10153 1/2 Riverside Drive Suite 729, Toluca Lake, CA 91602     Phone: 1-818-505-0022     Toll Free: 1-800-850-4949     Fax: 1-818-505-9972     email: enx@pacbell.net     website: www.enxmag.com
  ENX Magazine     Archives     Media Kits     Editorial Calendar     ENX Mexico & Latin America     In The News     Industry Calendar      Free Job Listing     Contact Us
 Minding Profitability by Ronelle Ingram

Trust But Verify

The most commonly discussed MPS topics I see online, hear at seminars, or are asked about personally are:
Where should I buy my compatibles?
What MPS software works the best?
What pricing should we use per click?

A question I feel is of greater relevance that I almost never hear mentioned is:
How are you monitoring and adjusting the click default settings on your equipment?
If you are not even sure what a click default setting is, read on.

The importance of being aware of and properly adjusting the click default setting on all equipment is worth your ongoing inspection. The default determining switches are usually mounted on the main printer circuit board or can be electronically programmed through the operations panel. In either case, the servicing dealer can set the default click setting to register once for each piece of paper exiting the machine or differentiate the clicks by the size of the paper and if 2 sided copying is being used. Consider the difference a click can make when a customer is running 2 sided 11 X 17 full color versus 1 sided 8 X 11 monochrome.

Most digital equipment now offers multi-lined printouts denoting usage of monochrome, color, size of print image, dual sided paper usage, misfeeds, next PM due, etc. Older equipment comes with dual meters denoting color usage and monochrome.

To maximize recovery of printing/copying cost, dealers must make sure the counter default setting will click multiple times for imaging that is larger than 8.5 X 11 and are 2 sided imaging. Just because someone in your service department says your default settings are being monitored is not enough proof for me. There should be ongoing, independent testing of each piece of equipment that leaves your building. As President Ronald Reagan often said, “Trust, but verify.”

Additionally, every piece of equipment being included in a managed print agreement should be tested, and adjusted if necessary, for the appropriate default setting on click readings. Once in the field, each tech who services a piece of equipment that has 8 X 14 or 11 X 17 paper in it should be required to test to see how the default setting is counting these larger size printed images. Any equipment that has the ability to run 2 sided copies should also be tested to make sure the default is correctly set to register 2 clicks for each two sided 8.5 X 11 or 4 clicks for 11 X 17 and 11 X 14. Once the techs get in the habit of verifying the click defaults, it takes less than 2 minutes to completely verify and document the click default settings.

Upon introduction of each new piece of equipment, our setup shop techs figure out how the default is set and how to read the click printout page. Recently four of our most experienced techs could not make any sense out of the count printout page on a new model of high speed color printer we were setting up.

As an authorized sales and servicing dealer, we called the OEM’s Technical Hotline for assistance. After waiting the extended length of time on hold, we asked for an explanation of the click readout page. We were told, “You are the first dealer to call for an explanation. The machine was manufactured by another company. It was engineered in Japan, manufactured in China, and the click explanation had been translated into Japlish.” Jokingly there was some further explanation involving an abacus theory. To make a very long story short…It took 5 days, 7 phone calls, 8 emails and translation from Chinese to Japanese to English to figure out the most convoluted print explanation page I have ever seen. We had to reset the defaults to differentiate color and two sided printing from the one sided monochrome which was originally programmed as the default click setting.

The scariest part of the story is, according to the OEM hotline techs, we “were the only dealer who had requested an explanation of how to read the printout and reset the defaults.” The click default setting is also the digital signal that hooks into the MPS software that reports clicks and bills the end user. I firmly believe without the lengthy explanation, no clerk, customer, sales rep or tech could have dissected the utterly baffling set of numbers and letters on the printout page. Nor could anyone figure out and test how the defaults were set or how our MPS software would invoice the clicks.

This brings us back to the importance of the defaults. The installing, or MPS servicing dealer, has the right to have the final decision on how different sizes of paper are counted and ultimately billed. Without being aware of what the click default setting represents, the MPS servicing dealer may be missing thousands or millions of legitimate billable clicks each month. If you believe your dealership has the right to charge more for an 11 X 17 full color 2 sided copy than a single sided 8.5 X 11 monochrome, you need to consistently monitor the default settings on all the equipment you have under any type of servicing agreement.

When the market is forcing dealers to charge under a penny per click for full service and supplies, there is no room for mistakes. Your dealership has the absolute need to make sure you are being paid additional revenue for color, larger than 8.5 X 11 and two-sided prints/copies.

Equally important as understanding the importance of the default setting is replacing the use of the word Copy or Print with the term Click on all your MPS and other servicing agreement documents.

Make sure your MPS, CPC, or other service agreements specify CLICKS. Never sell copies or prints. When making a full color 11 X 17 double-sided image you should register 4 color clicks. That is one click for each of the four 8.5 X 11 sized images. As an example: using .07 cents per color click versus .008 cents per single monochrome click. 4 color clicks = .28 compared to one monochrome click at .008. There is a difference of .272 in cost. A customer who makes 2000 two sided 11X 17 color copies each month should pay $560. Over the course of a 60 month lease the dealer would receive $33,600.

If the default setting was set for a single exiting monochrome sheet at .008 the cost for 2000 sheets per month is $16. Over a 60 month lease the billable cost is $960. This equals a billable difference of minus $32,640 over a 5 year lease. If you have 100 machines in the field with a similar incorrect billing default, the price differential is a net loss of $3,264,000 over 60 months. Those of you who have a thousand machines under MPS contracts can simply add another zero to your lost revenue potential.

The click default on copiers, printers, and MFPs is a mystery to most. I have seen the same OEM make and model of equipment come in with different default click settings. Too many dealers are allowing their service and supply profit margins to be determined by a nameless worker on an assembly line 6000 miles from your business who randomly decides how the click defaults are set. An internal company policy regarding the checking of the click default setting is imperative to maximizing MPS revenue. Each new piece of equipment must be tested to determine when and how clicks are registered. When setting up pricing criteria on new color equipment make sure you understand how color, monochrome, larger size paper and 2 sided images are registered on the equipment, your monitoring software and actual billing. I challenge you to ask a couple questions of your service staff, and then go test your showroom equipment yourself.

Servicing dealers must be proactive and knowledgeable about each machine’s click default settings. Dealers can insure they are receiving appropriate click revenue from every image produced that is covered by their MPS or other servicing agreement by vigilantly monitoring and adjusting click default settings.

Ronelle Ingram, author of Service With A Smile, also teaches service seminars. She can be reached at ronellei@msn.com.

 
FREE SUBSCRIPTION TO IMAGING INDUSTRY PROFESSIONALS FOR MORE INFORMATION EMAIL: enx@pacbell.net
 
www.enxmag.com