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Print.IT Reseller
www.printit
reseller
.co.uk
Cooking is a science as well as an art.
It requires precision in mixing your
ingredients and a unique flair for
creativity in order to stand out in a
sea of competitors.
With customers holding onto equipment
longer and page volumes flat, the print and
imaging industry is faced with a very real
decline in traditional, product-led business
models that appears to be going beyond
cyclical economic conditions. With the
heat in the kitchen rising to uncomfortable
levels, what is the reseller to do?
Managed Print Services (MPS) has
become the go-to strategy that successful
providers are using to gain sustainable
advantage in tough economic times. But
what are the ingredients that are key to
their success?
In late 2011, I began assembling a
group of leading MPS providers from
around the world to help quantify
anecdotal evidence that we at Photizo were
hearing in our discussions with the channel.
We call this group the Hybrid Provider
Index, a leaders’ index for MPS that
consists of leading Hybrid Providers (more
than 25% MPS revenue) and Services
Providers (more than 80% MPS revenue)
ranging in size from $3 million up to $425
million in annual revenue.
Just as a thermometer signals whether
the temperature is too hot or too cold, this
index provides a market-leading indicator
for managed print services from the
reseller’s perspective.
This year, we expanded the number of
providers in the index and launched the
MPS Provider Scorecard, which includes
more than 450 metrics that providers can
use to gauge the readiness and health of
their MPS practice compared to the best
in the industry. One of the key differences
in our scorecard is that we surface low
and high values in the range, so that you
can use it in much the same way as you
would a recipe: you can follow the recipe
exactly or you can add, remove or adjust
ingredients as you see fit.
Whichever approach you favour,
our analysis shows that there are
five staple ingredients every MPS
practice must have in order to
achieve success:
1) Be prepared to get dirty.
I don’t know about you, but I’ve found that
cooking can be a pretty messy ordeal, but
one that's worth it in the end. The leaders
we spoke to understand this concept and
aren’t afraid to roll up their sleeves: they
believe in being highly focused on the
task at hand. We consistently find that
leading Hybrid and Services Providers either
lead with or include MPS as part of their
customer-facing story every time: 85% of
them have dedicated MPS executives, and
those that don’t ensure that all of their
executives have MPS-related responsibilities.
2) Understand the sales cycle.
If you were to cook your dish too quickly
or leave it on too long, you’d surely not be
satisfied with the results (and may even be
unwell if you ate it). Leaders understand
their sales cycles very well: the ones we
have spoken too tell us that when they
rush the process, it almost always turns
out badly. We found the typical sales cycle
for small and medium-size (SMB) accounts
averages 78 days, while larger accounts
take on average 192 days to close.
Many pundits emphasise the value of
an MPS assessment, but we wanted to
quantify it, so this year we introduced a
‘revenue per assessment‘ measure. We
took the reported MPS revenue and divided
it across the number of assessments
performed, much as you would in revenue
per employee calculations. We found
that assessments were indeed valuable,
generating $43,500 per assessment.
3) Build a culture of engagement.
In order to be pre-eminent in their
marketplace, Hybrid and Services Providers
have realised they must empower
employees to serve their customers. To
keep this kitchen running smoothly, it takes
a high level of engagement. Our index
shows that leaders average one manager
for every six employees and generate
revenue of $227,000 per employee.
4) Automate processes to scale the
business.
If you’ve ever put together a dinner party
for dozens of guests, you know how
much effort can be saved by using the
right tools for the job. Just as industrial
kitchens prepare large-scale meals, leading
providers have learned to tune up their
processes in order to maximise profit. On
average, they service about 5,000 devices
in their MPS fleet (with a maximum of
21
mps
Cooking Up MPS Success
Ken Stewart, Director of Channel Analysis at the Photizo
Group, outlines the five key ingredients of MPS success
continued...
Infographic
showing a
summary of the
top MPS provider
metrics captured
in Photizo Group’s
Hybrid Provider
Index.