ENX Magazine October 2019 Issue

OCTOBER 2019

VOLUME 26 NO. 10

Connecting People, Ideas and Products in the Document Technology Industry since 1994

engage ‘n exchange

UNHERALDED AND UNDERRATED: DEALERS RELY ON HIDDEN GEMS TO EXPAND CLIENT CONVERSATIONS

Rick Bastinelli Centric Business Systems

Masters of the Mid-Atlantic:

DARE TO DIFFERENTIATE: IN A SEA OF SAMENESS, DCS STANDS OUT FROM THE CROWD SELLING PRINTER CARTRIDGES: RABBIT HOLES AND ROAD MINES

Strategic Acquisitions and Client Education Keep Centric Business Systems on Top of its Game

IMPROVE YOUR RESULTS BY REWARDING YOUR STAFF

ENX Magazine

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Our Managed IT Services Portfolio:

Disaster Recovery ARE YOU READY TO EVOLVE AND PRESERVE YOUR COMPANY’S LEGACY? LEVERAGE VISUAL EDGE IT TO ENSURE FUTURE SUCCESS Make the Call to Learn How Your Dealership Can Build a Growth Foundation for Tomorrow

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Michael Brigner

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Michael Cozzens

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Mark Gibson

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Panasonic offers a variety of document capture, workflow and ECM applications from leading software partners. Providing its resellers with a complete document management solution.

Panasonic congratulates this year’s Document Imaging Industry’s Difference Makers!

For more information on how Panasonic Document Scanners can be the Difference Maker for your business, contact 877-207-0035 or visit info.panasonic.com/business-scanners

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OCTOBER 2019

VOLUME 26 NO. 10

Connecting People, Ideas and Products in the Document Technology Industry since 1994

engage ‘n exchange

UNHERALDED AND UNDERRATED: DEALERS RELY ON HIDDEN GEMS TO EXPAND CLIENT CONVERSATIONS

Rick Bastinelli

Masters of the Mid-Atlantic:

DARE TO DIFFERENTIATE: IN A SEA OF SAMENESS, DCS STANDS OUT FROM THE CROWD SELLING PRINTER CARTRIDGES: RABBIT HOLES AND ROAD MINES IMPROVE YOUR RESULTS BY REWARDING YOUR STAFF

Strategic Acquisitions and Client Education Keep Centric Business Systems on Top of its Game

In This Issue

22

DEALER SPOTLIGHT

Masters of the Mid-Atlantic: Strategic Acquisitions and Client Education Keep Centric Business Systems on Top of its Game

By Erik Cagle

16 STATE OF THE INDUSTRY

Unheralded and Underrated: Dealers Rely on Hidden Gems to Expand Client Conversations

By Erik Cagle

30 BUSINESS PROFILE

Dare to Differentiate: In a Sea of Sameness, DCS Stands out From the Crowd

By Erik Cagle

16

34 OEM SOLUTIONS

Treasure Hunting: Manufacturers Shed Light on Hidden Gems that May Unlock Dealer Fortunes

By Erik Cagle

42 IMAGING SUPPLY MARKET NEWS

Selling Printer Cartridges: Rabbit Holes and Road Mines

42

By Tricia Judge

48 COMPENSATION PLANS

Improve Your Results by Rewarding Your Staff

By Jim Kahrs

52 DISPLAY ADVERTISERS INDEX 48 6

•

www.enxmag.com | October 2019

We Saw It In ENX Magazine

Maintain Your Legacy Flex Technology Group is on a mission to build a legendary national technology and office solutions organization by acquiring successful entrepreneurial dealerships. If you’re a dealer with proven leaders, a solid marketplace reputation, strong financial performance, and the ability to provide superior employee and customer experiences — we want to talk to you.

FTG Provides Options and Flexibility • Achieve liquidity today • Retain business name and go-to-market strategy • Continue building your business while achieving additional liquidity • Reinvest in Flex Technology Group and their platform • Flexibility to have multiple partners with different exit options

Contributors

Staff

TRICIA JUDGE has served as the executive director of the International Imaging Technology Council, a 501 (c) (6) not-for-profit trade association serving imaging supplies remanufacturers and dealers, for 20 years. She planned and executed the startup of the member trade organization serving the remanufactured imaging supplies industry. She is currently the senior consulting editor for Imaging World Magazine (formerly Recycling Times Magazine) and has been published in numerous domestic and international publications.

Susan Neimes Publisher & Managing Editor

JIM KAHRS has been a leader in the office systems industry for more than 32 years. Jim founded Prosperity Plus in July of 2001. The consulting group provides realworld tools for improving profit, cash flow and growth and has helped hundreds of dealerships improve their performance and achieve their goals. He may be reached at jkahrs@prosperityplus.com or by phone at (631) 382-7762.

Erik Cagle Editorial Director

Ronelle Ingram

2019 G

Contributing Editor

I

N

Th

A eW e ek In I M

G

CONGRATULATIONS TO

2019 ELITE DEALERS

Christina Kim Editor

engage ‘n ex engage ‘n exchange

MEET 2019 ELITE DEALERS

engage ‘n exchange

in the December issue of ENX Magazine

www.enxmag.com

8

•

www.enxmag.com | October 2019

México & Latin America

La Revista del Distribuidor Dealer Source

engage ‘n exchange

Corporate Office

Susan Neimes - susan@enxmag.com Erik Cagle - erik@enxmag.com 10153 1/2 Riverside Drive, Suite 729 Toluca Lake, CA 91602 tel. 818-505-0022 • fax. 818-505-9972 ENX Magazine is published monthly by Affinity Business Communications, Inc. Any inquiries should be sent to: enx@pacbell.net or mailed to the corporate office.

Copyright ©2019 by ENX Magazine printed in the U.S.A. All reproduction in whole or part is prohibited without written permission. Cover photo from depositphotos.com

We Saw It In ENX Magazine

YOUR BUSINESS IS

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ENX Magazine | www.enxmag.com

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.

Copiers • Printers • MFPs • Faxes • Scanners E m a il: info @ n u w o rld in c.co m

Order Online! www.nuworldinc.com

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Parts Order Hotline: 562.977.4949

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.

NBS / ENX | October 2019

Since 1985

Your Prime Source T EL: 800.729.8320

FAX: 800.829.0292

REBATE PROMOS ALL INSTANT REBATE PROMOS ARE VALID THROUGH SEPTEMBER 30, 2019 TO CANON PREMIER PARTNERS OR WHILE SUPPLIES LAST!

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All supplies & Parts available for prompt delivery!

ENX Magazine | www.enxmag.com

All prices, rebates, and availability are subject to change without notice. Please call us to confirm.

Nuworld is not responsible for typographical errors or inaccurate specifications. Registered trademarks are properties of their respective owners.

Copiers • Printers • MFPs • Faxes • Scanners E m a il: info @ n u w o rld in c.co m

Order Online! www.nuworldinc.com

Blind Drop Shipping

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Erik Cagle

State of the Industry

Unheralded and Underrated: Dealers Rely on Hidden Gems to Expand Client Conversations

I

n a world where the subject of speeds and feeds was everything, the ability to venture away from the topic of MFPs with a client or prospect has become the more-popular approach for office technology dealers. Printers and copiers will always serve as the baseline offering; after all, they catapulted your dealership to where it is today. They have enabled you to keep the lights on for years.

The good news is, the conversation no longer needs to be driven by the box. Dealers are already branching out into ancillary areas that can titillate customers who manage weak smiles when you reference higher-capacity trays. It’s time to raise some eyebrows and explore the world of hidden gems—those underrated products and services that tend to fly under the radar but have the potential to take your dealership to a new level.

Think about your client base and MIF. What if you were able to sell 10% of your base on an offering that is somewhat atypical of dealers’ products and services? Would that give your bottom line a shot of adrenalin? Well, many of your contemporaries are offering these hidden gems, and it’s not just in the name of prettying up lease renewal talks. Here are some examples of dealers who have used these hidden gems, several of which are recent additions, to take the client conversation in a different direction.

Cool Reception

Lee Flood is almost apologetic when he discusses the beauty of Konica Minolta’s ALICE Receptionist. The director of sales at Pearson-Kelly Technology laments that it is one of the few instances in which technology actually fills the seat of a person (the dealer has an ALICE kiosk in addition to a live receptionist to showcase the technology). But, it

SOME OF THE MORE NICHE OR ANCILLARY ITEMS YOU CAN SELL CAN BE COMPLICATED, BETWEEN INSTALLATION AND MAINTENANCE WITH A LOT OF COSTS UP FRONT. THAT INCREASES YOUR RISKS. Lee Flood, Pearson-Kelly

The ALICE Virtual Receptionist from Konica Minolta

also frees clients to make better use of their personnel through ALICE’s automated ability to greet and register visitors, notify employees, provide information and improve security.

“From a security standpoint, for organizations who need to watch out for potential issues, it can help keep people out of the building,” he noted.

“One of the things I like about it is the system is not overly complicated. Some of the more niche or ancillary items you can sell can be complicated, between installation and maintenance with a lot of costs up front. That increases your risks.”

