Will The Imaging Channel Imagine What's Possible or Rely on Memories?

by ray stasieczko June 07, 2020

"Imagination can destroy the thoughts of complacency's comfort; therefore, many will continue creating visions from memories rather than imagination."  

Sometimes the greatest educations are realized from what no one expected. This pandemic is the classroom for the imaging channel's dealers, manufactures, and the customers they serve. More importantly, it's also providing an education to those outsiders who intend to disrupt a decade's old complacent deliverable.

"It's not the competitor we know and believe we can beat that should concern us, it's the competitor we never saw coming from places we refused to imagine, we must fear and get motivated to win against, I call this, The Uber Factor." 

Unfortunately, some will exit their houses and quickly run to their existing customers and prematurity upgrade their print equipment. It is hard to believe that for many dealers, the 1980's business model is still in use today. For some, even a pandemic did not awaken their imagination to explore the awakened realities of the marketplace they serve.

Every living office worker in the world recently received an education in technology relevance, and many have learned that being digital is a great asset. The digitalization of the SMB and Enterprise marketplace will advance at unprecedented speeds over the next 24 months.

The question regarding the relevance for the decades-old Imaging Channel's deliverable is a simple one. Will the channel's leaders use memories to create visions, or will the channel's leaders use their imaginations and create what could be based on what should be?

Of my many warnings to the channel over the last few years, these two are now front and center to the channel's reinvention.

1) The A3 product's declining relevance.

2) The evolution of A4 MFP equipment will attract new actors who will create new processes disrupting the decades-old deliverable of print equipment and its services. 

The channel must now react to accommodate these two realities. Realities that were extremely highlighted during these last few months as the world went through this pandemic. For the first time, the facts of oversold equipment will consume the end-users minds as they re-evaluate all expenses in their quest for digitalization.

Unfortunately, from some, we continue to hear the battle cries for saving yesterday based on memories of what was. There are still too many rushing out the door to oversell, and prematurely upgrade leased equipment continuing to chase revenue regardless of the high cost to their business this complacency creates.

Who else sees the insanity in a business model where there is an obsession with saving current customers money by prematurely upgrading their leased equipment, then adding in the buyout as they replace one oversold machine with another. This practice is what is defining an industry's actors as product-centric.

An industry saying, explains some of its disfunction. "We save our customers money" an industry dilemma 90% of our new deals are already our customers. In other words, our new deals lower our existing service revenue. Not to mention the realities of the higher cost to deliver services on new equipment during its first couple years of a new installation.

All the Imaging Channel's business model experts concluded decades ago that selling hardware is not a profit center for the dealership. The profit center is the service and supply revenue the product generates, and every time a dealer upgrades a customer, the customers save money. Does this not deify logic? Another flawed process is billing based on clicks or out-put when out-put is declining.

"The compensation program, by default, becomes the behavior path for the compensated." 

Of, course the imaging channel's salesperson is paid to sell products, not services we all know the drill. The salespeople run back to the office ring the bell and holler-out as they write on the board the revenue of the hardware; of course, some progressive dealers emphasize the gross profit over the revenue.

Wait, what about the service? No, the salesperson does not write on the board the amount of service revenue, or how much of the service revenue was lost when the current customer was upgraded. This hardware first mentality is the reason so many dealers have failed in actually selling Managed Services PROFITABLY.

Let's imagine some changed behaviors

Imagine if the salespeople had to write on the board how much service revenue the dealership will be losing as compared to the customer's pre-upgrade amount?

Imagine if the service technicians could look on the sales board and see which salespeople cost the service department the most money as they upgrade current customers?

Imagine what dealer owners would change if the lease buyout amounts of current customers were also written on the board to show the cost of the revenue lost to leasing companies by pre-mature upgrades?

Some months the sales teams will finance more dollars in buyouts then new equipment the team sold. Everyone knows that customers who lease equipment are buying a payment. In other words, if the dealers weren't prematurely upgrading customers, they would be more profitable.

I think it's important to highlight these transactions' insanity because this will be the insanity that the disruptors will highlight as they seek out first to educate then deliver to a vast majority of the channel's end-users a better experience.

"The hunting grounds for disruptors are in the fields of complacency."  

Here's some of what I imagine is coming to disrupt the print equipment and its services delivery model.

I imagine, based on marketplace realities, iDaaS (imaging Device as a Service) will become a new normal for print equipment for millions of users as they welcome subscription models. Remember, subscriptions are the most widely used acquisition programs for both the hardware and software needed in an organization's digitalization.

I imagine, based on marketplace realities, the print equipment subscription model will gain in speed based on the evolution of A4-MFP, and the deepening decline of print. OK, please don't confuse that with some nonsensically distracting paperless argument. It's not about paperless. PRINT IS DECLINING!!!!!!!!!!! It will be outsiders and those forward-thinking dealers who build customer-centric programs to sell and profit off the decline who will prevail.

With the advancements in AI, predictive science from data collection will aide resellers to deliver closer to market realities. Subscription-based billing for print equipment and its services is not just possible but is now on the path to becoming mainstream. Also, alternative equipment service programs delivered through processes outside what is known as the Document Imaging Channel's business model will provide end-users an alternative means to both the purchase and services of print equipment.

Imagine the size and scope of those distributor organizations that currently provide products and yes, even services to technology resellers both in and outside the imaging channel. These distributors are positioned well to deliver alternative programs to the evolving office and yes, even the home office regarding print equipment and its services.

Imagine organizations like Field Nation or others who have been servicing some of the Document Imaging Channel's customers for decades on A4 desktop print equipment sold directly to these end-users by manufacturers and IT service providers. The A4-MFP and its continuous evolution is creating opportunities for new actors; actors which those unimaginative imaging channel dealers will never recognize as they have an unrealistic view of their importance to end-users. Very few dealers can comprehend their end-users appreciating alternatives in the selling and servicing of MFP's. Overconfidence based on out-dated processes will always welcome challenges from innovators. 

New billing models and new service provider alternatives will impact a huge part of the imaging channel's customer base. These new models and alternative service providers won't concern themselves with those print applications unsuited for their innovative processes. However, the vast majority of customers who live in that legacy BTA type dealer model are ripe for disruption.

"Innovation to a delivery system is not for the faint, or those who use memory management over imagination management."  

Of course, those who deny market realities have a place in the ecosystem of a disrupted process. If that's you, you will still be able to oversell to the unaware for a while, you can still think nothing will change, you can still deny actual data, and you can still think that status quo will remain till your retirement. Just remember, those things that some still think are the things their disruptive competitor bets they will continue thinking.

"Those who cannot imagine how they will be defeated will fall to the mercy to those who plan and execute their defeat."  

"Status quo is the killer of all that will be invented."  

 If not already Let's connect here on Linkedin and I welcome everyone to subscribe to my YouTube Channel https://www.youtube.com/channel/UCULKZDBCR1ozWXmu4Tob66A?view_as=subscriber

Ray Stasieczko

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