerling says, noting that in a recent conversation with a representative of Quench, he was told that “their biggest growth comes from copier dealers right now.” The Quench rep also reported that “point-of-use is growing at 8.3% per year,” he says. “That will account for 34% of the market by 2024, up from 28% in 2020. There are still so many water-jug systems out there. That’s why there is so much growth left in this business.” n

Brent Hoskins,

executive director of the

Business Technology Association, is editor of Office Technology magazine. He can be reached at (816) 303-4040 or brent@bta.org.

“It really becomes a great piece of revenue for dealers. It’s a ‘buck-out’ term with the leasing company, then you just take over the equipment and start billing the monthly fee yourself.“

— John Kerling United Business Systems

Toshiba & Ricoh Join Forces

New joint venture announced May 19

Compiled by: Elizabeth Marvel, Office Technology Magazine

On May 19, 2023, in Japan, Toshiba Tec Corp. (TTEC) and Ricoh Corp. announced the creation of a new joint venture (JV) between the companies “whereby the manufacturing from each entity will be transferred to a new joint venture” with the goal of gaining “manufacturing efficiencies for common components while expanding both companies’ addressable markets through product synergies.”

Through this joint venture, TTEC and Ricoh will maintain separate distribution channels. Each company will individually buy its products from the JV, while maintaining its own IP and go-to-market strategies. The anticipated start of the new JV is the second quarter of 2024. Toshiba expects new products from the JV to be available in 2026, but the final details are yet to be determined.

On May 19 in the United States, Larry White, president and CEO of Toshiba America Business Solutions (TABS), held a virtual press conference explaining the announcement and allowing attendees to have their questions answered. Following is a transcript of his comments.

Timeline of Events

White: First, let me give you an outline of events as they occurred yesterday [May 19, 2023] in Japan. Yesterday at 8:30 a.m., both Ricoh and Toshiba Tec, made what was called a timely disclosure to the appropriate governing bodies. And that timely disclosure [shared] their intent to form a joint venture for the purpose of development and manufacture of multifunction printers [MFPs], aftermarket and bar-code products.

That was the first thing that happened. The second thing after that was the timely disclosure went to both companies’ boards. They had to have approval by the board of directors for each company. Ricoh’s board of directors approved the measure, as did Toshiba Tec’s board of directors. And then lastly, at three o’clock, a formal announcement was made by

both companies to the press. That is the timeline of how things transpired yesterday in Japan.

Why Start a Joint Venture?

White: Experts say that the total expected placements of MFPs — and you all know this — is expected to decline 3% to 7% per year. Now, that creates a lot of problems. As a manufacturer, the most important thing — the most expensive thing that you have — is in the expense of manufacturing products. As we know, prices are going down, the cost of manufacturing is going up. It was imperative that both we and Ricoh and, in fact, for that matter, every company in this industry [address this]. We chose to address it by forming a joint venture with Ricoh Corporation.

What Was Announced?

White: What was announced and what is a joint venture overall? First off is the JV, announced yesterday. However, it’s not expected to commence until probably the second calendar quarter of 2024. So we’re still a year away from the actual JV taking place. For product development, from 2024 on, all products will be manufactured by the joint venture. What’s interesting with that is the joint venture will continue to manufacture both our products and Ricoh’s products with their current product lines. You will not see, however, product that is mutually developed by the JV and manufactured until probably the 2026 time frame at the earliest, and probably more toward the middle of 2026. So, as details come up with that, we’ll get you more information.

As I mentioned earlier, it’s for manufacture of MFPs, aftermarket toner and Toshiba bar code. The JV will be managed by representatives from both companies, and both companies will have representation on the board of directors for the joint venture, which is really important. So it’s not one company or another exclusively managing the

joint venture. It truly is a joint venture, a joint company between both Toshiba Tec and Ricoh Corporation. And this is really important, especially for our dealer customers. Both companies will individually buy their products from the JV while we’re still going to maintain our own value-added software and go-to-market strategies.

Although the basic components of the product will be similar or the same, how we go to market and the differentiation of the product will be key.

The other part of this is that both companies will continue to maintain their independent and solely separate distribution channels, and that obviously includes us here at TABS.

Goals of the Joint Venture

White: What are the goals of the joint venture? Why was the joint venture formed? The first part is obviously the efficiencies and scale you get from both companies’ total production. This is truly important, especially when costs are continuing to rise. The other part is that — and a lot of people don’t really think about this — but this came to the forefront during the global pandemic: There is a lot of geopolitical risk out there and part of that was caused by, for example, China [shutting] down on the spur of the moment for weeks on end affecting your components suppliers. So this really reduces the risk that you have on a geopolitical scale.

The other part of it, which a lot of people don’t pay attention to, is the cost of manufacturing. One of the reasons it’s going up is because of the global environmental compliance that you have to have with your products. Different countries can have different compliance structures, so it gets more complicated. This is going to help mitigate that. The other thing is, it will also allow us to focus — in both companies by the way — on other areas. For us, one of our key areas is growth in our bar-code solutions, in our managedprint-as-a-service [MPaaS] solutions and our software solutions that sit on these edge products known as MFPs. So this is going to be very, very important for us in the future. The other thing is that we’ll be able to expand some product offerings in the future.

