ENX Magazine March 2015 issue lr by ENX Magazine

VOLUME 22 NO. 3 MARCH 2015

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

Extra Help:

engage ‘n exchange engage ‘n exchange Comp and Talent—

How the Document Imaging Industry Helps Resellers Be Successful with MPS

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Connecting People, Ideas and Products in

OEM’s Keep Pressure on Vendors Marketing Infringing Ink and Toner Supplies

Midterm Report: The MSE/Clover Merger John Frisch, Higher Information Group on Selling a Diverse Mix of Products and Services

Business Profile

The 10 Biggest Mistakes Business Sellers Make

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e e n n xx

In This

Issue e n x

16 14

EDITOR’S NOTE EDITOR’S EDITOR’SNOTE NOTE

24 22

INDUSTRY STATE OF THE INDUSTRY STATE STATEOF OFTHE THEINDUSTRY INDUSTRY

Extra Help: How the Document Imaging Industry Helps of 2015 2015 Trends and Trendsetters of Resellers Be Successful with MPS By Scott Cullen By Scott Cullen NEWS BRIEFING

32 HP Sheds More Resellers As As It It Implements Implements New New Qualified Qualified 28 16 OEMs KeepProgram Pressure on Vendors Marketing Infringing Supplies NEWS BRIEFING

NEWS BRIEFING

In This Staff Staff

Between The Lines: Are You Fed Up with MPS Yet? Between The Lines

Issue

EDITOR’S NOTE

Between The Lines Ink Toner Supplies By and Charles Brewer STATE OF THE INDUSTRY By Charles Brewer 24 BUSINESS PROFILE PROFILE

Trends and Trendsetters of 2015 40 Static Control By Scott Cullen 36 Innovolt 44 32A Conversation HP Sheds More with Resellers As Justus, It Implements New Qualified Keith President of Keith Justus, President of Business Business Supplies Program 42 Comp and Talent – It Isn’t an Either Or, It’s both! Copier Solutions BUSINESS PROFILE

BUSINESS PROFILE NEWS SPOTLIGHT: BRIEFING DEALER SPOTLIGHT: DEALER SPOTLIGHT:

SALES MANAGEMENT

By Charles Brewer

By CharlesEXCELLENCE Lamb SERVICE EXCELLENCE SERVICE EXCELLENCE

48 40BEIStatic Services and ENX Magazine Control Magazine to to Acknowledge Acknowledge Service Service 46 John Excellence in 2015 of Higher Information Group, Frisch, President BUSINESS PROFILE

DEALER SPOTLIGHT

Staff

DEALER SPOTLIGHT: 44 A Conversation Justus, President of Business on Selling Diversewith MixKeith of Products and Services SALES & a MARKETING

54 TheCopier Year Solutions Ahead 50 48 By Brad Roderick Midterm Report:and TheENX MSE/Clover BEI Services MagazineMerger to Acknowledge Service By Scott Cullenin 2015 Excellence 58 How to Win Over a New Prospect Prospect The Year Ahead 54 54 By Dave Sobel Innovative Document Solutions: A Dealership By Brad Roderick with a Foundation Based on Super Service 60 58TheHow 10 Biggest Mistakes Business Business Sellers Sellers Make Make –– Part Part 11 of of 33 to Win Over a New Prospect 58 The By Jim Zipursky By Biggest Dave Sobel 10 Mistakes Business Sellers Make – Part 3 of 3 By Jim Zipursky Display Advertisers Index Index 62 60 The 10 Biggest Mistakes Business Sellers Make – Part 1 of 3 of Events Calendar of Industry Industry Events 65 ByCalendar By Jim Zipursky 66 Laser Pros Printer Tech Tip Display Advertisers Index Printer Tech Tip 66 62By Laser Pros By Laser Prosof Industry Events Calendar 68 65 By Britt Horvat Tech Help Printer Tip Free TechTech Help 68 66Free By Laser Pros By Smarka! Smarka! 72 ByBySmarka! Free 4110 Tech Help Fuser Repairs Xerox 4110 Style Style Fuser Repairs 70 68Xerox By Smarka! By Britt Horvat Horvat 62 By Britt 4110 Style Fuser Repairs 70 Xerox By Britt Horvat 66 MARKETING SALES & MARKETING

Susan Susan Susan Neimes Susan Neimes

Publisher & Managing Editor Publisher Publisher & Managing Managing Editor Publisher &

INSIGHT

SERVICE EXCELLENCE

MANAGED MANAGED IT IT

SALES & MARKETING

SERVICE EXCELLENCE DIAMOND AWARD WINNER

Susan Neimes

Publisher & Managing Editor

EXIT EXIT STRATEGY STRATEGY MANAGED IT

EXIT STRATEGY

Scott Cullen Scott Cullen Scott Scott Cullen

Editorial Director Editorial Director Editorial Director Editorial Director

Scott Cullen

Editorial Director

EXIT STRATEGY

PRINTER TECH TIP

XEROX® 5632 & 5675 FUSER MODULES

TECHNICAL TIPS ® ®

Ronelle Ingram Ronelle Ingram Ingram Ronelle Ronelle Contributing Editor Contributing Editor Contributing Contributing Editor

Ronelle Ingram Contributing Editor

DISPLAY ADVERTISERS INDEX ®

CALENDAR OF INDUSTRY EVENTS

engage ‘n exchange engage ‘n exchange engage ‘n exchange engage ‘n exchange engage ‘n exchange

Associate Editor Associate Editor Associate Editor

12 14 14 14

La Revista del Distribuidor Dealer Source La Revista del Distribuidor Dealer Source

Corporate Office Corporate Office CorporateOffice Office Corporate Susan Neimes -- susan@enxmag.com Corporate Office Susan Neimes susan@enxmag.com Susan Neimes susan@enxmag.com Susan Neimes -susan@enxmag.com susan@enxmag.com Susan Neimes 10153 1/2 Riverside Drive., Suite 729, Toluca Lake, CA 91602 10153 1/2 Riverside Drive., Suite 729, Toluca Lake, CA 10153 Riverside Drive., Suite 729, Toluca Lake, CA 91602 91602 1/2 Riverside Drive., Suite Toluca Lake, CACA 91602 101531/2 1/2 Riverside Drive, Suite 729, Toluca Lake, 91602 tel. 818-505-0022 •• 729, fax. 818-505-9972 tel. 818-505-0022 fax. 818-505-9972 tel. •fax. fax. 818-505-9972 tel. 818-505-0022 818-505-0022 818-505-9972 tel. 818-505-0022• •fax. 818-505-9972 Editorial Office: Editorial Office: Editorial Office: Editorial Office: Editorial Office: Scott Cullen -- scott@enxmag.com Scott Cullen scott@enxmag.com Scott Cullen scott@enxmag.com Scott Cullen - scott@enxmag.com scott@enxmag.com Scott Cullen 21 Llanfair Ewing, NJ 08618 •• 609-406-1424 tel. 609-406-1424 21 LlanfairLane, Lane, Ewing, NJ 08618 • tel. 21 Llanfair Lane, Ewing, NJ 08618 609-406-1424 21 21 Llanfair Lane, 08618 • tel. tel. 609-406-1424 Llanfair Lane,Ewing, Ewing, NJ NJ 08618 • tel. 609-406-1424 engage ‘n exchange

Christina Kim Kim ChristinaChristina Kim Christina Kim Christina Kim Associate Editor Associate Editor

México & México && México Latin America Latin LatinAmerica America

del Distribuidor Dealer Source Revista del Distribuidor Dealer Source México & LaLaRevista Latin America La Revista del Distribuidor Dealer Source

ENX Magazine is published monthly by Affinity BusinessCommunications, Communications, Inc. AnyAny inquiries should be sent enx@pacbell.net or mailed toorthe corporate office. ENXMagazine Magazine published monthly byAffinity Affinity Business Communications, Inc. inquiries should beto:sent sent to: enx@pacbell.net ENX is monthly by Business should be to: enx@pacbell.net mailed the corporate office. ENX Magazine isispublished published monthly by Affinity Business Communications, Inc. Any Any inquiries inquiries should be sent to: enx@pacbell.net or or mailed mailedtoto tothe thecorporate corporateoffice. office. ENX Magazine is published monthly by Affinity Communications, Inc. Any inquiries be sent to: written enx@pacbell.net or Cover mailed to the corporate office. Copyright ©2014 ENX Magazine printed in the U.S.A. Allreproduction reproduction inin or part is prohibited without written permission. Cover photo from photo shutterstock.com Copyright ©2015 byENX ENXby Magazine printed the U.S.A. All reproduction inwhole or part isisshould prohibited without from fotolia.com Copyright ©2014 by Magazine printed inin Business the U.S.A. All whole part prohibited without writtenpermission. permission. Cover photo from shutterstock.com Copyright ©2014 by Copyright ©2014 by ENX ENX Magazine Magazine printed printed in in the the U.S.A. U.S.A. All All reproduction reproduction in in whole whole or or part part isis prohibited prohibited without withoutwritten writtenpermission. permission.Cover Coverphoto photofrom fromshutterstock.com shutterstock.com

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Contributors Charles Brewer | Charles Brewer is the founder and president of Actionable Intelligence, the digital imaging industry’s leading market research firm. He was an editor for Inc. magazine and ComputerWorld during the 1990s, and more recently, the managing editor of The Hard Copy Supplies Journal. Mr. Brewer’s analysis is currently featured at his firm’s website, www. Action-Intell.com. Charles Lamb | Charles Lamb is the President and CEO of Mps&it Sales Consulting. His firm delivers proven methodologies and processes that assist dealer principals seeking a successful transformation into the managed services space. He’s created complementary solutions including Funnelmaker, Gatekeeper, and Shield IT services. For more info, call 888.823.0006, e-mail him at clamb@mpsandit.com, or visit www.mpsandit.com. Jim Zipursky | Jim Zipursky is the Managing Director of CFA-MidWest, an investment bank serving the middle market. Jim is a registered representative of Silver Oak Securities, Inc., member FINRA/SIPC. For more information visit www.cfaw.com/omaha. Follow Jim on Twitter (@jazcfane) for articles and information about M&A. For more information about Exit Strategies or Selling Your Business, feel free to contact Jim at (402) 330-2160 or jaz@cfaomaha.com.

Technical Article Contributors Britt Horvat | Britt Horvat works for The Parts Drop, a company whose primary business is providing parts, supplies and information for Xerox brand copiers, printers and fax machines. You can find more information www.partsdrop.com. Saul Widawski | Saul Widawski operates Smarka.com and Starlight Communications in California. Tips appearing in the Technical Tips section are reprinted courtesy of Smarka! The Copier Tech’s Info Source.

•

www.enxmag.com | March 2015

B E T W E E N

T H E

L I N E S

Are You Fed Up with MPS Yet? Everywhere I look, including here at ENX, people are still writing about and talking about MPS. And one of those people writing about MPS is me. Truth be told, there has been a fair amount of MPS bashing in the press and in conversation at industry events, in some cases deservedly so. For a time it was the document imaging industry’s salvation or so it seemed. But a funny thing happened along the way—it became commoditized as more than a handful of dealers and resellers engaged in a race to the bottom, trying to figure out just how far over they could move that decimal point while some dealers and OEMs found themselves in a rip and replace frenzy rather than doing what was truly in the best interests of the customer. I get it. Self preservation, hitting quotas, moving boxes, you know what I’m talking about. This month we thought it would be interesting to find out what’s happening out there in the real world by talking with some of the companies and organizations with a history of educating dealers about MPS or who have played a part in either helping them get into MPS or improve their existing MPS initiatives. They share with us the reasons why dealers continue to seek them out for help, what kind of help is currently available, as well as identify the mistakes that dealers who tried and failed at MPS consistently make in spite of all these educational opportunities and new tools to position it as something more than just another commodity. No matter who I spoke with, one thing came through loud and clear and that was that MPS is still relevant. Plus, believe it or not there’s still an opportunity to get in the game and achieve an element of success even at this late date. I was surprised and not so surprised to hear that, even if some of those organizations providing MPS education are dialing back on their sales training and focusing more on the operational side of MPS. The MPS theme continues this month online with an article on the commoditization of MPS on the ENX/The Week in Imaging website and in the newsletter. We’ll identify who’s to blame for this trend and how to compete against MPS providers who are practically giving it away. Thanks for reading. Scott Cullen Editorial Director

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NBS / ENX | March 2015 21

Scott Cullen

State of the Industry

Extra Help: How the Document Imaging Industry Helps Resellers Be Successful with MPS

ou’d think by now there wouldn’t be much left to say about MPS. How much more can we beat that horse? Turns out, plenty more, especially when you speak with folks in the document imaging industry who are still doing their part to help dealers and resellers get a grip on MPS and be profitable with it. Tons of companies offer MPS programs and education or are rolling out new programs, indicating there’s still a market, even if some segments of the industry are doing their best to commoditize it. (See the article “How to Combat the Commoditization of MPS in Your Marketplace” in ENX/The Week in Imaging at www.enxmag.com). A second article, “Faltered States” that looks at common areas dealers and resellers falter with MPS will also appear this month in ENX/The Week in Imaging. To get a better sense of just how viable MPS remains and the assistance available to dealers and resellers starting out, or those struggling, we spoke with various industry players with a legacy of providing MPS education, programs, and services.

