Dealer Support September 12 by Intelligent Media Solutions

September 2012 Issue 207

INSPIRING BUSINESS SOLUTIONS FOR DEALERS

DEALER SUPPORT SEPTEMBER 2012 | ISSUE 207 E-COMMERCE | BRANDS V. WHITE LABEL | CONSUMABLES

UNTANGLING THE WEB Investing in e-commerce BRANDS V. WHITE LABEL Can brands fight the hard times? TAKE IT UP A NOTCH Your guide to consumables

FROM THE EDITOR

Growing your business one opportunity at a time PEOPLE

DEALER INTERVIEW

Intec Office Systems

A B E T TER INTEC Stuart Thompson first set up Doncaster-based Intec Office Systems in 1989. Billy Taylor talks to the MD about how the industry has changed over the years and how he’s led the company to success despite it all

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page 24

Can you tell me about Intec’s background and what it was like when it started in 1989? I guess our beginnings were fairly typical. I worked for another office supplies company and saw no obvious route for advancement. I decided I would rather work for myself and so I left and started my own business. It was very difficult in the early days because unlike many, I didn’t poach any of my previous customers from my other job. One of the problems with this industry is it is relatively easy to start a business which means that everyone thinks they can do it…. As a result, there’s a lot of potential competition, large and small. In the early days there were very few stationery wholesalers that went direct, everybody seemed to know their place within the framework, and wholesalers were generally content to allow dealers to work with end-users. I think as the Americans started infiltrating the UK market with the likes of Viking and Staples it became quite clear that the wholesalers felt that the small dealers were

If ever there were a bumper issue of Dealer Support, it’s this one. At 88 pages, including USP, it’s chock full of stats, facts, information, opinion and advice in the shape of your usual features and interviews, but also an IT Guide (p55), focusing on opportunities for original consumables in the OP channel. In Industry, we bring you an article on the benefits of selling branded vs. white-label products, including what kind of products are better suited for which (p12). We then move on to look at e-commerce solutions on the market, including an analysis of when it’s worth venturing into the world of selling through your website (p18). In our People section, we speak to Stuart Thompson of Intec Office Systems about how the industry has changed in the 23 years he’s been in business (p24). Then on to an interview with Nemo’s new MD Tim Beaumont, who was promoted from commercial director. He discusses what he has planned for the dealer group and the direction he would like to see the channel take (p32). Our IT Guide zooms in on the original consumables market, looking at how it’s faring in a world of MPS. In a Big Ask-style feature, we put the question of what dealers can do now to succeed to the experts (p62), while interviewing a dealer that is actually 25 experiencing success in IT products (p66). Lastly, it’s a Grow Your Business on unified communications (p74) and a Final Word from AF International with some scary stats on just how dirty an office can be (and we don’t mean in a Carry On way). I think there’s a lot to take in this month, and hopefully we give you some food for thought. If you have a story to share, as always, get in touch. We want to hear from you. Here’s wishing you the best of the back-to-school/back-to-work season. Let’s hope it’s a good ‘un. DEALER INTERVIEW

Intec Office Systems

under threat and in danger of becoming the corner shops of the stationery and OP industry. I think at the time, the work that the wholesalers did in setting up support services and marketing departments made it much easier for their supporting dealers to compete on a level playing field with the insurgent Yanks [chuckles] – Wholesalers were very supportive but essentially, they were being sensible in protecting their own revenues In 1994, we were the first office supplies company in the UK to offer a genuine same-day-delivery service with the full range of 20,000-plus stationery products. We did this initially by collecting from Kingfield’s premises in Sheffield, and then returning to the office for two daily delivery cycles. We’d go out and do the morning deliveries and anything that had been ordered that morning would be delivered later that same afternoon. It gave us a fantastic USP, and for many years we retained that. However, as the market hardened and people got more concerned with green issues and the environment, keen pricing became everything so whilst we still offer

SEPTEMBER 2012 www.dealersupport.co.uk

www.dealersupport.co.uk SEPTEMBER 2012

“We’re aware of the social status some brands portray, even down to the notepad we use ” MANAGING EDITOR Julia Dennison julia.dennison@intelligentmedia.co.uk

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managing editor

intelligent media solutions suite 223, business design centre 52 upper street, london N1 0QH tel: 020 7288 6833 fax: 0207 979 0089 email: info@intelligentmedia.co.uk web: www.dealersupport.co.uk web: www.uspmagazine.com

Annual subscriptions are ABC available at a cost of £68.00 for UK and overseas by surface mail, £90.00 for airmail. Subscription enquiries should be sent to the above address Dealer Support is the leading monthly publication for dealers in the business supplies industry. It provides information on the industry (both in the UK and overseas), information for and about the UK’s independent dealers, as well as information and advice on running a small business. The views expressed in this magazine are not necessarily the views of the publishers. Copyright of all the material published remains with Intelligent Media Solutions Limited. No part of this magazine may be reproduced, copied, stored in an electronic retrieval or transmitted, save with written permission or in accordance with provision of the copyright designs and patent act of 1988. Printed in the UK by Buxton Press www.buxtonpress.co.uk

INSPIRING BUSINESS SOLUTIONS FOR DEALERS

CONTENTS September 2012

INDUSTRY

08 NEWS AND VIEWS All the month’s news and views in the office products industry 12 BRANDS V. WHITE LABEL As the economy bites, can brands compete? 18 UNTANGLING THE WEB Is e-commerce worth the investment? Looks like it

PEOPLE 24 A BETTER INTEC Doncaster’s Intec Office Systems on decades of success 30 BEAU DU JOUR Nemo’s Tim Beaumont on his promotion to MD

IT GUIDE

39 A GUIDE TO ORIGINAL CONSUMABLES See inside for contents

MANAGEMENT 58 GROW YOUR BUSINESS This month: unified communications 60 FINAL WORD AF International’s Karen Harrison tips for a safer workplace

Also in this issue: the IT Guide. Plus, flip over for the September edition of USP magazine

Industry

NEWS

news Simon Wallis back on Synergy programme

NEC strengthens EMEA leadership team NEC Display Solutions has appointed Karsten Winther as VP of sales, EMEA. NEC claims the new management position, will reinforce and strengthen its EMEA sales and business operations to further develop its solution-led sales. Winther, who has many years of experience within the AV industry, will be part of the EMEA management team based in Munich and report into Bernd Eberhardt, president and CEO of NEC Display Solutions Europe. In the role of VP, sales EMEA, he will lead and drive strategic and operational sales activities to support NEC’s regional sales, corporate sales and channel sales teams. Commenting on his new role, Winther said: “NEC Display Solutions has welldefined business objectives and a strong commitment to be successful with its solutionled sales approach. I’m excited to be part of the EMEA management team and to further develop and increase our efforts to support the EMEA business operations. “NEC Display Solutions will continue to deliver and enhance our tools and resources to support our EMEA channel partners, and in turn help them to grow and succeed in their business areas”. Winther has over 15 years of experience in the AV and IT industry and a strong background with over 10 years dedicated to the Epson Group, where he managed complex product lines, pricing strategies, sales strategy planning and business partner agreements. Prior to Epson, he held several other positions at IT-related companies in Denmark. “As NEC Display Solutions increases EMEA-wide sales activities through its valuable partner network, it is critical to ensure that our overall sales and marketing strategies match our partners’ growing needs,” siad Bernd Eberhardt, president and CEO of NEC Display Solutions Europe. “Karsten brings solid expertise in product sales and channel sales strategies, and will help NEC to expand its business partners’ effectiveness and profitability.”

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Simon Wallis is set to join Spicers next month to undertake the running of the wholesaler’s Synergy programme – again. Wallis previously headed up the Synergy programme for five years from January 2000. After that he became a regional director and then business development director at VOW. Speaking on his return to Spicers, CEO Alan Ball said: “Listening to our partners within Synergy it was clear that focus and ownership were a priority and bringing in Simon will achieve that. “I expect that Simon will be presenting his plans for the business once he has settled in; he has significant knowledge of the market and in particular on how dealers operate and it is this skill set that will stand Synergy in good stead.”

AB Copyright celebrates 20 years Halifax-based dealer AB Copyright celebrated 20 years in business on 1 August to coincide with Yorkshire Day. The dealer’s HQ has also undergone a makeover, including new signage and furniture from the ranges it sells. MD Greg Adams told the Halifax Evening Courier: “It’s important for us to continue to evolve as a business and the recent renovation has brought AB Copyright into a new era where modernity and innovation are as important as being well-established and family-run, though customer care and service will always remain king to the AB ethos.” Founded in 1992, AB Copyright mainly trades in West Yorkshire. It continues to grow and plans to turn its focus to its online offering, with a website revamp and social media campaign in the pipeline. One way AB Copyright is expanding its business is through free cost and carbon reduction consultations to local business, which have had a successful take-up.

NEWS

Are independent dealers the forgotten link? Independent dealers feel increasingly isolated from manufacturers and yet are keener than ever to use product information, product samples and promotional support material to attract and encourage their customers to purchase. This was the key finding from research carried out by newly launched field marketing agency, Product Promotion Services (PPS), which specialises in the UK office products market. “Although they still control almost 50% of the office products market, independent dealers appear to be the forgotten link in the supply chain,” said PPS director, Martin Eames. “Our research confirmed that few receive any direct contact from branded manufacturers so their knowledge of new products and promotions is weak and certainly not at a level which enables them to proactively ‘sell’ into their customers.” The result is that many new products take years to become established and many consumer promotions fail to deliver acceptable results. Due to margin pressures, few manufacturers can now afford the cost of a national field sales force, which means that independent dealers are left out of the communication chain, said the firm. Ironically, it added, this communication gap has worsened at a time when, due to the state of the market, the appetite of independent dealers for product and promotional information to sell into their customers has never been greater. Eames said: “We recently carried out a sales campaign for a manufacturer and our account managers were actually thanked by dealers for visiting them! “There is no doubt that independent dealers represent an unexploited opportunity for brand manufacturers to promote to consumers but the messages have to be delivered effectively to dealers to give them the confidence to take them forward. We recognise the cost pressures that manufacturers are under but our shared field sales service can cut the cost per call by over 75% compared to a manufacturer’s dedicated sales force. That makes it viable for most manufacturers to communicate ‘face to face’ with independent dealers again and our research indicates that such contact will be welcomed and effective.”

