As 2007 begins, managed print services can either tumble into a self-defeating, complex morass or put a solution provider on the road to growth. It can build into a win-win partnership between channel partner and vendor, or it can devolve into channel conflict.
Built-in features that enable remote, browser-based management of printers and brutal competition have led to this crossroads. To help them seize page sharethe all-important measurement that shows how much hardware and ink a company sellsHewlett-Packard, Lexmark International, Xerox, Oki Data and others all have delivered new channel programs, strategies and solutions. But in their quest, these vendors can become notoriously direct.
This may be why some solution providers have looked at the print technology, service and channel offerings of the top vendors and have simply decided they could offer print managed services better by themselves.
QLC Technologies, Philadelphia, provides comprehensive print managed services to customers for freeas long as they sign on to buy print and copy consumables (primarily ink cartridges) from QLC. QLC manufactures its own ink cartridges, and the margin on consumables alone allows the $30 million company to provide comprehensive print managed services, said CEO John Murabito.
"We try to keep it all in-house and do it all ourself," Murabito said. "With our technology, we don't feel we have to rely on anyone. We have software that tracks cost per page and provides print management. If a customer has multiple locations, like a bank, they can go to our Web site and track the service history of machines, how many times we've been on their site and done repairs. They can check page yield and page count per machine."
Because page share makes for simple accounting, few technology disciplines lend themselves as easily to managed services as printing.
"In the whole document solutions space, we're going down that [managed printing] road," said Tom Senecal, president of Laser's Resource, Grand Rapids, Mich. "The big thing in our organization, our key performance metric that we run every month, is 'pages under contract,' " Senecal said. "As we move forward with our business strategy, everything inside the company is about pages."
All major vendors have articulated some version of the page-share strategy. Xerox, Stamford, Conn., has provided a version of its own document consulting tool, called XOPA, giving partners a weapon in negotiating managed services deals. Xerox has seen about 15 percent growth in document managed services, and Chairman and CEO Anne Mulcahy has made it clear she expects to grow sales through solution providers.
Oki Data, Mount Laurel, N.J., was among the earliest to partner with solution providers in the delivery of print managed services. In June 2006, the company beefed up its offerings to provide presales support such as Webcast training, joint sales calls, RFP and RFI response services and a strategy to work with customers regardless of their document hardware environment. The program has shown an astounding 500 percent growth since 2005 with 85 percent of the managed service consulting triggered by partners, according to Oki Data.
Lexmark, Lexington, Ky., has been aggressive in the development of channel-focused print managed solutions for vertical markets including education and health care. But the company continues its relationship with Dell, closing a lucrative print managed services contract with the vendor for Boeing in 2006.
Laser's Resource has partnered with market-share king Hewlett-Packard, Palo Alto, Calif., to roll out document assessment consulting services and print managed servicesusing tools to keep track and manage fleets of document hardware. Working with HP has been a growth-creator for Laser's Resource, Senecal said. But even HP and its massive channel are struggling to clamp down on all opportunities. Senecal said HP leads in techno-logy and its approach to solution providers but could grow in other areas.
While solution providers have generally provided a thumbs-up to each company as a partner, few if any will say their vendor partner has gotten it perfect. Some have lauded Oki Data's channel commitment and managed service strategy, but have said its technology hasn't overwhelmed the market. Some laud Xerox's technology, but have said some channel conflict remains. Lexmark, with an army of loyal channel partners, only recently rebounded from several quarters of disappointing sales and profit.
Offering managed print services can be simplified, said Andrew Ritschel, president of Electronic Office Systems, Fairfield, N.J. "The ideal situation is you put in printers to replace older printers out in the field in company populations," Ritschel said. "You have to go in with a lower cost-per-page output and say, 'Look, you give me your five-year-old printer, I give you your parts, supplies, everything included.' The biggest challenge is reading the meters correctly every month."
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