People are going to wonder: Is Ricoh going to have availability to Toshiba’s products? Is Toshiba going to have availability to Ricoh’s products? Well, you know, their status is still to be determined, but it will expand both of our company’s future product offerings.

Also, at the bottom of this — and this is really important

— is JVs are often overlooked in what they accomplish. And this is a statement from Deloitte; we pulled this from one of their reports. The average JV participants’ return on equity increased significantly from 1% to 7% above the industry average for a period of four to five years. That’s really important.

So this allows us, if we execute, greater flexibility to invest in other areas of future growth for both of our companies.

On the chart to the right on your presentation [White shared a slideshow during his presentation], you’ll see a graph of the different global share of these different manufacturers. For example, you will see in the red, that’s the combined manufacturing scale based on IDC’s unit placements from 2022, that Toshiba and Ricoh make up 22.2% of the global shares. Our combined global volume is going to be huge. And if you compare that to the second biggest, which is Canon, we’re 28% greater in the total volume. That’s going to give us incredible economies of scale once again on the manufacturing side. It’s going to be interesting to see how everybody else in the marketplace reacts to these types of joint ventures that we form. It’s going to be very important for our business moving forward. And, again, we’re going to see some tremendous economies of scale from this.

As I mentioned earlier, although final details are not yet determined, we don’t anticipate any mutually developed and manufactured products coming for about three years — so the 2026 time frame. The difference between the products will be great. They will be differentiated. For example, our products will have a different set of solutions, a different set of apps, and we’ll have the Elevate Sky suite of products and services embedded into our products. Ricoh’s will not. And our products will not have the Ricoh embedded apps and solutions that come with their products. So they will be greatly differentiated.

We will be moving forward in a number of areas. Again, we talked about expanded MFP product offerings, which we’ll be examining as the future comes about. It’s going to be really interesting to see what happens over the next three years.

Examples of Joint Venture Success

White: Joint ventures don’t get a lot of press. And so I want to give you an example of a recent joint venture that has turned out to be very, very profitable and very successful. There’s a joint venture between Lockheed Martin and Boeing. It’s called ULA [United Launch Alliance]. And it was created to compete against SpaceX in the global race for delivery mechanisms into space — rockets

The difference between the products will be great ... For example, our products will have a different set of solutions, a different set of apps ...

delivering astronauts to the International Space Station, supplies, satellites into orbit, things of that nature. Both Boeing and Lockheed were very interested, but they didn’t have the resources nor the technology capabilities to get there. They formed a joint venture a number of years ago. And now ... they’ve delivered more than 100 satellites into orbit. In fact, I read this morning they’ve delivered 148 satellites into orbit. They are a very, very viable competitor to SpaceX in this all-important market. It is a high-risk, but a high-reward market. Those are the kinds of things that a joint venture can achieve for a company.

The other example I want to give you is laptops. You know, it’s funny, there are people who are committed to either having HP products or Dell products, but their inner things — the internal components on all laptops — are virtually the same, right? It’s the same components going inside. They have different labels on them. What differentiates the different

laptops are: sometimes it’s price, sometimes it’s the IP embedded into those laptops, which draws people to acquire those products. If you take a look at that, yes, our products are going to have common components. The differentiation is the IP products versus what you’re going to see from the Ricoh products. There definitely will be differentiation between the products that will allow us to go after the market in different ways.

Conclusion

White: In conclusion, here’s the good news. It reinforces our commitment to the industry — to the print industry. Toshiba Tec realizes, and here at TABS we have more than 60,000 customers, what that print does in our company — the value of having those MFPs as edge products to provide other services and solutions to those customers. It’s really good that Toshiba Tec understands that ... and the importance of print devices. I’ve already talked about it numerous times, it increases our manufacturing efficiencies and synergies. Also — and this is kind of an interesting one — we’ve been going through this process for a while now and going through the due diligence as we got closer, there has been more sharing of information on technology.

And the interesting part is that our Toshiba Tec engineers looked at the Ricoh technology that they have coming and they were very impressed with that. Ricoh’s engineers and developers looked at our technology and likewise were very, very impressed with the future technology they were looking at.

To be honest with you, I am really excited to see what products that are developed by the JV. It’ll be interesting to see what happens with those products. Over a period of time, technology can become siloed. However, by combining both companies’ technologies and talents, I believe you’re going to see an infusion of innovation that benefits both organizations. I’ve already talked about it earlier: insights from the supply chain, geopolitical events and other constraints. It frees up capital for us to invest in future products such as our software solutions business. It also enables us to have greater focus on differentiated value-added softwares and services. And, lastly, it capitalizes on our expertise in multivendor sales support and go-to-market strategies.

Elizabeth Marvel is associate editor of Office Technology magazine. She can be reached at elizabeth@bta.org or (816) 303-4060.

n

And the interesting part is that our Toshiba Tec engineers looked at the Ricoh technology that they have coming and they were very impressed with that.