The Tipping Point

For dealers and resellers only now getting into MPS, what’s the tipping point that finally inspired them to follow a path that Doug Johnson Red Sage Group

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www.enxmag.com | March 2015

was blazed long ago by so many others? “Because they’re losing key accounts,” responds Doug Johnson, president of RedSage Group and formerly SVP, Managed Print Services for Supplies Network. “Most dealers have 10 or 20 signature accounts that not only offer great visibility, but provide a significant portion of their revenue. When they lose any of them to a competitor due to MPS that’s when they realize they need help.” “Dealers that are just now launching an MPS program have typically lost a big customer to a competitor with an MPS program, or have lost business to competitors with MPS programs over time and it’s adding up,” adds Ray Loisel, senior vice president MPS, West Point Products. “For dealers Ray Loisel West Point with existing Products programs that come to Axess for support, the tipping point is usually one of two key things; the first is pricing pressure and a need for assistance when calculating TCO. The second tipping point comes from a frustration with processes related to supply fulfillment or management of contracts. Regardless of the dealer’s need, it’s my goal to understand their entire MPS program,

because solving all the issues is where we can add the most value.” Mike Lamothe, founder of Office Document Consulting, an organization that provides dealers and OEMs with strategic support in MPS/MDS, continues to Mike Lamothe see new dealers Office Document Consulting embrace MPS. “We’ve had more questions in the last five to six months about ‘how do we do this’ or ‘we have a customer that wants this,’” reports Lamothe. He attributes this trend to a greater awareness of customers about MPS and dealers not being able to answer their MPS-related questions. Another tipping point is meter collection. “That’s one of the biggest struggles dealers have,” says Jennie Fisher, senior vice president and general manager of the Office Equipment Group at GreatAmerica Financial Services Corp. “Making sure they have a process to do it in a timely manner and do it correctly.” For West McDonald, vice president of business development, Print Audit, the tipping point that brings dealers to Print Audit for extra MPS help is when customers start asking them for “Print Governance” continued on page 24

We Saw It In ENX Magazine

Extra Help: How the Document Imaging Industry Helps Resellers percent happy with their program from products. “There are start to finish,” concedes Gary Willert, some that are sold dipresident of LMI. “Dealers are looking rectly to the customer. The dealer makes some for some type of best practice to take their program to the next level.” margin on it and the customer then owns the entire Print Governance Help is Still on the Way Let’s hone in on some of the ways these portion of managed West McDonald players are helping dealers either get Print Audit print,” explains started with MPS or enhance their existMcDonald. “They start losing revenues ing programs. because waste print starts to disappear “We’re certainly not the only deal and they start printing fewer e-mails in in town, but for us and others like us, color, and they turn their arms up and 2015-2016 is going to become the year say ‘Good grief, we’re losing revenue of the user and ‘Print Governance,’” says because they’ve become more efficient.’ McDonald. “That’s where we can help. The tipping point is when they’ve had some pain in that spectrum and they want Since 1999 we have a pedigree of monitoring and managing to have control and user printer behavior. profit on it instead of “Pricing on MPS is a We call it ‘Print Goverlosing revenue.” complicated matter nance’. If you’re trying The most comto get out of commodbecause of all the different pelling reason why itization, you have to dealers seek help kinds of printers you might do more for end users from Toshiba and be managing. They’re all than manage their print. its Encompass MPS program according individual CPCs. This takes Once you get past toner and service, workflow to Chief Marketing a lot of the guess work out is the next natural Executive Bill Melo, progression and the of pricing.” — Bill Melo is its PageSmart ofonly way to do that is a fering where Toshiba stronger focus on user print behavior. We provides them with a cost per page, which they can then mark up and provide can go into the print stream and help save customers an additional 30-40 percent to their customer. over what they were probably saving on “That’s appealing because among the other benefits they get is automated toner their traditional MPS program through fulfillment,” says Melo. “Pricing on MPS Print Governance.” is a complicated matter because of all the “We can offer them a team of experts with a combined 40 years of experience different kinds of printers you might be helping dealers create successful MPS managing. They’re all individual CPCs. programs; we have seen it all,” explains This takes a lot of the guess work out of pricing. We make it easy for a dealer, and West Point’s Loisel. “Furthermore, we have a robust suite of comprehensive and take a lot of the risks out for them.” flexible MPS solutions that is comprised Last year was a record year for its Encompass program in of the leading remote monitoring software platforms, a TCO pricing calculator terms of growth. Some and proposal generator for CPP, in-depth of those taking adsales training, and auto toner fulfillment vantage of it are large well-known dealerships supplies replenishment. We also offer a full service option for dealers that prefer looking to enhance their existing programs our team to manage their CPP contracts for them. Within our family of compaor decided it would be Bill Melo nies, we are partnered with the leading more efficient to have Toshiba imaging supplies remanufacturers, a Toshiba administer broad printer part distribution solution their entire MPS program for them. and free recycling programs. Needless to “I don’t think any dealer is 100 24

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say, we have something for everybody, in all different stages of MPS.” “Depending on the size of the dealership and the infrastructure they have in place, we have Gary Willert various ideas for them,” LMI says LMI’s Willert. “We’ve got a program for smaller dealers where we do everything for them. All they have to do is sell and we have a complete infrastructure to support them from start to finish. Even larger dealers are looking at that model. It’s become popular because they know exactly how much to charge, how much they’re making, and no headaches. We see everything that’s going on in the country and can get certain nuggets from dealers who have been successful and we have many different plans, structures, and best practices that have worked for other dealers to share with them.” After spending the past few years with Supplies Network and continuing that relationship as a consultant to the company, Johnson is well versed in how a third-party organization such as a Supplies Network and its mpsSelect program can assist dealers looking to enhance or build a Managed Print Services business through training, follow-up support, and ongoing consulting. “They have a good handle on the assets and competencies needed for success in executing the sales and operations needed in a managed print services model in a customer’s account,” explains Johnson. “Their strength is around saying you don’t have to develop most of those competencies, particularly the care and feeding of those fleets once you’ve got them under contract.” GreatAmerica’s Fisher is quick to tout GreatAmerica’s Jennie Fisher Great America strengths at helping Finacial Services dealers with MPS, even if the company no longer offers its Navigator educational program. A big part of that was around crafting the deal around a finance product and administering the deal. “We have the most knowledgeable continued on page 26

We Saw It In ENX Magazine

Extra Help: How the Document Imaging Industry Helps Resellers people in the industry; we put our sales dealership’s approach to MPS, but after people through professional training, the smoke clears, what is it that dealers the leaders of the company educate our need to do to ensure ongoing success? people and the value MPS brings to the “They need to be committed to doing dealer, what the process looks like at a it,” says Fisher. “They get into it, don’t high level, all the areas to do analysis, understand it and don’t understand what what techniques they can use to secure it takes or they’re not getting the supthe appointment, steps to go through on port from the owners of the company. If the analysis and putting the deal togethyou don’t have buy in from the top and er.” somebody being a champion of that, Pinpointing the value that a GreatAthere’s going to be confusion and they’re merica brings to the MPS process, Fisher going to struggle. That’s one of the cites the administration piece, the meter biggest things we see. It comes down to collection, and the education. “Admininvesting in the tools and resources to do istration and how we help them gain the it efficiently. Sometimes when they see efficiencies,” says Fisher, adding that dollar signs and what it takes, they’re GreatAmerica has the MPS Trustmark, not willing to go in 100 which gives them percent.” “If the commitment is not a certain amount Willert concurs with of credibility in the there, everybody has their Fisher. “If the comMPS space. mitment is not there, jobs to do and they Dealers who everybody has their jobs gravitate towards what come to ODC can to do and they gravitate take advantage of a towards what they’ve they’ve been doing for process that intebeen doing for years. It’s grates with FMAudit years.” — Gary Willert making a conscious effort to provide an autoto change that environmated QVR (Query View Reporting). ment and that dealership into thinking “The more sophisticated we get with differently. That’s the biggest message we processing that data and using that data, try to share—we can give you every tool, it becomes a significant benefit,” says and all these marketing materials and Lamothe. videos, but it’s got to come from the top What ODC can do is help dealers down. You have to be committed to makwho already have some basic knowledge ing it successful. It’s not an easy thing to of MPS learn how to leverage managed do. The presidents of these companies print software to provide consumables are under a lot of pressure from the and service alerts, and assist them in OEMs to make quotas. How do they find moving up the ladder to workflow and time to make sure their MPS program is process improvement. successful? That’s probably the biggest “Because we work with FMAudit dilemma most dealers face.” we’ve developed an approach where once While Toshiba can manage the entire we’ve done an assessment we strategize MPS process for its dealers, including and build an approach for sales and selling it on their behalf, Melo says take that data and completely focus on most BTA dealers in the program prefer unmanaged devices inside their base,” to service the product themselves even explains Lamothe. “That’s where [we though Toshiba can do that too. “A big often find] 40-60 percent of devices in a part of the value proposition is being able dealer base are unmanaged. When I talk to service the fleet with the same level of to dealers and I say if we can increase responsiveness and professionalism as your base by 25 percent over the next they do with the MFPs.” couple of years what would that mean to Another typical dealer must do is the you, their eyes light up.” billing. “Again we offer that, but most dealers want to keep control of the billThe Onus is on the Dealer ing so being able to capture the meters, It’s one thing to take this education, create a billing format that’s clear and training, and/or tools to help improve the 26

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concise and meets the customer expectations is definitely a dealer responsibility,” adds Melo. “If we take a dealer on, it takes 18-24 months to get systems in place, speaking to each other, etc.” notes Lamothe who feels that sales reps still need to be able to go out into the field and present MPS in an intelligent manner. ODC has MPS in a tablet, an app they developed because sales reps were having a difficult time describing what MPS was to the customer and how to differentiate their offering from their competitors. Print Audit has a 90-day program to make sure its dealers are successful. “We hand hold them to make sure they’re closing Print Governance and managed print deals,” says McDonald. “After that because they’re shadowing us and it’s more of a mentor-based program, they’re quite happy to run on their own and do the same thing.” As long as dealers follow that lead they’ll be successful. In fact McDonald claims Print Audit has a 100 percent success rate with its Premiere Member dealers ever since they first signed them up for that program. “We have to do our best every month to ensure they’re happy Print Audit customers,” he says. “As much as we would like, we can’t improve an MPS program if a dealer is not committed to the business model and doesn’t implement a sales process and manage their metrics,” adds Loisel. “In addition, if dealers do not extend recommended changes into the ‘back of the house’ processes within service and administration, it is very difficult for an MPS program to be successful. On the bright side, if a dealer is committed and willing to ‘champion’ their MPS program within a dealership, with our guidance, sales training and tools, they can become extremely successful.” ✦

We Saw It In ENX Magazine

March 2015 | www.enxmag.com

â&#x20AC;˘

Charles Brewer News Briefing

OEMs Keep Pressure On Vendors Marketing Infringing Ink and Toner Supplies

ttorneys for a number of hardware manufacturers are ramping up for what appears to be a very busy year. Canon, Hewlett-Packard, and Lexmark all have lawsuits pending in various U.S. federal courts against firms both foreign and domestic. The defendants are alleged to have marketed consumables that violate the OEMs’ respective intellectual property. In addition, the U.S. International Trade Commission (ITC) recently announced that it will investigate Epson claims that a number of companies are now selling infringing ink tanks in the U.S. for Epson machines. The commission is also conducting a similar investigation into Canon claims that assorted companies are importing infringing toner cartridges into the U.S. And these are just the matters that I know of pending in the U.S. courts. Canon, HP, and Samsung have all filed cases in courts across the European Union. Canon has also filed suit in Russia, and HP even has a couple of cases now working their way through a couple of courts in China including one pending before the recently established IP court in Shanghai. I’ve been following the digital imaging industry for almost twenty years and I can’t remember a time when so many OEMs were engaged in so many legal battles in so many countries. Of course, hardware manufacturers are now particularly sensitive to losing supplies sales to infringing goods as people print less

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www.enxmag.com | March 2015

and cartridge consumption drops. But that’s not the only thing fueling all these cases. There is also an abundance of infringing products being manufactured and shipped around the world and the supply just keeps growing. Apparently, regardless of the risk of lawsuits, demand for infringing stuff remains strong and certain third-party supplies vendors around the world are willing to peddle consumables that violate OEM IP.