One Office golf day goes with a swing Northern Irish Nectere partner One Office swapped stationery for clubs and balls and invited customers to its yearly corporate golf day. On 27 July, over 50 customers were invited to tee off for a day of golfing fun at the prestigious Fort William Golf Club in Belfast. Players were welcomed with a pre-game brunch in the clubhouse before putting their skills to the test on the championship course. MD David Martin commented: “Our corporate golf day is an event we hold annually to express our gratitude to our business customers and give them the chance to experience a fantastic day of golf, win some fabulous prizes and to round off the day with a delicious three-course dinner.” He went on to say: “In this difficult economic climate it is important that we continue to provide customer events. They help us keep front of mind and maintain strong relationships. This is what long-term business partnerships are all about.”

“With consumers increasingly value-conscious, it is still a challenging climate for retailers, and the rain in early July did not help. But it is dangerous to just blame the weather. There are retailers, particularly in the discounting space, who are bucking this trend through flexible and responsive supply chains. The quicker you can get your products to market, the louder you will hear tills ring. Getting your supply chain right is the new retail battleground and those who achieve flexibility and agility will survive and prosper” Don Williams, national head of retail and wholesale at accountancy firm BDO LLP

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Industry

NEWS

VOW and Integra tap into new markets Wholesaler and dealer group both partner with water cooler firms to offer further service opportunities to dealers

news in brief... Stewart Superior with Spicers Spicers has entered an exclusive partnership with Stewart Superior to supply its stationery lines to the channel. Geoffrey Betts, CEO of Stewart Superior, commented: “Spicers has

VOW has collaborated with Water Coolers Direct, while Integra has launched a water cooler service for its members in conjunction with Cool Water Direct. Both wholesaler and dealer group hope branching out into new services like water coolers will help generate new sources of income for their dealers, while helping them to differentiate themselves. As part of the VOW+ Programme, Water Coolers Direct will provide resellers’ sales teams with training and support, offering joint visits to the end-user, bespoke marketing material, and help in creating effective sales pitch presentations. Meanwhile, Integra members will have access to water cooler-related promotional support via the dealer group’s online print and e-marketing solution, Inprint3. Neil Basham, Integra’s purchasing director, commented: “This is another great opportunity for members to expand their product and service offering. It is essential for dealers to tap into – no pun intended – added value services not only for their existing customers but also to use as an opportunity to open new accounts.” Helen Beckett, VOW business development director, commented on the wholesaler’s new service and partnership: “There are already around 600,000 water coolers installed in the UK, and this market will continue to grow as businesses focus more on the health and wellbeing of their employees.” VOW has also recently launched a corporate gifts scheme as part of its VOW+ Programme, in partnership with trade supplier and industry leader, The Sourcerers. The scheme gives VOW+ resellers the opportunity to offer their customers over 50,000 corporate gifts, which can be branded. VOW+ resellers can promote the new service using a bespoke web shop, tailored product and promotional flyers, branded digital and printed catalogues, personalised presentations branded for client pitches, product promotion and marketing strategy support, and sample packs.

made a commitment to develop the brand and the range we have on offer and we are confident our partnership will deliver profitable growth opportunities across the supply chain.” Speaking on the agreement, Alan Ball, CEO of Spicers, said: “We now see the team as an extension of our business and we are excited about securing this credible organisation as a partner.” Exclusivity starts in January.

Integra’s Play initiative winners Dealer customers took home a raft of prizes this quarter, including Xboxes and Wiis, as part of Integra’s Play Initiative end-user campaign. Members of the dealer group with winning customers included Imaging Supplies, Southfields, Active Office, Office Essentials, Wallis Business Services, MBM Omega, Cleartask, SOS Office Supplies, Compleat Office initiatives, and Westhill Direct. Designed to help promote the Initiative brand and drive sales, members are encouraged to promote the Play Initiative campaign to end-users.

New recruit for Office Club Office Club has recruited

£437,293

Diary

Manisha Patel to join the

The annualised value of the 114 new accounts opened by the latest group of Spicers’s New Training Academy trainees

3-4 October Convergence Summit South Sandown Park, Esher, Surrey ConvergenceSummit.co.uk

covering the north of England

business development team, and Scotland. Prior to this role, she spent 12 years in the sales

6-7 November Corporate Social Media Summit London UsefulSocialMedia.com

department of Antalis McNaughton. Business

22 November Integra’s national conference Cotswold Water Park Hotel, Gloucestershire Integra-Office.co.uk

Office Club to enhance its policy of assisting

september 2012 www.dealersupport.co.uk

development manager Keith Lacey commented: “Her appointment will enable members on a personal level.”

Jackson Office Products nets new deal Jackson Office Products has scored with Coventry City. The company, founded 66 years ago in the city, has inked a deal to become the official stationery supplier to its local football club. Jacksons - a member of Office Friendly Dealer Association - will keep the Sky Blues’ off-field team stocked up with everything from pens to printers and benefit from advertising at the club’s Ricoh Arena on matchdays. “I’m delighted to be able to sponsor the club in this way,” said Steve Beard, managing director of Jacksons. “I have supported the club through thick and thin over the years and after the disappointment of relegation last season, I believe it is up to local businesses like mine to try and help get the club back where it belongs.

“We’re a local company, supplying other local companies, but we can compete with the national stationers on price. Hopefully other businesses will see our name associated with the club and look to utilise our products and services too.”

For more information on Jackson Office Products call 0800 092 4709 or visit www.jacksonofficeproducts.co.uk

Steve Beard of Jackson Office Products

INDUSTRY

BRANDS V. WHITE LABEL

The rise of the white label goes hand-in-hand with a credit crunch. So as the economy bites, how can brands compete to keep people buying? Bryony Taylor finds out

Branding your way to success

he phrase ‘own brand’ or ‘white label’ conjures up images of cash-strapped consumers filling their trollies with cheap, faceless and often nameless, generic products to save money. But it’s no longer a niche market. In today’s marketplace, consumers are faced with a vast array of branded or unbranded products to choose from in almost every product sector. How does one decide? It’s a trade-off as we all know. Or at least we think we know. Does one purchase the branded product for that slightly higher price, or get more of the cheaper generic product that costs less, even if the quality isn’t quite as good? In an economic crisis consumers tend to ‘trade down’ by leaving the more expensive branded products behind for their cheaper generic rivals in order to save money. But that assumes the generic rivals lack in quality and are therefore a poorer

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product. Is this always the case? And are branded products worth the price? It takes more than a reputation and a name in an economic crisis. “Looking at the high street I would say that most shops tend to brand their own products because branding is such a powerful communication tool, more so than a white label,” says Chris Stott, MD and owner of Pukka Pads. “White label products do not seem that popular, with the exception of copier paper. We have certainly noticed more of the larger high street chains stocking up with white label copier paper at low prices,” he adds. “To date, we haven’t produced many white label products as most of our business customers either require a Pukka Pad product or a bespoke product that includes their own brand identity,” Stott explains. “From a financial angle we found

INDUSTRY

BRANDS V. WHITE LABEL

that the retail pricing of a Pukka Pad branded product is almost equivalent to a bespoke product.” It is obvious that the main selling point of branded products is that the brand name itself suggests quality and has a reputation attached to it. But that doesn’t always mean this stands. As supermarket wars intensified during the last decade, Tesco led the trend and began producing different levels of its own branded products – not quite white label, more private label. The cash-strapped Tesco consumer, who had always hankered after the more expensive product but couldn’t afford it, now had a choice. Private label products began accounting for between 40% to 45% of all Tesco’s sales, according to Sir Terry Leahy, the man who led Tesco until 2011. This abundance of choice diversified the audience; no longer was it appealing simply to cash-strapped students, but those looking for mid-market value and/or quality products also found something they were looking for. The reputation of the brand became synonymous with the shop name. While Leahy knows that you have to offer customers a range of options, that’s much easier if you’re a huge superstore. What if you’re not? And with the stigma of having white label products at home reduced for consumers, how has this impacted other sectors? “With budget cuts and freezes on the agenda for many offices, offering white label products can seem like the way forward,” says Gregg Corbett, marketing director of Avery Office and Consumer Products, “but in the current climate what businesses need are products that offer greater convenience, increased efficiency and real value. As job cuts become a reality for many businesses, staff are frequently finding that they need all the extra help they can get with everyday office tasks, from mailings to filing and organising.” Dealers need to focus on offering a product that speeds up working processes and can positively impact the working lives of their customers, Corbett explains. “It’s simply about the little things that work in a big way. Without a brand, a dealer is unable to emphasize any value-adding features or offer the consumer any guarantees on product performance. Highlighting valuable, time-saving features, combined with offering a trusted brand will appeal to consumers who may be facing reduced budgets, but don’t want to compromise on product quality for their business.” “Quality branded products show through in attention to every item of detail, in making sure that the functionality of a product is right and at the same time the product delivers value over its life,” says Craig Jessop, trade marketing manager, Esselte UK and Ireland. “We have a strong focus on quality, on creativity and on innovation as we believe that’s the route to competitive advantage,” he adds. “In an industry where we are told we have constant price and volume pressures branded products are key to ensuring that the industry remains profitable,” Jessop says. “Branded products provide strong products which add value, not only for the resellers but also the end users. A branded product should deliver innovation. This is the single most important aspect of any modern economy and any modern dealer.” But it’s not just the quality that matters. One shouldn’t judge a book by its cover, but it happens, and aesthetics play an increasingly important role according to Stott. “The aesthetics of today’s stationery market is led by colour, fashion and design,” he says. “Bright, bold designs are what makes a brand stand out from its competitors. Although white label is seen as cost-effective, having a strong brand identity is invaluable as the battle for customers intensifies day-by-day.” Creating an identity that sticks with customers is important and aesthetics play a key role in this. But it’s not the only element at play. Efficiency, ease of use, as well as

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INDUSTRY

BRANDS V. WHITE LABEL

value, quality and design all play a part in creating a sense of loyalty and trust in the brand. “Having a brand identity is a fundamental piece in your marketing communication strategy, and one you don’t want to be without,” adds Stott. “As consumers, we are fashionconscious, no matter what market we shop in. We’re aware of the certain social status that some brands portray, even down to the notepad or stationery we use. The key to success is to focus on being innovative while maintaining the correct quality and price equation that our customers know and respect,” he explains. Inspiring the customer to believe in your brand is not without cost, however. Innovation in design takes research and development, which can price products out of the range of smaller cash-strapped businesses looking to cut costs. Jessop agrees, adding that at first glance, paying half the price for a white label stapler might look appealing, but for an office worker having a tool that works flawlessly day after day and never jams or fails can be crucially important. “White label products cannot offer the same dedication to innovation, when price is the only driver. Investment in innovation is sometimes at a great risk, but it’s also the greatest difference between white label and branded products,” he says. “It was our continual encounters with businesses with limited budgets who refused to compromise on quality that led to the creation of our latest product range,” explains Corbett, adding that as a leading market brand they had to take a step back and listen to their customers and continually strive to react to the changing economic environment. “We have a