ALICE is best geared toward the larger office setting with 50-plus employees, which helps open the door to larger opportunities, according to Flood.

In addition to the office setting, Pearson-Kelly, which has offered ALICE for about 19 months, has seen increased interest from the manufacturing vertical. Churches with multiple locations are prime clients in situations during which sermons are simulcast from a remote location.

While the economy remains strong, ALICE is a cost-saving solution, replacing an individual who may be making $15 an hour plus benefits and providing a quick return on investment. It’s particularly effective for businesses that may not have many walk-in clients/visitors.

Likewise, having ALICE can also free up a utility employee to handle other chores instead of being tethered to the front desk. “ALICE also has integrations with FedEx and UPS for deliveries,” Flood noted. continued on page 18

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www.enxmag.com | October 2019

We Saw It In ENX Magazine

Unheralded and Underrated: Dealers Rely on Hidden Gems to Expand Client Conversations Surveilling the Opportunities

Jason Habbal only needed to turn on the television or go online to gain an appreciation for the uptick in demand for surveillance equipment. The news is awash with tales of irate customers and scorned former employees showing up at businesses fully armed with the intention to wreak havoc, often with tragic results. Cyber threats have been joined by physical assaults as a leading concern for all manner of safety.

LIKE CAR INSURANCE AND DISASTER RECOVERY, YOU HOPE YOU NEVER HAVE TO USE IT. BUT YOU’RE PROTECTED IF YOU DO. Jason Habbal, Vision Office Systems

Habbal, the vice president of sales for Vision Office Systems (VOS), was intrigued by the Axis surveillance equipment offered by Canon (which acquired Axis in 2015) during its product showcase three years ago. Habbal also noticed a great deal of pent-up demand for surveillance equipment, so within the past year, VOS began to offer the Axis line.

“We started looking at smaller deals that we could grow a customer base on,” Habbal noted. “We’ve quoted some residential, mansion-type homes, but we’ve tried to stick to commercial opportunities as much as possible. We’ve done a few churches to get up to speed and make sure that we have everything in place.”

Choosing Canon was easy, since VOS was already a dealer for the OEM and trusted the company’s solid reputation. VOS hired a sales rep who had experience outside of the MFP world in selling phones and other technology, and the rep quickly absorbed the talk track to give the dealer a go-to person.

With regulations for installers varying from state to state, Habbal has an agreement with a local reseller to handle the installation and aftermarket service. The firms have an agreement not to encroach on one another’s business, and they refer work on a mutual basis.

It hasn’t been an easy road. The cameras can provide a great margin, but Habbal has seen how easy it is to price himself out

Vision Office Systems has Canon Axis surveillance cameras at its headquarters so that sales reps can demonstrate its quality via a remote app 18

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www.enxmag.com | October 2019

of a deal. Surveillance camera conferences haven’t yielded a wealth of insight, as Habbal also learned that resellers aren’t particularly enamored with copier dealers trying to move into their space, regardless of whether they’re seen as direct competitors.

Eventually, Habbal would like to handle both installs and service. For now, he finds himself dealing with objections from clients and prospects who would prefer to use off-the-shelf home systems that cost a few hundred dollars at the local Costco instead of high-grade, advanced equipment and monitoring. It’s akin to an office client buying a $75 printer at Staples; a wholly insufficient solution.

“Like car insurance and disaster recovery, you hope you never have to use it,” Habbal said. “But you’re protected if you do.”

Virtual Security

Since we’re on the subject of security measures, many dealers have found a gateway to growth through offering managed security services, which falls under the managed IT umbrella.

Axion Business Technologies offers just such a solution that provides protection against the latest advanced security threats, offers end user cybersecurity training and helps ensure business continuity, notes Bob Ferland, president of Axion, and a member of the Visual Edge Technology family of companies.

Ferland notes that Axion’s intuitive solution learns the user’s computer behavior, which helps safeguard against malware and ransomware intrusions by blocking the atypical behavior caused by the threats. It has been on Axion’s menu for the past year, and Ferland is excited about the possibilities of scaling within current and prospective customer accounts.

WE’RE EDUCATING BUSINESSES AND USERS ON CYBERSECURITY, WHICH WILL HELP BRING TECHNOLOGY LIKE THIS TO LIGHT. Bob Ferland, Axion Business Technologies

“It really does fly under the radar,” he noted. “Document companies are familiar with this type of product because it uses artificial intelligence and requires retraining users on how cybersecurity should be viewed. Also, the solutions are fairly new.

Many computer users out there will use traditional antivirus, or some users don’t use it all.”

As is the case with competing technologies that are designed for a home or SOHO environment, off-the-shelf products can be overwhelmed in a larger business environment. Ferland notes most commercial antivirus software solutions provide an outdated approach that is more prone to failure or newer threats that are unleashed.

“We’re educating businesses and users on cybersecurity, which will help bring technology like this to light,” he said.

“The artificial intelligence piece is pretty cool.” continued on page 20

We Saw It In ENX Magazine

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Unheralded and Underrated: Dealers Rely on Hidden Gems to Expand Client Conversations Digitizing Documents

Quality service is a hallmark often boasted by office technology dealers. Dr. Dawn Abbuhl, president of Repeat Business Systems (RBS), points out that her company’s Net Promoter Score regularly sits in the 90s—one month it was 100, but it’s usually 95. By contrast, she notes the globally renowned Ritz-Carlton hotel chain’s service score is in the 70s, as are many other businesses with a staunch reputation.

But from a hidden gem perspective, Dr. Abbuhl appreciates the strength and value of her company’s document imaging and backfile scanning. The dealer has thrived through Ricoh’s CHAMPS dealer services program for providing business process improvement enhancements for clients. In fact, RBS has increased software and professional services 800 percent in the past few years.

“People are always talking about workflow, but in the past they’ve seen it as an expense that they don’t really need,” Dr. Abbuhl said. “But lately, I’ve seen a shift. We’ve definitely sold more software and workflow.”

THERE’S DEFINITELY AN OPPORTUNITY FOR BUSINESSES TO FACE LAWSUITS IF THEY DON’T DIGITIZE THEIR DOCUMENTS. Dawn Abbuhl, Repeat Business Systems

Converting hard-copy files to digital is one of those eye-rolling propositions for customers, but it only takes one fluke mishap—a flood or fire, triggered sprinkler systems, etc.—to turn a repository of information into a major headache, not to mention a potential lawsuit.

“There’s definitely an opportunity for businesses to face lawsuits if they don’t digitize their documents,” she said. “Businesses run out of space, and you can’t keep hard-copy documents forever. We have a robust conversion solution for it, but it’s not the most affordable.

“Even with technology advances, you still have to deal with paper. That’s why it’s important for dealers like us to go forward with document imaging as well as back-file scanning. The beauty of this offering is it can be sold off-cycle; you don’t have to wait until the copier contract comes up.”

COMPANIES SHOULD STOP THINKING OF MAILING EQUIPMENT AS SOMETHING THAT’S BORING AND JUST A COST. Matteo Recanatini, Offix

In his mind, the visage of a dirty, dank mailing room for producing invoices, bills and checks gives way to a vehicle for folders, inserters and cutters to produce a myriad of products, including invitations and thank-you cards, that just scratches the surface of its capabilities.

Having this type of equipment in house provides a number of benefits for the end user, according to Recanatini. It provides control over the quality and speed of the job, and oversight that is lacking when firms choose to farm out such jobs. That added flexibility enables the client to turn jobs on a dime, or make wholesale changes without the hassle of dealing with an outside vendor.

Offix uses the gear to produce trifolds, communications inserts for client invoices, holiday cards, invitations and client leave-behinds (customized with the name of the representative).

“It just allows for a level of customization and flexibility that I’m convinced saves money and allows the company to grow,” Recanatini observed. “Companies should stop thinking of mailing equipment as something that’s boring and just a cost.

It’s a catalyst of marketing activities and can actually pay dividends pretty quickly.”

Offix has its mailing equipment connected to its CRM platform, which converts the digitized information right down to a stuffed, sealed and folded envelope. This has been a boon for the dealer, given its proximity to the Washington, D.C., market, which is awash in organizations that use paid and unpaid volunteers to fold and stuff envelopes.

“That’s manpower that can be spent doing other things, and that applies to volunteer political work as much as it applies to for-profit organizations,” Recanatini said. “The ability to link it to a CRM when it comes to marketing provides a suite of potentials for communicating that people don’t think about.” ♦

Stamp of Approval

When most people think of mailing equipment, they picture dark rooms and heavy machinery, or a postage meter. For Matteo Recanatini, marketing director of Offix, he sees an unsung hero of the marketing department, capable of serving the needs of clients both large and small.

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The FB PostBase 45 We Saw It In ENX Magazine

Erik Cagle

Dealer Spotlight

Masters of the Mid-Atlantic: Strategic Acquisitions and Client Education Keep Centric Business Systems on Top of its Game

W

hen analyzing the scope and availability of potential acquisitions at his disposal, Rick Bastinelli—the president of Centric Business Systems of Owings Mills, Maryland— likes to keep an open-but-analytical mind.