Q&A: Michael Hannon

FP executive addresses postage meter opportunity

Compiled by: Brent Hoskins, Office Technology Magazine

Recently, Office Technology magazine interviewed Michael Hannon, managing director for North America at FP Mailing Solutions, a provider of mailroom and shipping solutions with products in more than 230,000 mailrooms worldwide. Founded in 1923, FP is celebrating its 100th year.

Formed by the merger of a German company, Francotype, and an Italian company, Postalia, FP originally sold cash registers. The company began offering postage meters in the U.S. market in the 1960s. All of FP’s products are manufactured in Wittenberg, Germany.

Hannon is responsible for all aspects of FP’s North American operations. He moved up through the company over the past 16 years, beginning in sales in 2007. Gaining knowledge of the industry throughout his career, Hannon has been able to develop and implement numerous processes and programs, like FP finance and sales process automation, that have improved both sales and operations, leading to FP’s continuous growth.

Below are nine of the questions Hannon was asked during the interview and his responses.

the ballot as a candidate for the mayor of Chicago. I was 19.

The opposition candidate was Richard Michael Daley; I was one of the only people he ever contested to keep off the ballot. You’ve got to get a certain number of signatures and then they can compare the signatures. As a registered voter, you are only supposed to sign one ballot petition. If you signed mine and you signed Daley’s and he contested, then they took a look at both. If they saw the date of a signature and the date the sheet was notarized, and any of those names on his petition were the day before mine, then the signature got killed for my sheet and stayed on his.

So, Daley kept me off the ballot. I did not get on the ballot, but it got me a bit more noticed. So, I worked for a few more people and then four years later I ran for alderman of the 41st Ward of Chicago. I absolutely got killed, but it was OK. I was 23 and the guy I ran against had been in office for 21 years. I did run for alderman again while I was in law school. By then, I was already here at FP in management. Ultimately, I ended up leaving law school. It got to a point where it was between work or school and, well, having a job needed to come first as the income needed to come in a little bit more than the additional schooling. I have now been at FP for 16 years.

Hannon: I was born in Chicago, raised in Chicago and have always lived in Chicago, up until about eight years ago — when I moved to a Chicago suburb. As an undergrad, I attended Loyola. I went to John Marshall for law school. Through high school and college, I had family members involved in politics and I got very involved in politics as well. I worked for a lot of different people, ran campaigns, did speech writing, etc., but got to a point where I no longer wanted to run someone else’s campaign. So, I tried to get on

OT: Explain why postage meters cannot be sold. Who actually owns the meters? Also, knowing that this is a regulated industry, what are some of the requirements of the manufacturer and dealer as it relates to the meter?

Hannon: Let me start with this: “Meter” can mean two things. First, it can mean the entire system that everyone sees as the postage meter. Or, second, it can mean what is referred to as a PSD, which is a postal security device. That is a little box that is about the size of a cellphone. It can never be owned by anyone but the manufacturer. We own our

OT: Let’s begin with something we learned about you. We understand that you once pursued being a mayoral candidate in Chicago, Illinois, at a particularly young age. Tell us more.

PSDs. The PSD holds the currency — the postage — and, so, is very heavily regulated because it is considered a currency printer. It is the only thing that prints currency outside of the mint. So, if you have a misprint of $50 in postage instead of 50 cents, you can go to the post office, fill out a spoiled postage form and they will process the refund. With that in mind, to say we are “severely regulated” would be an understatement.

FP sends a file to the USPS [U.S. Postal Service]. It is aggregated data, so it is not customer identifying, but the USPS has to know the serial number of each device, the volume of mail pieces and the amount spent on postage. That goes from FP’s system to the USPS for each one of our customers. Likewise, if the PSD is moved to a different place, we have to tell the post office. So, if a customer moves to a different address or if a dealer moves postage meter inventory to another warehouse, we have to update where the inventory is being held.

While no one but the manufacturer is allowed to own the PSD, you can buy the base, the scale, the feeder — and you can lease those. We turn over the sales opportunity for the larger systems to our dealer channel. We know dealers have on-site service and support. On our smaller devices, the PSDs cannot be removed from the machine, so we cannot sell them or lease them. They are rental only. [FP inside sales reps handle the low-end rentals over the phone. Office technology dealers handle all other U.S. placements of FP products.]

Our mailing machines are connected to FP via either WiFi or Ethernet. They connect either every time someone goes to add postage or, with the newer IMI-compliant mailing machines, they connect every night. That is when they are sending the information to us to essentially say, “Hey, these are all the pieces that were run today. Here’s everything that went through the machine.” That’s the file that goes to the USPS.

On the dealer side, if a customer does not connect the meter or for whatever reason they unplug it and it does not connect for a certain amount of time, the post office has us lock it and it will start down a loss-control process. The dealer can call the customer and say: “You’re still there, right? Can you plug the machine back in so that it is connected?” That is usually all there is to do. If the customer does not plug it in, the dealer has to go on a site visit, seeing the meter in person.

Meanwhile, once a year, dealers have to do a physical inventory. Some dealers will have bought, say, 50 to 100 bases at a time with some still in inventory. They just have to tell FP what serial numbers they have once a year. Otherwise, there is not a whole lot on the dealer side for the compliance requirements. It is mostly on us.