Epson at the ITC

Going from the most recently filed action and working backward, let’s begin with the ITC’s investigation of Epson’s allegations. In December, Seiko Epson along with Epson America and Epson Portland filed a complaint with the commission alleging 19 third-party supplies vendors

violated five Seiko Epson ink tank patents. The ITC agreed to pursue the complaint and ordered on January 20 that an investigation be conducted to determine whether section 337 of the Tariff Act of 1930 had been violated. The ITC is the federal agency charged with investigative responsibilities on matters of trade so it has the authority to uphold section 337 of the Tariff Act, which says that the infringement of intellectual property rights and other forms of unfair competition in the import trade are unlawful. Epson’s past successes with the ITC were well chronicled. About 15 years ago the firm began pursuing companies cloning its ink tanks but it was its 2006 suit that grabbed headlines. Alleging 24 third-party supplies vendors violated its ink tank intellectual property, Epson’s case

Epson is returning to the US ITC seeking orders that will further restrict the importation of infringing third-party ink tanks.

continued on page 30 We Saw It In ENX Magazine

We Saw It In ENX Magazine

March 2015 | www.enxmag.com

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OEMs Keep Pressure On Vendors had the largest number of defendants the industry had witnessed when it was filed in U.S. federal court. In addition to the suit, Epson filed a complaint with the ITC saying the practice of infringing its patents was widespread and many of the ink tanks being imported into the U.S. violated its patents. After conducting a so-called 337 investigation, the commission determined that many third-party Epson compatibles encroached on Epson’s IP and the firm had suffered losses as a result. The ITC granted a general exclusion order (GEO) in 2007 barring the importation of infringing Epson compatibles into the United States. As the 337 investigation was being conducted, most of the companies named in the federal case settled. One might conclude that with the settlements and the GEO, the case was largely wrapped up and Epson was the victor. That was not the case, however. Several companies continued to fight the OEM in federal court and challenged the ITC’s determination. As the pitched legal battle was being fought, the ITC discovered that several firms had ignored its GEO and the commission meted out heavy fines in 2009. Ninestar and its wholly-owed U.S. distribution subsidiary Townsky were slapped with a fine in excess of $20 million, the largest ever levied by the commission, and several other firms received lesser fines. What followed were years of additional legal wrangling during which time Townsky went bankrupt and the Ninestar fine was reduced to $11.1 million. Although Ninestar ultimately lost its appeal to have the fine reversed, I’m not sure the matter was ever fully settled and the fine was actually paid. Regardless of the status of the fine, Epson’s successful pursuit of the lawsuits and its efforts to have the authorities enforce the GEO resulted in the OEM regaining much of the U.S. market share for its ink tanks. That has been changing over the past few years as more vendors have added third-party supplies for Epson machines. No doubt, it is this proliferation of non-OEM ink tanks that has resulted in the OEM’s December filing at 30

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the ITC. Unlike the 2006 complaint, which included manufacturers in China, Hong Kong, and Europe as well as a number of U.S.-based firms, the majority of Epson’s most recent ITC complaint involves businesses based in China or Hong Kong as well as a few U.S. resellers. The 2006 case involved various patented technologies, but in the most recent complaint, the five patents that Epson asserts are related to circuitry used for transferring power and data from the printer to the ink tanks. I suspect that certain respondents will challenge Epson’s patents so we may see a prolonged fight as we did with the 2006 matter. The latest Epson investigation before the ITC is filed under 337-TA-946, and has been assigned to Administrative Law Judge Dee Lord. If as expected, there are hearings, they will most likely occur in the first quarter of next year after commissioners witness a plethora of filings during the current year.

HP vs. Ninestar and Apex

In October, HP filed suit in the U.S. District Court for the Northern District of California against Epson’s old foe, Ninestar along with its longtime chip supplier, Apex Microelectronics. HP alleges Apex and Ninestar marketed products in the U.S. that infringe U.S. patents 6,089,687 (‘687), 6,264,301 (‘301), and 6,454,381 (‘381). The accused products include Apex chips for HP 564, 920, 932/933, 950/951, or 970 series ink tanks, as well as for “similar cartridges” and Ninestar replacement cartridges for the same SKUs. In its complaint, HP notes that at least some of the Ninestar ink cartridges use chips manufactured and sold by Apex. The ‘687 and ‘301 patents were allegedly violated by Ninestar 564, 920, 932/933, 950/951, or 970 series compatible cartridges and Apex chips for those SKUs. HP claims Apex’s chips and Ninestar’s compatibles for the HP 564 and 920 series as well as “similar cartridges” infringe the ‘381 patent. This is not the first time that HP has sued Ninestar as well as others for violating some of the patents asserted in this new lawsuit. In 2006, HP filed

patent-infringement complaints in district court and before the ITC alleging that Ninestar and various distributors infringed seven patents, including the ‘687 and ‘301 patents. The lawsuit was eventually settled in March 2007, and Ninestar agreed to acknowledge the validity of the patentsin-suit and pull infringing compatible inkjet cartridges from the market. After conducting a 337 investigation into the matter at HP’s request, the ITC issued a GEO against products violating the ‘687 and ‘301 patents. It seems to me that if Ninestar is indeed selling cartridges that infringe the ‘687 and ‘301 patents, not only is it in violation of its 2007 agreement with HP, both Ninestar and Apex could be seen as flouting the ITC’s GEOs as well. HP is seeking a judgment that the defendants have infringed the patents in suit, a preliminary and permanent injunction barring the defendants from further infringement, damages, as judgment that treble damages are warranted, and attorneys fees and costs. Of course, if the ITC gets wind of the case, it could levy its own fines against Ninestar and Apex, which would be independent of any damages or fees awarded by the federal court. I suspect that as a repeat offender, Ninestar’s fine could be considerable. It appears that HP and the defendants are working towards an amicable solution, however. In several different motions filed with the court, the plaintiffs and defendants have requested that certain deadlines be pushed back. The court has ordered that more time be allowed explaining that “because the parties have been involved in discussions to explore possible amicable resolution of this matter, the parties agree that there should be a further extension of time for filing an answer or other pleading in response to the complaint.” It is impossible to say how close the two sides are, but if no agreement is reached, the case should move quickly to the discovery phase in March.

Canon’s Dongle Gear Case

Ninestar is also part of a 337 investigation that Canon requested last year. In May, Canon U.S.A. and Canon Virginia

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OEMs Keep Pressure On Vendors asked the ITC to investigate 33 companies including eight Ninestar affiliates to determine if they had infringed one or more of a dozen U.S. patents. The patents Canon claims the respondent infringed relate to a coupling mechanism found on Canon and HP all-in-one toner cartridges that connects a laser printer to the cartridge to synch and rotate the imaging drum. The investigation

Canon has initiated another round of lawsuits related to the gears found on its toner cartridges.

followed Canon’s filing of 11 lawsuits against 18 aftermarket supplies manufacturers and resellers on January 29 in the U.S. District Court for the Southern District of New York claiming that they had infringed some of the same patents as those in the ITC matter. Last year’s filings came almost two years to the day after Canon filed similar complaints with the commission and in the same federal district court where the 2014 case was filed. On January 23, 2012, the OEM sued a long list of third-party supplies vendors for infringing two patents that Canon holds on the design of a twisted-prism gear, which is used in most of its older cartridges. Although that twisted gear was quite different in design than the so-called dongle gear at the center of the most recent case, both are coupling mechanisms that perform basically the same function: synchronize and rotate the image drum. All of the defendants in the case either settled with Canon or defaulted. After 32

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conducting its 337 investigation, the ITC determined that Canon’s U.S. supplies business was being damaged and granted the OEM a GEO in June 2013 to restrict the importation of infringing cartridge into the U.S. Unlike its 2012 case, Canon is claiming a smaller number of accused cartridges this time around and the patents were issued more recently. Canon has obviously devoted significant research and development to its newer “dongle gear” design and presumably plans to use this gear design in new yet-to-belaunched products. So if the firm were to be granted a GEO, it is likely that such an order would impact not only infringing versions of the toner cartridges currently on the market, but also infringing versions of cartridges that the OEM has yet to launch. The ITC was wrapping up its investigation into the Canon matter as I was writing this article. Part of the investigation includes testimony to be presented to the administrative law judge, which was slated to happen in February. Typically, in these matters, respondents offer an affirmative defense—such as they did not infringe, the patents are invalid, the patents are unenforceable, and so forth. It appears, however, that Ninestar, as well as some other parties, will defend themselves by going after the validity of Canon patents. In certain documents filed with the ITC, Ninestar claimed that the Canon patents in question are examples of obviousness-type double patenting and that prior art exists that establishes the invalidity of the asserted claims of the asserted patents as it had in the Epson litigation noted earlier. Ultimately, of course, Ninestar settled with Epson, by questioning their validity and attempting to chip away at the number of patents and claims the OEM had asserted. Obviously, a new wave of litigation from Canon, the world’s top manufacturer of toner cartridges and laser printer engines, is huge news for the supplies industry. HP is the leading printer vendor worldwide, followed by its manufacturing partner Canon, and together the firms have an enormous installed base and market share. Virtually any firm playing

in the aftermarket toner space offers HP/ Canon cartridges, so if Canon prevails and is awarded a GEO, an enormous number of companies may be impacted. A number have already settled. I would expect that the ITC will issue its initial determination in the matter in the spring and if warranted the commission will implement the GEO in early summer. Until the ITC matter is resolved, the case pending for the federal court has been staid but look for it to roar back to life this summer if the defendants in the matter don’t seek settlements with Canon.

Impression Products’ Appeal

Of all the cases currently pending in the U.S., Impression Products’ appeal of a ruling issued in a Lexmark suit perhaps holds the greatest importance for the remanufacturers in the region. The origins of the case date back almost five years and it took on almost epic proportions in 2012 when attorneys for Lexmark sent out letters to an unspecified number of U.S.-based remanufacturers and third-party supplies vendors. Rumored to have gone to more than 100 companies, the letter said that the OEM had learned the recipient marketed toner cartridges made from empty cores sourced outside the United States. Under U.S. patent law, remanufacturers can only refurbish cores first sold in the U.S. or they infringe the patent holder’s protections, as I’ll explain in a moment. The firms were given the choice of accepting a one-time offer from Lexmark and pay the certain royalties or risk being added as defendants to the 2010 case filed in U.S. district court. Lexmark’s threat to add remanufacturers to its patent-infringement complaint in district court centered on the doctrine of patent exhaustion, or the extent to which a patent holder retains rights on a patented product after it is sold. In Jazz Photo Corp. v. International Trade Commission, the U.S. Court of Appeals for the Federal Circuit held that a product may retain certain U.S. patent protections if the first sale of that product occurs outside of the United States. (Jazz Photo had been importing cameras sold outside

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OEMs Keep Pressure On Vendors the United States and refurbishing them for sale in the United States.) Over the years, firms in the third-party supplies industry had hoped various Supreme Court rulings might undo the territoriality requirements outlined in Jazz Photo. But, despite the high court’s actions, rulings

Lexmark and Impression Products are heading the federal court of appeal to resolve a dispute that could dramatically change U.S. patent law.

from the Federal Circuit have consistently upheld Jazz Photo and, thus, it remains the law of the land. In July 2013, Impression Products, a remanufacturer based in Charleston, WV, made yet another attempt to have Jazz Photo overturned. The showdown came in a courtroom in the U.S. District Court for the Southern District of Ohio.

Impression Products declined to settle with Lexmark and sought instead to have the OEM’s suit dismissed. The firm argued Jazz Photo was rendered moot in the wake of the Supreme Court’s Kirtsaeng decision. Earlier in 2013, the Supreme Court decided copyrights are exhausted on any authorized sale regardless of where the the sale is made in its Kirtsaeng v. John Wiley and Sons ruling. Impression Products argued that copyrights are siblings of patents rights and patent-holders rights are similarly exhausted regardless of where the sales occurs. The Ohio court did not buy the argument and in March 2014 held that copyrights and patents are distinctly different types of intellectual property protections and as other courts have maintained, Jazz Photo is the law of the land. Impression Products appealed the Ohio court’s decision to the U.S. Court of Appeals for the Federal Circuit last summer. In its docket statement, attorneys for the firm spell out why the Federal Circuit should change its earlier rulings and update U.S. patent law to align with the high court’s Kirtsaeng decision. Impression Products reiterates its argument to the appellate court that the U.S. Supreme Court’s decision in Kirtsaeng v. John Wiley and Sons reverses Jazz Photo. I reviewed the docket for the U.S. Court of Appeals for the Federal Circuit and the case is scheduled for March 5. There is no telling, however, when the decision may come.

Another Big Year! As you can see, there is a lot going on the legal front and that’s just in the U.S. As I mentioned at the beginning of this rather lengthy article, there are similar cases now pending around the world. Even with all the pending cases in U.S. courts and investigations before the ITC, I wouldn’t be surprised to see more suits filed here as the year progresses. Samsung has become very active in Europe, where it has more market share, but to date has done nothing on this side of the pond. I expect that as those European cases are developed and evidence is discovered they will result in additional cases including, perhaps, Samsung’s first supplies-related suit in the U.S. I’ve also wondered when Brother will get active in U.S. courts. The company has managed to grab some significant market share in the lower tiers of the U.S. laser market. Its growing installed base has become an attractive target for third-party supplies. In terms of the players with pending cases, I expect to see HP file additional suits in the U.S. Over the past couple of years, the company has begun litigating those that infringe its intellectual property related to LaserJet cartridges. Currently, there are no such suits pending in the U.S. that I’m aware of but I suspect that’s subject to change. Of course, we’ll be following all these lawsuits and much more on our website, www.Action-Intell.com. I suggest you tune in for the latest breaking news. ✦

engage ‘n exchange Who’s Making a Difference in the Document Imaging Industry? This May ENX celebrates the people who are making a difference in the document imaging industry and we’re looking for your recommendations. We invite you to suggest as few or as many people as you’d like with a line or two as to why or how they’re making a difference.