After all, there’s ample reason for Bastinelli to target the Mid-Atlantic market, as Philadelphia, Baltimore, Washington, D.C. and northern Virginia offer a wealth of possibilities. Bastinelli has fished in these waters twice in little more than a year, adding Webster Integrated Technologies and Carefree Office Technology, Virginia-based firms that have deepened and expanded Centric’s geographic footprint.

The Mid-Atlantic region has been kind to Centric, providing a growth trajectory that lifted Centric from a $1 million performer, when Bastinelli acquired then-Copy World of Baltimore in 1991, to more than $60 million in revenue by the time the final receipts are tallied for 2019.

Bastinelli changed the name in 2006 to reflect the dealer’s aim to provide products and services that are a central communication point within the office environment. Centric now employs more than 260 people through eight locations, supporting more than 37,000 devices throughout the marketplace.

Centric has used its status as a full-line Sharp dealer at the onset as a growth vehicle, and Bastinelli also brought in Ricoh, HP and Kyocera.

The dealer offers a broad array of products and solutions, including MFPs, wide-format devices, production print, managed print and IT, document management, business consulting and facilities management.

We sat down with Bastinelli to learn more about how the acquisitions are fueling Centric’s growth, the dealer’s Centric Connect IT support function and the value of hosting themed events that provide education in a relaxing and fun manner—all of which casts the dealer as a thought leader and a companion in their clients’ quest for growth as well.

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Rick Bastinelli, Centric Business Systems

How is business so far in 2019?

BASTINELLI: Overall, very strong. It started out slow due to a strong finish in 2018. However, our core business is very solid and we’re on course to hit our annual plan. July was one of our biggest months ever. Our vertical market focus has produced excellent results with consistent growth in both production and health care. It seems the larger you grow, the more challenging it is to achieve double-digit growth, especially with price erosion. But we’ve always had a strong emphasis towards new, organic growth, and we complement that with strategic and synergistic acquisitions that keep us moving forward at an aggressive pace. We purchased two companies in the last 12 months and continue to look at other opportunities. In 2019, we also created a bid desk that is ensuring we’re handling bids properly, which is helping us win larger contracts. We expect it to be a very successful year.

We Saw It In ENX Magazine

continued on page 24

Masters of the Mid-Atlantic: Strategic Acquisitions and Client Education Keep Centric Business Systems on Top of its Game was a natural evolution for us to expand in a territory that was contiguous to our current footprint.

Adding Carefree Office Technology, located in northern Virginia, provided us more density in our existing marketplace.

Both companies shared a customerservice philosophy like Centric’s, with solid service departments, tenured technicians and dedicated customers. For us, adding experienced employees and net-new customers, while growing our MIF and revenues, are drivers toward seeking acquisitions.

Shown from left are Lisa Scholl, healthcare manager; Scott Schnabel, executive vice president; Rick Bastinelli, president; and Frank Curreri, major accounts manager

What does Centric Business Systems pride itself on?

BASTINELLI: Like most dealerships, Centric has always focused on providing outstanding customer service and offering a strong value proposition.

We consistently survey our customers to ensure we are achieving a high level of customer satisfaction. We’re always looking for ways to improve the customer experience. Our biggest source of pride is the team we have assembled and the culture attributes that it demonstrates when executing their job responsibilities. A few years ago, a team of Centric employees, without any leadership participation, documented the attributes that made up our culture and labeled it the Centric Way. They were successful in identifying and documenting the essence of our culture, and that document now serves as a new-hire orientation tool. It’s the foundation of our recognition programs and a guiding plan for all of our employees.

We’re also proud that we have achieved our growth, expansion and acquisition as an independent company controlling its own destiny. The growth has created opportunities for our employees, which in turn creates long-term tenure and enhances the employee experience. Lastly, our success 24

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www.enxmag.com | October 2019

has served as an opportunity for us to contribute to the communities we serve. Last year, over 5% of our profits were donated to nonprofits or other community organizations. It is important to be a good corporate citizen.

In a little more than a year, Centric has acquired Carefree Office Technology and Webster Integrated Technologies, expanding your Virginia presence. Can you talk about the strategy behind these moves, and what does each dealer bring to the table?

BASTINELLI: The acquisition activity remains strong, and the climate creates terrific growth opportunities for companies like Centric that have

What will you be looking to accomplish in future deals? What are the geographic and product/service needs you will be looking to address?

BASTINELLI: We are open to considering other marketplaces that will provide us an additional product line. In the future, our acquisitions will target companies with a good culture, solid operations, accurate billing, clean financials and fair pricing. The quality of the opportunity would determine our future direction. We would look carefully at an opportunity outside of the Mid-Atlantic region. However, when you combine Philadelphia, Wilmington, Baltimore, Washington and northern Virginia, and all of the secondary cities within that region, it is a strong and vibrant marketplace. We could certainly achieve our long-term goals within this region of the country.

WE CONSISTENTLY SURVEY OUR CUSTOMERS TO ENSURE WE ARE ACHIEVING A HIGH LEVEL OF CUSTOMER SATISFACTION. WE’RE ALWAYS LOOKING FOR WAYS TO IMPROVE THE CUSTOMER EXPERIENCE. — Rick Bastinelli the size and the scale to buy them, and more importantly, the expertise to integrate them into their culture. We’ve always enjoyed solid market share in Washington, D.C., and northern Virginia.

The Webster Integrated Technologies acquisition was quite synergistic because they sold a compatible product line in Ricoh, and their geography bordered the southern part of our existing footprint. It

You have a wide breadth of offerings, from managed print and IT to business consulting, facilities management and production printing. In a business that seeks out the next big thing, how do you vet new offerings?

BASTINELLI: Dealers with solid resources who have built a strong B2B service operation have a full range of options. Vetting new offerings can be

We Saw It In ENX Magazine

continued on page 26

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Masters of the Mid-Atlantic: Strategic Acquisitions and Client Education Keep Centric Business Systems on Top of its Game

Centric Business Systems headquarters in Owings Mills, Maryland

challenging, so we take several steps to determine our direction. First of all, we rely on our manufacturer partners to share their vision of the future and their product roadmap, so we understand their direction. Next, we carefully study the events of the industry. I’ve always said we might not be the most-creative dealer or the first to jump, but when we copy something, we fully commit and do it well. We’re constantly looking at what’s happening with our peers throughout the industry. When we are considering a new offering, we build a realistic business plan. We carefully analyze the new revenue opportunity, the investment costs, and the sales and service structure required to sell, service and support the offering. What is our break-even point?

Most importantly, how many units or sales are required for us to have an acceptable ROI? We feel that a solid business plan will guide us in making the right decisions.

Centric hosts themed events that provide learning opportunities for clients in areas such as document management and workflow solutions. Talk a little about the value this brings to your client relationships.

BASTINELLI: We find that customers are eager to learn. Knowledge gives them the power and enables them to help their organization achieve its 26

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goals. We conduct 12-15 events per year designed as educational forums to keep our customers and prospects informed on the latest technological developments. We find these events to be extremely beneficial. It requires our staff to keep abreast of all the technological developments and understand them well enough to give presentations. This helps establish us as a knowledgeable industry leader, which gives our customers confidence in knowing that they’re partnered with the right company. We serve the role of instructor, helping our customers understand industry trends, new solutions and current offerings.

They’re all designed to be educational and fun. One of our most-recent themed events was Casino Event, and all our participants had a lot of fun gambling before and after the sessions. They’ve proven to be quite successful.

Your dealership launched Centric Connect, which helps resolve postinstallation issues with copiers and provides value for clients who may lack IT support. How has it been received by customers?

BASTINELLI: It’s been beneficial to both our customers and our company.

Prior to launching Centric Connect, our help-desk technicians were spending more time solving customers’ network and software issues than they were solv-

ing device issues. We were handling calls for printing issues that had nothing to do with our device. With competitive pressures on cost per page, it was impossible for us to build that service into our costper-copy pricing. In addition, we recognized that customers really had a need for this type of service. Many clients had offsite IT support that wasn’t immediately available, or their onsite staff was busy with other projects. Offering that service for a low monthly cost per device, per month, provided the peace of mind that regardless of the issue, Centric is a full-service solution provider to handle their needs. The initial launch was slow to gain momentum; our sales staff was reluctant to discuss the additional costs. However, as customers called with issues and we had the opportunity to explain the program benefits, we have had several adaptors and it has become very successful. Many of those adaptors include members of our sales staff.

Talk about the role that organic growth has played in Centric’s success story.

What are some of your strengths in this regard?

BASTINELLI: Although we’ve made six acquisitions over the past few years, it’s our organic growth that drives us as a company. Close to 50 percent of our hardware placements are net-new installations. We achieve those results through our unique sales structure, our sales process, extensive training and our expansion into new geographic territories. I believe that generating organic growth is an area we execute well, and it’s been significant because it contributes to double-digit aftermarket growth.

What was your dealership’s biggest win last year?