OT: What distinguishes FP from the other two mailing meter hardware manufacturers in the U.S. market — Pitney Bowes and Quadient?

Hannon: I believe two areas distinguish FP. The first is the equipment itself. We started introducing today’s newer technology back in 2015 or so. We are still very heavily invested in our hardware and our equipment and take pride in saying that it is built outside of Berlin in Germany. It is still an “overly manufactured German product.” It is a great physical product.

The other thing that helps us — even though we are the smallest of the three postage meter vendors in the United States — is that our warehouse and call center are here. Everything and everyone are here in one building in Addison, Illinois, just outside of Chicago. If there is a problem with an order, shipping, equipment or some technical issue, having everyone in one building makes it easier to move things forward more quickly. We can be responsive much more quickly, because we do not have all the layers.

OT: FP is actively pursuing growth through the BTA Channel by its involvement in the Business Technology Association (BTA) as a member and otherwise. What led to the decision to pursue office technology dealers as a means of placing FP products?

Hannon: For years, it was not about BTA; it was about AIMED [Association of Independent Mailing Equipment Dealers; AIMED was merged into BTA in 2018]. That was the association that was more heavily involved as independent mailing dealers. We would vary with the number of dealers that we had; sometimes it was as low as 100 to 125 and sometimes as high as maybe 200 to 225. [Today, FP has between 150 and 200 authorized dealers.]

There were a lot more mailing-only dealers 10 to 12 years back. Ultimately, we began seeing that as new dealers started coming on, they predominantly sold copiers. So, they sold copiers, but were looking for other ancillary products. That led us to start being a little bit more proactive, looking at other organizations. GreatAmerica turned us on to BTA. It has been a natural progression for us.

OT: For those dealers who decide to begin offering FP postage meters, what can they expect to receive in terms of residual business in supplies and service?

Hannon: Right off the bat you make the GP on the hardware sale. With the consumables, while there are inks

While no one but the manufacturer is allowed to own the PSD, you can buy the base, the scale, the feeder — and you can lease those.

available that you could get in the United States that abide by USPS standards, the USPS standard is pretty stringent as it has to have a certain level of fluorescence and iridescence in it. When it passes through their machine, the imprint — the indicia — “lights up.” However, [with lower quality ink] it is not until you turn your mail into the post office that it might get rejected, and then you are filling out all those spoiled postage forms because none of those imprints are real. So, there is a good revenue opportunity for dealers selling quality ink.

We sell to a dealer and they then have the ability to bring the product offering forward to their customer at a price they have determined.

Dealers also have the ability to generate maintenance income, similar to any other hardware product that they would service on a customer’s behalf. So that rate will be dependent on what the dealer would like to charge.

Additionally, because the PSD cannot be owned, there is a monthly rental fee that is charged for the PSD. Again, this is another area where the dealer can make residual income — and it is one that is unique to mailing. So, overall, there are three potential recurring revenue opportunities: supplies, maintenance and from the PSD, along with the GP made from the hardware sale. This is, of course, separate from other incentives that we offer to dealers: rebates, co-op, etc.

OT: Does the placement of the meter often lead to the placement of other products?

Hannon: Yes, for both us and the dealer channel. While we can sometimes be viewed as an ancillary product to a copier, we, too, have our own ancillary products that we offer such as: folder inserters, addressing systems, parcel lockers and software that goes along to provide address verification, envelope design, etc. Mailing can provide an opportunity to open a lot of doors. If something is being printed, there is a good likelihood that it will end up in the mail stream.

It is about a full solution sale, as opposed to just a hardware sale, and offering all that we can to our dealers so they can provide to their customers. Having the conversation and knowing what the customer is trying to achieve could mean the difference in a standalone hardware sale for several thousand and a mailroom solution that could be tens of thousands or more.

OT: When a dealership is placing an FP mailing machine, is it replacing a competitive product or are there still businesses that did not have a mailing machine previously?

Hannon: It is both. However, predominantly, we are

taking out competition because FP is only about 8% of the market here in the United States. We buy leads. We nurture our own database. We try to help our dealers. But, really, probably eight out of 10 placements are a competitive takeaway. We do get those net-new customers that never had a mailing machine before, such as new startups. Whether a replacement or net-new, we do have our key verticals that we are in very heavily — medical, health care, real estate, accounting and finance. These are verticals where mail is not going away.

OT: Is it your recommendation that dealers have a dedicated salesperson or can the general-line copier/MFP sales rep be the champion for mailing equipment in addition to selling MFPs?

Hannon: I have seen dealers be adamant both ways. I can think of one very large dealership everyone knows that — while they have one dedicated person who oversees the program — has quotas throughout its entire sales force. I have other very large dealerships that are fixated on having one to four dedicated reps per office and they want it to stay with the dedicated reps. Other dealers say: “It’s part of the product line that we sell and everyone sells the full product line.”

OT: Explain the decertification of postage meters. What does that mean for end users and the dealer channel?

Hannon: The USPS has required a change to the security encryption level within the PSD. The indicia is going to look exactly the same, but there is now information behind it that is better for the USPS. The change is from old technology, so IBI is changing to IMI, meaning information-based indicia to intelligent mail indicia.