Our intent is to acknowledge the thought leaders and individuals from all corners of the industry whose knowledge, opinions, and guidance are valued by their peers and others in the industry. Some of these difference makers are also doing a terrific job of leading their organizations and growing their businesses and are often front and center at industry events.

E-mail your suggestions to ENX Editorial Director Scott Cullen @ scott@enxmag.com or susan@enxmag.com Profiles of the individuals who are making a difference will appear in the May issue of ENX.

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Business Profile

Innovolt

Raising the Bar on Power Protection within the Dealer and Reseller Channels

I Brady Murray SVP Marketing and Business Development

f your mission is to help businesses improve the performance and reliability of electronic assets by providing intelligent technology to ensure those assets work better, longer, and more profitably, it helps to have a strong technology background. That’s where Innovolt comes in. Founded in 2007 by some of the most knowledgeable minds in grid and power protection, the company has rapidly grown its offerings and today has a substantial portfolio of intellectual property and patents related to its expertise in ensuring the performance of electronic assets. These unique, adaptable microprocessor-based algorithms, originally perfected at the laboratories of the Georgia Institute of Technology (more commonly known as Georgia Tech) in Atlanta, deliver unmatched capabilities that enable unprecedented control of electronics.

The Innovolt Difference

When it comes to power protection there’s surge protection, there are uninterruptible power supplies, and everything else. Innovolt offers that everything else. “It’s easy for us to get lumped into the same category as surge protectors and power supplies,” explains Brady Murray, SVP Marketing and Business Development. “We’re a great surge protector, but surges are a small percentage of power disturbances. If you look at studies about power problems, a surge is only a problem about a half a percent of the time. The vast majority of voltage

problems are voltage sags caused by minor dips in power.” The best way to think about this he says is when an air conditioner in a home, for example, clicks on and the lights dim momentarily. “Those minor voltage sags and the current inrushes that follow them are very harmful to complex electronics like today’s MFPs and that’s the problem that we help protect you from,” says Murray. Innovolt’s Intelligent Electronics Management (IEM) platform maximizes the performance of electronic assets across the distributed enterprise. Through the combination of its patented sensor technology and the Innovolt Management Cloud, Innovolt helps resellers and their customers protect expensive, sensitive equipment while providing resellers with the tools to predict, measure, and optimize essential assets in dispersed environments. Using a series of patented protection protocols and remediation algorithms to recognize potential power concerns and fix the issues before damaging effects occur, Innovolt focuses on three core competencies—monitoring, remediation, and management—to improve reliability and reduce the cost of electronics ownership, including:

Electronics Management Platform

Innovolt’s comprehensive electronics management platform combines sensor technology with analytics software to optimize the performance, productivity and useable life of essential electronics. Through the reme-

diation of power disturbances and a cloud-based dashboard and management console, customers achieve improved equipment uptime, lower repair costs, and increased revenue. In addition to safeguarding and optimizing the performance of electronic assets, Innovolt monitors and aggregates key data from those assets and turns it into actionable information via the Innovolt Management Cloud (IMC). The reseller simply signs on to Innovolt’s secure, intuitive Web-based dashboard and console to remotely track and manage vital electronics.

Innovolt-as-a-Service

The latest way that Innovolt is taking its products to market is the Innovolt-as-a-Service model. Murray believes it’s a great way for dealers to get started offering Innovolt to their customers. When one considers the upfront cost of an Innovolt device versus a surge protector, Murray acknowledges that Innovolt can be more expensive in some cases. This can be an obstacle for dealers and resellers of the technology despite the added capabilities Innovolt provides over a traditional surge protector. That’s the reason, he says, for the evolution to a service model. Now, instead of the dealer or customer purchasing the equipment up front, Innovolt will sell the customer the protection service for a small monthly fee. “You don’t have to take that big chunk of capital expenditure, instead you pay as you go and for as many new devices as you continued on page 38

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Come see us at ITEX 2015 in Booth #728 and have a conversation the latest protection Come see us on at ITEX 2015power in Booth #728 andtechnology... have a conversation on the latest power protection technology...

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Innovolt Raising the Bar on Power Protection “Without protection from these power disturbances, you’ll see more error codes than you normally would and experience more downtime.”

Creating Awareness

want,” notes Murray. This model offers an array of advantages, including protection from product obsolescence. A customer who buys a device will have to buy a new one whenever a new device comes out with new features and functionality. Under the service model, they can be continually upgraded to the latest equipment at no additional cost. “You’ve transferred from this big up front capital expenditure to a much smaller operating expense,” says Murray. This model also provides customers with ongoing information. “In addition to our core protection, we also provide a Web-based dashboard that shows you all the power events taking place that we’re protecting you from,” says Murray. “That can provide important intelligence to folks as they make decisions about service costs or if [issues are being caused by] internal wiring issues within the building.” That’s key, says Murray, citing research that reveals that around 80 percent of all power problems originate within the building rather than outside. “If you have some sort of wiring issue internal to your building or office and that’s causing problems for your electronic equipment, Innovolt can show you that and allow you to be intelligent and fix those things. Without our visibility you’d never know.” This is still a relatively new offering from Innovolt, but the early returns 38

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from resellers and customers is positive. “Dealers are excited about it because it’s an ongoing revenue stream instead of just a one-time sale,” states Murray.

Power Protection and MFPs

Why should dealers and resellers care about power protection? That’s a loaded question for Murray who hones in on the benefits of protecting MFPs from power anomalies that can take place in an office. “When a sag takes place you have an experience like kinking a garden hose— you bend the hose and the water slows to a trickle, you un-kink it and straighten it out you see that rush, the water rushing out of the hose,” explains Murray. “The same things happen to electronics when there’s a voltage sag. There’s a dip followed by an inrush of power that damages electronic components, particularly on high end MFPs, which are really made up of a collection of integrated systems working together in concert rather than an individual machine.” That makes sense when one considers that an MFP consists of various parts, all running independently, yet all working in sync, from paper manipulation, to scanning, to touch screens. When things are out of sync there’s the potential of error codes, resulting in machines that are offline. Over time power issues will cause the device to fail more quickly, says Murray.

Educating the dealer and reseller community about the Innovolt difference poses a sizable, but not insurmountable challenge for Innovolt. As a result, Murray is on a mission to make sure everyone understands Innovolt’s value in terms of protecting electronic equipment from downtime and service calls caused by power disturbances. “Education is our biggest challenge because this is a problem that manifests itself slowly,” states Murray. “It’s not like if you don’t protect your devices they’re going to break tomorrow. If they take the time to understand what we do and how we’re different from a surge protector, we win. If they don’t have the time or interest to understand the difference between Innovolt and a surge protector and they choose the least expensive option, then we don’t win. The burden for us isn’t winning on a technological basis, we always do that, it’s making sure people understand how we’re different and what we do.” Innovolt has over a quarter million devices deployed and has witnessed plenty of side-by-side comparisons between protected and unprotected devices. “Usually there’s a reduction of 40-60 percent in service calls and downtime as a result of Innovolt,” reports Murray. “We know it, the numbers are there. When you look at the small amount you pay for Innovolt versus the huge savings you get, the numbers work out great.” Murray says the best way to present power protection to one’s customer base is to bundle it in with the MFP sale, although it can be done separately too. “A major global OEM includes it with every MFP that goes out the door. We have other clients who do it through their service channel. When they have a machine that’s having issues, they’ll come in, recognize here’s a situation that Innovolt can help with and install it that way. We’re happy to go to market either way.”

A Growing Business

Last year was a good one for Innovolt,

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Innovolt Raising the Bar on Power Protection particularly in the office technology space. Expect to see the company continue to build on those successes while expanding into new markets this year. “We’re starting to see some other markets with similar dynamics to the office equipment space that are different and new to us, like the ATM market,” reveals Murray. “ATMs are actually very similar to MFPs. There’s a lot of the same things going on—internal paper handling, monitors, touch screens, scanning. For that reason our technology is a good fit. Markets like that are early for us, but it’s exciting to see the opportunity.” Does he still see room for growth in the dealer channel? “Our penetration is good, but there’s certainly plenty of room to grow,” acknowledges Murray. “We’re excited as more people become aware of what we do and how we’re different, there’s a lot of potential for expansion.” It’s been seven years since Innovolt first opened its doors and Murray finds the biggest difference between Innovolt today and 2007 is the transformation of its business model, as it transitions into Innovolt-as-a-Service along with all the data that customers can now access. “It’s this increased availability and awareness of data we’re now getting that is most exciting,” says Murray. “In the past, the core protection was always there. We continue to do that and continue to do that very well. We’ve got patents on that technology and are the only one that protects from all these dif

ferent anomalies like sags and brownouts and minor over-voltages, whereas everyone else is just a surge protector. The other thing we’re doing now is collecting all this data from every device in the field. It automatically uploads to the Internet and provides our customers with much more information about their environment and provides us with more information about what’s going on.” That, he feels, is the biggest difference. “We always knew our technology worked, our customers knew it worked, but you could never see it and now you can and that’s exciting.”

Why Innovolt? Why Not?

Murray concludes with a final compelling argument to convince resellers who aren’t doing business with Innovolt to give them another look. “It’s an interesting technology for someone interested in increasing uptime, decreasing service calls, and thereby increasing customer satisfaction,” he says. “In this business we all know the one-time sale is important, but keeping the customer happy and building a relationship with them over time is the real key. That’s where we can really help people excel because machines protected by Innovolt go down less, have fewer error codes, and produce more copies between service calls. All of those are nice metrics, and if dealers want to find a way to get ahead of their competitors we can be a real difference maker.”✦ Contact Info: Innovolt 14 Piedmont Center 3535 Piedmont Road NE, Suite 1205 Atlanta, GA 30305 www.innovolt.com Sales: (404) 467-6331 Support: (404) 467-6355

Benefits of Innovolt-as-a-Service: u Innovolt’s

patented and proven solution with minimal upfront investment and quick ROI

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Continual access to the most current electronics protection technology Access to the Innovolt Management Cloud including reports tracking your electronic assets and disturbances protected against

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Sales Management

Comp and Talent – It Isn’t an Either Or, It’s both!

t’s not uncommon today to get into deep conversations about sales compensation. Typically, it’s a business owner looking to refocus and energize their sales team and to drive the best possible behavior and thus sales results. Compensation is a serious topic for serious reasons. Mess with it too often and you’ll clear the house, don’t mess with it enough and you’re probably giving away too much money and your growth numbers (net new accounts) are probably suffering. There are so many conversations going on about compensation. “Am I paying out too much?” “Am I paying enough to attract sales talent?” The emotions, rules and even laws around compensation make this a very challenging topic to deal with. I hear a lot of “If it ain’t broke don’t fix it!” but what usually comes along with that statement is a business that’s behind the times, including their market strategy and yes, their sales comp program. The cold hard facts are, our industry is changing and in order to remain a leader in your marketplace you have to change with it. So drive a sales compensation that empowers your future. Let’s face it; if you don’t know what you want (your key business objectives) and you’re not sure what your market wants (market strategy) then it really doesn’t matter what sales comp plan you implement. But when you get it right and it’s aligning performance and activity to your destination, it becomes a propellant that drives your company. Many owners express fear when I recommend a change in their sales comp plan, mostly

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because it’s so hard to get things operating smoothly. One business owner told me that there are very few smooth moments within a month that they just stopped expecting them. Some report, “we’ve tried to change it in the past, but we had a mutiny on our hands!” Every situation is different; however, if they don’t know your business objectives and market strategy, they’ll have no reason to understand the comp change. Our industry is one of the most dynamic industries in the world. Think of it, we help millions of businesses operate everyday with the technology we sell. What you sold even five years ago has changed drastically, so changing compensation is just part of it. You’re not the cause of the change; you’re just trying to remain relevant and competitive. I’ve heard, “We’re not selling a lot of MPS!” or “We get in a deal so far and then we bail and it becomes a hardware sale!” Both of these could be caused by a sales comp misalignment. Your sales compensation isn’t just a way to pay your sales team, it’s part of your marketing execution plan; it ties action and direction to your key business objectives and market strategy. It can get especially challenging when a hardware company tries to move into managed services or include software sales. Without allowing your comp plan to assist you in the change, it’s probable you won’t make the transition successfully. Sales compensation should be as standardized as possible, all for one and one for all. I have found within a single We Saw It In ENX Magazine

company as many as 8 different comp plans at work at the same time. Talk about a nightmare. This is typically caused by the lack of foundational planning on behalf of the business owner or leadership. There is nothing wrong with different comp plans for different deliverables, but different comp plans for reps all selling the exact same deliverable? Unmanageable! If you’re paying more money or higher percentages to some, this will be discovered and drive dissention in the ranks and may result in undesired consequences. This can happen in the recruiting process, when an inbound candidate negotiates their way through your comp to make it more favorable. Obviously if you scored the right person it may be worth the headache; however, I’ve seen this a thousand times where a negotiation to pay higher commission creates a monster. A rep who can live on your base and a few sales is not what you want to create. Creating high activity and momentum drives the highest ROI for your company. Slow creates slower and when your “higher talented” reps are not at the front of the pack raising the bar, where do you think the others will be? Sales compensation isn’t a toy to play with, it’s a tool that helps guide your sales organization to the direction and behavior that best serves your company’s future. As powerful as a great comp plan can be, it seems that there are some folks that you simply cannot please. Not in every company, but in many, there seems to be confusion sometimes on who works for whom. Letting things continued on page 44

