Increase Profits Without Increasing Revenue, Part 1: Don’t Skip Phase 2
So you liked the first three blog posts. You’re still with me. You’ve sat there in your office with your arms crossed, nodding your head.
Perhaps you already knew everything I’ve written about so far. That’s great, because you’d be surprised how many “MPS specialists” don’t. Laser printing has been part of business for more than 20 years. Customer printing attitudes and alternative technologies have changed far faster than many dealers are able to keep up with.
I got all the ranting off my chest. I warned you at the beginning: I’m passionate about this. I feel better now. It’s time to get on to the good stuff. No more preaching — for a while, at least.
Remember our favorite scenario? You won some accounts, and the sales team is beating the streets in search of more. You did that thing with the secret sauce that switched legacy monochrome and color devices from OEM to reman toner; so now what? Do you just keep shipping out the toner, dispatching the service technicians as printers break down, and billing the meters? Is there nothing more to MPS?
Well, actually, there is. In the Photizo doctrine, MPS is at least a three-phase process. Phase 1 is when you win and take control of the fleet. Phase 3 is often several years later, when you replace the entire fleet. Phase 2 is optimizing the fleet, and it’s the step that most dealers miss completely. This is a shame, because it’s where you have the opportunity to maximize your profit and (if you choose) pass on further savings to the customer (thus ensuring you get the opportunity to actually remain the incumbent for Phase 3).
Optimization is defined by Photizo as “deploying devices in a manner that is most effective both in terms of asset utilization and user satisfaction/productivity.” The crux of it is deciding which printer replacements will make the fleet more efficient, decrease the TCO for the customer and increase the profit per page (PPP) for your dealership.
Wait. Who is responsible for fleet optimization at your dealership? Sales guy? Service manager? CFO? If it’s everybody’s job, it’s nobody’s job!
If you don’t optimize the fleet throughout the contract, you’ll be stuck supplying and servicing the current fleet. You’ll make a declining amount of money, because as the fleet ages and requires more service, it will eat into your PPP.
C’mon, you know this, right? Repeat after me: “The client hired us to reduce printing costs over the next *insert number of* years.” You didn’t think the job was done after the contract was signed, did you?
Good. Err, okay — no need for me to start with the rant again.
So, fleet optimization. Do you want the MPS doctrine or the street-wise tactics? Thought so. There are plenty of consultants you can hire for the belt-and-braces theory.
In Part 2 of this blog, I will show you how to segment printers into buckets that I call the “Three F’s” — flawless, functioning and flawed. Using this method, you can easily figure out which printers to keep, replace now or replace in the future (Phase 3).
For now, your homework is to figure out who is in charge of fleet optimization (if you haven’t already). Check back for Part 2 to get the next steps.
For more from Christian, visit the MPS Ready blog at www.printersdirect.com/blog/.
Posted by Christian Pepper on Jun 25, 2012