What this means for the industry is that about 1 million meters have to be changed. So, anyone with that older technology — that IBI technology — has until the end of 2024 to change the equipment. This is already underway, but because of the COVID-19 pandemic and everything else, it is slow going. Our best guess is that there are probably close to 500,000 to 600,000 meters that still have to be changed.

The biggest benefit to the BTA Channel resulting from the decertification of older equipment is that it fantastically condenses the sales cycle. Because, no matter what, everyone has to change out their meters. n

Brent Hoskins, executive director of the Business Technology Association, is editor of Office Technology magazine. He can be reached at brent@bta.org or (816) 303-4040.

The biggest benefit to the BTA Channel resulting from the decertification of older equipment is that it fantastically condenses the sales cycle.

DocuWorld 2023

DocuWare hosts partner conference May 4-5

by: Elizabeth Marvel, Office Technology Magazine

DocuWare hosted DocuWorld 2023, its 23rd-annual partner conference, May 4-5, 2023, at the Hyatt Regency Grand Cypress in Orlando, Florida. The event, themed “The Future of Selling,” consisted of a general session presented by company executives, a sales-focused keynote address by author and sales strategist Shari Levitin, breakout sessions, sponsor exhibits and networking opportunities.

DocuWare Corp. President Jim Roberts kicked off the general session on May 4 with a quick overview of the company’s results in the last year. He noted that the company accelerated new business growth by 9% year over year and shared a new trend that has emerged for the company: The biggest growth segment has been extension cloud, where customers are adding on to their current subscriptions.

“This is where we sell more licenses, storage and upgrades to our existing cloud customers,” Roberts said of extension cloud. “And some of our greatest acceleration over the last two years has been occurring because we’re selling more and more to our existing base.

“This is great,” Roberts continued. “Any time your existing base has this much confidence to invest even more, it’s a great tribute to DocuWare and to all of you. We can all admit no customer would be willing to spend another dollar if they’re not completely satisfied. And so you should all be ready to take credit because it takes amazing customer service and an amazing customer experience before those customers are going to continue to invest.”

During his general session presentation, DocuWare Group President Max Ertl focused on changes in the workplace and how DocuWare can be used to take advantage of these changes. He specifically noted the trend toward working from home/ teleworking, the new generation coming into the workforce, gig workers and artificial intelligence. “The world is changing and we have to see which opportunities these changes create for us,” Ertl said. “What’s important for us is: ‘How does the work environment change?’”

Ertl went on to categorize the three types of work, how they

have been affected by the changes in the workplace and how DocuWare can improve worker productivity:

(1) Focus — “Focus work can be all types of different things, like ... when you do invoices or code software,” Ertl said. “This is work where you say, ‘It’s best that I stay alone where no one disturbs me and here is my computer and my brain’ ... But if your focus work is where you have to book invoices, then it’s only productive if you have the necessary documents available; if you have all the resources you need. And for ... a lot of activities, DocuWare can help you. Our term is the ‘document pool,’ and we’ve been pushing this for many years. This is exactly the type of focus work where our technology can help.”

(2) Coordination — “You have to coordinate something in a workflow or a process; you have to make sure that things get done and you need other people to do this,” Ertl said of coordination work. “ ... Coordination would be best if you would be in the office and if you would be with the people you need in the same time zone. But now, no one wants to do this because ‘I want to work at any time, anywhere’ ... And now DocuWare saves the day because this is really where we can help with our workflow, with our document pool — where we can help people be productive in coordination work even when they are not [working] at the same time and in the same office. This is where we can consult with our customers and sell additional licenses.”

(3) Cooperation — “Cooperation is when you do some brainstorming, there are conflicts and you need the cooperation of other people,” Ertl said, noting that this type of work is best done in the office.

His advice for selling DocuWare to assist with these types of work: “When you talk to a prospect or a customer, find out what his team is doing,” Ertl said. “Do they do focus work most of the time? Are they in coordination or cooperation? ... There ... are always processes that require coordination. One-hundred percent, that’s where we want to be. And there’s focus work where they need access to documents. One-hundred percent, this is where we want to be. And then tell your customers that technology and products like DocuWare can really help them to be better at this complex work where, on one hand, we want to have the best work/life balance but, on the other hand, you also need to generate some productivity.” n

Elizabeth Marvel is associate editor of Office Technology magazine. She can be reached at elizabeth@bta.org or (816) 303-4060.

Jim Roberts

Max Ertl

Hiring & Firing

Best practices to consider for both situations

by: Robert C. Goldberg, BTA General Counsel

Finding and retaining good employees is a challenge every dealer faces. With the enforcement of non-compete agreements being questioned, employees are testing the marketplace for new positions. Hiring someone who is already trained in industry sales or support allows for an immediate contribution to the organization without the time and expense of bringing an unfamiliar individual on board.