Comp and Talent – It Isn’t an Either Or, It’s both! get to this point is a mistake. Often I find that the sales team has control of the company and the pace of sales. They live in the lease renewals and the company is just a vehicle for the sales team to drive their income. Trying to change the comp in this environment is amazingly difficult and you’ll probably lose those who have only been using you as a cash cow. The good news is, if they were living in your renewals you certainly can renew your own leases (most of them anyway). This leads us to the talent side of our conversation. Certainly you’ve heard the old saying, “What came first, the chicken or the egg?” This applies directly to our hiring success. Designing a sales team model that will get the job done is so very important. Is it the comp plan that attracts the talent or is it talent that requires a great comp plan? And it’s not about hiring a lot of people; it’s about putting together a sales team strategy and attracting the right talent with the right comp plan. With any candidate you’re about to hire, it is a great point of conversation to share AT THAT POINT, “We review our comp plans every year and modify them AS NEEDED to accommodate the new products, services or market strategies.” I would go as far as dropping that into your hiring or employee handbook and provide a place for them to initial that they understand. Trying to motivate sales reps that will never adapt is like putting a new motor on a sunken boat—it’s not going anywhere. You have to build a comp plan that will attract the right talent and the right talent should understand how the compensation can help them make a lot of money. The right candidate is probably looking for higher income opportunities over a strong base. But remember your thoughts of a strong base are always less than theirs it seems. Most importantly your comp plan must be REAL. I see people throw out numbers that came from Mars and then an unknowing candidate jumps into failure the day he joins your company. There are a lot of practices out there like hiring an experienced sales professional or hiring inexperienced talent and 44

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training them. There can be problems with both sides of those practices. If you hire inexperienced talent and decide to train and nurture them, you have to have a training and nurturing program. Do you have one? If you hire the experienced sales professional, you realize they do have some baggage, good and bad and hopefully you hired someone with a proven SUCCESSFUL track record that you validated. Someone who can sell the C-suite solutions our industry is requiring. What you should always do with your existing team and/or new hire candidate is show them a three-year view of their comp and quota requirements so they understand your long term expectations for year two and three. One of the most negative comments I hear in our sales rep surveys is, “My employer keeps raising my number every year.” A great market strategy is always going to include growth calculations; however, many business owners look at yearly budgets and forget to share the long-term requirements with their sales team. Again, sales compensation is a tool, it has to demonstrate a path for successful income or you’ll never attract the higher talent. It should show the same new business mix requirements that your company needs. Share more commission for growth and less for renewals and both of those are impacted positively or negatively based on quota attainment. The salary you provide should assure you that you have control of the daily activity and expectations of your sales team. You should be able to request and expect the normal and necessary sales activity that every company would require to grow their sales funnel. They say that a great sales rep is one in ten thousand! They’re out there, and your comp plan, if it’s right, can attract them. This is important! They’re probably employed and you’ll need a technical sales recruiter to find them! If you think that your salaries and commissions won’t compete, here’s a process for affording the talent you need. Let the three or four underperformers you employ go and use their funds to design and attract the right talent. It will only have a positive impact on your

company immediately. Let the recruiter review and share their thoughts about the quality of your comp plan. They get to see hundreds of benefit packages every month and work in your marketplace. So help them help you! Make any reasonable adjustments they suggest that align with your plan. So what is the right sales compensation? Let’s just look at the marketplace today. With managed services being a C-Suite deliverable (mostly) you’ll have to afford a sales rep with the talent to perform at that level. That type of talent is going to want to make six figures plus and will want to build some type of residual commission. With services, you really can’t base their comp on equipment profit so you have to create a comp plan that’s based on the value or profitability of your contract. Just like equipment, services generate profit; all you have to do is design a comp plan around the profit of longer-term contracts and reward your sales team for bringing them in. I certainly have examples I could share. A mediocre comp plan plus a mediocre sales team delivers mediocre results, plain and simple. You don’t have to ride in a boat that’s sinking. Patch the holes, put a new motor on it and grab the rudder and point it where you want it to go! ✦

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Dealer Spotlight

John Frisch, President of Higher Information Group

on Selling a Diverse Mix of Products and Services

F John Frisch President of Higher Information Group

or the past 13 years, John Frisch has been enjoying life as president of Higher Information Group in Harrisburg, PA. The dealership was originally founded in 1969 and for the next 30+ years focused primarily on business equipment. Since acquiring the company in 2001, Frisch has transformed it from a company known primarily as a provider of business equipment to one that can manage customer information from inception to destruction. Higher Information Group offers services in six divisions, including Business Equipment (Toshiba, HP, and Lexmark), Information Technology, Shredding Services, Document Storage, Web Design and Development, and Corporate Reprographics. It truly is a onestop shop for its many clients located throughout South Central Pennsylvania. During a telephone interview Frisch discussed his background, the challenges of running an office technology dealership, and how he managed to successfully reposition Higher Information Group to ensure its relevance in a changing and dynamic industry.

dealership as a sales manager and then owned half of a POS company. When I bought it, Harrisburg Copiers had 13 employees and was doing $1.3 million in business. They were on the skids and close to bankruptcy. We came in and pumped it up to 21 employees. We had to do $2.1 million or we weren’t going to make it. We did $2.3 million the first year. Today we have 67 employees all through internal growth. About six years ago we had the idea for an organization that handles information from inception through the entire life cycle. Business equipment is still about 60 percent of our revenue. We have an in-house print shop, a retention portion, which is physical storage of documents and is comprised of three warehouses and a small section in our main office. We have IT. On the destruction side we offer document shredding. Three years ago we decided to change the name of the company because “Harrisburg Copiers” sounded too regionalized. We also wanted another “H” name so we could keep our logo. That’s why we changed to Higher Information Group.

You’re much more than an office technology dealership, and the name of the company reflects that, how did that come about?

You’ve set yourself up as a one-stop shop for information management. How many of your customers take advantage of virtually everything you have to offer?

FRISCH: I bought Harrisburg

Copiers about 13 years ago. At that point I had been out of the industry for 3½ years. I used to work for another copier

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FRISCH: : More than half of our

customers use more than one service. That tends to reflect how long they’re with us. We might We Saw It In ENX Magazine

sell someone a copier then a year later they say they’re not happy with their shredder provider or they need IT services.

Who are your customers? FRISCH: Predominantly small

to midsize companies. Less than 25 percent of our revenue comes from larger companies.

Why do your customers choose you? FRISCH: The biggest reason

is our services. We’re able to handle their information needs across the board. Secondly, we’ve grown well over 1,000 percent over the last 13 years because we always put the client first. Whether you’re in sales or service, we encourage our people to put themselves in the client’s place and do what’s best for them.

Who do you consider your primary competition? FRISCH: We’re so diverse it

depends what vertical we’re looking at. Our biggest hurdle is ourselves. We need to continue to develop our services and do a better job. When you’re specifically a copier dealership, for example, you have your main competitors, but because we’re so diverse it’s more about making sure our different divisions work in cohesion and we’re taking care of the client.

Is there anybody in your market that you compete against that positions themselves the way that you do? continued on page 48

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John Frisch, President of Higher Information Group FRISCH: We break ourselves up into

five or six groups depending on how you count it. There’s people who might have business equipment and do shredding and storage, but haven’t got into the IT side of things. The IT is a big differential. There are other people who might have a print group or shredding and storage. Because we have a data center in house and 20 technicians in IT we’re able to literally put our arms around a client’s entire business and host it for them. From an information management standpoint, that sets us apart.

Is it a challenge to make sure all these groups within Higher Information Group are on the same page and communicate well with each other? FRISCH: A year and a half ago we had

specialists that would do IT or document storage and we broke our sales group up into specialists in different areas. We’ve since made the decision to go back to relationship sales where our clients would have one point of contact from a relationship standpoint. What we did was backfilled with support people. Let’s say you want to do IT as a sales person, you probably don’t know a ton about IT, but you basically understand what the client wants and then that person brings in a sales engineer to support them.

represent a small percentage of our business. We can have 30 percent growth there, but it’s not going to have a big effect on our top line revenue.

Why do you think IT is growing so well? FRISCH: After plugging away at it for

six years we finally got it. IT is a very complex and expensive venture both in what you have to put in as far as the hardware to have a Data Center, but more importantly getting your people up to speed. We have 20 people in our IT group and getting them up to speed has been a long process.

What’s it going to take to get some of the other segments of your business to do better? FRISCH: : Everything’s doing fairly well,

but I have my eye on the print group. I’ve ignored that for a little too long and that’s why that’s been stagnant. Like anything if you don’t pay attention to it it’s not going to do as well as if you do pay attention to it. It’s a good market, but it is an area where we’re going to focus on small transactions.

Where do you see your future growth coming from? FRISCH: IT is going to be our largest

Why do you think you’re doing so well?

growth area. The hardest thing about that is building a relationship with a client. If you can sell more than one service to the client, that’s obviously a huge benefit. I think we can stay where we are in Central PA and probably grow 10-15 percent organically. In order for us to have larger growth we would need to move into other markets.

FRISCH: The biggest thing was going

Do you want to do that?

How’s business? FRISCH: We were up 15 percent over last

year. Back in the ’08 timeframe we were flat, which was unusual for us.

back to relationship sales. Clients were getting lost when we were saying if you want five of our different services you’re going to have to deal with five different sales people. Once we went back to a single sales person as a main contact and backfilled support, it’s helped our growth.

What segments of your business are doing well for you right now? FRISCH: We had a big year in business

equipment while IT is by far our largest growth area. Printing is just kind of plugging away. Shredding and storage

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www.enxmag.com | March 2015

FRISCH: We do.

made a big jump forward, then three or four months later doom and gloom set in with the economic forecast. That was scary. But now I sleep a little better than I did back in ’01 or ’08.

What’s the one thing you know now about running Higher Information Group today that you wish you knew when you first started? FRISCH: A lot of things. Looking

back when I first bought the dealership Toshiba switched over to Oracle and we couldn’t get the equipment shipped to us for almost a month and a half. In real economic dollars that cost us close to one hundred grand. Whereas had I known then what I know now I probably would have reached out to some brokers and bought some used equipment and put it in on a temporary basis to hold onto some of the customers we ended up losing. Otherwise, I don’t have any major regrets. It’s just growing and learning as you move forward, and doing things better today than you did previously. Most of that comes through experience.

How does 2015 look for Higher Information Group? FRISCH: I’m an eternal optimist so I’m

going to say great. Over the last two or three years we solidified who we are and what we do and our different groups are working well together. We’ve made some great improvements to our personnel. I think 2015 could be a year we get some expansion done. It’s all about timing and finding the right opportunities.

After all these years are you still enjoying yourself? FRISCH: I always enjoy myself.✦

You purchased the business in 2001, what’s been the biggest challenge of these past 13 years? FRISCH: Starting the business under-

capitalized. That was hard in the beginning. The other big inflection point for us was six years ago before the financial debacle we were less than half the size in revenue and had half the number of employees we have now. That was when we made the decision to add the four new services. We bought a 35,000 square foot building, aggressively We Saw It In ENX Magazine

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Insight

Midterm Report The MSE/Clover Merger

S Gilz Wazana SVP of Sales, MSE

Luke Goldberg Global SVP of Sales and Marketing, Clover Technologies Group

uddenly last summer, two prominent suppliers in the document imaging industry, MSE and Clover Technologies Group, joined forces to create an even more formidable entity. On the supplies side of the document imaging business this was by far one of the biggest stories of 2014. It’s now eight months into the merger and we thought it would be interesting to touch base with Gil Wazana, Senior Vice President of sales at MSE, and Luke Goldberg, Global SVP Sales and Marketing of Clover Technologies Group, to find out where things stand today, the impact on customers, and what’s in store for the rest of 2015. Incidentally, MSE just celebrated its 20th anniversary in December, which is an impressive feat in itself.

there haven’t been many significant or earth-shifting changes that affect how we do business or affect how we support our customers internally and externally. Ultimately, we’re where we thought we would be seven or eight months into the merger. We have introduced some additional solutions and value-adds to our customers. We recently announced an additional distribution location in Florida, and an expanded location for the East Coast in New Jersey. We have expanded our California location with a new 4,500 square feet QC lab and 18 engineers and technicians have been added as part of the merger. These are all positive changes that will allow us to better serve our customers.