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“White label products do not seem that popular, with the exception of copier paper”

strong reputation for products that make things easier for the customer,” he adds. “So we continued to do that by offering the consumer a high quality series of fully customised marketed, branding and promotional materials such as business cards, compliment slips and brochures. All of these can be designed online and simply printed from a standard office printer as often as needed. For small businesses, this system makes it easy to maintain a professional look and up-to-date image without wasting money.” Although the original outlay by the consumer may be more on branded products than white label the overall outlay often swings the other way. Consumers can therefore justify their purchases through their long-term cost-effectiveness and quality. In addition many branded products offer the consumer separate add-ons directed from the manufacturer. Whether it be free design for printing labels or downloadable software, the consumer can often get more ‘bang for their buck’ when these are included in the deal. “With an unbranded product, this comprehensive level of support wouldn’t be available to the consumer, which can lead to wasteful and frustrating errors and can ultimately result in the consumer choosing not to buy the product again,” says Jessop. Although there will also be a place for unbranded products for certain customers, these additional extras can mean that the market share of white label products remains low.” To which Jessop adds: “We believe that the bitter taste of poor quality remains long after the sweet taste of a low price is forgotten.” DS

Industry

e-commerce

Untangling the web of e-commerce The rise in tablet computers and internet shopping means that online stores are a great way to showcase your business to the world. But to do it well takes massive investment. Is it worth it? Bryony Taylor finds out

or huge corporations, such as the BBC, investment in a website that perfectly showcases their wares can set them back anywhere between £10m and £40m. And even then, it’s not always done successfully. For dealers with nowhere near that type of money to invest, competing in the world of the web could be a sticky and messy investment if not done carefully. But is it one worth untangling? The answer is yes according to the latest figures from IMRG Capgemini eRetail Sales Index. British online shoppers spent £68bn in 2011, 16% more than the year before. The IMRG study predicts that growth in internet retailing sales will slow to 13% more than that this year (but that’s still a lot of growth), and it expects some £77bn to be spent online during the course of the year. According to the IMRG index, e-retail now accounts for 17% of the total UK retail market and is likely to increase with the rise of mobile commerce and following high sales of tablet computers in 2011. “Dealers should think beyond an e-commerce website and look towards ‘m-commerce,’” says Andrew Flint, a technical consultant at VOW. “That is, mobile-commerce, using mobile devices like smartphones and tablets to make [a] purchase. The buying power of m-commerce continues to increase

September 2012 www.dealersupport.co.uk

Industry

e-commerce

each year. If a dealer could get on board with m-commerce now, they would really be ahead of the curve.” While it seems a daunting task regardless of the benefits, getting e-commerce right doesn’t have to be difficult. It takes strategy and planning. Andrew robathan, development director, Netalogue, explains: “When looking for an e-commerce system, there are a number of considerations that need to be taken into account, the main one being: Is your offering business-to-consumer or business-to-business, or do you have a combination of the two?” “most e-commerce systems don’t deal with B2B and B2c in the same way, be it with their style of integration, front-end design or back office administration,” robathan adds. “You need to make sure your businesses strategy and the capability of your potential e-commerce provider match up.” “In our experience, dealers initially want to provide a good method of online ordering for their existing B2B clients, as well as hankering after the consumer business that is out there,” explains Kevin cowell, director, calidore computer Systems. “But the challenge of processing both types of business through one website raises the problem of making special offers attractive enough without threatening the contract prices and profiles that dealers have established with existing clients.” Karly Haley, marketing director, Superstat agrees, adding that customers surfing the web expect to find a product and be able to buy it immediately. “Web browsers bring so many benefits to dealers by boosting sales and providing a pot of warm leads that they can convert into long-term customers, however, these benefits can only be realised if their website can be found in the first place,” she says. Learning the ropes of search engine optimisation (Seo) is crucial to staying on the first page of search results – something that is not easy in a competitive marketplace. The internet is also filled with cowboys offering this practice at a monthly cost to unsuspecting businesses. “If your online ambitions extend to taking on the big boys, such as euroffice, then you will need very deep pockets, a lot of expertise and a single focus on this and this alone,” adds Alex Dunn, sales director, Superstat. “I’ve seen dealers waste a lot of money on pay-per-click and misguided Seo strategies that in hindsight were probably always doomed to fail.” “The message here is be creative and provide the route of least resistance when the customer needs to order,” says rob Burgess, senior projects manager, Integra office Solutions. “Also, e-commerce isn’t just about order capture. ensure, where possible, that invoices, credits, statements, payments and management reports are all available as part of your e-services.” Intranet ordering systems, as opposed to open internet systems, generally provide a format alien to typical consumer online ordering systems and provide end users with a limited shopping experience explains David Kowal, marketing manager of Nectere. “Providing customers with a public shop which provides bespoke pricing upon log in, promotional offers and relevant recommended or alternative products should be part of developing and enhancing a customer relationship. Adding value in this way should increase AoV, sales and margin,” he says. other problems can arise through back-office integration. “It’s worth pointing out that where a dealer has a back office system from one company and a web store from another, and there is some degree of integration between the two, then during the inevitable hot fix or upgrade there are bound to be issues with the combination,” said cowell. Working with one suppler on everything can be an advantage. For example, Heart’s PulseStore links directly with its Pulseoffice.

September 2012 www.dealersupport.co.uk

Andy Whyte, sales and marketing director, evolution Software, has worked with many dealers in the UK to provide this type of software. “most dealers opt to operate a web store that is visible to customers regardless of whether they have an account with the dealer or not,” he explains. “Whether the dealer wishes to take orders via credit card, Paypal or Google checkout is an option that the dealer can choose, alternatively they can simply request the customer calls to setup an account.” “With a closed web store it rules the dealer out of opportunities to win new customers using internet tools such as search engines, product based email marketing, social media and price comparison sites,” Whyte continues, adding that he believed having an open web store was imperative if a dealer wants to win new business via the internet. “The importance of having a web store that creates the right impression should not be underestimated,” he says. An e-commerce tool can be an effective way of extending your business reach, but before investing dealers must make sure that they can make it work. “The advice is simple,” says Dunn. “Decide what you want and get your business online. When you come to choose a system, don’t try to reinvent the wheel and spare a thought for your customers’ experience – it all starts with a sale.” DS

people

dealer interview Intec Office Systems

A b et ter I n tec Stuart Thompson first set up Doncaster-based Intec Office Systems in 1989. Billy Taylor talks to the MD about how the industry has changed over the years and how he’s led the company to success despite it all

september 2012 www.dealersupport.co.uk

dealer interview Intec Office Systems

www.dealersupport.co.uk september 2012

people

dealer interview Intec Office Systems

a same day delivery service it’s an option that’s chargeable. We charge a nominal £3.95 for that service now. If people want it, they can have it.

Do you keep products on site? Yes, we moved into a brand new, purpose built office and warehouse facility back in 2003. The building is over 5,000 square feet, with over 2,000 of that dedicated as office space that doubles up as a working showroom. We’re very proud of it. As a working showroom we have a different range of furniture, with different finishes, in each of the main offices which allows us to display most of our furniture range.

Do you find dealer groups offer value for dealers? We are a member of Office Friendly. In fact, we were one of the original members of the group. I think over the years Office Friendly has demonstrated value. I think one of the really interesting things about Office Friendly is the emergence of Chris Nichols as commercial director. He is very hands-on and he’s taking Office Friendly into a completely different league. He’s working with dealers at a level that’s very useful. He understands scalability and the very real day-to-day issues that we face. Credit where credit’s due.

Who is your primary wholesaler, and do you distribute products directly from them? Our primary wholesaler is VOW. We’ve majored with them for the 23 years that we’ve been in business. I think that the courier based distribution model allows us some additional functionality for those outside our usual delivery areas, but in honesty, less than two per cent of our distribution is done by courier. The reason that we do this is quite clear - If everybody uses a courier, where’s the differentiation? I see no value at all in providing nationwide delivery by courier other than when absolutely necessary. If one of our delivery drivers is asked to put ten boxes of copier paper in the stationery cupboard upstairs, and drop five by the photocopier, that’s what he does. You try asking a courier to do that. For us, keen pricing matched with a service that’s second-to-none is absolutely key. If everybody gives the same service then it becomes a race to bottom and price is the only thing you can compete on. I never wake up in a morning and think “Today, I want to be the cheapest”... Cheap is rarely a good thing – It’s usually closely related to ‘nasty’... We’re not the cheapest and we never will be.

Spicers would maybe take a more positive and supportive stance towards their core business, the traditional dealer base, but at the moment, from my perspective at least, that may well have been a little idealistic. I feel that wholesalers should stick to wholesaling, and dealers should be the ones who sell to end-users, giving them the kind of amazing levels of service that only a local dealer can offer.

It feels like dealers are being squeezed from all sides.

It was recently revealed that Spicers was using an Amazon storefront called Ernie’s Office Supplies. Do you object to wholesalers selling direct? When VOW originally announced their plans to set up Caboodle to deal with ‘B2C’ customers and they had supplies team handling the corporate business, I made my feelings very clear. I thought that any wholesaler that professed to support the dealer channel whilst also having a direct route to market had a deeply flawed business strategy. I had some very in-depth and heated conversations with the management team at the time and I’m pleased that they seem now to be actively withdrawing from this obvious direct to market approach and instead are supporting dealers far more positively with initiatives such as their VOW+ partner programme. However, the latest revelations about Spicers operating Ernie’s Office Supplies is a very unfortunate development and one that as a dealer, we’re obviously not very happy with. We originally wondered whether under new management

september 2012 www.dealersupport.co.uk

CV Turnover: £2.1m Number of vans: Five Number of staff: 16 Back office system: Pulse

I honestly think that dealers have three decisions to make over the coming five years. They have to either: get scale, get niche, or get out. They can only do one of these three things. Unfortunately, the commercial stationery and OP market has become increasingly commoditised. It seems that everyone is checking prices on the internet. They then call us to see if we can price match because, please note, they like buying from us dealers. Our customers don’t really want to deal with a Caboodle or an Erniesstyle operation. Because the internet has made things so transparent however, margins will continuously be under pressure. I believe that the wholesale channel has actually made things worse by exposing the end-user market to some of the cheaper perceived end-user pricing, which ironically puts dealers under pressure, which then ensures that dealers continue to push for better wholesaler pricing – madness! We’re lucky to have some fantastic customers, however, we do occasionally get the odd customer who will ring us up and want us to price match something on the internet. They want us to price match it but they often ignore the carriage costs, and that it’s cheaper to order with us and our free delivery than pay online prices with additional delivery charges. It’s a very difficult conversation you have to have with the customer to

people

dealer interview Intec Office systems

I honestly think that dealers have three decisions to make over the coming five years. They have to either get scale, get niche, or get out

point this out. We’ve even had customers turn around and say that the online competitor delivers by a courier and so has to pay carriage, but we could surely just “drop it off in a van” without any thought to the cost associated with the van and driver. Happily, these conversations are few and far between and we usually retain the business successfully.

