IT solution providers report that more businesses these days are open-minded about managed print services that consolidate printing and related document management costs. Demonstrating those cost savings is a key component of managed print sales. Few businesses give much thought to their print budgets in relation to their overall IT technology spending plans, say IT solution providers.
“It is fairly difficult at times, because people believe printers don’t need maintenance,” said James Watson, CEO of Northwest Computer Support, an IT solution provider in Seattle. “You have to show them how they will save money.”
For example, Watson relates the story of a client that didn’t realize it had more than $50,000 worth of toner supply sitting on its storage shelves, getting close to its expiration date. Once Watson brought this to the company’s attention, it was much simpler to have a managed print services discussion.
Managed print services typically place each device under a monthly maintenance or management contract that includes all the consumables, pieces and parts that might be necessary to repair it. Data published by technology trade association CompTIA Inc. in September 2011 suggested that more than half of large companies (those with more than 500 employees) are now using some flavor of managed print service. That compares with approximately 20% for smaller businesses. Of those businesses that do not use any sort of managed print service, 35% said they will “definitely” or “probably” consider some level of adoption over the next 12 months, according to CompTIA data.
Blaine Sander, director of the print technology solutions team for WBM Office Systems, a Canadian IT solution provider that makes its headquarters in Calgary, Alberta, said the primary business benefit of managed print services comes in the form of reduced operating expenses.
“We can find efficiencies and remove unnecessary devices or reallocate them, putting the right devices in the right place,” Sander said. “There is also an element of environmental stewardship. We can help produce a reduction in power consumption.”
Businesses can also use managed print services to help standardize the number of devices and models that their organization uses, resulting in reduced maintenance and repair costs because components or consumables can be shared among the fleet.
“We generally reduce the number of assets and standardize on one or two manufacturers,” Sander said.
WBM Office Systems also helps reallocate devices so that the best technologies for high-volume situations are in the right location throughout an organization. The solution provider has developed its own remote and onsite management services, and service-level agreements for its managed print offerings. They do this, said Sander, because it gives them more flexibility around which printers and multifunction devices to support. Some vendors will only work with specific, newer models of their print and imaging portfolios.
“We quite often don’t recommend a flip of [the customer’s] fleet,” Sander said. “We don’t want to support super old ones, but if they have a fleet that is working, we can go in and support it. People really like this approach.”
While managed print services contracts can bring higher margins for printing and imaging equipment, building a managed print services business requires serious attention to operational metrics.
Watson said solution providers should be careful to include a clause in their contract that details what happens when a client decides to retire a printer before the terms of the contract are up. Otherwise, the solution provider could wind up losing money on the deal or end up being stuck with toner supplies. Printers and multifunction devices should be priced according to volume and their inherent feature set, and it may be necessary to set a minimum monthly service charge, he said.
Green initiatives hinder managed printing services
For those reasons and others, building a managed print service practice isn’t right for every reseller or VAR. That is why some IT solution providers have chosen to represent vendor-delivered managed print services.
M.J. Shoer, president and virtual chief technology officer for Jenaly Technology Group Inc., a VAR in Portsmouth, N.H., said managed print services have been slow to catch on with Jenaly’s customers. That is because many have been trying to print less, in line with green technology initiatives within their companies.
“The whole green movement flies in the face of managed print,” Shoer said. “At its best, this works best when there is a high-volume of printing involved.”
Jenaly has had the most success with managed print services when targeting organization such as law firms, accounting firms or other businesses that manage many documents in the course of day-to-day operations, he said. Jenaly resells the PagePack offering put together by Xerox, for which it receives an agent fee.
About the expert
Heather Clancy is an award-winning business journalist in the New York City area with more than 20 years’ experience. Her articles have appeared in Entrepreneur, Fortune Small Business, the International Herald Tribune and The New York Times. Clancy was previously editor at Computer Reseller News, a B2B trade publication covering news and trends about the high-tech channel.
This was first published in November 2011