BASTINELLI: It came from our healthcare vertical-market team. We added a health system with 11 hospitals as a new Centric customer. The engagement was a managed print/copy/services agreement for over 5,000 devices that included some production machines.

We Saw It In ENX Magazine

continued on page 28

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Masters of the Mid-Atlantic: Strategic Acquisitions and Client Education Keep Centric Business Systems on Top of its Game just focused on combining our organic growth strategy with strategic acquisition in order to keep our growth pace at a very aggressive rate.

Employees enjoy the President’s Club trip to Lisbon, Portugal, which took place in May of this year

What was your biggest challenge in the past year?

BASTINELLI: We are enjoying a strong economy with under 4% unemployment in our region. That’s great for business; however, it creates a challenging environment to hire the talent required to fill open positions in a growing company. The time and effort required to fill a position is longer and more expensive than it was previously.

We’ve done some unique things to deal with this challenge. We’ve developed in-house recruiting, people working directly for us as full-time recruiters to fill positions within the organization.

This investment has really paid off.

These recruiters know our culture, have a much-better understanding of the roles and responsibilities of the positions, and we are more effective at recruiting and retaining employees when our own recruiters are bringing them into the organization. We’ve also provided incentive programs for our existing employees—they’re eligible for a bonus for helping us to land a new hire.

Your employees are a terrific resource, because they understand what it takes to be successful in this company and industry.

There’s another challenge we see in major markets, where office employees 28

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are looking for opportunities that allow them to work remotely from home, either a few days per week or full time. We feel the nature of our business makes it difficult to allow certain employees to operate as untethered workers.

Collaboration is important to us, and our ability to provide great customer service is difficult to accomplish when employees are working remotely. I think the untethered worker is a phenomenon that preceded the millennials, and certainly spans the full gamut of the workforce.

What are your goals for the next 12-18 months?

BASTINELLI: Growth is critical to the financial success of any company.

We are focused on achieving doubledigit growth, and we believe that size and scale are necessary to effectively compete with the mega dealers and the manufacturer branches. Both of them have a strong presence in our markets.

Growth also provides the resources required to expand and invest in products and services. At Centric, we call it the cycle of sustainability. Successful companies generate profit, they reinvest the profits in the company for growth, and that growth ensures continued profitability. This year, we expect to exceed $60 million in revenue, and we’re

How do you view the industry changing in the future and what are you doing to adapt?

BASTINELLI: The M&A activity in the industry is changing the landscape.

Specifically, Staples acquisition of DEX Imaging can have major implications.

Time will show the real impact to the independent dealers. Apart from M&A activity, our view of the core business is growth will be a critical component to survival in the future. As technology becomes more sophisticated, it will become difficult for smaller dealers to compete without a lot of resources.

Also, we expect inkjet technology to play a larger role in office output devices, especially in production print.

We continue to expand our production team and also support staff to help them on both the presale analysis and the post-sales training. Smart office, or the office of the future, will be an additional workplace that will leverage traditional devices, like MFPs and white boards, with artificial intelligence to reinvent the office landscape for meetings and methods of communication. I think we’ll see more dealers embracing the IT business, providing managed network services. Customers in the future will be looking for a service provider to manage their network, computers, devices and security, as well as prints. I think we’ll see a much-greater acceptance for storing information in the cloud.

At Centric, we have built a NOC staffed with certified help-desk technicians. We plan to expand our offerings into MNS. Our focus on vertical markets will enable us to better understand specific industry requirements, including the complexities of regulations that matter most to customers. It’s very large in health care. We are expanding our solutions team, preparing and adapting to help streamline the sales process,

We Saw It In ENX Magazine

understanding customers’ unique workflow requirements and preparing for subscription-type solutions in the future.

A primary focus is to build our staff with technology-savvy employees who are capable of selling and supporting future technology.

What do you like the most about your job?

BASTINELLI: My favorite part is building both personal and business relationships with customers, employees and vendors. I believe relationships are the foundation of building a great company and culture. Centric has an amazing team of employees who are dedicated to our mission, and I enjoy working with them every day, watching them perform, and mentoring to help them grow and reach their potential.

Outside of work, what do you do for fun?

BASTINELLI: The job requires a pretty strong time commitment, so when I’m

Centric team members get the opportunity to claim king pin honors during a team-building bowling event.

not working, loved ones become a priority. My priorities have always been family, work and golf. And I realized a long time ago that you can only be good at two out of the three. I enjoy playing

golf, but it certainly takes a back seat.

Spending time with loved ones in our homes in Stone Harbor, New Jersey or Naples, and traveling occupy any free time away from work. ♦

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We Saw It In ENX Magazine

October 2019 | www.enxmag.com

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Erik Cagle

Business Profile

Dare to Differentiate: In a Sea of Sameness, DCS Stands out From the Crowd Most readers can fondly recall their favorite comic panel from The Far Side, authored by the legendary and offbeat creator, Gary Larson. Aside from casting chickens and cows in various, hilariously ridiculous circumstances, Larson could also deliver poignant messages with a straight face, so to speak.

O

ne such panel shows a penguin among a crowd of his flightless friends, presumably in Antarctica. Wings stretched out, the penguin sings, “I gotta be me, oh I just gotta be me…” Despite the fact that the little fellow walks, looks and sounds like all the others among his species (aside from the singing), it serves as a reminder that even in a sea of sameness, the ability to stress a unique value proposition can make one rise above the crowd. Not an easy task, to be sure.

The same could be said in business.

Dealers, manufacturers and distributors all vie for mind space within their customer segment in an attempt to illustrate a unique value proposition that exceeds price consideration. Diversified Computer Supplies (DCS), based in Ann Arbor, Michigan, is a distributor and remanufacturer of OEM and aftermarket imaging supplies to the office technology dealer community—a field not lacking in competitors. Founded in 2003, DCS has elevated itself to the $100 million mark in annual revenues.

How does a distributor catapult itself from zero to $100 million in a relatively short timeframe? Acquisition has played a major role in the growth trajectory, particularly DCS’ 2006 addition of Original Copy, then led by current DCS vice president Brian O’Connor. Until that point, DCS had primarily focused on OEM branded printer supplies, but adding Original Copy widened that scope to copier brands that are under-served within the wholesale network, notes Brian Leek, division president.

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DCS has completed six deals since its inception, but adding Original Copy lifted the company into a different stratosphere.

“When we bought Original Copy in 2006, it forever changed the footprint of DCS within the industry,” Leek said. “That focus on copier brands continues to be the means which separate DCS from other distributors, both for OEM and aftermarket products.”

DCS later obtained the Stantek contract manufacturing operation in late 2010, which guided the company into the world of remanufacturing. Subsequent acquisitions paved a gateway to Latin America business and accelerated not only DCS’ geographic footprint, but its sales reach.

Who is DCS

In addition to its Ann Arbor headquarters, DCS has distribution facilities in Michigan, Florida, Texas, Nevada and Montreal. It is also a tier-one North American remanufacturer with a production facility in Stanton, Kentucky. DCS offers products from more than 20 of the industry’s leading manufacturers, including Brother, Canon, Epson, HP, Konica Minolta, Kyocera, Lexmark, Ricoh, Sharp and Toshiba. The company’s multiple offerings support a number of devices, such as copiers, inkjet printers, laser printers and fax machines.

Its roots as a distributor with thousands of active accounts, and its subsequent move into the remanufacturing sector, have helped create a point of differentiation. The company embarked on an extensive recycling campaign in 2012, providing a considerable source of cores for its remanufacturing operations while reducing its dependency on the core broker market.

“We are able to see new opportunities sooner than most other remanufacturers based on sellthrough data after new OEM SKUs are sold through our network,” Leek remarked. Katie Ferrigan, DCS “Besides being vertically integrated within an OEM distributor, we are distinguished from other remanufacturers simply by the fact that our operations are in the U.S. We have been ISO-9001 certified since 2011, and also maintain a STMC certification.”

Another feather in DCS’ cap is its wealth of industry experience. Leek notes that many times, dealers will reach out regarding technical issues that may have nothing to do with the cartridges themselves. That ability to offer insight fosters customer stickiness and enhances the company’s reputation as a thought leader as opposed to being just a hub for cartridges and supplies.

“Having the depth of knowledge to the extent that we enjoy allows us to help our partners in a lot of different ways,” Leek noted. “We’re doing a lot of research and support for them beyond the toner cartridges we manufacture.”

The key to underscoring DCS’ value proposition is creating meaningful partnerships through products, services and solutions that are superior to alternative sources, notes Katie Ferrigan, senior sales leader and sales development manager.

DCS’ broad range of offerings positions it as the only true one-stop shop supplier in the industry, she adds.