Many dealers with open positions in their dealerships are turning to recruitment firms to help fill the gaps. If a dealer is engaging with a recruitment firm, there are important safeguards to include in the written agreement. The recruiter should assist the dealer in preparing a job description and posting it. He (or she) should also help create interview questions, screen qualified individuals and prepare the employment offer. A background check should be conducted for each potential employee. If an individual will be responsible for any financial aspects of the business, a credit check should be considered as well. The recruitment firm should also agree that it will not solicit any of a dealership’s existing employees.

Perhaps the most important provision in a recruitment agreement is the period for which the firm “guarantees” the employee and will replace him at no additional cost. Often the guarantee period is 60 to 90 days. This amount of time is insufficient to truly determine if an employee fits in and is fully capable of performing the functions in the job description. Look for at least 120 days to secure a replacement if the original employee does not work out.

All employees should be retained “at will.” This means a termination can take place by the individual or the company, with or without cause. Sometimes it is found that an employee is “not a good fit” for the company. Such vague terminology may be problematic when the employee claims that his termination was actually because of illegal discrimination or harassment. A U.S. Court of Appeals recently upheld an employer’s “not-a-good-fit” determination because the employer was able to provide concrete examples of the employee’s poor interactions with others.

In Lashley v. Spartanburg Methodist College, a professor sued for discrimination and retaliation under the Americans with Disabilities Act (ADA), among other things, when the school

decided not to renew her contract and then terminated her shortly thereafter. The court found that, with regard to the non-renewal of her contract for being a poor fit, the school offered several reports that the professor was often at the center of conflicts with students and faculty, that there were multiple complaints that she had unprofessional relationships with students, and that there were conflicts with multiple faculty members. There were also emails in which the professor expressed her dissatisfaction with the school — sometimes profanely. As to her termination, that was the result of her making threatening statements to students and colleagues following the non-renewal of her contract.

The lesson here is that “not a good fit” can be a legitimate reason for terminating an employee, but it is important that the employer be able to demonstrate exactly why the employee is a poor fit. And, frankly, it is better to identify the specific grounds — truthfully and accurately — for why the employee is not a good fit when informing him of the reasons for termination. When considering employee actions, BTA members should always consider consulting the BTA Legal Hotline for guidance. n

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

BTA would like to welcome the following new members to the association:

Dealer Members

Access Systems, Waukee, IA

Complete Document Solutions Inc., Torrance, CA

Image Systems & Business Solutions, Elk Grove, IL

RHS Technology Group, Clearwater, FL

Vendor Members

Item Inc., Woodbridge, VA

MyQ, Bradenton, FL

For full contact information of these new members, visit www.bta.org.

Insurance Programs

BTA members can enroll in a number of insurance programs specialized to fit the needs of office technology dealers. The programs cover a variety of insurance plans.

Health care is expensive and the options are confusing and complicated. Save time and get a free, no-obligation quote through Mass Marketing Insurance Consultants Inc. (MMIC).

American Fidelity Assurance Company specializes in providing Section 125, longand short-term disability, cancer and accidental death policies specifically designed to help you and your employees save time, money and manage expenses.

For more information, visit www.bta.org/Insurance.

For information on BTA member benefits, visit www.bta.org/MemberBenefits.

For the benefit of its dealer members, each month BTA features two of its vendor members.

Source Technologies is a Charlotte, North Carolina-based financial services company with more than 35 years of experience. Its main objective is to assist financial institutions in enhancing their productivity, security and customer service by implementing payment solutions tailored to the specific requirements of each branch. Source Technologies offers secure and effective payment solutions with flexible hardware, software and self-service options. It provides software that enables remote check printing while keeping centralized control over the process and MICR printers.

www.sourcetech.com

MyQ is a global software company with a 30-year legacy of expertise and continuous innovation. With a firm commitment to user-centricity and cultivating strong partnerships, it delivers print, copy, scan and document management solutions. MyQ’s comprehensive range of offerings, including native public cloud platforms, as well as on-premise, private and hybrid cloud print management solutions, directly tackle the tangible challenges encountered in modern workplaces. By streamlining processes and optimizing efficiency, MyQ saves valuable time for both individuals and organizations.

www.myq-solution.com

A full list of BTA vendor members can be found online at www.bta.org.

For more information, visit www.bta.org.

DEALERS HELPING DEALERS

MPS Success

Dealers share their experiences & CPC rates

Compiled by: Brent Hoskins, Office Technology Magazine

Following are two related questions submitted by a dealer member as part of BTA’s Dealers Helping Dealers resource, and many of the answers received. These answers and many others can be found in the members-only section of the BTA website. Visit www.bta.org/Dealers HelpingDealers. You will need your username and password to access this member resource.

What can you share about successes you have had with MPS? What are your typical CPC rates for printer service?

“We have had consistent success with MPS, but have found that it is becoming more and more difficult to rely on outside companies to provide reliable support and supply replenishment. We have partnered with several and all have decreased quite a bit in the customer service area — all while increasing prices across the board. CPC rates vary greatly depending on the makeup of the printer fleet and age of devices. We also offer a CPC-only or a CPC with equipment replacement, which are priced differently.

Brian Bence, executive director of sales Shenandoah Valley Office Equipment (SVOE), Verona, Virginia

“Our ratio is not where we want it to be, but we have one printer for every two A3 devices. We want to get to a ratio of one to one.”