Is that part of the reason you started pushing office furniture as a category? Around six or seven years ago, we were selling very little in terms of office furniture but I saw it as a way to differentiate the company, and to attack a different market. Furniture is almost 45% of our turnover now. By the end of the year we’re on target for it to be 50%-plus. Like most people, we offer free design and planning as well as loan chair facilities so people can try a chair before they buy it. We can then have it upholstered in the fabric of their choice. We look at furniture very much as a consultative sell. It’s not a commodity product, and whilst we are very keen and competitive, it’s less easy for a customer to argue about a product being cheaper elsewhere. We will sell over a million pounds of furniture this year. We’ve recently done installations that have ranged, in some cases, over a hundred thousand pounds for an individual job. Whilst it’s not in the really big league, we’re getting there.

Do you offer any managed services? We are launching our own shredding service in the next few weeks. It will essentially be a bag shredding service. We will pre-sell packs of five shredder bags and we will pick up the bags as required when we’re doing normal stationery deliveries. We are essentially going out and doing the deliveries for stationery and back-hauling the shredding requirements of our customers.

I noticed you do consumables recycling as well. Yes, that is something we do in connection with a local charity, the Bluebell Wood Children’s Hospice. We’ve adopted them as our local charity of the year for the next 12 months and we donate any money raised on recycled toners directly to them. We did a copier promotion to raise money for them recently. Next month we’ll be doing a consumables promotion and we hope to raise even more then.

Have there been any changes to the way you approach the market? In the past two months, we’ve introduced a totally new way of working. We have an external OP sales team who in the past have divided their time between getting new customers and looking after existing accounts. Knowing where to concentrate our efforts is a constant problem. We wanted to do things differently and have an internal

september 2012 www.dealersupport.co.uk

team looking after existing business and leave the external team to spend 80% of their time chasing brand new business. Even though we’re in relatively tough times, we were so committed to the idea, we took on two brand new employees to ensure it worked as we wanted.

Did this impact your marketing approach? We have introduced a very structured marketing plan that involves monthly telesales calls to all customer accounts, along with regular email offers, targeted mailings, etc. We took on a person in telesales to assist an existing team member, as well as someone to assist within the marketing team. We looked absolutely everywhere for a CRM system that was tailored specifically to the office supplies industry and we found that the market is catered for by either very basic systems, or not at all. We wanted a system that would handle CRM telesales, email customers, either individually or in bulk e-shots, print labels for mail-outs, date stamp memo lines, filter on different market segments, etc. and to have all the flexibility that we needed whilst linking seamlessly with our back-office system. After many hours of searching, we eventually spoke to a Stockport-based company called Salespoint. They develop bespoke CRM systems that’s generally aimed at mid- to large-scale operations. Although we’re still in the early stages, we’ve had Salespoint CRM installed now for about six weeks and it’s very encouraging. We’re ironing out a few remaining teething troubles and developing it as we go with the team, we keep asking for new things as we realise what it can do, but all in all, it’s a fantastic package. We can keep track of customer information, have full email facilities to groups or individuals, post anything we need and handle full telesales campaigns and track sales patterns with the confidence of knowing that we’re doing absolutely everything that we actually planned to do. DS

PEOPLE

DEALER INTERVIEW NEMO

Beau du jour Nemo’s commercial director was recently tapped to serve as the dealer group’s newest MD. Billy Taylor chats with Tim Beaumont to discuss his background, opinions on the industry, and his vision for the future

SEPTEMBER 2012 www.dealersupport.co.uk

DEALER INTERVIEW NEMO

Congrats on your recent promotion. Tell me a little about your background before joining Nemo. Varied. I spent the last three years running a web development company, designing and building a web banner platform. We were trying to introduce a new type of web banner that allows you to plug in a company’s API, which turns the banner into a full e-commerce-enabled shop rather than just a signpost banner. Before this, I was group marketing head at SCH (Specialist Computer Holdings), Europe’s largest privately owned IT reseller, with 7,000 employees and a turnover in excess of £2.5bn. I managed a large team of marketing professionals, covering all aspects of the business, including distribution, corporate, SME and public sector. What was the most difficult thing about crossing over to office products? The breadth of products and number of suppliers. We currently work with over 80 suppliers as well as the leading wholesalers. That’s a lot of new names and faces to get to know.

www.dealersupport.co.uk SEPTEMBER 2012

PEOPLE

DEALER INTERVIEW NEMO

Joining the OP sector as an outsider, what do you see as its biggest challenges? For us as independents, one of the big challenges is, of course, the contract stationers as they continue to push down into SME, but [there are] also new challenges from big, fast-growing players like Amazon. However, the biggest challenge is gaining a greater share of the spend from our customers across all of the product sets that our dealers now offer. We are continually encouraging our members to introduce new product categories to their customer base. Facilities management (FM) and managed print services (MPS) are the best examples. Do you think the distribution model for the industry is broken? Not broken, but in need of change. This is where the IT industry is much different, with a large number of distributors on offer, from specialist/niche to broadband. In IT, the distributors mainly focus on giving credit and shifting boxes – efficiently. In the OP industry, the two main wholesalers have numerous add-on services and value added propositions. The main issues for me are: Are they really supportive of the independent dealers? Are they hedging their bets by trying to go direct to the business user? And what will their service offering look like in two years’ time? If we can focus on dealer groups specifically for a moment, can you tell me why they’re still important for dealers? I don’t think that they are important. I think that they are essential. Where is the big drive to get rid of all the buying groups coming from? Unless the wholesalers have got some unspoken plan to deal direct with every independent, then there is of course a need for buying and marketing groups. We add tremendous value to dealers, in terms of the deal that they get and the marketing support that we give. In your opinion, what should dealers be doing in the future to be successful? Sell more of their extensive product range to more of their existing customer base. Make sure that their new business programme is driven and focused. Gain a better understanding of their customers’ requirements and business pain, then shape their offering to fit those elements. Use all currently available tools, both web and offline, to tailor their offering Is product diversification the key to dealers’ success in the future? Yes, one of the keys. Traditional office products are in terminal decline and if a dealer only focuses on these then I would suggest the end is near for that business. Independent dealers are a trusted advisor in the eyes of their customers and are in a great position to introduce new product categories. The level

SEPTEMBER 2012 www.dealersupport.co.uk

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DEALER INTERVIEW NEMO

DEALER BOOKMARK

of service offered by the local, independent dealer is hard to compete with. I constantly hear stories from our members of ‘going the extra mile’ and over-performing with the expected service level. Having previously run a number of SME businesses, I can testify that I was willing to pay for higher service levels and was always keen to cut down the number of suppliers that we dealt with. Nemo recently launched a new e-commerce site. Can you tell me a little about it? We have built a platform, where all of our members are given their own e-commerce enabled site that they can customise to better fit their brand. Featured products, pricing, marketing and traffic stats are managed centrally. We have also added a unique element, with Office TV, a video platform that enables VOD (video on demand). Most vendor videos end up on YouTube and if the viewer wants to purchase, they have to then find a site where the product is sold. We are bringing the audience to the video and allowing the business end-user to add to basket, whilst watching the video. The platform is also fully social media enabled, so that videos can be facebooked, emailed or tweeted. Research has shown that at the point of purchase, video gives the viewer a far clearer understanding of the features and benefits of the product, which allows a more informed purchase. What are your feelings on Spicers having an online storefront on Amazon? To be honest, I believe that wholesalers should stick to wholesaling. I am against any project where they are dealing direct with business end-users. Given the choice, I would also prefer it if they didn’t operate their own pseudo dealer group either. To answer the specific question asked; I take Alan Ball at his word. He continually tells me that he and Spicers are totally supportive of the channel. Given the total dealer spend as a percentage of his turnover, I would have thought that a project like this will be short-lived.

Unless the wholesalers have got some unspoken plan to deal direct with every independent, then there is a need for buying and marketing groups

Martin Kent Systems analysis manager ACS Business Supplies Bingley, West Yorkshire

How would you say Nemo is different to other dealer groups? Nemo is unique in that we are truly a cooperative and have just celebrated our 25th anniversary. All of our members own an equal share and have an equal say in how the business is run. We are not trying to make a profit, we are focused on helping each member increase their profit. We return all rebates throughout the year, and unused surplus at the end of the year. A large number of our members have been members for many years and are very loyal. In the last nine months we have increased our membership by 25%, which is testimony to the new and innovative things we are doing. Additionally, Nemo is a member of Nexus – a group of groups, made up of like-minded dealer groups from different sectors. The total spend of the Nexus group is in excess of £687m, which gives Nemo much stronger buying power and access to many new product categories. What is Nemo’s current member number and annual group turnover? Nemo currently has 58 members and another 122 group members (representing 357 retail outlets between them). Annual turnover for Nemo membership is in excess of £110m. What is your vision for Nemo in the future? Nemo is calling this a year of innovation and growth. So far we have launched our new group-wide e-commerce platform, introduced Nemo TV, completed the first steps into the education sector and grown the membership by 25%. I see no reason why this pace will not continue. We are confident that we will continue to grow and our minds are set on being industry innovators for the foreseeable future. DS

SPECIALITY

A complete business supplies solution.

Worked in the industry for over 20 years. Started in sales at ISA Wholesale before a move into MIS/IT developing reporting and sales process software applications. ACS offered me a fresh challenge.

BEST MOMENT

Many great moments growing with ACS (including winning the highly contested ACS Golf Day in 2010) but especially automating our essential management information so that we have constant visibility of our business-wide activities.