We Saw It In ENX Magazine

continued on page 32

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DCS has what is expected from a World-class Partner • Vast Order Entry Integration Capabilities ... including Direct EDI, eAutomate and others • Most Extensive Selection of Aftermarket Copier Supplies • Extended Yield MPS Cartridges and Private Labeling Solutions for all types of Partners • Lifetime Warranty & Satisfaction Guarantee for all Aftermarket Toner Cartridges • Recycling Program since 2012 with hundreds of US Partners

Phone: (800) 766-5400 | Email sales@dcsbiz.com | Website: www.dcsbiz.com

Dare to Differentiate: In a Sea of Sameness, DCS Stands out From the Crowd “Our unique approach, coupled with long-term vision to strategically create unique solutions that help our partners achieve maximum success, has earned DCS a legacy for being a highly trusted and reliable partner in the industry,” Ferrigan said.

Managed Print Services

One of the value packages in the DCS portfolio is OptiPrint, an adaptable, turnkey MPS platform for dealers. The program enables customization to fit any dealer’s MPS offering, and DCS ensures its dealer channel confidentiality—customer information is not shared with manufacturers. Dealers can avail themselves of competitive pricing for OEM and aftermarket products (including those with extended-yield capacity), advanced monitoring capabilities and proposal-generating software.

Leek notes that while MPS occupies a vital and growing segment within the imaging supplies industry, DCS does not see it becoming the dominant segment within the space. Regardless, the distributor’s goal is to provide this software to dealer partners best positioned to leverage opportunities within the end user base.

“Generally, our OptiPrint partners are copier dealers and/or tech service providers, as those operations tend to have the technical wherewithal to master the software, IT integration and printer maintenance/support challenges within the MPS space,” Leek stressed. “The OptiPrint program,which features the PrintFleet software, does not necessarily appeal to all of our partners, but it is quite popular for those who are more technically inclined to take advantage of the MPS opportunities in the market.”

Spreading the Word

Heather Stemm, senior sales leader and director of channel strategy for DCS, notes the company uses several marketing methods to increase visibility among customers and prospects, including promotional emails, news product announcements and industry trade shows. Where the rubber truly meets the road is DCS’ polished sales team and its personalized 32

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interactions thro­ugh cold calls, conference calls and face-to-face en­ co­un­ters that es­ pe­ci­ally drive home the value of the distributor’s value propHeather Stemm, DCS osition.

“Our goal is sim­ple: to show dealers how we can provide value,” she said.

“This is straightforward for our team once we have successfully connected and are able to listen and learn about the dealer’s business practices. From there, we are able to easily understand how we can offer value with our unique product offerings, services and programs.”

O’Connor firmly believes DCS’ sales team of dedicated individuals provides a personal touch that drives relationships and is the one area where technology is not a substitute or elixir for success. The personal touch, he added, is ingrained in the DNA of the company’s culture.

There’s also much to be said for the ability to deliver goods at the lowest price possible, as needed and where needed.

“This approach has served us and our clients well, and we will continue to execute on that goal,” O’Connor added. “Assisting our partners in achieving success in a competitive environment will, ultimately, allow DCS to grow right along with them.”

Still, DCS execs note the application of technology will help drive a greater wedge between the haves and the have nots of the distribution and remanufacturing sets in the coming years. DCS’ position among the former will be fueled by its MPS platform, products (OEM and extended-yield reman cartridges), software, support, logistics and labeling solutions.

DCS has invested heavily in broadening its suite of integration software platforms, which allow partners to seamlessly communicate with DCS from their ERP systems. Its IT team has been integrating partners on a direct EDI feed during the past 10 years, and continues to do so for companies that are not using popular ERP

packages such as e-automate and other ECI Solutions products.

Looking ahead

DCS will continue to find ways to enhance its ability to deliver on price, service and logistics, the three pillars of commodity management. The company has plans to open a distribution center on the East Coast by the end of the first quarter in 2020. DCS will also have the e-automate POP system available by the end of 2019. Its long-range plans include distribution centers in the Southeast and Midwest, and strategic acquisitions will likely continue to play a role in the company’s growth.

“Any accomplishments we have attained are a testament to our clients,” O’Connor remarked. “They are the foundation of DCS. We know if we take care of our current clients, then we can continue to build out the tools, programs and facilities necessary to keep adding new partners to the DCS family. Dedicated reps, e-commerce, electronic platforms, EDI, MPS services and North American remanufacturing are just a few of the ways DCS will continue to help clients win new business and make more money on imaging supplies.”

Leek wants the dealer community to know that DCS is working hard alongside them. As the industry continues to consolidate and competition grows stronger, dealers have a partner that understands their business and is one they can lean on in times of need.

“Our partners know we’re going to try to find ways to help them win new business or add margin to their existing sales,” O’Connor added. “That’s been the focus from day one. We have made it a priority to have ample inventory in each of our locations throughout the United States and Canada. On the critical items that are key to their bottom line, we can help our clients save money, enabling them to continue to grow. The competition in the marketplace keeps DCS focused on how we can help the dealer edge out larger competitors every single day. And we’ve proven it with success.” ♦

We Saw It In ENX Magazine

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Celebrating 20 years 1999–2019

| www.ecisolutions.com | How business gets done.

Erik Cagle

OEM Hidden Gems

Treasure Hunting: Manufacturers Shed Light on Hidden Gems that May Unlock Dealer Fortunes

D

o you ever like to steal away on a Sunday morning and visit your local antique stores? The experience offers a trip back in time to the halcyon days of your youth, maybe even decades before you were born. Maybe you have a hobby itch that needs scratching.

Or maybe you don’t know what you’re looking for until you see it. After all, a hidden gem just might be lurking on a dusty perch.

Well, we’re bringing the antique store to you, so to speak.

We’ve canvassed many of the primary hardware manufacturers that you carry to learn a little more about the less-heralded aspects of their catalogs. These treasures just may offer the opportunity to expand conversations with your customer and prospect base.

Brother

In only the last six months, Brother International Corporation soft-launched its Managed Print Services support program within the Brother Enhanced Services Technology (B.E.S.T) Community. The program is designed to help Brother’s BAPP Gold Member channel partners offer custom solutions to their end customers. Case-in-point: a mid-sized health care IT channel partner wanted to improve the document solutions platform it

had implemented in hospitals across one of the largest cities in the United States. To do so, Brother built custom configurations on its scanners to integrate seamlessly with the partner’s system. After the custom solution was complete, Brother devices could be installed and fully operational “out of the box” at these major metropolitan hospitals.

Without the support of Brother field engineers and MPS specialists, that mid-sized business could have lost revenue to larger enterprise competitors that can offer these services directly.

Through the B.E.S.T Community, Brother is able to provide channel partners customized functionality, as well as sophisticated assessment tools and services designed to help identify workflow bottlenecks and opportunities for process optimization, next-level security assessments or other variables. Brother wanted to ensure its channel ecosystem was strengthened by providing increased levels of customization based on the needs of its channel partners.

Canon

Emails sit at the heart of the modern-day office workflow. As the pace of business continues to accelerate, it’s becoming increasingly critical for Canon and its channel partners to offer endto-end solutions with security features that enable collaboration and efficient workflows. Particularly with cybersecurity being top of mind in today’s office

environments, it is imperative for dealers to provide solutions that can integrate with Canon MFPs, offering auditable and manageable options for the ever-growing challenges that come with information chaos.

Canon holds a strategic, third-party partnership with mxHero, a cloud service for intelligent email management. With its unique and non-disruptive integration between a customer’s existing email server and leading cloud content management platforms such as Box, Google Drive and OneDrive, mxHero can transparently facilitate the easy transfer of files and automate additional mail rules by utilizing links with security and governance features. The platform allows customers to gain control over access to their data, leveraging “read only” and “link expiration” features based on pre-set business rules. In addition, the end-user workflow does not change—if a user attaches a document, mxHero does the behind-the-scenes work to help keep the information secure.

Epson

Powered by PrecisionCore Line Head Technology, the WorkForce Enterprise WFC20590 A3 multifunction color printer offers breakthrough speed, up to 100 ISO ppm and distinct advantages over laser.

Inkjet printers can sometimes be continued on page 36

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We Saw It In ENX Magazine

Treasure Hunting: Manufacturers Shed Light on Hidden Gems that May Unlock Dealer Fortunes

Epson WorkForce WF-C20590

overlooked in the SMB and corporate workgroup environments because of misconceptions over cost and performance. However, this A3 printer with PrecisionCore technology and innovative line head design offers a lower total cost of ownership and is more environmentally friendly than laser. It also has fewer moving parts, making it easier to service.

The WF-C20590 offers a different type of inkjet design than other copier models on the market. Epson’s PrecisionCore technology uses a cold process, as opposed to a thermal inkjet method, which heats up the ink and consumes high amounts of energy and over time can wear out the print head. PrecisionCore’s cold printing technology allows printers to consume much less energy and be more efficient, durable and reliable over time. By leveraging Epson’s high-speed production inkjets, color printing in the office is now accessible to all, at an affordable cost.

mation initiatives. These investments, led by cloud and mobile technologies, seek to create more agile, adaptive and collaborative environments that address new styles of working and a new generation of workers. Office technology dealers have a unique opportunity to capitalize on these transformation efforts by offering smart services and solutions that tear down barriers between paper and digital and deliver on what businesses need today and in the future.