Looking back at the past year would you say it’s been a good one for MSE?

WAZANA: Absolutely. When we initially announced the merger we committed to a best practice methodology and to creating additional value for our customers and resellers. Expanding in certain areas of the business, including our product lines and distribution, and having additional resources in engineering, so we can be faster to market and have a wider product breath, is part of the value we’re committed to and are already delivering on.

WAZANA: It’s been an excellent year and the measurement for that is multi pronged. It’s not one singular thing that made it an excellent year. Of course we can point to the merger with Clover. That’s a big part simply because it set us up for the next 20 years along with the collective value and support we can provide to the industry through that.

The merger was announced in July, has much changed since then? WAZANA: Things are changing and they will continue to change, but they’re all positive changes. We are progressing as you might expect when two large companies merge together. From the day-to-day mechanics of MSE,

Are your resellers feeling the impact of these changes yet?

Merging two large organizations like this must come with some challenges, what’s been the biggest challenge of merging the two entities? GOLDBERG: There haven’t been that many challenges because both sides have been moving forward with a spirit of cooperation.

Sometimes when these things happen, you get a “we always did it like that” scenario. We’re not getting that. One of the terms you hear frequently within the context of these mergers is “best practices.” Best practices are driving the communication and cooperation between the collective organizations. There is no ego here; it’s not about “we’ve always done it that way,” it’s what’s the best way to do it? Driving things forward with that spirit of cooperation is first and foremost based on the premise of best practices, which is keeping the conflicts and challenges to a minimum. It would also be disingenuous to say there haven’t been any challenges because it’s not inherently possible to meld two organizations of this size together without some challenges. There are certain day-to-day things like not being on the same ERP system, which means we don’t have 100 percent visibility across all platforms. Eventually we will, but in the meantime, that’s a challenge. We have a sister company, West Point Products; they’re an excellent company and excellent partner, but we sell to some of the same customers. A big part of what Gil and his team are doing is making sure we’re going to the market collectively instead of as adversaries. That is a challenge, going from being an adversary to a partner. You have to change that mindset overnight to make sure we’re being cooperative as opposed to competitive. That takes a lot of work and Gil can attest to that. WAZANA: On the customer side

continued on page 52 50

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Midterm Report The MSE/Clover Merger there’s questions like, “Will MSE be different? Will West Point be different? We love our rep at MSE or we love our rep at West Point, what will that look like?” Those are things we’re working through, with a focus on a seamless process for our mutual customers while staying focused on our core competencies. We have 1,100 employees on one side and over 16,000 employees on the other side. You need to balance the human element as well. The challenges have been minimal and more on the tactical day-to-day side of the business. How do we get on the same ERP? Which project or integration do we want to tackle first? Outwardly, both sides are lucky. We have customers who have a lot of faith and trust in us and believe we will be able to grow and merge properly while only providing benefits to them without degrading our level of service or the quality of our products. Our customers are making this process easier than we imagined.

Gil, earlier you mentioned you’d be introducing various new solutions and value adds, can you be more specific as to what those are? WAZANA: We recently launched a postal ink line and believe that this creates an incremental profit opportunity for the majority of our customers. We are launching a branded remanufactured inkjet solution that will augment our MSE Brand. The products are made in the USA in a state of the art facility which utilizes robotics and automation in order to deliver a very high quality product that our customers can rely on. That’s an additional value from a product position that MSE is regularly asked about. We have also started down the road of better understanding the organization’s MPS platform and how we can deliver it under the MSE Brand suite of services and marketing support. Our goal is to continue to offer differentiation on the MSE Brand as we bring these services to market. These are just a couple of things we can bring to customers who were historically MSE-only customers.

Let’s talk more about how MSE and Clover are complementing each other? 52

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GOLDBERG: One critical aspect we haven’t talked about yet, which creates one of the biggest insecurities in our industry, is the availability of cores. Obviously, Clover being the largest collector of cores in the world in the aftermarket imaging supplies business, that doesn’t eliminate [the insecurity], but it mitigates and/or alleviates a lot of the stresses that MSE was encountering vis- a-vis core collection. Another benefit happening behind the scenes is that Clover will be handling our core collection program. They have the most robust and comprehensive core collection program in the world. Providing dealers with Clover’s services and reclamation programs is another huge value add. Another exciting thing about being part of the Clover family of companies is our global footprint. That global footprint is global manufacturing, global distribution, and global sales and marketing. We have the ability to interface with customers in 26 languages in more than 18 countries. We have manufacturing, distribution, and collection all over the world. That’s exciting from an MSE context as well because MSE now has the ability to expand our brand in markets we couldn’t expand into before. We’ll now have distribution in Latin America, we’ll have sales people and boots on the ground in Mexico and Brazil and places we didn’t before. That’s an expansion of all of our brands globally, including the MSE brand. It’s also exciting to be part of a diversified organization. Clover’s global solutions portfolio includes mobile device solutions and telecom engineering services. Our wireless device solutions include private label mobile device buyback and repair. We currently support some of the top brands in the industry. Clover’s wireless and telecom divisions are essentially taking this platform of manufacturing or reengineering and applying it to other types of e-waste and diversifying beyond the world of print. WAZANA: MSE is celebrating its 20 year anniversary and over the years we have had an incredible team of leaders that are smart and experienced who have

been the driving force in our progress. Through the merger, that team has been expanded and it’s exciting to sit around that table now with more people that have different experiences and walks of life both professionally and personally. I can only speak for myself, but it’s great to hear other people’s history and experiences and learn how we can change or do things differently. It’s a great learning experience that will allow us to grow, gain new insights and reshape ourselves. GOLDBERG: Everyone is open minded and willing and desirous to learn just as we are. We create a formidable team when you put together the level of expertise that each of these top managers have in their respective areas, whether it’s the retail, distribution, technology or Big Box side. That’s exciting and I’m enjoying the learning experience as well.

All the positive experiences you’re sharing, does that surprise you or were you expecting that? GOLDBERG: I don’t think I had a lot of preconceived notions about how this was going to take place. You naturally expect when you have a lot of different personalities and strong personalities coming together there would be some conflict. It’s almost unbelievable how little conflict there has been and how that spirit of cooperation has prevailed at the highest levels. I anticipated it would go well, but I didn’t believe you could have as collegial an environment as the environment that’s been created. WAZANA: Clover and MSE were fierce competitors with a great relationship. And the relationship was such that each side had some insights into the style, approach and personality of the other. We’re both extremely passionate and spirited. I expected to have some high voltage type discussions and am glad that we did as it revolved around the ultimate goal of creating a better experience for our customers. Not to sound like a cliché, but everyone is truly open minded and focusing on collaboration and best practice.

What else do you think readers should know about the new MSE

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Merge: cont. and Clover that hasn’t already been discussed? WAZANA: I want to reaffirm that both organizations are working towards becoming one. The goal at hand and everybody sees it clearly, is taking care of our customers and helping them grow their business. Over the past six or seven months we’ve proven it by delivering value. The customer is always number one and that is something that we all see clearly at every level. GOLDBERG: We’re going to continue to deliver better products, better solutions, diversity of product lines, and we’ll continue to be an even more valuable part of our customer’s business. We already started delivering on some of the promises we made pre-merger. We said we’d have product line diversity, better distribution, and better tools. We’re delivering on that and our customers are seeing that. We continue to bring the highest degree of value any organization can bring to any dealer anywhere in the world.

Next year when we have this conversation again, what do you think we’ll be talking about? GOLDBERG: We’ll be speaking more in terms of our mid-market organization, more as a cohesive whole. We’re seeing the same things, we’re on the same system, approaching independent dealers in the United States as an organization as opposed to two organizations and there’s going to be more cohesion as far as that aspect of our business is concerned. Being only eight months into this everybody talks about synergies; by then more synergies will be delivered. We’ll have more solutions and products to talk about and we’ll have a full-blown managed print solution available to our dealers. You’ll see the byproduct of more time together and how more time together will bring more synergies, more value, and more cohesion. WAZANA: What we’ve been talking about

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Service Excellence Diamond Award Winner

Innovative Document Solutions Office Technology Service Excellence Award

DIAMOND LEVEL

A Dealership with a Foundation Based on Super Service

evin Heitritter, President of Innovative Document Solutions in Murrieta, CA, knows great service. He ought to. He began his career as a service tech in the mid 1980’s before starting his own office technology dealership in 1989. That’s not a career path most dealer principals take and Heitritter knows it. “I am cut from

(from left) Kevin Heitritter, President, and Frank Birtcher, Service Manager

a different grain, I carried a tool bag before I carried a briefcase,” he concedes. Considering Heitritter’s and his service manager, Frank Birtcher’s backgrounds, along with the dealership’s 26-year emphasis on service, it’s not much of a surprise that Innovative Document Solutions is a BEI Services and ENX Magazine Office Technology Service Excellence Diamond Award winner. It’s not surprising either that their scores are among the highest of any dealership tracked. Equally impressive is that Innovative is a small dealership serving a niche market. An authorized Canon dealer, Innovative focuses on the Inland Empire aka South54

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west Riverside County. Besides its Murireta headquarters, there’s a branch office in Palm Desert, CA. Approximately 75 percent of Innovative’s customers are small to medium size businesses while the rest fall into the enterprise segment. Customers tend to choose Innovative because they appreciate their proactive approach to service. Innovative’s biggest competitors are Canon and Konica Minolta branches. Xerox has a strong presence too. “I probably have five Canon Solutions America offices within a 70-mile geography around me,” reports Heitritter. “They’re everywhere!” That’s okay, Innovative can deal with it, and has historically held its own against larger, better funded competitors. “Being a local around-the-corner dealer helps,” states Heitritter. “Customers appreciate our ability to act quickly and take care of their needs. If they go to a branch or a larger dealer, they’re just an ID number. Here, they’re more than an ID number and we get to know them intimately.” Heitritter has understood from the beginning that his background in service is a huge differentiator. “I’m more of an operational guy and technical guy,” observes Heitritter, who does his share of selling like any other owner. The difference between him and his peers who started in sales—and Heitritter’s been a member of SDG for more than 10 years and a past president—is that it’s a different conversation when he’s in front of a customer. “It gives me a competitive edge,” he says. “I spend more time on We Saw It In ENX Magazine

metrics, looking at profitability and parts usage and stats in our service department than sales GP or sales goals. That’s our mantra and we realize if we give good service the renewal process for our sales reps is easier.” If renewals are easy, then why would a dealership with a well-documented history of providing great service need a program from BEI Services? “When we started working with Innovative, their numbers from the get-go looked better than the average dealer starting out with BEI,” acknowledges Steve Sharkey of BEI Services. “That simply speaks to Kevin and Frank’s backgrounds in service.” “We weren’t a complete train wreck and didn’t need to reinvent the wheel,” explains Heitritter. “We were providing great service. BEI helps us validate and build off of that.” As a result, Innovative now has a snapshot of what they look like compared to everybody else from a service and parts perspective. The technician compensation piece of the program was another reason. “We wanted to pay our guys to do a good job,” states Heitritter. “If it’s green in their jean the tech’s going to march to that. On the 15th when we pay sales commissions, we pay our BEI commissions and it’s a good feeling to see our techs receive an added bonus.” Innovative also uses the program to data mine. “A lot of times we’re comparing ourselves to other dealers and what parts are being used with different models, especially a new release model that we may not be selling a lot of continued on page 56

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March 2015 | www.enxmag.com

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Innovative Document Solutions yet,” notes Heitritter. “We can see ahead of time what parts are being used. We thought we’d always done a decent job, but it’s also helping Frank write his employee reviews every month. It’s just a great tool.” As far as Innovative’s scores, Heitritter is quick to identify who is responsible for the dealership’s performance. “Frank is the biggest reason,” he says. “I can only lead so much, but it takes someone to take the reins and run with it.” Besides his unparalleled technical expertise, Birtcher is adept at resolving issues over the phone. “Our phone fix rate is extremely high,” emphasizes Heitritter. “Frank is like having another tech and a half to two techs.” Reviewing Innovative’s scorecard, their hold for parts rate was 9 percent. “Which means their numbers are well within the threshold we’re looking for from a benchmark standpoint,” says Sharkey. Copies per tech is 80 percent, a reflection of the niche market they serve. “They don’t sell to production environments like other dealerships in bigger markets do,” adds Sharkey. Over the past six months Innovative’s first call fix rate was 66 percent while call backs were running at 25 percent. “That puts them in the upper echelon of each of those categories,” reports Sharkey. “Those are the three big metrics that look

It Pays to Sell Document Management Solutions DocuWare’s products and proven business plan provide you a strong bottom line. Executive Leadership Council

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www.enxmag.com | March 2015

at how good these guys are at fixing the equipment the first time. That speaks to the department and company profitability, and speaks largely to their customer’s experience. Their customers have to feel confident the vast majority of the time when their techs come through the door they’re going to have the skills, the parts, and the wherewithal to get that problem fixed on that first trip and that’s huge.” Innovative benchmarks itself against the Johnson model and Heitritter says they exceed that profitability benchmark when everything is mixed into the stirring bowl. He’s now looking to take things to the next level. “The biggest challenge now is supplies gate-keeping on managed print as well as supplies gate-keeping for color devices. That’s a big hidden loss center if you’re not measuring it properly. Our CPC prices have dropped and you don’t want to send more toner than you need. We’re also rolling our contract profitability on a lot of major accounts and gate-keeping the supplies piece of the business. The functionality break-fix, we have that strong and do a good job, now it’s how to mature the profitability of a whole contract whether it’s MPS or MFP and to get a better handle on that in 2015.” Heitritter hopes this acknowledgement creates more opportunities for Innovative. “We support populations of 100+ [devices], but we want to get into more major accounts,” he says. “Even though we’re a small dealer this makes us look like a larger dealer. It’s just going to help us grow the business.” Asked if he has any advice for other dealers looking to enhance their service operations, Heitritter replies, “Any dealer principal not involved in their service department and relies on someone to run reports and doesn’t look at it on a monthly or daily basis, ought to invest money in software [that does that for you]. That’s where the money is made, on the service side of the house, and every dealer principal across the country should know that. Partnering with a software solutions provider, you owe it to your customers, you owe it to your employees, and you owe it to yourself as an owner. This is what renews leases, this is what makes customers come back, and this is what customers rave about to other potential customers.” Innovative Document Solutions Murrieta, CA www.idsprintwise.com President: Kevin Heitritter Service Manager: Frank Birtcher Brands Serviced: Canon, HP, Samsung Territory Covered: Southwest Riverside County, CA

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Exit Strategy Part 3 of 3

The 10 Biggest Mistakes Business Sellers Make

n last month’s article, we looked at mistakes four to six of the “10 Biggest Mistakes Business Sellers Make” when selling their businesses. This month, we finish the series by considering the final four mistakes sellers make when selling their businesses.