CATCHPHRASE

“If something is worth doing, it’s worth doing it right”

WORD FOR THE WISE

Horizon was the business platform of choice due to its end-to-end business process integration and time-saving functionality. It’s good to see even more new features coming through.

THE LEADER IN INDUSTRYSPECIFIC BUSINESS SOFTWARE

www.eci.eu

PEOPLE

VENDOR PROFILE Spicers

Wholesale change Six months after Spicers’ sale to Better Capital and the wholesaler is doing better than ever. Dealer Support catches up with Sales and Marketing Director Tom Rodda to find out what he has planned for the foreseeable future

SEPTEMBER 2012 www.dealersupport.co.uk

Can you take us through your plans for the 2013 catalogue? That’s been going particularly well this year. There aren’t too many changes, partly because we made significant changes last year and having undertaken more end-user research on launch of the book we’ve been told they (consumers) love the changes and want a period of stability going forward. What we have done is reduce the size of our main books slightly by about eight millimetres along two of the edges, which makes a surprising amount of difference to the amount of paper that you use, so that’s more environmentally friendly but also allows the book to stand out on a desk or shelf because the size is different to all the other catalogues that an enduser might be browsing. It helps with the costs too. Our catalogues are cheaper this year for our dealers than they were last.

VENDOR PROFILE Spicers

How about your online marketing? Having again undertaken some end-user research, when comparing OSCARnet to other products in the marketplace, the functionality is pretty good. In fact, having benchmarked it, we think it’s the best product on the market in terms of functionality. But in terms of look and feel, it’s definitely out-dated. So we’ve put a significant investment into OSCARnet to turn it into not only industry leading, but best in class when it comes to e-commerce. When it comes to e-commerce, the end-users are not just surfing for office products online, they’re searching for all sorts of other stuff, so our e-procurement needs to look as professional as someone like Amazon or Argos. Are you seeing more dealers offering/using e-commerce solutions? Absolutely, the research we undertook shows that the majority of end-users now want to order their products online. Most still search through the paper catalogue as part of their research, but once they’ve found what they want, they order it online. So it’s very important that we have the best solution to that piece in the jigsaw. You’ve been feeding back end-user data on e-commerce to dealers, is that right? Yes, we’ve literally just finished another end-user study. We started doing end-user research about 18 months ago, which, believe it or not, is unique in wholesaling. We’ve always surveyed our dealers and critiqued things internally, but in reality, it’s the person right at the end of the chain who is buying and using our products that matters most and if he or she likes it then I’m happy. If they don’t like it, we need to change it to make it right for our dealers to use with their customers. Tell me about the New Talent Academy. That seems to be going well? The New Talent Academy has been the most successful programme run by any wholesaler in my career. It’s absolutely going ballistic. We’ve just about sold out New Talent Academy Four. It goes right back to basics: our dealers know how to sell office products, so why don’t we help them sell more office products? Why do we have to bolt-on different fads or products? Sell office products; sell more of them. There’s a massive market out there and New Talent Academy helps them achieve that. The graduates from NTA Two have opened 102 new accounts with a projected business of £301,000. They have a £1.4m pipeline and 307 customers at closing stage and if they won all that business it would be just short of threequarters of a million pounds. One New Talent Academy graduate opened a new account on his second day with a £6,500 order. Our target was to put 100 people through in three years – so 33 a year. We’ve done 34 in one year and we’re at least 9 to 12 months ahead of that target now. We think we’ll be there in two years.

In terms of product categories, do you have any plans to expand into new turf? We’re putting together our third specialist book on workplace solutions and are still in exponential growth in the category. What we’re really concentrating on now is moving away from our traditional buying sources in that category, which would have been other wholesalers, and going direct to source. Technology is also a big area of growth for Spicers, right? Yes, we had our technology launch back in June. It was very successful – we had 14 suppliers there with over 150 exclusive new products which didn’t feature in our January 2012 catalogue. We’ve also introduced a weekly product webinar every Thursday at 8.30am with suppliers covering a 20-minute slot. Our dealers can log on and listen to the sales support presentation all focussed on generating new opportunities and sales growth. There is also an exclusive offer for those who do log on every week. So when they sell the product that they’ve been trained on, there’s a double financial reward for it.

If you pick it right, pack it right, deliver it right, it’s a good enough range at the right price, that’s 98% of what you require from a wholesaler. At the moment our service has never been better

In your opinion, what are Spicers’s unique selling points? Let’s get back to basics. If you pick it right, pack it right, deliver it right, it’s a good enough range at the right price, that’s 98% of what you require from a wholesaler. At the moment our service has never been better. On top of that, we have regional distribution centres and we fundamentally believe in them for a number of reasons. We have a number of customers we deliver to at 10 o’clock at night, you can’t physically do that from one distribution centre. We also do over 100 same-day deliveries from our Greenwich branch into the City of London through Rapidline. Again, you can’t do that unless your stock is close to where it’s going to.

We also have one of the most recognised brands in Europe with 5Star™, which makes it a pull brand rather than a push brand. We’re also launching our charitable trust, so for every 5Star™ product purchased, a donation is made to the charitable trust. Trustees will comprise of some senior Spicers individuals and dealers who will be selected regionally and they’ll help define where that money goes back into local good causes. Another one of our massive USPs is our data. Dealing with the likes of Euroffice and Amazon means we have to have very good data. However, we’re not standing still. We’ve gone from 14,000 to 37,000 images in our portfolio. We’ve got lots of application shots, videos and 360 degree product views and we’ll be launching our own set of defined attributes in January, which help people search online for products faster. It’s all about helping dealers sell more of what they’re good at selling. So it’s more than just about price? People talk about price all the time, but I genuinely have dealers that make 24 points of margin and dealers that make more than 40 points of margin on the same price file. Is price important? Of course, but it can’t be the number one factor. Do you have big plans for Synergy with Simon Wallis back in the driving seat? Yes, and that will be his only job. Long overdue, but we had a meeting with some Synergy partners two or three months back and the first thing they asked for was some dedicated resource. We asked them who the best person in our industry would be for that, and that was Simon. So we went and acquired him specifically for that role. Anything else prospective dealers should consider? If I were a dealer starting from scratch and looking at what’s out there in terms of wholesalers, I would certainly look at our financial position. When Better Capital bought the business this generated £32m of debt, which is very light considering we’re a business that turns over in excess of £300m. We’ve cleared £20m of the £32m debt so we’re left with £12m and we’ll have that cleared early next year. That’s a really comfortable place to be. Dealing with our new owners is incredibly easy. If we need investment, we get an almost immediate decision. They want return on that investment, but nonetheless, they’re not frightened to invest in our business. They’ve invested £10m into the DDC, £500,000 in a forecasting and replenishment system for better fill rates, and £250,000 into voice picking, for a lower error rate. You can only make the business the best it can be when you’ve got minimal debt in your business. DS

www.dealersupport.co.uk SEPTEMBER 2012

e d i u g IT IN A

P U T NK I

ling l e s o de t A gui toner d ink an

CONTENTS 40 News and introduction A look to the future of ink and toner 42 Seeing the light Thereâ&#x20AC;&#x2122;s a glimpse of light at the end of the IT tunnel 44 Market update Keep up to speed with consumables 46 Big ask What should dealers do now to succeed in OEMs? 50 Leading the way We speak to a successful IT dealer 54 How to sell A guide to selling ink and toner

N WIT

IATIO SSOC

012

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M SEPTE

IT GUIDE

NEWS

Welcome to the September IT Guide. In this issue, sponsored by Westcoast, we focus on the original consumables market and what independent dealers can do to succeed in it. We hope this helpful and informative guide will encourage you to get in touch with any of your IT news on editor@dealersupport.co.uk. Note from our sponsor Westcoast is the UK’s leading supplies distributor and represents virtually every printer vendor from Brother to Xerox and everyone in between. In fact, Westcoast distributes over 25 brands across more than 7,000 skus, so whatever printers your customers have, you can be certain that Westcoast will be able to help. The scale of the Westcoast supplies business enables us to take advantage of the best deals available and pass these benefits on to our customers with consistently competitive pricing. Westcoast also enjoys long-standing relationships with every major supplies vendor which means that we can help to bridge the gap between the OEMs and our customers. Many vendors have programs to support resellers by way of rebates, marketing support and advice. By purchasing from an authorised distributor, resellers can be sure that their business is recognised by OEMs and as a result additional support may be available. With Westcoast’s incredible breadth, depth and inventory levels coupled with our leading edge logistical capabilities, our customers can rely on us to deliver on their behalf often leading to their own stock holding to be reduced significantly and allowing the cash generated to be redeployed to grow their business further. On a daily basis Westcoast is shipping up to 4,000 orders and 6,000 parcels directly to resellers’ customers. Finding compatibility information, spec sheets and catalogue information can be a frustrating and time consuming process for resellers. In response to this Westcoast created the Science of Supplies www. scienceofsupplies.com site where resellers can find all this information from every leading manufacturer all in one site.

War on counterfeits extends to patent infringement Although patent infringement is a separate issue from counterfeit, the lines between counterfeit product and patent infringing products are blurring so much that the efforts to thwart both are starting to intersect, according to InfoTrends. In the case of both counterfeit supplies and patent-infringing supplies, education is a key component, says the research house, since often, the victim of counterfeit products are the customers who believe they are paying for genuine products but are getting a poor substitute, which can reflect badly on the OEMs. InfoTrends is making the channel aware of risks in selling infringing and counterfeit goods as well as reporting these goods that are being sold on marketplaces.

Westcoast revamps bid tool British owned distributor Westcoast, has recently refreshed its online bidding tool SMARTbid, an online bid tool available to non-preferred and non-gold partners. The tool is to be utilised to obtain discounted prices in a competitive situation. Since its conception in 2010, SMARTbid has transformed business prospects for many resellers and has seen an increase of new users by 25% year on year. The web-based tool streamlines the bidding process and offers a competitive edge for HP products. Resellers are asked to provide the product code they need, the quantity, a target price for the product and end user details. Automated requests are evaluated by Westcoast and feedback is provided within one business hour. Paul Hamilton, HP business manager for Westcoast explained: “SMARTbid’s ease of use, one-hour SLA and support from the HP business is key to its success. Through SMARTbid we can offer our resellers competitive pricing that fits within their budget – and recommend higher spec HP PC’s at the same price as they had been quoted elsewhere for lower quality hardware.”