One hidden gem offering tremendous opportunity for dealers is HP’s JetAdvantage Apps, which was announced in last March. JetAdvantage Apps is an innovative solution that enables dealers to seamlessly connect an HP MFP to a digital platform. JetAdvantage Apps includes pre-built, made-to-order or build-ityourself management and development tools that are supported by HP cloud services. Each app streamlines key tasks, saving businesses time and money. HP is on track to provide the broadest range of workflow integrations with 35 Beta apps already available today and over 200 development partners.

Kyocera

HP

Most companies nowadays have significant investments in digital transfor-

Konica Minolta IQ-501 Intelligent Quality Optimizer

Konica Minolta

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enue streams outside of traditional office print, the IQ-501 Intelligent Quality Optimizer allows them to offer an appealing product to printers looking to enhance their own menu of services. The IQ-501 is an optional add-on to the AccurioPress, and speeds up installation time and technician time during a service call. And by allowing customers to readjust color on their own, the IQ-501 may also reduce the amount of service calls.

The IQ-501 can register stocks up to 400 gsm, as well as align front-to-back registration for banner printing. It is the only system on the market that can automatically calibrate, profile and adjust for density balance, engine gradation and front-to-back registration without need for any additional accessories and can do all of these in the least amount of time.

All of this adds up to significant time and money savings.

The IQ-501 system is currently available on Konica Minolta’s AccurioPress C3070, C3080, C6100, C6085, 6120, 6136 and 6136P models. The company will showcase the IQ-501 at Printing United, Oct. 23-25 in Dallas.

Konica Minolta’s IQ-501 Intelligent Quality Optimizer achieves and maintains color consistency to industry standard with near-perfect registration accuracy. With highly automated image registration and color control, a closedloop system that constantly monitors and adjusts printed output, and automated color calibration and profiling, the IQ501 delivers streamlined operator time, reduced print waste and industry-leading productivity.

As dealers look to different areas of commercial and production print for rev-

Today’s document-driven businesses are always looking for ways to increase efficiency and lower costs. However, in order to do so, they require innovative tools which can sometimes be expensive and overly complex solutions that take months to implement. These solutions can be exactly what businesses need, but not every business has the budget or the time to radically change how they do things on a daily basis.

Kyocera DMConnect

We Saw It In ENX Magazine

continued on page 38

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Treasure Hunting: Manufacturers Shed Light on Hidden Gems that May Unlock Dealer Fortunes Solutions providers want to help every business achieve its goals, including the small, family-owned and run business that’s just looking to automate and expedite a simple process. Implementing a large ECM or Document Management solution may not be the answer in every case. This is where Kyocera’s DMConnect could be a fit.

With DMConnect, any size business has the ability to capture, process and intelligently route documents and information directly from an MFP or through various interactive digital sources. Businesses can better manage their information and document workflows, which allows solutions providers to reach new customers and even improve the situations of current ones.

Lexmark

For decades, Lexmark has been leveraging vertical industry expertise to optimize business opportunities, close deals and foster customer relationships.

Founded on knowledge gained from years of global data and backed by industry consultants who understand the ins and outs of business best practices, its industry approach has given it a competitive edge in the marketplace.

Recently, Lexmark introduced Lexmark Industry Advantage (LIA), a service that gives partners access to Lexmark’s proven industry approach so they can explore new customer relationships and expand upon existing ones. LIA is a hidden gem because it helps partners differentiate their capabilities in two key ways: Enablement provides partners with resources to further their understanding of the vertical industries in which their customers operate. Partners will be able to increase their knowledge of relevant

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trends, challenges and terminology for stronger, more-targeted communications.

Engagement connects partners directly with Lexmark experts for conversations and collaboration that drive growth, close deals and help expand their business. Based on the size of the opportunity, partners will have access to specific engagements that can help them close the deal.

LIA provides enablement and engagement support for industries including government, education, health care, finance, manufacturing and retail.

Panasonic

The Panasonic KV-S1026C-MKII document scanner transforms paper documents to high-quality digital documents, allowing users to simplify their records management. With the touch of a button, users can instantly start scanning documents and send them automatically to their destination of choice.

Compact design and intuitive operation make the scanner a perfect fit for small- to medium-sized businesses as users can expect a straightforward setup, innovative functionality and a host of advanced features, including booklet, long paper, and plastic and business card scanning. With ultrasonic double-feed detection and an active double-feed prevention roller system, this solution is able to quickly and reliably feed mixed documents at a scan speed of up to 30 pages per minute and 60 images per minute at

300 DPI. The scanner’s bundled Panasonic Image Capture Plus software suite helps users optimize scanning workflows by allowing them to easily scan and preview their scanned images before exporting them as a PDF, text searchable PDF, TIFF or JPEG file formats. Most recently, the Panasonic KV-S1026C-MKII was awarded the 2019 Scanner Line of the Year by Keypoint Intelligence-Buyers Lab and is an EPEAT bronze and ENERGY STAR certified device.

Ricoh

Since Ricoh’s founding in 1936, businesses have transformed using the company’s ideas and innovations, and today it continues to enable people to work smarter by empowering digital workplaces. One way it does this for dealer partners is by acting as a one-stop shop for their solutions needs. A prime example—one that qualifies as a hidden gem—is the Ricoh Theta, a modern gadget that can be combined with print, workflow, services and other solutions for use in all industries.

The Theta launched in 2013 as the world’s first 360° single-shot camera..

Since then, it has been used to capture unique fully spherical images in a variety of situations. The 360° visual space has defied the conventions of traditional photography, making it an intriguing add-on for any customer engagement.

When selling into a school, consider the opportunities for a cross-sell to encourage more collaboration and information sharing. Or if selling to a local law firm,

Ricoh Theta

We Saw It In ENX Magazine

continued on page 40

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Treasure Hunting: Manufacturers Shed Light on Hidden Gems that May Unlock Dealer Fortunes capturing information via a spherical photo could have a multitude of benefits.

The THETA line includes the Theta Z1 (premium model), Theta V (advanced model), Theta SC (beginner model) and Theta SC Hatsune Miku.

Sharp

What if there was a way to provide faster, more-efficient customer service for clients’ multifunction printers (MFPs) while actually reducing the frequency of service visits?

Sharp MICAS

Sharp’s proprietary Machine Intelligence Call Assistance Service (MICAS) is a cloud-based service application and real-time monitoring agent that collects and reports information on MFP device status, usage counts, supply levels, errors and alerts.

MICAS works by remotely collecting data from customer MFPs. This includes information such as paper and toner levels, status alerts and meter reads. The data is viewable by dealerships to facilitate quick service and proactive maintenance.

If a device requires service, MICAS is notified immediately and the technician is prepared with relevant device information. Further, the MICAS online portal provides solutions unique to service technicians, dealers and dealer administrators, such as error code explanations, toner forecasting and customizable supply notifications.

Document systems dealerships can reap myriad benefits from MICAS. Not only does MICAS assist with first-call resolution, it helps to optimize device uptime, provide efficient service deliv40

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ery and ultimately increase revenue and profitability by enabling dealers to focus time and resources on other areas of the business.

Toshiba

Toshiba America Business Solutions simplifies labeling with its BA400 thermal barcode printers, which combine speed (up to eight label inches-per-second) and high-print quality (up to 300 dots-per-inch labels) for tackling diverse labeling needs. The printers’ streamlined and durable chassis—available in both metal and rugged plastic models— allow easy integration within even the most space-sensitive environments. The unique design and simple operation further enable consistent and continuous labeling.

The BA400 printers incorporate an array of intuitive elements for ease-ofuse and low maintenance. For example, a top-loading design permits user-friendly media replacement, while parts lifecycle alerts and simple printhead and platen replacement help increase uptime.

The Toshiba printers also integrate USB, Bluetooth and Ethernet, as well as Near-Field Communication (NFC) connectivity which enables BA400 printers to pair with other NFC embedded devices such as smartphones, handhelds and mobile computers. Compatibility with Zebra ZPL, Sato and Toshiba program languages allows seamless integration within existing settings.

When added to Toshiba’s award-winning line of multifunction printers, its full line of thermal barcode printers allows dealers to become a one-stop shop.

Toshiba BA400

No other major manufacturer offers the scope of products to its dealers as Toshiba.

Toshiba’s BA400 printers have a beginning list price of $1,195 and are available via authorized Toshiba resellers.

Xerox

According to the Identity Theft Resource Center, hundreds of millions consumer records containing personally identifiable information (PII) are exposed annually. That’s why the Xerox Auto-Redaction App is worth knowing about.

When downloaded onto the Xerox ConnectKey Technology-enabled multifunction printer (MFP), the app leverages

Xerox Auto-Redaction App

cutting-edge AI technology and Google’s Data Loss Prevention software to eliminate the time-consuming and error-prone process of manual redaction. Phone numbers, Social Security numbers, emails, names and more can all be redacted with the touch of a few buttons.

Users simply choose, then scan from presets or custom PII and the app automatically redacts it. Results can be reviewed on the MFP and then either printed or shared via email. Custom redaction types are easy to add, and there’s flexibility to meet specific needs. The app is ideal for legal departments and firms, government, healthcare, human resources and education professionals.