Mistake #7: Hiding Profits It is understood no business owner enjoys paying taxes. Furthermore, tax avoidance (and/ or deferment) is on the mind of most every business owner. As you can imagine, we have seen just about every trick in the book (legal or otherwise) used by owners to reduce the taxable income of their businesses. Because corporate tax rates in the USA are among the highest in the world, it is only natural for business owners to seek ways in which to reduce their tax bill. However, as you consider your options to lower your taxes, be aware: if a buyer cannot readily and easily “find” your profit, while you may lower your current costs (your taxes), you are also significantly impacting the future value of your business in the eyes of buyers. Consider the following scenario involving two of our former clients in the imaging supplies industry. One client, Company A, was very profitable and played no “games” with its financial statements. The Company wrote down/off slow-moving/obsolete inventory on an annual basis, the two owners paid themselves reasonable salaries and generous bonuses, and the owners did not run any personal expenses

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through the business. Buyers could easily see the profits of the business, trusted the value of the inventory and ultimately, the winning bidder for the business paid an above market price for the company. Company B was a similar sized business and a competitor to Company A (actually, Company B was a little bigger than Company A and had a more diversified product line and customer base). The three owners of Company B told us “we hate to pay taxes.” They ran sizeable amounts of personal expenses through the business, employed numerous family members who did not really “work” at the company, paid themselves below-market salaries, played games with their inventory and A/R, and routinely deferred revenue and increased expenses at the end of the year in order to defer/avoid taxes. We were able to ultimately sell Company B, but for significantly less than Company A…and at a price we believed was much lower than market. The bidders for Company B said they struggled to get a clear picture of the true earnings of the business, which ultimately lowered their valuations. I recently published an article entitled “Investing in Taxes.” The gist of the story is if you are considering a sale of the business, you are better suited to pay more in taxes while showing the true profits or earning potential of your business. When considering hiding/deferring profits in your business, remember this: buyers have zero imagination and will only pay for

We Saw It In ENX Magazine

the profits they can see.

Mistake #8: Managing to Sell This mistake is the converse to Mistake #7. Buyers are not dumb (or if they are, they have already been fleeced by someone else). Buyers can tell when a business owner has been managing the business, and its financial performance, to pump up earnings immediately preceding a sale. For example, we were consulting with a company whose owners told us they had been considering a sale for several years. We asked them about their capital expenditures/investments over the past five to seven years. What we learned showed us the owners were managing their financial statement in anticipation of a sale. The company routinely invested $200,000 to $300,000 annually in new equipment for their warehouse and assembly areas as well as for systems upgrades; this was a practice they had employed for many, many years. However, in the two years before we met with the owners, their capital expenditures dropped to less than $15,000 annually. Furthermore, in the past, they had expensed as many capital expenditures as possible but in the past two years, what limited expenditures they had were capitalized, not expensed. We also learned in the last two years, they had slashed travel reimbursements for their sizeable salesforce. The owners forced the sales staff to stay in lower priced hotels and cut daily meal allowances by 50%. The owners continued on page 60

We Saw It In ENX Magazine

March 2015 | www.enxmag.com

â&#x20AC;˘

The 10 Biggest Mistakes Business Sellers Make also discouraged their sales team from treating customers to meals. While all of this may make good business sense, the company went from zero turnover in its sales staff to high turnover. These tactics, and more, had the desired effect the owners sought: the company improved its operating profits by more than 15% over the 2-year period while sales only increased 5%. We let the owners know if we could see through their “smoke screen” with just a few questions, buyers would be able to as well. We suggested they would not be able to achieve the sale price they sought because their expectations were built upon unstable, inflated earnings. We chose not to accept the assignment of selling the business. The owners marketed the business on their own. After many buyer visits and many offers significantly lower than what the owners desired for the business, the owners took the business off the market and reverted to their original travel expense and CapEx spending policies. We expect to be in the market with the business sometime next year. Buyers today are very sophisticated and data driven. They can spot trends very easily and are not often fooled. See Mistake #9 for our best advice as to how to avoid this issue.

Mistake #9: Letting Off the Gas My father, who founded our company 35 years ago, always told clients, “Run your business as if it will never be sold… sprint to the finish line.” Never have words so profound been spoken to help

business owners operate during the difficult process of selling a business. Too often, owners who are selling their businesses state: “I won’t make that decision now, I’ll let the buyer figure it out.” We also often hear comments to the effect of: “We need new computers, but we’ll make do and let the buyer spend the money to upgrade the system.” What happens if you don’t sell the business? Just because the business is for sale is no guarantee it will be sold. If you defer business decisions today…even seemingly small ones…you could hinder the company in the future. There is a natural tendency for business owners to get complacent (dare we say “lazy”) when they are involved in the sale of the business. It is only human to let your foot off the gas a little and take it easy knowing soon you will have sold your business. However, it is critical for business owners to resist this temptation. One of the most difficult conversations between buyers and sellers is when the seller has to explain why the company’s revenues or earnings have declined during the time the buyer is looking at the business. These conversations are never pleasant and often painful. The business owner who manages as if the company will not be sold, who literally “sprints to the finish line,” will be rewarded with a better sale price as well as an easier sale process.

Mistake #10: Selling It Yourself At the risk of sounding self-serving, selling your business yourself is like the

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surgeon who operates on him/herself: it might be successful but it will be extremely painful. Selling a business is a full-time job and not one for beginners. Recently, we successfully sold a top company in the imaging supplies distribution business. This was the third company we sold for this client. The owner told us even though he knew most of the likely acquirers for his business, after selling one business on his own, he would never repeat that mistake. He said having an intermediary representing him and his company was invaluable. Consider this: in a typical business sale process, an intermediary and his/ her team will spend approximately 500 to 1,000 hours working on the deal. As a business owner, you already have a full-time job. Do you really want to work a second, full-time job managing the process of selling your business? Whether you employ the services of an investment banker, a business broker, an intermediary, your accountant or an attorney, make sure the person/group you engage to represent you has extensive deal experience and a fundamental understanding of your industry. Your advisor will more than earn their fees for helping you not only to avoid the top 10 biggest mistakes sellers make, but he or she will also make the process easier and better for you. Those are the last of our Top 10 Mistakes for Sellers. Next up is a look at the Biggest Mistakes Buyers Make. If you have any questions about the Top 10 Mistakes Sellers Make, please feel free to contact me to discuss them with you. ✦

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Printer Tech Tip

ter Tech Printer Printer Tip Tech Tech Tip Tip

LASERJET H TIP TECH TECH TIP TIP ENTERPRISE M806

LASERJET ENTERPRISE MFP M830 CP3525, HP HP CP3525, CP3525, CM3530, CM3530, CM3530, M551,FLOW M551, M551, M575 M575 M575 ISSUE:

: ISSUE: ISSUE: Paper Jam Error 13.B2.FF “jam in front door” Error59.F0 59.F0 Error Error

PTION: DESCRIPTION: DESCRIPTION: ots upPrinter Printer to 59.F0 boots boots Error up upand to to59.F0 59.F0 is unable Error Error toand and print. isisunable This unableto toprint. print.This This may bebehavior behavior caused by may may one be beof caused caused the following by byone oneof of three the thefollowing condifollowingthree threecondiconditions: tions: er belt1.1. is Transfer locked Transfer upbelt belt andisiscannot locked lockedrotate. up upand andcannot cannotrotate. rotate. SR172.2.(primary Sensor SensorSR17 transfer-roller-disengagement) SR17(primary (primarytransfer-roller-disengagement) transfer-roller-disengagement) is bad. isisbad. bad. ged or3.3. broken Damaged Damaged fuser or drive orbroken broken gear.fuser fuser Typically, drive drivegear. agear. grinding Typically, Typically, or aagrinding grindingor or g noise will clicking clicking be heard noise noise during will willbe be boot heard heard up. during duringboot bootup. up.

FOUR SENSOR FLAGS

GREEN LIFT TAB

MENDED RECOMMENDED RECOMMENDED ACTION: ACTION: ACTION: st step1.1. is The to The reseat first firststep the stepITB isisto toand reseat reseat power-cycle the theITB ITBand and thepower-cycle power-cycle printer. the theprinter. printer. the problem NOTE: NOTE:persists, IfIfthe theproblem problem an HP persists, Certified persists,an an Technician HP HPCertified CertifiedTechnician Technician The registration in troubleshooting. the M806/M830 series containsIf4 the paper flags. Any of 4broken, flags obstructed at on rotate will produce ITB flag is IfIf broken, the theITB ITBdamaged, flag flagthe isisbroken, or does damaged, damaged, not rotate or orpower replace does doesnot not rotate replace replace be dispatched should should for be befurther dispatched dispatched for forfurther furthertroubleshooting. troubleshooting. sensors – three of which are paper width sensors (PS1, PS2 and 13.B2.FF where the plate would need to be lifted for inspection the ITB (CC468-67907). the the ITB ITB (CC468-67907). (CC468-67907). Otherwise, continue Otherwise, Otherwise, with step continue continue 3. with with step step 3.3. the ITB 2.2. Inspect Inspect by taking the thethe ITB ITB ITB by bycompletely taking takingthe theITB ITB out completely of completely the out outof ofthe the also topto of page sensor The as Test any paper obstruction may not visible otherwise. 3.when Testalso Sensor SR17. 3.3. TestPerform Sensor Sensor SR17. the SR17. Manual Perform Perform Sensor the thebe Manual Test. Manual In Sensor order Sensor Test. Test.✦ In Inorder order CheckPS3) to printer. printer. seeand if Check the Check flag torotates see see ififthe (callout the flag flag(PS4). rotates 1) rotates when (callout (callout theregistration 1) 1) when the the an access that(callout liftsFigure (green tab)the to expose the sensor to run this test successfully, to torun runthis thistest test make successfully, successfully, sure the Fuser, make makeITB, sure surethe Cyan theFuser, Fuser,ITB, ITB,Cyan Cyan knob is has turned white white (callout knob knobisplate is2). turned turned See the (callout 2). 2).following. See See the Figure Figurefollowing. following. This Printer Tech Tip is contributed by Laser Pros (www.laserproscom). Email any questions to marketing@laserpros.com

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Britt Horvat

Technical Tips

Xerox® 5632 & 5675 Fuser Modules—

Repairing and rebuilding the fusers for the (WorkCentre®) WC232-275, WC5632-5687, WC5735-5790, & WC5845-5875

t’s hard to imagine that it’s been nearly 7 years since we took a look at the C35 fuser modules in a July 2008 ENX article. Since then, the C35 style continues to proliferate. There are newer versions of the fusers which go along with all of the many subsequent models which came out since then. Rebuilding the fusers is one good way to cut costs. Good replacement parts are available and I think you’ll see that the fusers are fairly easy to work on. We’ll look over the differences and similarities between the versions, talk about which parts to replace, and then get into the procedure for taking apart one of the high speed fusers to rebuild it. First let’s compare the four versions of these fusers. The parts which remain consistent are the web, the picker fingers, and the web pinch roll. The differences in parts are as follows:

• 4 types of the CRUM chips in 110 volt versions, and 4 different ones for the 220 volt versions (each fuser part number has its own CRUM chip) • 3 types of the heat rolls which are not interchangeable (see Photo #1) • 2 types of pressure rolls with other differences in the pressure mechanism. The high speed fusers have a larger diameter. • Heat lamps are different too.