John Lowery, president & CEO Applied Innovation, Grand Rapids, Michigan

“We converted our larger customers to MPS contracts over several years before the COVID-19 pandemic lockdown and it saved us. We are in a competitive market and charge $.009 for black and white and $.06 for color.”

Jeffrey Foley, COO Apollo Office Systems, Alvin, Texas

“It varies. We find ourselves doing more rip/replace MPS opportunities, therefore CPC is much more aggressive on a uniform fleet.”

Mitchell Mawby, vice president of sales Professional Business Systems Inc., Rogers, Arkansas

“MPS is the backbone of our offerings. Nineteen percent of our revenue is A4 products. We rip and replace everything or we won’t do it. With Lexmark, we can do a monochrome MPS rate of $.014 and be very profitable.”

Evan Said, director of sales Coastal Business Systems Inc., Eureka, California

“We have had great success with MPS starting in 2009. With our subscription model, we are moving away from transactional fees and capturing them in a flat-rate monthly subscription.”

Tom Minuti, president Copy Products, Upper Darby, Pennsylvania

“MPS can be as easy or as difficult as you make it. We do a walk-through on some accounts; on others, we will just quote cartridge prices to get us in the door. I am not sure I can give an accurate CPC price, as many models have different costs.”

Sam Stone, president Stone’s Office Equipment, Richmond, Virginia

“We do a lot of MPS. It is part of our go-to-market strategy. Every deal is priced a little differently depending on how we structure it.”

Tim Renegar, president Kelly Office Solutions, Winston-Salem, North Carolina

“We have been doing MPS since 2006 when we purchased our first printer service company. Black-and-white CPC rates are $.015 and color is $.09.”

Rick Salcedo, president & CEO KDI Office Technology, Aston, Pennsylvania

“We have many large accounts nationwide for MPS. We also use SYNNEX PRINTSolv. They provide pricing options to us with parts and labor only or all inclusive. We mark up their rates to provide pricing to our customers. We mark up 35% to 50%.”

Stephen Valenta, president/owner Offix, Gainesville, Virginia

“We charge $.005 for black and white and $.05 for color.”

Chip Miceli, CEO Pulse Technology, Schaumburg, Illinois

“We have had quite a bit of success, with several clients that have more than 1,000 printers. Rates are really all over the place depending on the mix of gear. Each client is independently priced.”

Chad Schwartz, president/founder

Imagine Technology Group

Chandler, Arizona

“We are charging $.12 for color and $.011 for black and white.”

Les Harris, vice president of sales

UTEC, Ann Arbor, Michigan

“$.0129.”

Jose Hernandez, owner JCM Distributors, Miami, Florida

“$.0175 to $.025.”

Mick Dean, president SaraMana Business Products, Sarasota, Florida

“We stay away from MPS and CPC. We find that to be an old model and are moving toward extended warranties and buy supplies as needed.”

Todd Deluca, owner

Boston Business Technology

Plymouth, Massachusetts

“We’ve been steadily growing about 15% a year. Rates are around $.01 for black and white and $.06 to $.08 for color.”

Nick Lioce, president

The Lioce Group, Huntsville, Alabama

Do you have a question for your fellow dealers? If so, email it to brent@bta.org with the subject line: “Dealers Helping Dealers.” BTA will then share your question with the full dealer membership with a request for guidance from your fellow dealers. n

Brent Hoskins, executive director of the Business Technology Association, is editor of Office Technology magazine. He can be reached at brent@bta.org or (816) 303-4040.

“We have had quite a bit of success, with several clients that have more than 1,000 printers. Rates are really all over the place depending on the mix of gear.”

The Future of Selling

Can artificial intelligence replace salespeople?

by: Troy Harrison, Troy Harrison & Associates

The sales profession is facing an entirely new type of competition. Whether it will be a game-changer is yet to be seen. The topic of a recent LinkedIn poll was: “Can salespeople be replaced by artificial intelligence (AI) in five years?” My instinctive reaction was probably the same as yours: “Of course not.” Then I did a little thinking before I answered and I realized that, yes, a lot of salespeople could be replaced by AI — not in five years, but right now. That is because their skills are not really any better than your basic chatbot — and therein lies a problem for those of us who care deeply about the role of the professional salesperson.

Let’s be clear. I believe there are things that skilled, engaged salespeople can do that AI cannot do — and probably will not ever be able to do. But for this article, I wanted a more expert opinion, so I decided to interview the most prominent current expert on AI about this very topic: ChatGPT. That is right — I interviewed AI about AI. Here is a highlight from that interview:

Me: “Will AI be able to replace most salespeople in the future?”

ChatGPT: “While AI technologies like ChatGPT have shown tremendous advancements in recent years and can perform many tasks with impressive accuracy, it cannot completely replace the role of a salesperson. There are several reasons why ChatGPT cannot replace salespeople:

(1) Personalization: Salespeople build relationships with their customers through personalized interactions that require a high level of emotional intelligence and human connection. AI technologies lack the empathy, intuition and emotional intelligence needed for human interactions.

(2) Complex sales processes: Some sales processes require a high degree of complexity and nuance that ChatGPT cannot handle. Salespeople can provide specialized knowledge, solve complex problems and negotiate terms with customers.