$14.5bn The amount the market for software as a service is projected to reach before the end of the year (Source: KPMG)

THEY SAID We need to help simplify the reordering process so that customer can quickly reorder and get back to printing. At the end of the day - whether you’re printing out an important proposal or an outline for an origami swan, time is precious and you should never waste it.” Ian Cowley, MD of online reseller Cartridgesave, on the launch of the company’s new Speedy Reorder service

SEPTEMBER 2012 www.dealersupport.co.uk

IT GUIDE

MARKET REPORT

IT shows glimpses of light in dark economic conditions, finds GfK’s Andrew Walsh as he takes a look at how the market fared over the last quarter

Light at the end of the tunnel?

he UK retail market continues to struggle in tough economic times, as the much talked about double-dip recession hit the UK last quarter (AprilJune) and consumer confidence remains at a low-ebb. The consumer channels have been the hardest hit by this situation, particularly in the multi-function device (MFD) inkjet market. This has seen a 19% value decline year-to-date (YTD) (January 12-June 12) compared to last year, and remains five per cent down on Q2 2011. Independent outlets within this channel are performing slightly worse than the market rate, with a seven per cent decline over the same period. The upside of this is that the business-to-business (B2B) channels are retaining their value somewhat better – seeing MFD Inkjet sales value decline by only three per cent YTD. However, the larger segment of laser printers has declined by eight per cent in market value. Independent business outlets are very much struggling, as customers look to multiples more frequently for printing hardware. Notwithstanding a four per cent value growth in laser printers versus Q2 2011, independent business outlets have shown a ten per cent decline in this area and multiples down by two per cent in comparison, despite an 11% decline for multiples in laser printers. Looking across to the IT markets, web books remain a key value driver in the market – with a panel market value growth of 165% on Q2 2011. Once split into the B2B channel, this growth increases slightly to 185% over the same period. Independent B2B outlets are missing out on these high growth rates, falling behind the market rate yet still registering 55% sales value growth in Q2 2012.

SEPTEMBER 2012 www.dealersupport.co.uk

B2B channels are retaining their value somewhat better

Storage devices continue to exert a growing influence in the B2B channel, with the average selling price (ASP) per unit up by 73% compared to Q2 2011. Sales value growth is up by 35% over the same period, which indicates a decline in volume demand of 22% as high ASPs begin to be a deterrent for some. B2B independents’ performance from this perspective is very encouraging; registering a 56% sales value growth on top of an 11% volume increase. Deskbound computing, in contrast, has declined by nine per cent in sales value compared to Q2 2011 within the B2B channel, despite a five per cent volume increase over the same period. In comparison, B2B independents’ performance has experienced a 34% sales value decline in Q2 2012, stemming from a 33% decline in volume. This demonstrates that multiple dealers within B2B appear to be coping better in the tough market conditions. DS

Andrew Walsh Account manager – office hardware, UK and Ireland andrew.walsh@gfk.com 0870 603 8236 Gfkrt.com/uk, Twitter.co.uk/gfkrtuk

IT GUIDE

MARKET REPORT

ROOM FOR

G R OW T H

During the average office supplies dealer’s darkest moments all may seem lost – but there is hope to be had yet in consumables. Julia Dennison analyses the market

rint is not what it used to be – but it is still essential to many dealers’ revenue. Toner and inkjet cartridges make up approximately 70% of the worldwide office supplies market, according to Photizo Group, and this is growing – with unit shipments of both product types on the up, with colour supplies revenue projected to be the fastest growing segment with a compound annual growth rate of 6.2 per cent. The print supplies market isn’t so rosy here in the UK, however, where inkjet remains in a difficult and unpredictable state, according to GfK. Sales prices are essentially flat with only 0.1 per cent growth this January to June, compared to last year. Meanwhile, sales value is actually 3.3 per cent in decline for the same period. GfK account director for office/stationery, Greg Allen puts this down to strong falls in the consumable specialist and office equipment retailer (CSP/ OER) channel – independents in particular. “As the economic climate has become fragile, it has had a strong impact on the numbers of independents able to survive and remain competitive,” he says. “With digital workloads increasing, rising levels of smartphone and tablet device use, the demand for consumables has hit these independents hard.” There is brief respite to be had by independents in the laser toner market. With growth of sales pieces by 7.5% and 9.4% in sale value over the January to June time. This compares admirably to the overall laser toner market, which has fallen 3.9% in sales pieces and 4.8% in sales value, according to GfK. The CSP/OER channel continues to drop across laser independents and the total market. However, IT resellers and mail order continue to develop sales. Allen puts this down to the relationships these independents have with their customers. “Small business relationships have become much more crucial to the continuation of strength of independents in the laser toner market,” he says. “In order for this to continue though, the retention of custom will become the key consideration.” So where can a dealer find growth? Photizo puts a worldwide growth in ink jet cartridges down partly to a shift in the product mix from tricolor to single-colour cartridges, which has contributed to a decline in their average sale price. The research firm predicts high-yield cartridges with lower cost per page and purchase prices to continue to trend higher as printer OEMs push business ink jets as an alternative to laser printers for business users.

Meanwhile, green is on the scene in the toner market, with printer makers rolling out products with low-melt toner and fusing systems. OEM manufacturers like HP are pushing the value and quality of HP supplies above alternative or refilled cartridges at lower prices. While this competition is good for the marketplace, HP believes that compatible products cannot rival the performance and value of original HP supplies. According to research commissioned by the firm, more than 40% of all non-HP toner cartridges tested exhibited some kind of problem, while almost the same amount of pages produced by the tested non-HP toner cartridges were of limited or no use. “Wasting time to reprint low quality pages which cannot be used for the intended use means wasted money for the business,” explains Dexter Harriss, HP’s marketing manager for the UK and Ireland. For a viable sales opportunity, Photizo Group points to managed print services. Monthly office print volume dropped by a little over five per cent in 2011 year-on-year, which users put down to the economic downturn and the environment. Companies looking to save the pennies and the earth are turning to MPS, with about one-quarter of US companies having implemented some form of MPS and the UK looking to go the same way. But with page volumes decreasing and personal devices on the up, will business and consumers still be printing in five years’ time? Alex Tatham, Westcoast’s sales and marketing director, says yes and so the real change will be the impact of corporate computing. “If computing becomes a utility as pundits predict, then printing will have to follow,” he explains. “If the servers exist in the cloud, then printing will too. Control of printing will be increasingly important as will asset management. Office dealers can play a role here as they become more important in managing the physical hardware, delivering to the machine and help IT/facilities managers to asset manage. All networked machines must be cloud enabled and dealers must begin to understand this vital development if they are to take advantage of the change. Those dealers still talking to the facilities manager exclusively will not be trading in five years.” DS

As the economic climate has become fragile, it has had a strong impact on the numbers of independents able to survive and remain competitive

SEPTEMBER 2012 www.dealersupport.co.uk

Turn the page for this issue’s Big Ask to find out what dealers can do now to ensure their survival.

IT GUIDE

BIG ASK

BIG ASK in association with

What should dealers do now to succeed in the consumables market?

SEPTEMBER 2012 www.dealersupport.co.uk

BIG ASK

ALEX TATHAM, SALES AND MARKETING DIRECTOR, WESTCOAST “Margins are thin, the market isn’t growing and IT dealers are increasingly taking share. The value that an office products dealer provides must be tangible to demand higher prices. This value needs to go beyond next-day delivery. Managed print services can delight an end-user and do not have to be contractual; offer asset management with delivery to machine and this can transform your relationship with a customer without threatening contracts. Work your way up to offering the customer a fully monitored service by offering break-fix services (using vendor/distributor provided services) and ensure you know your customer’s print fleet inside

out. Once your end-user has decided that you are providing a valuable service, you can then enquire about installing monitoring software on their network. Then you have all you need to succeed. “Beware buying your products from office products distributors or through buying groups. You will certainly find that IT distributors can offer significantly cheaper prices. In a category that is highly competitive, being close to the online price is critical and there is little point in complaining about the margins you make on these products – it is often in the smarter buying of such products that you can be successful.”

DEXTER HARRISS, UK AND IRELAND MARKETING MANAGER, HP PPS “Consumables such as HP Printing supplies should not be regarded as a commodity sale as they’re hi-tech products designed for a specific print environment, and we recommend that dealers offer them as part of a value-added package of services. A total printing solution should take into account the business printing needs and utilising key printer technology benefits. For example, they could offer ordering and replenishment services which can reduce administration and cost as well

as environmental impacts by reduced transportation. “We’re seeing growth areas in colour printing and managed print services – MPS – so dealers need to understand the markets for colour transition and how an MPS solution can work within an organisation. Dealers should also be aware of new printing technologies and programmes to reduce environmental impact…and those to enable mobile printing.”

DANIEL HISCOCK, SUPPLIES PRODUCT AND MARKETING MANAGER, PRINT DIVISION, SAMSUNG “In the current market environment, quality and cost are huge influencers on key decisions so it is essential [that] we act responsibly by producing high quality products that are affordable to users. The growth of polymerised toner means that print quality is improved while power consumption is reduced which helps keep costs low… “Our overall market view for this year is that end-users will continue to recognise the importance of using quality original toners to ensure they are achieving the optimum results for their machines. For example, by using original toners this can prevent downtime for machines and replacing a toner cartridge with a new Samsung original toner cartridge delivers the same benefits as buying a new printer. Therefore,

to keep printers in the best condition and to print superior documents, dealers should always use verified original cartridges. The current economic environment means that the life cycle of printers is being extended and the best way to do this is by using original supplies that are designed to work in tandem with the machine. “To maximise sales in the tough market conditions, customer relations are paramount. It’s vital dealers understand what their customer requirements are and not to assume every customer behaves in the same way. It’s also important to strive for the best customer service. Helping with fleet management and providing same-day and next-day delivery are also good ways of keeping customer satisfaction high.”

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IT GUIDE

BIG ASK

MALCOLM DRAKE, HEAD OF CATEGORY, EOS AT BROTHER “The first key to success is to pick a knowledgeable distributor who can provide competitively priced products, the option for direct delivery and integrated back-office solutions. “When communicating with buyers, push original products with proven reliability to ensure minimum problems to the reseller and maximum end user satisfaction. If they are looking to save money, highlight that they can do so using original consumables, and that it is more cost effective to print economically, for example by using ink and toner save modes, duplex and booklet printing, and print preview prior to printing. In this way, the end user can achieve savings, while avoiding the possible hidden costs of non-original product.

