In many ways hardcopy can be viewed as a hangover from pre-computer days. It is an anachronism that should be totally unnecessary in these days of multiple viewing solutions and sophisticated electronic storage techniques. Alas, the paper mountain continues to grow decimating the world’s rapidly diminishing stock of trees. The printer manufacturers continue to thrive successfully in this somewhat contradictory state of affairs and can provide a good living for dealers and consultants working in the imaging area.
We spoke to three of the manufacturers – Epson, HP and Xerox – to find out how they can help improve the lot of printer dealers who operate at the sharp end with end users. One common thread that ran through these discussions was education, not just to a point, but ongoing because like other technology based products printer technology continues to evolve. These discussions concentrated on what the manufacturers can do for their dealers rather than the technical merits of their differing approaches. Market trends come and go but two that are currently in the ascendancy are photo printing and the wider adoption of multifunction units.
Epson
Katrina Timmis, Epson’s channel manager for Ireland, has been looking after the Irish operation for over five years and is one of the most experienced channel managers in the country. Epson are very strong in both the home market and small business areas. Unlike some other players Epson work very closely with all its dealers of which there are over 750 in Ireland, some of which would have very small turnover.
Leaving aside the question of technical prowess the main channel strength for Epson dealers is accessibility. The Epson channel model is built on the premise that dealers should be easily able to deal with Epson. This is not just about ordering products and parts but includes technical backup, marketing collateral, replacements and repairs. All dealers have the same direct access either by phone and/or through the web site. This approach makes for a more personal touch engendering a strong working relationship between manufacturer and dealer.
Epson operate a “push pull” strategy where interest that has been generated through advertising or the web site is linked directly back to the dealers within the relevant geographic area. The dealers are given the leads thus enhancing the benefits of being an Epson dealer.
Key to the smooth delivery of products and consumables is a strong local distribution channel. In Ireland Epson useS Sharptext and Micro Warehouse to ensure an efficient delivery service to their national dealer network. Epson also operates a number of express centres where products can be rapidly repaired or replaced on a swap basis.
Education and keeping dealers up to date with new products, services and sales strategies are an integral part of the Epson model. One of the most widely used devices is a monthly “e-shot” that is delivered by e-mail every month to all the dealers. Timmis stressed that it is a constant challenge to Epson to ensure consumers are educated and this effort has been reflected in the increasing consumer awareness and knowledge displayed by consumers. Long gone are the days when the price of the printer is the key purchasing decision. Dealers must display knowledge of the prices of consumables and coverage achievable.
Self-maintenance has become a much more important factor for consumers as prices of service calls have escalated.
The unit sales of multifunction units have more than doubled for Epson in the last two years. The company’s faith in this market is reflected by the recent launch of Epson’s first laser based multifunction unit the CX11N. Photo media and printers have also displayed huge growth mainly driven by the adoption of digital photography in the home user space.
Timmis said it is important for manufacturers and the channel to work in close partnership creating a win-win situation for both parties.
Epson has set up a dedicated show room mainly for specialised products in Ballymount. This is used for both demonstrations and to conclude sales on behalf of dealers. Other support from Epson includes training sessions and web ordering of products including brochures and images.
The Epson organisation, consisting of five people in Ireland, is dedicated to imaging sales and, according to Timmis, is the most approachable. Its strength is that it covers all bases from the smallest to the biggest.
HP
HP has the biggest overall market share in the printer space. The company has recently appointed Brian Finn as the manger of the commercial imaging and printing business in Ireland. HP’s distribution channel is similar to Epson with two main indigenous distributors, Clarity and Sharptext. The distributors sell directly to a large national network of HP channel partners which total approximately 800 plus.
Like most of the printer manufacturers HP is leading the rush into colour as it attempts to sell its benefits compared to monochrome especially in the SMB market place. Naturally, the growth in colour demand is being driven partially by the huge adoption of digital photography. The other main trend that is driving growth in the market, according to Finn, is the increased take up for multifunction units as compared to single function units.
The cost of colour laser printers has fallen significantly to €450 excluding Vat for the 2550L colour laser printer. This makes the price gap with monochrome laser printers very small, thus removing the price barrier to colour. Companies who would not consider colour before are now using it to print, for example, marketing collateral; and are seeing the impact that a colour document can have.