(3) Trust and rapport building: Salespeople establish trust with customers over time through their interactions and relationship-building skills, which are essential to closing sales. Building trust takes time and a deeper understanding of the customer’s needs, which ChatGPT may not be able to provide.

In summary, ChatGPT can be used as a support tool for salespeople by providing relevant information, data and customer insights. However, AI cannot replace the human-to-human connection that is necessary in sales interactions.”

Whew. Well, even ChatGPT thinks it cannot replace salespeople. So, all is well, right? Wrong.

Look at all of the things ChatGPT says salespeople do:

n Build relationships with their customers through personalized interactions that require a high level of emotional intelligence and human connection

n Provide specialized knowledge

n Solve complex problems

n Establish trust with customers over time

Here is the problem. An awful lot of today’s salespeople do not do this. They go through the motions, make some sales calls and put in some numbers. The level of engagement described by my ChatGPT “expert” is the level of skill that top salespeople show. This is 20% or less of this profession.

The implication is that a large number of salespeople can be replaced by AI. Imagine an AI bot that dials a prospect, engages in a voice-to-voice conversation using prospecting and sales best practices, and even sets appointments.

Take it a step further and imagine it doing so in the same voice as the real salesperson who would handle the live appointment. Or, how about an AI bot that sets Zoom sales appointments and then carries them out in a hologram? This kind of thing would have been science fiction five years ago. Now it is a coming reality. The technology to do the phone prospecting is almost here now — AI can have conversations through chatbots. Text-to-voice technology is here. And you can even train that tech to use your voice — or a voice similar enough that few people could detect it is not you.

So what does all this mean for you? It means that it is time to up your game in every respect. If you are a principal or a manager, ask yourself if your salespeople are exhibiting personalization, emotional intelligence, problem-solving and trust-

building on a day-to-day basis. If not, find ways to train them to do so.

It means that if you are a salesperson, you have some work to do. Here is a quick list of what salespeople should be doing in order to move into the future of selling:

n Personalize your encounters. Onesize-fits-all sales calls do not work anymore, if they ever did. Neither do canned presentations. Personalization means knowing your customer better by asking thorough and more questions, and then using the information you have discovered to solve problems — not just pushing whatever you can.

n Tune in to your customers. After asking a great question, it is time to listen. Really listen and tune in to the words coming from the customer — they are important. Watch their LinkedIn profiles for clues as to their viewpoints and priorities.

n Live with empathy. Notice I did not say “show” empathy — that is inauthentic. I mean live with empathy. Work on your ability to put yourself on the other side of the desk and see things from the customer’s point of view. Facing the same situations, what would you do? How would you react or feel? That is empathy.

n Focus on the buyer’s journey. In sales, we are trained to think about the “sales process” — projecting what we want onto the customer. It is time to flip that script. Instead, think

about the journey the buyer takes to reach a purchase and what that buyer wants at each stage (this is part of living with empathy).

n Use technology to its max. Competing with tech means using tech. The battle over CRM is over. It is a good thing. Embrace it and use it. Use reviews of your customers’ businesses to learn more about them and find opportunity. Even using ChatGPT as a research tool is completely fair. It is a tool — use it to be the best salesperson you can be. Make no mistake about my outlook. A great salesperson will always be better than AI. A good salesperson will always be at least as good as great AI. I am a 100%-passionate advocate for personal selling by human salespeople to human customers. And just as I am challenging you to up your game, I am challenging myself to up mine. This space, in future issues, will help us do just that. n

Troy Harrison is the author of “Sell Like You Mean It!” and “The Pocket Sales Manager,” and is a speaker, consultant and sales navigator. He helps companies build more profitable and productive sales forces. To schedule a free 45-minute Sales Strategy Review, call (913) 645-3603 or email troy@troyharrison.com. Visit www.troyharrison.com.

2-3 • 2023 BTA National Conference (800) 843-5059 / www.bta.org/BTABoston

23 • BPO Media

www.workflowotg.com / www.theimagingchannel.com

18 • BTA Service Troubleshooting Training (800) 843-5059 / www.bta.org/STT

14 • DocuWare

https://start.docuware.com

31 • ENX Magazine

(818) 505-0022 / www.enxmag.com

5 • Epson

https://epson.com/business-inkjet-printers

32 • Image Star (888) 632-5515 / www.imagestar.com

7 • MPS Cloudware

www.mpscloudware.com

19 • Mars International (973) 777-5886 / www.marstinl.com

15 • Polek & Polek (800) 526-1360 / www.polek.com

31 • ProFinance 3.0 (800) 843-5059 / www.bta.org/ProFinance

11 • Pure Water Technology

https://purewatertech.com

23 • ROSS International

(973) 365-9900 / www.ross-international.com

19 • Sharp

https://business.sharpusa.com

9 • Toshiba

https://business.toshiba.com

28 • UPS

(800) 636-2377 / https://1800members.com/bta

13 • Xerox www.xerox.com

A great salesperson will always be better than AI ... I am a 100%-passionate advocate for personal selling by human salespeople to human customers.