CHARLOTTE ELMER, IT CHANNEL SALES MANAGER, KYOCERA DOCUMENT SOLUTIONS “Dealers need to work with a manufacturer who will support them, can demonstrate a clear European strategy for its managed consumables business across Europe and who will always provide quality support for genuine consumables.”

STEVE TORBE, HEAD OF RESELLER SALES AT EPSON UK “Dealers who focus on regular customer contact and the provision of excellent levels of logistics and service are those who will be most successful in selling consumables. “Differentiation is not always easy, but the value placed on high levels of service is significantly more important to end-users than simply providing a low price point. In addition, the most successful dealers are in tune with their customers’ business needs – product quality and reliability are crucial to customers. As a result of these customer demands, it is no surprise that Epson’s inkjet cartridge market, according to GfK, demonstrates a genuine share of 80%. Customers will not thank dealers for simply focusing on low prices; it must be remembered that Epson’s hardware and ink are developed in tandem throughout the R&D process to provide the best customer experience.” DS

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“Also highlight the need to protect hardware by using quality consumables, for example, some manufacturers’ warranties won’t cover damage caused by using compatible products. “This will help to build relationships with customers as it proves knowledge of the market and hardware as well as a consideration of the long term benefits of purchases. “It’s important to ensure a strong online presence and it’s essential to have a well maintained, regularly updated e-commerce enabled website. This website can be used to attract new business as well as keeping reseller costs low. In a highly competitive marketplace, a good online presence will help to differentiate your business.”

www.dealersupport.co.uk SEPTEMBER 2012

it guide

dealer interview

Life in print 50

september 2012 www.dealersupport.co.uk

dealer interview

For nine years, Adrian Tolhurst watched his boss turn away OEM clients in favour of higher margin compatibles. In a bid to capitalise on missed opportunities, Direct Imaging Supplies was born. He tells Nina Rosandic how he has grown the company in just three years

ightened printing budgets, an increasingly saturated compatibles market, squeezed margins, the threat of the paperless office... None of these appear to have affected the meteoric rise of Tolhurst’s company. Three years in and his business, of which 81% of sales are generated by ink and toner cartridges, has hit a turnover of £700k. In April 2009, Tolhurst opened up shop from his Yorkshire bedroom with a view to starting his own modest and manageable venture selling print consumables. He explains: “My intention wasn’t to start a big business, but more so I could be in control and enjoy myself, have a bit of time to see my family and friends. But it went really well – it went really, really well!” As is often the case, he spent years not only learning the trade at his previous dealership, but identifying areas in which he could improve. “They were doing some things right and some things not quite right and I thought: ‘I can do better than that.’ So I set up on my own,” he says. Before long a friend and former colleague asked Tolhurst if he could get onboard. “I said: ‘Yeah, why not?’ He knew the industry and didn’t need training up. And then somebody else rang me and before I knew it I was like: ‘Flippin’ ‘eck, I’m recruiting staff here!’” he explains. Very quickly the sales picked up, although Tolhurst was wary of the company getting out of his control. “I wanted it to stay the same; it was enough really. I didn’t want the stress of getting all the staff and the big offices and rates and all the rest of it.” But seeing the growing potential, Tolhurst thought again. “I’m only young, I’m 33 now, I’ve got plenty of time to work, so I thought, why don’t I give it a go, and if it doesn’t work out, I can reel it back in.”

www.dealersupport.co.uk september 2012

it guide

dealer interview

Casting the net Today the 11-strong team is housed across three offices in the plush Maltings building in Malton, North Yorkshire, supplying a national customer base of mainly schools and doctor’s surgeries. “It’s about 40% surgeries, 40% schools, and the other 20% is a bit of a mixed bag really; solicitors, accountants, it’s just a variation,” says Tolhurst. “The view with the surgeries and schools is that they don’t tend to go bust, so the payment is generally pretty secure.” The majority of sales leads are created via the company’s cartridge recycling scheme, the drivers of which are three websites that, when searched, feature on the first page of Google. Tolhurst set up RecycleInkCartridges.co.uk at the outset, and the two supplementary sites were set up in 2010 and 2011 to boost the drive. Not only does the scheme appeal to customers’ environmental efforts, there is also a charitable aspect. “They’re pretty busy sites and the customers are coming to us with their info. We collect the cartridges, take them to the recycling company, they send us a statement and we send that money to the children’s charity When You Wish Upon a Star each month. The scheme generates a lot of interest and if you offer a good service on collecting empties then you can say: ‘Would you be interested on saving money on your consumables?’ It creates a lot of business for us.” Meeting the demands According to Tolhurst, the wants and needs of the customer have changed. “Back before the recession and budget cuts, when everything was hunky dory, it always came down to service, and although the service aspect hasn’t gone away, I do think more people have budgets to meet, and they’re saying: ‘We’re spending this much on printer cartridges, can we get a better deal?’ Obviously we’re talking in the majority here, but as long as we can save them some good money, the chances are we can get the customer,” says Tolhurst. Direct Imaging Supplies offers customers, both old and new, significant savings, as he explains: “We’ve got a bottom price which we like to go on, which we know will save them a lot of money, unless they’re buying on Ebay or something like that. Rather than just have 20 customers, buying at a high price and only saving a bit of money, we’d rather have a bucket of say 50 customers paying a lower price, and saving a lot of money, but with double the customers in the net. And then, if any do swing off – which they do as buyers change or the odd thing goes wrong – it’s not as much of a dent in the business.” This ethos of winning clients, above gaining the biggest margin, aligns with the lessons Tolhurst learned at his former company. “Their business was purely a reseller of compatible cartridges. We were always taught: ‘Got to sell compatible, got to sell compatibles,’ but they were turning down sales for originals, basically, because the company didn’t want to make a lower margin on what the compatibles were. Most customers ask for originals. Why turn down the business on the originals if it’s what people want?” Beyond price and product variety, the team maintains service level at a premium, making sure each customer has a designated account manager and local companies are offered same-day delivery. “We hold stock for local businesses. We distribute nationally, so

september 2012 www.dealersupport.co.uk

for customers in Scotland or Cornwall we tend to ship everything direct from the supplier. But we supply to a lot of companies in the town, so to get ahead of local competitors and the big stationery companies, we decided to hold a lot of stock, so if anyone rings up with an order we can get it to them the same day – we try and get it there within the hour.” Tolhurst and the team source from a number of suppliers, purchasing the majority of their OEM cartridges from Westcoast. “We’ve been working with them for years. We get all the support we need from our suppliers really, in terms of delivery and tracking and reliability. We seem to be very lucky, things rarely go wrong with our suppliers. It’s not like it used to be, you can feel in control of your deliveries these days. They ship direct to the customer and we are given regular emails so that we know where the deliveries are, which allows us to give the customer a call to give them an ETA. You don’t tend to get that if you’re ordering from a random site online.” Tolhurst has been preparing a managed print service which will be available to customers later this year. “I mentioned about my old company missing the point and turning business down. A lot of companies we’ve lost out to as they’ve said: ‘Oh actually we’re getting rid of all of our standalone printers, we’re going on to a copier contract.’ You have these customers who you have really good relationships with but then the people above them, like IT guys, are looking into it and cutting down on pence per page and getting signed into contracts for two or three years. Providing it comes up cheaper and providing we can offer them the right contract then we can have a slice of that pie as well.” According to Tolhurst it all seems, “pretty straightforward but we need the sales manager to make sure he can take care of the sales side of it. However, I think for it to work we need someone on it full time because there’s quite a lot of paperwork involved and it’s got to be done right.” Team spirit When asked what he thinks is the key to the company success, Tolhurst insists it is down to the staff, most of whom have come to him. “We have a brilliant team at the moment and making sure they are happy and motivated is really important to me. According to Tolhurst, it’s also about placing people in the right jobs and playing to their experience and strengths: “In football terms, if you’ve got Wayne Rooney on, he’s a striker, you don’t go putting him in goal.” That way his team gets the most out of it: “I have done jobs where I have dreaded going into to work, so I am determined to create a happy workplace.” When looking to the future, Tolhurst says: “At the moment I think we’re covered on everything I want to be covered on, but I do see the industry changing – it’s changing all the time. As a business you always need to be one step ahead and cautious, however, I think it’s a long way off until the paperless office has a real impact on us. However, we’ve just got to be ready, so that if we need to change direction it’s no problem at all.” The unprecedented growth of the business has not dampened Tolhurst’s watchful eye on the balance sheet, as he explains: “There may come a time around the corner where something may not go to plan, and you don’t know what that could be. Although it’s going well, it’s always good to be prepared for winter.” DS

In football terms, if you’ve got Wayne Rooney on, he’s a striker, you don’t go putting him in goal

it guide

sales tips

Print consumables can be a substantial part of a dealer’s business. But with so many companies and outlets vying for your potential client’s business, how can you ensure you stand out and secure the sale? Nina Rosandic speaks to the leading OEM manufacturers to put together some tips

INK

OUTSIDE THE BOX QualitY inveStment

Dealers should be aware of the key selling points of their print consumables in order to validate the customer’s investment in a quality product and secure themselves as a trusted source of advice. Customers may be tempted by cheaper, lower quality alternatives, in which case, Phil Jones, country head, Brother UK says “it’s up to resellers to make customers aware of the risks and benefits of both options so that the business can make an informed decision on their purchase”. Therefore, price remains a selling point alongside cheaper alternatives, as Jones explains: “Being tempted by lower prices could mean that they lose more money in the long run.” As Martin Kelly, consumables manager, Oki UK points out: “Selling on price only can lead to resellers spending their time fire-fighting; dealing with problems, instead of proactively selling... Make it clear to customers that the quality of the toner directly affects the quality and accuracy of output and the page yield achieved. Dealers also need to point out environmental features and warranty issues.” HP’s UK and Ireland marketing manager Dexter Harriss adds that customers “want to be rewarded for their loyalty and feel that they are getting a good deal.” Therefore, dealers should take advantage of multipacks, bundle deals, and cash back offers where possible to offer competitive pricing.

finDing clientS

You need potential customers to be able to find you, therefore an online presence is very important. Also, you must continually assess where the market is growing and who you should be reaching out to. Kyocera, for example, has seen an increase of over 20% on FY11 in its consumables business – and most of that growth has come from the public sector. It is also important to be in regular contact with your current clients to make sure you are aware of their needs. Do you have the company’s full print consumables spend? Are they tempted by any other offers or services suggested by a competitor? Do they have any other offices or sister companies you could be supplying to? Is the current buyer likely to lose control of the decision-making to someone more senior following budget reshuffles? Make sure you are one step ahead and having the right conversations with your clients.