The Xerox Auto-Redaction App can be found on the e-commerce-enabled Xerox App Gallery, providing a global marketplace for channel partners to promote and sell apps. Also, channel partners can share in the revenue when their customers purchase an app. ♦

We Saw It In ENX Magazine

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Imaging Supply Market News

Rabbit Holes and Land Mines: Companies Selling Printer Cartridges Face Numerous Unforeseen Challenges

B

rother has been reasonably quiet about defending its intellectual property rights. But in August, it filed a complaint with the U.S. International Trade Commission (USITC) against 32 companies and individuals that allegedly infringed its patents. By doing so, Brother joins Canon and Epson as companies fiercely fighting with Asian-based cartridge producers in 2019.

OEM patent infringement is a serious concern for those selling imaging supplies. And now OEMs want their business back.

More than ever, selling imaging supplies is a complicated business. Scams, inferior (even toxic) cartridges, shifting Asian supply sources, patent-infringing products and blatant anti-competitive OEM behavior make this a difficult time to sell printer cartridges. One bad move can herald the end of one’s business—or even one’s freedom.

So here are some rabbit holes and land mines to watch out for.

But don’t despair just yet—there

are safe options that can provide lucrative profits.

Intellectual Property Infringement

In the early 2000s, new-built cartridges from China started showing up and taking market share. North American cartridge remanufacturers, and their trade association the International Imaging Technology Council (int’l ITC), waited impatiently for Canon to protect its huge portfolio of intellectual property.

It took a number of years, but Canon finally sued over an internal gear, securing a general exclusion order from the USITC. But the party wasn’t over yet.

The Chinese companies and their U.S. subsidiaries responded by developing workarounds to the gear. Canon sued again, claiming these workarounds were also illegal. But a preliminary finding sided with the new-build manufacturers.

On May 31 of this year, Canon announced that it had appealed the ITC decision to the

U.S. Federal Circuit Court of Appeals, which is one step below the U.S. Supreme Court. The Chinese companies are game for the fight, but Canon has money and plenty of procedural avenues available.

Another interesting suit that is still pending is Canon v. LD Products and V4Ink for infringement involving Canon’s new-build color cartridges. Canon sued LD based on LD’s sales of newbuild compatible versions of HP CF210/211/212/213 color cartridges on March 20 in a U.S. District Court in California.

Will Canon continue its roll over the new-build invasion? Probably. However, it certainly has been picky about which patents it intends to enforce, given the tens of thousands of patents it has in its arsenal. Still, it’s easy to be an “innocent infringer” in today’s marketplace, so it’s never been more important to know your suppliers intimately.

Chips: Firmware Causing Printer Interruptions

Another OEM, HP, is using chip technology to control imaging-supplies use. Modern chip technology allows consumers to enjoy a host of features from their machines, while manufacturers use it to monitor their products’ performance and make improvements in subsequent generations.

However, chip technology can also be abused. When chips are used to monitor supply usage in printers, for example, they can continued on page 44

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We Saw It In ENX Magazine

Rhinelander

Chambersburg

ONE DAY TWO DAYS COMING SOON

Rabbit Holes and Land Mines: Companies Selling Printer Cartridges Face Numerous Unforeseen Challenges become an impediment to product performance. In 1999, the first “killer” chip was introduced—chips in Lexmark printers shut off the printer when they detected that a remanufactured printer cartridge was in use.

The bundling of beneficial security technology in chips with printing functions appears initially to be a plus for consumers, but it sometimes has a sinister, convoluted impact. The chips have long been the target of aftermarket ire, and the dark side of similar technology bundling was at the core of legal battles between Microsoft and U.S. antitrust officials decades ago.

competitive cartridge works for a while, but then is disabled. And the firmware affects a host of popular printers.

HP’s own internal documents and packaging alert the consumer that this scenario could happen: Dynamic security enabled printer. Only intended to be used with cartridges using an HP original chip. Cartridges using a non-HP chip may not work, and those that work today may not work in the future.

Anti-competitive statements such as these could serve as notice to the consumer: buyer beware. HP could argue it’s given consumers a notice that

IT’S EASY TO BE AN “INNOCENT INFRINGER” IN TODAY’S MARKETPLACE, SO IT’S NEVER BEEN MORE IMPORTANT TO KNOW YOUR SUPPLIERS INTIMATELY. Tricia Judge, International Imaging Technology Council HP also employed chips, but its earlier models didn’t lock out competition. The company provided a variety of information to consumers that they appreciated, including gauges for toner levels, information on page count, etc. Aftermarket replacement chips didn’t provide this information, and the cartridges to which they were affixed were seen as less valuable because of the diminution in function. This gave HP a competitive edge but did not keep other brand cartridges from functioning.

These early chips were overcome when smart aftermarket companies such as Static Control developed replacement chips that disabled the “kill” feature and allowed for reuse. The market for aftermarket chips became robust.

The OEMs then added a new tool to their competitive arsenal: firmware. By downloading what is supposed to be an “upgrade,” consumers became complicit in changing legitimate chips into killer chips.

However, consumers and the aftermarket are now confronting a very blatant attack from HP with a new round of firmware that is as inscrutable as it is destructive. It is either a time bomb, waiting until the printer is in service for a time, or it automatically changes the firmware so it disables all aftermarket chips. Either way, it is insidious, as the 44

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aftermarket cartridges might not work, and therefore any subsequent failures are to be expected, or perhaps not even actionable if the consumer becomes inconvenienced.

One thing is certain: it is deceptive.

The notice is usually printed in small type, and the vast majority of consumers will buy without knowing about the potential for printer interruption. And once the firmware update is done, it can’t be undone—there is no way to uninstall this firmware.

In the future, there will be more litigation and more movement by OEMs into the use of firmware as a competitive weapon. HP, once heralded by the aftermarket for its non-interference with remanufacturing, has a new generation of aggressive managers and engineers at the helm.

HP wants its business back, and they intend to get it—through chip supply manipulation, firmware updates or selling its “white box” product at predatorily low prices. And consumers will certainly lose if all competition is put out of business and HP reclaims its marketplace and margins.

One solution: keep consumers away from firmware updates altogether.

Educate them as to the insidious nature of the firmware’s purpose. You can

also leave a reminder on their printer; download these stickers from the Int’l ITC’s website (www.i-itc.org).

Additionally, Int’l ITC is working with aftermarket litigators to monitor and act on this. Have a firmware horror story? I want to hear it. Please email me at tricia@i-itc.org, or go to our website at www.i-itc.org.

Cancer-Causing Cartridges: Health & Safety Issues of Foreign New-Build Cartridges

Toner cartridges are comprised of an OPC or drum and toner housed inside a heavy styrene plastic shell or core. European industry members, including the European Toner and Inkjet Remanufacturers Association (ETIRA), started testing the cores from several large Chinese manufacturers of new-built cartridges.

ETIRA’s report found large quantities of the flame retardant DecaBDE in the new-built cartridge bodies. DecaBDE is a known carcinogen so powerful, it’s banned in most European countries.

The largest commercial producers and suppliers of DecaBDE in the U.S. agreed to phase out use of the chemical by the end of 2013, yet still the EPA is proposing a ban of the substance. Here is language from the proposed rule: “Decabromodiphenyl ether. DecaBDE (Chemical Abstracts Registry Service Number (CASRN) 1163-19-5) is a flame retardant that has been widely used in textiles, plastics, adhesives, and polyurethane foam. For DecaBDE, this proposal would prohibit the manufacture (including import), processing, and distribution in commerce of DecaBDE, and articles and products to which DecaBDE has been added…” The proposed rule has four exceptions that have nothing to do with imaging supplies.

In the electrophotographic process, internal elements of the cartridge reach 130–180°C, (266–356°F) heating the DecaBDE-laden cartridge and potentially releasing these carcinogenic chemicals into the office environment with every print.

Xerox and the other OEMs are wasting no time spreading the word.

We Saw It In ENX Magazine

continued on page 46

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Rabbit Holes and Land Mines: Companies Selling Printer Cartridges Face Numerous Unforeseen Challenges Xerox’s results found volatile organic compounds (VOCs) of DecaBDE up to 16,510 percent higher in new-builds.

Subsequent reports undertaken by the Int’l ITC have found large quantities in some Asian new-build cartridges, while others have undertaken steps to alleviate the problem.

But what about the toner itself? It too is made of plastic.

Toner consists of pigment, plastic polymer, wax, charge control agents, bulk additives and surface additives.

Low-cost cartridges, like the Asian new-builds, are like to employ low-cost raw materials, which are more likely to contain “impurities” that could have dramatic health and safety issues.

In addition, the smaller the size of the toner powder, the more fine the print is on the page. The OEMs have therefore driven down the particle size of toner in order to increase graphic quality and yield. Mean particle size can range from five to ten microns, but it can contain particles in sizes that are considerably below five microns and above ten microns.

The smaller the particle, the more hazardous it is. Once you get that small in size, respiration into the lungs is possible. Moreover, the additives used on toner, particularly the surface ones, are even smaller.