Finn said that HP is seeing a huge growth in the multifunction space as recently reported in the Q2 results. There was a 61 per cent growth in the unit sales of multi function products year on year. The greatest success has come from the new 4345MFP which is aimed at disrupting the traditional copier market. The 4345MFP is an A4 43ppm device which is a lot less expensive than its nearest A3 copier counterparts. The other great advantage for HP is that as more of these devices are being put on the network, customers know that as an IT company HP is considered a trusted brand. According to HP its multi function devices allow true IT network integration, document management and achieve substantial total cost of ownership savings for end-users.
The strength of HP’s printer marketing depends on its very strong brand name and the reliability of its products – recognised by both end users and the channel. The benefit for the channel is that they can sell HP with confidence and in the event of failure there is good support available. The strong brand name and market position creates a demand-pull from end users into channel partners. There is a core group of partners who focus on imaging and printing that HP work closely with providing training and support for marketing activities. Consultancy services are important to ensure that an efficient output strategy is implemented by end user organisations. Consultancy recommendations often lead to ten to thirty per cent reduction in the cost of running a fleet of printing devices.
The TCO (total cost of ownership) message is promulgated by the partners who work closely with HP. These partners “do a great job of spreading this message to end users,” said Finn.
Xerox
Recently, Xerox has been proactive updating its channel strategy with a number of important announcements that were made recently in Seville, Spain. Again Xerox’s products, in Ireland, are distributed through two sources – Media and Clarity. The routes to market fall into two main groups – concessionaires and the trade channel.
Bob Horastead, director and general manager Xerox Ireland operations explained that there are seven concessionaires based on regions – two in Dublin and one in each of the following areas – Waterford, Cork, Galway, Midlands and Belfast. Unlike conventional dealers concessionaires cannot sell products that compete with Xerox product lines. Apart from the trade channel, Xerox also has a corporate channel that currently consists of one partner – EDS Memorex. The purpose of the corporate channel is to deal with very specific specialised product solutions.
Xerox has a strict accreditation process in place for dealers and strives to ensure that its dealers have a high level of commitment to Xerox’s product lines. It comes as little surprise to find that the number of dealers is only 50 trading resellers in Ireland – considerably less that HP or Epson. The Xerox web site has dedicated zones with access controlled by individual partners’ passwords. There is also call centre assistance with code access to dedicated partner lines. Xerox expects its dealers to have at least some of their staff dedicated to the Xerox product lines. Some dealers have different areas of expertise such as in consumables and integration.
Like the other two commentators Horastead underlined the very strong growth in colour over the last twelve months and the rapid growth in the sales of multi function units especially at the retail end. The reduction in the price for colour printing and the benefits of colour output are driving this growth.
Xerox does most of the technical support centrally. Dealers have the option to get clients to sign up maintenance contracts covering technical support and services with the dealers who then subcontract Xerox to do the actual maintenance. Outsourcing is a growing area and is usually undertaken by Xerox although some dealers provide outsourced services covering fleet management and/or print procurement. Discussing TCO Horastead said that generally corporate users are aware of the real issues but that the message has not sunk in at the lower end of the market and that it is a challenge in the SMB market place. Xerox will be promoting some new software tools that automates the collection of information and compilation of print costs.
Among the announcements made in Spain is that the Xerox channel strategy has expanded to provide customers with a wider range of options for the purchase and deployment of Xerox solutions. For example PagePack offers a cost per page contract model – including consumables, supplies and servicing – on both printers and multifunction systems.
More choice and flexibility is good news for customers. The new channel strategy is an equally positive development for Xerox partners, who can build customer loyalty and gain strong competitive advantage by selling the expanding Xerox portfolio with greater flexibility.
Xerox has also announced the Xerox alliance partner (XAP) programme that links the Xerox portfolio with a software programme to create customised solutions for European customers. The XAP programme gives customers more options, both in terms of whom they choose to work with and how they choose to integrate Xerox solutions into their own particular environment. At the same time it provides Xerox partners with the opportunity to grow profits by building long-term relationships with customers and securing additional revenue streams.
Horastead said Xerox is in the unique position of supplying document management solutions that goes across the range. The company is very strong in all areas and can really help to have a positive impact on TCO by providing the most appropriate solutions either centralised or local or a mixture of both.
Dealers still have much work to do especially in the area of educating end users about the true cost of printing on paper. Paper output should be seen as only part of the information dissemination process. There is still a huge latent demand for colour and end users already appreciate the advantages derived from using multi function devices. Growth prospects will continue on a strong upward curve. n
Suppliers
Epson www.epson.ie/reseller
HP www.hp.com
Xerox www.xerox.com
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