People Power

What does it take to ramp up a managed-print practice in the first year? That’s the $64,000 question.

To be accurate, we’re really talking about $63,000—that’s the average that senior-level executives at VARs and MSPs say they committed when launching managed-print services. (These and other revealing numbers are part of “The State of MPS 2011” , an exclusive survey of senior level managers conducted by UBM Channel’s IPED research division and marketing strategist MarketBridge.)

And in case you have any doubts about this being a people business, consider this: The bulk of the investments—in the first year and in subsequent years—goes to personnel. In particular, beefing up the inside and outside sales forces, as well as the services staff. Averages for the ramp-up year of a managed-print practice look like this:

Outside sales staffing: $19,100

Inside sales staffing: $15, 800

Services staffing: $9,600

That leaves $18,600 for everything else, including training, R&D, marketing and infrastructure.

VARs and MSPs who are now plotting their long-term strategies will do well to keep a people orientation in mind. While overall investments decline slowly in the three years after launch, the sales staff continues to require the biggest financial commitment. In fact, the dollar amounts rise for both outside and inside staff in the second year and remain the dominant outlays in years three and four.

The selling expertise can spell the difference between winning customers and getting lost in sales cycles that take forever to close. Or as one VAR succinctly puts it:  “If you don’t have people committed, it doesn’t matter how cool the model is or how profitable it ‘might’ be.”