In toner cartridges, the toner is heated to a melting point during fusing, when the print is laid down on the page. At that point, the cartridge and its contents are heated to 356°F, and much of these “impurities” can become airborne.

But the problem doesn’t end with the cores and toners. There are many internal components that may containing toxins, and plenty of Asian-based suppliers looking to shave a few pennies off them by using tainted materials.

There are legitimate Chinese manufacturers that have taken steps to address the issues regarding contamination.

However, in today’s volatile Chinese imaging-supplies marketplace, companies are changing hands and being traded at a rapid rate. Yesterday’s environmental 46

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superstar could become tomorrow’s polluter when the company has to cut costs.

That’s how DecaBDE ended up in the plastic in the first place.

Safe Options Are Available

Remanufactured versions of these cartridges remain the safe, legal alternative, thanks to the right to repair.

The right-to-repair doctrine has long protected remanufactured cartridges from claims of patent infringement—just as consumers have a right to repair their cars, they can also repair their cartridges.

The issue was settled in the mid 1990s and 2000s in a variety of U.S. lawsuits.

OEMs have hundreds of patents at their disposal covering nearly every cartridge they offer. Canon in particular has a huge patent portfolio that it recently started protecting aggressively through litigation, and this has now affected some of HP’s products. It is all but impossible for a new-build manufacturer to successfully work around all those patents.

The remanufactured cartridge is based on the reuse of the OEM core, so the health and safety issues discussed herein do not apply. In addition to being potentially toxic, new-build molds use inferior grade plastics that don’t have the durability or integrity of OEM plastics.

Beyond the cartridge shell, there are important technologies the domestic market took decades to command, and then there are the chips and other highly technical components. A cartridge costing $3 can’t address these issues with the requisite quality, nor can it have all the vetting necessary to be free of all intellectual-property concerns.

Finally, customers are becoming ever more environmentally conscious.

Remanufacturers reuse 27 million pounds (12.3 million kgs) of industrial grade plastic reused, and conserve 73 million quarts of oil (69.5 million liters).

Clover Imaging Group alone reclaims more than 21 million ink and toner cartridges each year Reman Day has taken off under the direction of the Remanufacturing

Industries Commission, representing remanufacturers from John Deere and Caterpillar to 73,000 small auto and cartridge remanufacturers. This year’s events encompassed nearly 200 locations, spanning 21 countries on all six inhabited continents. All 12 of the recognized sectors of remanufacturing were involved, and a resolution from the U.S. House of Representatives and Proclamations from State and Local government officials were signed, recognizing remanufactured products as preferable.

Finally, there is President Donald Trump’s trade war with China. Trump has continued to implement tariffs on more and more Chinese products, and cartridges could be among them.

Selling imaging supplies shouldn’t be this complicated, but it is. As a dealer, look to the Int’l ITC to keep you apprised of ways to stay safe in your sales. ♦

We Saw It In ENX Magazine

CONTACT US TODAY!!!

17 Years Experience We Look Forward to Working with You

Sell Printer Cartridges?

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elling printer cartridges in today’s environment is tricky.

New-built cartridges from China offer big margins, but do they infringe OEM patents? Are they safe? What’s your liability if there is a lawsuit?

Protect your business by joining the International Imaging Technology Council (Int’l ITC). For a few hundred dollars, you’ll get information about this volatile marketplace from the organization that has advocated for aftermarket cartridges for 20 years, as well as insight from its attorneys and industry analysts.

What about cartridge quality? The Int’l ITC runs the Standardized Test Methods Committee (STMC), which is charged with creating tests and tools for determining cartridge quality.

Why be alone on the outside when you can be on the inside?

Looking for ways to grow your cartridge sales? Join today!

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Jim Kahrs

Compensation Plans

Reevaluate How You Reward: Improve Your Results by Setting Benchmarks for Your Staff

H

ere’s the scene: you’re preparing for an annual review with one of your key people.

You know the first thought in her mind is “How much of a raise am I going to get this year?”

And you’re thinking, “I know she’s been with me for another year, but I can’t afford to keep giving raises just for anniversaries. My payroll costs keep going higher and higher each year.”

So, you lock yourself in your office and review the year in your mind. What did she do well, and where did she fall short of your expectations? Her main role with the company is dispatch, so you start there. “Well, she tends to come in late fairly often, the technicians complain about her a lot and she had that run in with the service manager. On the other hand, she does a great job following up on parts calls, and really bailed us out with our biggest account when a key system went down.” You’ve now spent an hour thinking this through and the answer isn’t any clearer than before. Does this sound familiar?

Wish there was a better way?

Well there is, and you don’t have to have an MBA from Harvard to put a plan together. The solution involves measuring and managing production in all areas of the business, and tying the production to incentive plans. Production is what spells the

difference between success and failure in any business, no matter how large or small. Many employees believe they are trading hours for a paycheck. “If I come into the office for eight hours a day, I am entitled to my salary.” Very often, the employee totally misses the fact that production is what makes a business operate. In fact, many truly believe that they are entitled to an annual raise even if their individual production has decreased.

The key to increasing production throughout your business is to measure it via production statistics, and then work to improve those statistics. There is a basic law in this universe—you get what you reward. If your system is designed to reward people for simply making it through another year, their attention becomes focused on time, not production.

If you abandon the annual raise in favor of production-based incentives, the mindset of the employee shifts.

Let’s go back to the example of the dispatcher and review a plan. There is a series of steps that can be taken to drive the results. They outline an action plan for dispatch, but it can be easily modified for any position in the dealership.

Determine measurements of production that lead to success—You need to determine how success is measured. For starters, you could measure response time. The lower the response time, the better the dispatcher is at routing technicians and handling calls, so customers are happier. You could also measure the time technicians spend traveling. If the dispatcher is routing technicians properly, the time spent traveling decreases, leading to increased production. Another measure of production could be as simple as the volume of calls handled per day. The key here is to make sure that an increase or decrease in production in each area can be linked to the performance of the individual.

Convert production measures to statistics—Now take the actions that lead to success, and convert them into measurements that continued on page 50

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We Saw It In ENX Magazine

Reevaluate How You Reward: Improve Your Results by Setting Benchmarks for Your Staff can be counted and reported. In the example above, you would take items like average response time in hours, hours or percentage of technician’s time spent traveling and number of calls handled per day. The key is to have a measurement that is easily counted. If the measurement can’t be translated to a quantifiable number, it won’t work.

For example, a dispatcher is expected to create happy customers. But this would be very difficult—if not impossible—to measure since you don’t hear from the happy customers on a regular basis and would have no way to accurately count them. In this case, we measure the actions that lead to happy customers.

Capture and report the statistics—You must now determine how the statistics will be counted and reported.

In the case of the dispatcher, this is fairly simple if you’re using an industry-based software system. The information can be taken from system-generated reports, which may show the dispatcher, for example, that for the week, the average response time was 5.3 hours, technicians spent 40% of their time traveling and there were 200 calls received.

IF YOU FOLLOW THE STEPS OUTLINED ABOVE AND IMPLEMENT THEM WITH EACH MEMBER OF YOUR STAFF, THE RESULTS WILL SPEAK FOR THEMSELVES.

Set production targets—Once you can generate accurate reports for the key statistics, you can determine what your baseline is. Then you need to determine what improvement can be expected. For example, if response time is currently averaging 5.3 hours, we can set a target of being less than four hours. If the techs spend 40% of their time traveling, we can target getting them to 30%. And if the total number of calls handled is currently 200, we could target this to be 230. Of course, we would expect the increase in total call volume to be based on an increase in the number of customers being serviced. If the dispatcher can handle more customers and more calls, her efficiency has increased.

Create an incentive plan—The final step is to tie incentives to the targets. This can be as simple as setting up a monthly or quarterly bonus program for the dispatcher.

For example, if response time reaches five hours for the quarter, she gets a $150 bonus. If it gets to 4.5 hours, she gets $200 and if it goes below four hours, she gets $300.

The same process is applied to tech travel time and total service calls handled. You set a target with tiers and tie the bonuses to the results.

Once you implement an incentive plan, the employee review process becomes much easier. In the above example, the dispatcher knows exactly what targets needed to be achieved in order to earn more money. If the targets were attained, she enjoyed the benefits of the bonuses. If they were not, you can work on a plan to help her achieve them in the coming months.

Either way, you no longer need to have a vague discussion about an employee’s worth. You simply review the results and focus on improvement—the increase in compensation comes automatically.

If you follow the steps outlined above and implement them with each member of your staff, the results will speak for themselves. It’s not uncommon for clients of ours to more than double their profitability in less than a year. The best place to start is with the next employee up for a review. Make this process part of the review and planning for the coming year. Work out the production statistics and incentive plan for their department and start tracking and improving each one. If you do this, one by one with each employee, you’ll have the entire company driving production as a team within a year, and will reap the rewards for years to come. ♦

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UniNet...................................... 27 www.uninetimaging.com

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October 2019 | www.enxmag.com

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