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it guide

sales tips

Selling usage

Use more, buy more. It would be nice to be able to say that to customers and for it to stick wouldn’t it? One way to make this viable is to find ways to encourage customers to take some of their outsourced printing requirements in-house. For example posters, business cards, information packs, leaflets, door hangars, menus etc. Oki hosts a ‘What You Can Do’ section on their website to serve this purpose. Kelly points out: “If you concentrate on how much they can save by doing this rather than outsourcing, it can give a powerful message.”

Help from the experts

Many consumables manufacturers and distributors offer a wealth of support to their dealer customers. For example, Kyocera offers sales and marketing support, sales management, new promotions and sales leads, and Oki provides a selection of collateral for its accredited dealers within its PartnerNet system and on the consumables section of its website. Meanwhile, Ricoh has launched its Ricoh 100% Supplies and Parts Certification Programme for its dealer partners. With this in mind, it is worth checking with each of your brands to see what support they have available to reseller partners and to take advantage of it.

Service is paramount

If you can’t offer next-day delivery it will only take a client a couple of minutes on Google to find someone else who will. Kyocera IT channel sales manager Charlotte Elmer encourages dealers to “make sure they offer online ordering, timed deliveries, online tracking, later delivery times” as well as “good stock levels”. It is important to make the process as hassle-free for customers as possible. “Our research also shows that as more people are using the internet for these types of services it is increasingly important to have an efficient and effective online system for order taking and fulfilment,” says Harriss.

Signing up

Dealers are losing clients to suppliers of managed print and copier services. Elmer explains: “For those dealers still viewing toner sales as a transactional process, they do need to appreciate that a gradual shift is on its way as customers will increasingly buy MPS services as they understand more of the benefits on offer.” Harriss suggests that supplies should not be sold in isolation but as part of a total printing solution, “taking into account the business printing needs and utilising key printer technology benefits. For example, supplies could be sold as part of a package that offers additional services such as automated ordering and replenishment and managed print services (MPS).” Although a full MPS may be something you are considering or working towards, there may be other ways you can work with the client to monitor their usage and replenish stocks. Perhaps offering a scheme, whereby the client holds their own stock and payment is taken at regular ‘stock check’ visits. That way, your product is there before they’ve even picked up the phone. “Automated replenishment can reduce administration and cost as well as environmental impacts by reduced transportation - beneficial for both customers and resellers,” says Harriss. For those selling printers and copiers, Ricoh business generation director Keith Howell’s advice is for dealers to “sell hardware with a managed print agreement to guarantee service annuity and prevent supplies spend from going elsewhere”.

Green machine

Make it clear to customers that the quality of the toner directly affects the quality and accuracy of output and the page yield achieved

september 2012 www.dealersupport.co.uk

Environmental concerns are often held above all others. “Business customers will always be focused on quality and TCO,” says Elmer, however, “many of them are also very interested in the green aspects of the technology and consumables they are using.” “Unfortunately, 94% of remanufactured cartridges sold will ultimately be thrown away,” says Harriss. Therefore, it is important to focus on the green aspect of both the production and disposal of your OEM products. Offering a recycle scheme, or partnering with one, is a great way to prove your environmental responsibility or generate customer rewards, and it can be done cheaply and easily. Kelly leaves us with this final thought: “In general, resellers form two camps; the proactive who find out what you need and strive to sell it to you no matter what, and the reactive who just want a consumable sale. If you sit in the former category, then you have the best chance of building confidence, trust and loyalty – and developing your business.” There are many ways to bolster your OEM sales, as Harriss concludes: “There are alternatives and it’s up to dealers to work with vendors to exploit opportunities.” DS

management

grow your business

Unifying your communications Advances in technology are changing the telecommunications sector for the better. Bryony Taylor looks at the new avenues of revenue for dealers within unified communications

september 2012 www.dealersupport.co.uk

grow your business

n 1985 when the Doc set the DeLorean to go ‘Back to the Future,’ he took Marty McFly on an adventure to the future world of October 2015. It’s an iconic world of hover boards and holograms. But when you look at the advances made in the nearly 30 years since the film was made, never before has an idea of the future looked so passé before it’s even happened. Neither Marty, the Doc or perhaps anyone other than Steve Jobs, could have predicted the groundbreaking changes in communications that have occurred in the last few decades. From car phones through to wifi, TVs and tablets, we’ve changed the way we communicate. We don’t carry a CD, we carry our entire music collection on a device the size of a passport; we read a library of books with one tablet; and we expect the endless information on the World Wide Web to be at our finger tips at all times. Needless to say, the information revolution has changed the way we do business also. The question most businesses now face is how to marry all these devices together into one unified communications system. Step in office products dealers with the answer. “A unified communications strategy seeks to overcome these challenges by providing a ‘one-number’ contact point and a single message box,” explains Nick Goodenough, partner service manager for Spitfire. “With a ‘one-number’ solution the recipient’s terminal devices such as desk phone and mobile phone are registered with the phone system so that they will ring simultaneously, providing callers with only one number to reach them.” In a similar way, a single mailbox can be set up to manage emails.

Dealers should ensure that they are offering customers robust unified communications services with disaster recovery back-up for business continuity “An important point to emphasize is that business class unified communications solutions should not be confused with consumer grade services such as Vonage and Skype,” adds Goodenough. “Few businesses can survive long today without voice and broadband communications. So for ‘mission critical’ business communication applications dealers should ensure that they are offering customers robust unified communications services with disaster recovery back-up for business continuity.” Research by Vanson Bourne recently found that over three-quarters of UK firms are now pursuing a unified communications strategy to help boost efficiency in the workplace, says Paul Clark, Plantronics Director for the UK and Ireland. The research, which surveyed 200 senior IT leaders from medium and large UK-based organisations

across a number of market sectors, also found that voice over internet providers (VoIP), video conferencing and instant messaging were the most important applications to business when rolling out unified communications. This creates various significant revenue avenues for dealers involved in unified telecommunications technology. “One revenue stream that partners within unified communications may look to optimise is the sale of peripheral technology that enhances the unified communications experience, such as wireless headsets, desk phones and webcams,” says Clark. “As such, dealers need to effectively collaborate across a variety of platforms and locations. For example, wireless headsets that are compatible with unified communications deployments must automatically update an individual’s availability when they are on the phone.” “Two new unified communications technologies that offer office equipment dealers real opportunities for profitable contracts are SIP Trunks and hosted telephony,” says Goodenough. “SIP Trunks will gradually replace ISDN phone lines over the coming decade because the cost benefits to business customers are compelling, with a SIP Trunk costing typically 50% less than the monthly rental cost of an equivalent ISDN service.” As flexible working increases, it will become increasingly important for businesses that all their communication technology is compatible with unified communications packages. Dealers supplying this technology can also branch out into consulting. To offer the best solutions to businesses, dealers will need to partner with a provider in this rapidly changing industry. “Unified communications projects require careful consideration and planning before implementation,” adds Clark, “and if not done properly can have a negative effect.” “Business communications in the UK are undergoing a radical change,” adds Tim Nelson, marketing and product manager for Channel Telecomm. “There is a rapid shift away from conventional telephone systems installed on customer premises to hosted telephony services provided remotely, with only desk phones needed at the customers’ premises. Finally there is a shift to ‘cloud’ provision of hosted computer applications, which requires high quality, reliable broadband connectivity.” Christian Bauers, head of telecoms sales and marketing at Sennheiser UK, agrees, adding that workers operating remotely want access to their contact directory on their chosen terminal. Currently very few of these devices provide the adequate levels of privacy or clarity for voice communication. “Based on current trends we estimate that the headset attach rates will rise from current five per cent on conventional desk phones to 60% for active softphone user in coming years,” he says. “There can be little doubt that as unified communications continue to develop there will be a corresponding growth in headset adoption which will present a highly lucrative opportunity for the channel over the coming years.” The challenge for the channel is to educate and up-sell business users on the benefits of higher value unified communications solutions when there are many lower grade cheaper consumer options on the market. Dealers need to be able to point out that these are not optimized for the health and safety requirements of professional working environments. DS

3/4

UK firms are pursuing a unified communications strategy to help boost efficiency in the workplace

www.dealersupport.co.uk september 2012

FINAL WORD

It is a market that still has vast room for expansion, and could be a profitable link-sell for so many orders

Creating a safe working environment Karen Harrison, group marketing manager, AF International

t’s been reported many times that the average PC keyboard has more bacteria than found on a toilet seat – a scary fact, but one that everyone seems to remember. Telephones harbour up to 25,000 microbes per square inch, keyboards over 3,000 and mice above 1,500. Regular cleaning is the only way to keep computers and workstations germ-free. But are people taking their cleaning seriously? The cost of absenteeism through illness is costing UK businesses – the bare minimum cost of worker absence to employers (not including the cost to the economy in lost productivity) is over £500m in wages and benefits paid for work not done; and in the UK around 192 million working days are lost each year, costing the economy billions in revenue. This has to be a reason for everyone to take cleaning seriously. Cleaning your work space will help eliminate bugs, create a cleaner office environment and reduce the transfer of germs that can cause illness. The importance of using special bactericidal formulations to clean work surfaces and workstations will reduce the risk of infection through bacteria and consequent lost productivity through illness. Despite this, only around one in 20 installed PCs are cleaned regularly. It is a market that still has vast room for expansion, and could be a profitable link-sell for so many orders. Environmentally friendly cleaning products should be a part reseller’s product mix especially if they intend to target, for example, call centres, large corporate customers, government departments and the education sector. Computer and equipment cleaning products have been developed to provide simple and effective cleaning solutions for PCs, workstations, office equipment, game consoles and multimedia machines, tablet and smartphone technology. Dirt, dust and greasy fingerprints make screens difficult to read and may lead to headaches and eye strain. Using a screen cleaner will provide anti-static protection and a smear free finish, however it’s important to know what screen is going to be cleaned. What’s recommended for cleaning a keyboard? Keyboards harbour a large amount of dust, dirt and bacteria with debris getting trapped between keys, the perfect breading ground. The recommendation would be to blast with a ‘duster’ which is compressed gas, whilst the keyboard is tilted at an angle, and then use a wet/dry wipe with the special keyboard cleaning tool. The wet wipe can be placed on the specially shaped card and slotted in-between the keys. DS

SEPTEMBER 2012 www.dealersupport.co.uk

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