C35 version of fuser heat roll, C35 version of press roll, 520 watt fuser lamps

The following are the four fuser part #’s, the models they fit, and which versions of parts each one uses:

165 version: For (CopyCentre, WorkCentre, M, & WC-Pro) 165/175/265/275 109R723 (110 volt – U.S.), 109R724 (220 volt – Europe) 5675 version of fuser heat roll, 5675 version of press roll, 1100 watt fuser lamps 5675 version: For (WorkCentre) WC-5665/5675/5687, WC5865/5875/5890 109R773 (110 volt – U.S.), 109R772 (220 volt – Europe) 5675 version of fuser heat roll, 5675 version of press roll, 1100 watt fuser lamps

C35 version: For (DocumentCentre) DC535/545/555, (CopyCentre) C35/45/55, (WorkCentre) M35/45/55, WC-Pro35/45/55, WC-5030/5050 109R636 (110 volt – U.S.), 109R634 (220 volt – Europe), 109R750 (220 volt – Swedish)

WC 232 version: For (CopyCentre, WorkCentre & WC-Pro) 232/238/245/255, WC 5135/5150/5632/5638/5645/56 55, WC-5735/5740/5745/5755, WC-5835/5845/5855 109R752 (110 volt – U.S.), 109R751 (220 volt – Europe) 5632 version of fuser heat roll, C35 version of press roll, 905 watt fuser lamps

Tools you’ll need: • 5.5 mm Nut Driver (or #2 Philips screwdriver) • Snap-Ring Pliers (heavy duty) • Heavy Spring Hook (or a small flat-head screwdriver) Parts you’ll need: • Fuser Cleaning Web • Fuser Heat Roller • CRUM Chip (for resetting the fuser counter) • Picker Fingers (set of 5) • Thermistor repair tape (Kapton tape) Photo #1 - Heat Roll Comparisons 68

•

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2. Next, remove the Picker Finger Assembly from the right side of the fuser (2 screws from the right). Unplug the Exit Sensor’s connector near the rear end of the assembly (see Photo #2).

Other parts you might need: • Pressure Roll: It’s been reported from the field that the pressure roll may not need replacing all the time. We’ve seen that although the surface becomes twisted and wrinkly shortly into the roller’s life, it usually continues to serve its purpose without a problem. • Web Pinch Roll: Check this orange foam roll for any bad flat spots which might be severe enough to cause it to stop turning. The pinch roll does not always require replacing.

Procedure:

3. Replace the 5 Picker Fingers. Inspect the Exit Sensor and its Actuator (be particularly gentle with the tip of the Actuator as it can be fragile). Remove each Finger Spring and then rotate the finger till the slots on the finger’s holes line up with the protrusions on the plastic which they are mounted on (see Photo #3).

(This procedure shows the 5675 version although other versions are very similar) Important General Tip: The plastic parts in fusers often get brittle due to exposure to heat and ozone and can become fragile, so be gentle when handling the parts, and take care not to over-tighten the screws when you put things back together. 1. Start by removing the Top Cover (4 screws from the top), followed by the front yellow handle which lifts out easily once the top cover is off.

4. Remove the Web Assembly by first sliding the off-white colored Web Drive Coupling off of the web, and then removing 2 screws from the top. Note that the front screw also holds the metal tensioner for the Web Drive Coupling in place (this piece prevents the coupling from turning backwards). 5. Replace the Web and check the Web Pinch Roll (if it has a bad flat spot, replace it as well).

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Photo #2 - Rear End of Fuser

Photo #3 - Picker Finger Assembly

6. Now for removing the Bottom Cover: First open the Lower Right Baffle and use a spring-hook to release the spring near the rear end (see Photo #4). Then Remove 4 screws (long continued on page 70 March 2015 | www.enxmag.com

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Xerox® 5632 & 5675 Fuser Modules 10. Now the Thermistor / Thermal Fuse Assembly is ready to be removed from the left side of the fuser (2 screws from the left). 11. Re-tape the heads of the 2 Thermistors so that they do not wear all the way through during the fuser’s second cycle. Check the 2 Thermal Fuses for continuity to make sure neither one of them have been blown by an overheat condition. Photo #4 - Lower Right Baffle Spring plastic-thread screws). Two of these screws are from the front end (low down, see Photo #5), and two screws are from the rear end (also low down). Then you can lift the fuser out of the bottom cover. Pay attention to the front end. You’ll need to lift the assembly a bit and then shift it toward the front end to navigate the green tension release handle out of the cover.

12. Slide the Fuser Heat Lamps out of the heat roll. Note that they are two of the same lamps oriented in opposite directions. Also note that the heat lamp connectors’ clips sometimes break. If this happens, when you reassemble, you’ll need to find a piece of electrical tape or some other way to be certain the connectors do not become disconnected during use. 13. Remove the metal Lower Entrance Baffle (2 screws from the left side). 14. Release the pressure in the fuser by rotating the front green handle to a fully open position and gently rest the unit on the handle (see Photo #6) so the pressure doesn’t accidentally close up on you while you are completing the final few steps.

8. Disconnect the 2 rear Fuser Lamp Connectors. You’ll also want to remove 1 screw (from the top) which holds a ground wire (green wire) to the top metal tie-bar (refer back to Photo #2). 9. Next remove the Rear Lamp Holder Bracket (1 screw from the rear just above the heat lamp connectors).

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www.enxmag.com | March 2015

the way most fusers are assembled. If these babies get assembled wrong, it’d allow the roller bearings to become loose of the metal frame and all of your hard work would get ruined! 16. Now for the Heat Roll Assembly. Remove the rear snap-ring (use heavy snap-ring pliers) and slide the Heat Roll Drive Gear and the rear bearing off the rear end of the Heat Roll. Gently slide the Heat Roll toward the front end and remove it. 17. Finally the Pressure Roll can be lifted out of its cradles. Note that the Pressure Roll Bearings have the flanges positioned toward the center of the roll (they sit inside the metal frame at both ends when you reinstall the Pressure Roll). 18. Put it all back together with your shiny new parts! Note: You’ll want to reconnect the Exit Sensor connector early in reassembly as it is in an awkward position, with precious little in the way of slack on the wires. It can be tricky to reconnect if too much stuff is in the way of your fingers.

Photo #5 - Bottom Cover - screw locations at front end 7. Disconnect the 2 front Fuser Lamp Connectors and remove the Front Lamp Holder Bracket (1 screw).

Photo #7 - Critical to success: proper Bearing & Bushing positioning (rear end of heat roll)

Photo #6 - Pressure fully released 15. Take note of how the Heat Roll Bearings and Bushings are oriented (see Photo # 7). The flanges on both bearings are positioned toward the outer ends of the heat roller (outside of the metal frame), but both of the bushings’ flanges are facing the front end of the fuser. That’s different from

That’s it! Your fuser is as good as new. Well back to shoveling snow for us here in the northeast. Hope you are all having a great winter. Happy fuser rebuilding to you all! ✦

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Technical Tips SUBJECT:

: Wow. That’s a good one. Diffused light—coolest. Spent many hours troubleshooting a Sharp SF-741 with a constant jam. Turned out to be a spider web : Hello there guys. Can anyone tell me (spider and insect carcasses included) in the the proper procedure to tone up an MPlight tunnel, blocking the light from a bulb 5000 getting very light copies? Customer SUBJECT: to a photo sensor. Machine had been unused has put in a new toner cartridge but copies Canon 6025 False Exit Jam for a few months which is when the spider are still light. Thanks. : Yes, I know that it is older than dirt; so must have made her home in there. : SP-2207 will do a forced toner am I. Symptom: When a (single) copy : Not in my equipment (I’ve seen supply, but I doubt that’s your problem. exits the machine, it shuts down normally. many), but at a client’s location. A You’ll be back in 1,000 copies for the When the main drive motor coasts to a full retail location, with random burglar alarm same problem. You get about 150K max stop, THEN it throws a jam indication. triggers. Cause: a tiny spider inside of one of on developer, 125K max on drum. Plus • With the sorter removed, the symptom is the IR motion detectors! Oy! the mag roller gets caked with toner. Other unchanged. : Guys you’re getting off track!! things to check are optics and slit glass. • If I physically block the exiting copy, a Have you cleaned all the chargers in ‘normal’ immediate jam occurs. : Oh wow, thanks a lot. I didn’t the machine? Also, does this machine, if • When duplexing, the copy enters the know, that’s very helpful. Is there memory serves, not say whether it’s the ADM, the second side is copied, and the a calibration for the developer change? A or B jam? I have had weird jams with false jam symptom occurs when the copy Thanks again. dirty chargers. Had to take them home and exits the machine. The client insists that wash out in soapy water then dry out over a : SP-2801 developer; drum is SPthe symptom occurs in the morning, and 3001-2. vanishes in the afternoon. (I did not observe radiator before refitting. P.S. went to Ricoh 3020 back in 1984, customer reported a in the PM). I trust her observation. All : Thanks again, you’re the best. squeaking from machine. I told her the thoughts are welcome; when you have a mouse running the belt must be hungry!! screwy problem, you gotta think screwy. Big mistake; on examining I found a dead :Tell my wife that. She says I drink too TIA! mouse under the pressure roller. That much beer. I disagree...I always drink : If you were a rookie, I would say the was one empty office when I showed the just enough beer. exit sensor is hanging up but I’m pretty customer I had found the fault. It still makes sure it’s not because I know who you are me laugh :) Well, at least no one has said SUBJECT: and so on. I had a similar problem around to upgrade the firmware!! And the mouse Samsung 5935 Awful Noise 1982 with a Sharp SF- 770. Morning only thing—it was wireless! : My tech thinks the print head is going problems. Turned out that machine was : Have you changed the pickup, feed, bad. Noise starts when you lift the doc facing a window and bright sunlight would and separation rollers? May be damped feeder, gets louder and changes pitch when reflect into cassette, off paper and up into papers. I had weird paper jams on NP 6650 it starts to print. I’ve never had one do this the photocell of the “add paper” system. by a bad main board. And today I spent 5 before—do these print heads do this or is Since your exit sensor is probably a photohours for weird jam problems with stupid there some other thing I should look for? interrupter, stray light could conceivably customers’ papers. Thanks. be leaking into it and confusing things, : Well, I did not specify the paper : It’s probably the laser if it’s a high only at a certain time of day. Pretend you source in my OP. The symptom occurs pitched whining noise. I’ve had to are Indiana Jones doing that thing at the whether feeding from the bypass, tray replace three or four over the years. beginning of “Raiders” to find the exact spot one (LTR) or tray two (LGL). I have been where the arc was or whatever. No snakes to playing telephone tag with the client during : Yep, done that for a couple of these. worry about. It’s the same laser as the SCX5530. the holidays, so I haven’t returned. Funny thing about this model: the fuser exit sensor : Alas, this machine is far removed : It doesn’t have a print head. It’s a is NOT actuated whilst duplexing, until from a window (or any source of light cartridge. I’d lean toward laser too. the final exit occurs. I’m going to rob a PI beaming into the exit). My favorite line : “Laser print head?” :) I don’t know sensor elsewhere, swap it with the fuser exit from “Raiders” is when he’s being dragged where I picked up that terminology. sensor, then watch it for a few days. Further behind a truck: “What are you going to do About how much time is involved in thoughts welcome, and I WILL post the now?” “I don’t know; I’m making this up replacing this? final results. Of the troubleshoot, not my : Yes, some manufacturers call it a laser as I go along!” Light story: Old Toshiba mental health. TIA! print head, Lexmark for example. Pawl, moving-table machine in Santa Monica. : Make sure the fuser exit sensor flag Copies were light at one edge only when claw, picker finger, stripper. The terminology flops back to its home position easily. using bypass, only on SOME mornings. mix is kind of funny. Re: Time to change? Long troubleshoot revealed that on bright, If it’s delayed, this will cause a jam signal Well, if I was doing it for speed and fun I for the paper being too long. Just a thought. bet I could do it in 10 minutes in and out but foggy mornings, dispersed light from a window 20 feet away would enter the open If the sensor was bad, you would probably when you have it torn down I would clean bypass door, striking the drum at its rear have the jam signal right away.✦ good, etc. so say 40 minutes if you do it edge. NOT on clear mornings. Oy!

Ricoh MP-5000 Tone Up

well but timely. Give or take fuser clean and optics, a full hour is good all the way. : OK, thanks!

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Tips appearing in this section are reprinted courtesy of Smarka! The Copier Tech’s Info Source. Tips are randomly selected from submissions emailed to Smarka! Smarka! and ENX Magazine make no guarantees as to the accuracy of tips presented in this section. Email your tips to Tips@smarka.com. All Tips become public domain. 72

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EVERYTHING MATTERS. Leader in Aftermarket Imaging Supplies. All Future Graphics products provide the industry with the same OEM-like yield, fusing, and consistently superb print quality. C

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