The Art of the Managed Print Deal

Here’s something interesting: In a world where SMBs are all the rage when it comes to IT, service providers who are offering managed print services are seeing the most revenue come from larger customers, such as hotels or resorts, which have vast printer fleets and tend to be more knowledgeable about the concept of managed print.

When we spoke with attendees at the recent XChange Solution Provider event in Orlando, Fla., about trends in managed print, Bob Wiederhold, vice president of sales at TeraCat Data Solutions in Orlando, told us that managed print is truly “the future of printing.” But at the same time, the idea is still barely taking hold in the small to midsize markets. Fortunately, it’s a challenge that can be overcome, Wiederhold says.

A big part of the effort involves education. Many small and midsize organizations are simply not aware of managed print and its potential benefits. Because their print volumes tend to be lower than that of larger enterprises, they’re also not aware of the need for such a service.

“They think that it’s all about the copier,” Wiederhold says. “The printing is something they don’t even want to deal with.” But as a result, managers at these businesses don’t really know how much they’re spending on printers, toners, ink or other components. And that’s the other big part of selling managed print: showing customers what they’re spending on print and how much they can save.

TeraCat Data Solutions, which has been a Xerox partner for less than one year, is aiming to expand its managed print business by demonstrating to customers large and small how they can gain from the service. Wiederhold says the company is currently doing assessments based on the Xerox PagePack offering with three companies, and has closed “quite a few deals” since it launched its manage print operations in 2010.

TeraCat begins the print cost discussion with customers early in the selling process. First, Wiederhold asks them how much they think they are spending on printing. Then he shows them a work sheet that TeraCat uses to help customers discern the difference between printing costs from Xerox solutions compared with those of other vendors.

Some of the deals have been “quick in, quick out,” Wiederhold says. TeraCat shows the companies how much they’re spending by getting supplies from Xerox competitors, and how much they could reduce their costs. When they see the numbers, they’re quickly sold on managed print.

Other transactions take much longer to complete. For some companies, Wiederhold says, the idea that printing costs a lot of money is difficult to grasp. They’re seeing that copiers don’t cost them much and they think the same basically applies to printing. The idea that a small black and white printer could be costing them as much as it does over the course of a year is not easily understood.

What’s the normal time it takes to transform a customer into a Xerox customer? “It is either a quick sale or a very long, three-month sale,” Wiederhold says. “There’s pretty much no in-between.”

The customers that take longer to sell on managed print generally are skeptical on the concept; they want to see tangible proof that their printing costs really are high and out of control. For the bigger companies, that means TeraCat has to go in and conduct a thorough analysis of the company’s printing costs.

To conduct this assessment, TeraCat uses a data collection agent tool that captures every print job in an organization to every printer. Using this tool, it can show customers not a guess at how many pages are being printed, but the actual number a company prints, and to which printer. The reports show the cost to purchase supplies and maintain the equipment.

The data collection process can take anywhere from less than a month to three months, depending on the size of the company and what it’s comfortable with in terms of how much data to gather.

After the data is collected and analyzed, TeraCat can show the customer exactly how much it is spending on print with its current environment. It then presents a managed print program that covers all of the company’s consumables and printer maintenance based on a cost per page that is likely significantly less than what the company is currently spending.

So far, the selling strategy has been largely successful for TeraCat Data Solutions. Customers, even the ones that take longer to decide, have come to realize that they can operate many different types of printers for almost the same cost of using copiers—only much more conveniently.

It’s no surprise then, that Wiederhold sees lots of opportunity for managed print going forward.

Make Sure You Get Your Share

Here’s your chance to request an invitation to the invite-only Xerox Fusion 2011 Partner Summit, which will take place April 27-29 in San Antonio, Texas.

Attendees will get face-to-face interaction with successful managed print professionals who can help them build their own managed print business.
Learn more about the Xerox Fusion 2011 Partner Summit right here.

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