Opportunities in managed print: turning paper cuts into big bucks

The following appears on crn.com.au

It may surprise resellers contemplating their managed print offerings that the much-vaunted “paperless office” was popularised by a company synonymous with rapidly printing vast reams of paper on demand.

The famed Xerox Palo Alto Research Centre (PARC) – the research lab behind the Screen Shot 2013-11-08 at 12.19.21 PMgraphical user interface and which further developed the mouse and tablet computer – made the paperless office famous in a remarkably prescient 1975 Business Week article.

“There is absolutely no question that there will be a revolution in the office over the next 20 years,” PARC founder George Pake told a reporter nearly 40 years ago.

“I’ll be able to call up documents from my files on the screen, or by pressing a button. I can Screen Shot 2013-11-08 at 12.12.45 PMget my mail or any messages. I don’t know how much hard copy [printed paper] I’ll want in this world.”

Fast-forward to today, and paper is still woven into the fabric of office processes and communications. Despite – or because of – mobile devices, people still print because paper affords many benefits. It’s tactile, light, cheap, can be scribbled on, accessed randomly and easily shared.

And it’s not just luddites of the older generation who cling to print. A recent Norwegian study found 10th graders better remembered information printed on paper than displayed on a screen. This is why, over the past 30 years and spurred on by exploding volume of Screen Shot 2013-10-21 at 3.24.42 PMcontent on the worldwide web, page output has increased by half, says The Economist. And from 2003 to 2009 despite concerted “Go Green” campaigns and rising use of email, Australians lifted their annual paper use from 4 million to 4.25 million tonnes, says Clean Up Australia. The environmental group also estimates the average office worker bins 50 kilograms of paper a year – a staggering 10,000 A4 sheets.

Jay Ko, product director at Synnex Australia, distributor for printing brands including Fuji Xerox, HP and Epson, says that, perhaps unexpectedly, mobile devices are driving more print.

“Apps make it easier to print and they offer wi-fi print, which helps to print more because of convenience,” Ko says. “I expect page volumes to grow in single digits over the next couple years.”

Ko says Synnex’s partnership with managed print services software developer PrintFleet has just 300 to 400 printers under management with 20 resellers. The reason is small to medium-sized end-customer businesses are yet to grasp the benefits of managed print, he says.

Many resellers also have no idea where to start: “They require training to understand which managed print service model is suitable for them”.

Synnex marketing manager Chi Wing Chan is blunt: “Managed print service is still hype”.

He says tough trading conditions attract interest in cheaper managed print services but “I don’t see personally that many companies have jumped into managed print service yet”.

“For resellers, they have to transform to be a solution provider in order to offer a hassle-free managed print service.  This requires shifting the business paradigm and skill set of their staff.  After-sales is more important plus the measurements on savings.”

He adds that end-customers still prefer to own their devices because it “gives them peace of mind and full control”.

But Paul Harman, chief executive of specialist print distributor Alloys, says page volumes are declining and that time is running out to adapt to new market realities. He says page volume “hit its zenith” at the end of 2011 and is now declining by 1-2 percent a year.

“The print market is changing significantly and I’m not certain the reseller community is changing as fast as the market is trying, or needs, to change,” Harman says.

“Print is stuck with selling a toner-out configuration. And managed print services numbers are growing but not at a rate that many people thought they would.

“The managed print services market won’t reach its maturity before the print market comes into more significant decline.”

Alloys and US document-capture vendor Kofax are helping the channel provide business process services instead of simple print.

“We’ve been putting on a lot of seminars and package solutions to enable resellers to think about these as part of their balanced solution for print and process,” Harman says.

“I’m not suggesting everyone should throw out printers today. They will play a core role in the marketplace.

“It’s in six to seven years that Gen Y, which is the most printer illiterate of the generations, takes control of office purchasing decisions and at that time we may see a real change in how printers are viewed in office.”

To make it to that inflection point, Harman says resellers should evaluate paper’s role in business processes and communications – and learn how to replace or at least augment it with smarter solutions. For instance, Harman says scanning allows resellers “to move past a printer as the only solution they can offer for document output”.

“Most people think of the lifecycle of the printed page as creation and printing of the document and most people forget what later happens to the document. Smarter resellers have spent more time in document management and capture to drive it further.

“The next phase is trying to make information flow around the office; so we’re trying to build that bridge for resellers.”

An example was the project Alloys and reseller Upstream Print Solutions started last year to supply Toyota Finance with a Kodak digital capture system for its 350 dealers nationwide. The 450 Kodak i2400 document scanners that the Fuji Xerox-owned reseller supplied cut from the time to get loan approvals from dealers to head office from days to hours. Here, managed print trumped a costly and problematic cloud solution.

Snake oil

Nick Sheehan is also turning around SME perceptions. Sheehan, sales director for Fuji Xerox reseller EFEX Group, says realisation of the latent possibilities in multi-function devices is dawning on SMEs – especially those in hot verticals such as legal and financial services.

“Four to five years ago, scanning was seen as trying to sell snake oil,” Sheehan says. “Faxing is going away and scanning is becoming the new faxing.”

That includes sending to document management systems such as SharePoint and optical character recognition engines to automate common business tasks, he says.

Another change EFEX Group notices is the drift from big A3 printers to more economical A4 sizes. “Ninety-eight per cent of what people print is A4 and that’s only increased over time; the big push has been, let’s sell A3 copiers and multi-function printers [but] its three to four times as expensive as A4.”

EFEX Group divides its go-to-market strategy into three dimensions. Firstly, speaking to customers about replacing their A3 devices. Explaining the advantages of Fuji Xerox’s ColorQube solid ink technology for low-cost colour.

And kickstarting engagements by seeing how the multi-function device’s scanner is a stepping-stone to smoother workflows and automation.

He says an end-customer “may have signed a five-year contract with someone else [for printing] but we can still talk to them about their capture”.

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