enx magazine

So, it goes like this. Margins for imaging products (printers and MFPs) continue to slide. Making this problem even worse, the average revenue per sale is significantly lower due to the proliferation of lower cost A4 MFPs coupled with the expected price erosion that occurs when technology matures. Consequently, the outright dollar profit (margin X price) per unit is dropping like a stone.

Couple this with events happening outside our industry (yes, there is life outside our industry) including high unemployment, a housing market that sabotaged countless plans for retirement because of bad mortgage planning (which part of “your rate will increase” did we not understand) and inflation that is just insane. Did you ever think you’d see a time when $4.00 per gallon for gasoline was considered a “deal?”

All of this is forcing companies – many of them our customers – to cut back. Unemployment is increasing. Capital expenditures are being cut. Where, exactly, does that leave budgeting for MFPs? My guess is that our products are not currently near the top of anyone’s priority list.

In light of these disturbing trends, we can stay the course or change our strategies. Staying the course, even to the extent of increasing our efforts, doesn’t make sense. I’m always driven to the classic definition of insanity – “Doing the same thing over and over but expecting a different result.”

That leaves us with a clear need for change. We’ve all taken steps down these new paths, however tentative. And, each path presents its own set of problems. To visit just two examples:

* Expand color unit sales – Great idea, as long as you know what your service and supply costs are. Too many dealers have grossly underestimated supply consumption and have taken losses on “all in” contracts.

* Enter the market for managed print services – Possibly the best way to increase aftermarket revenue. You’ll capture pages on competitive printers by supplying service and supplies for the existing printer fleet. However, that assumes that your service force can, in fact service those devices. It also assumes that your sales compensation plan rewards reps for capturing those volumes.

In our opinion, the option carrying the least risk coupled with the greatest potential for return is that of the workflow analysis. This can include page volume histories, load balancing, asset consolidation, print management services and scan services, to name a few categories. But, in our opinion, a true analysis must answer these questions for each document studied:

The Time Is Right For Workflow Analysis Tools pg1 pg2 pg3 PRINT WORD DOCUMENT

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