Now that the $100/month price floor has been breached, it can no longer be business as usual.
Today your customers can finance aNEW color MFP with OEM supplies, including 2,000 color pages per month, AND next business day service for less than $100 a month. I’m not talking about a toy printer you get free with a notebook purchase, brands like HP, Lexmark, and Epson, among others, now have products capable of 30-40, even 50 pages per minute with supplies and service bundled in, for less than $100. Implications to your business? Let's talk.
It would be a mistake to view this market segment as outside of your business focus. The print technology market is dynamic. The below graph explains that those “higher spec” installations are shrinking. If your strategy is to only partake in the A3 market, then there will be fewer opportunities for salespeople to participate in. Over time, the $99/month color MFP will dominate.
Since 1993, 68% of all US job growth has occurred in small business. If you assume most new jobs are created for millennials, who print less than previous generations, the problem becomes clearer:
A $99/month color MFP capable of printing 2,000 pages per month can easily satisfy the needs of 10-15 office workers.
Heck, even 30 employees would benefit from two of these devices, which would also provide redundancy. As they become easier to build, manage and sell, (AKA: Scale!) the likes of CDW, Staples and PC Connection.com will bring compelling offerings to serve this growing market.
Are renewals getting more difficult? A lease renewal is much different than a new sale. Many dealers do not distinguish between the two, but new opportunities will be the hardest to close when faced with a competitors $99/month offering. Your current installations are a bit safer because (in theory) you have a solid relationship and service history, HOWEVER, this safety may be temporary. Online resellers will continue to target them. Eventually, the $99/month value proposition will resonate.
How will you respond when a loyal customer asks why a competitor is 30% your cost for a similar offering?
Going Digital.
Office technology sales are going digital. They are becoming easier to bundle. The only way to sell these offerings, at these price points profitably, is to do it without feet on the streets. To make this happen, you need a digital workflow and a functioning e-commerce website.
Is this an important moment for the industry?
In 1954 Roger Bannister broke the four minute mile.
It was a milestone nobody ever thought could be breached. Over 1400 athletes (and counting) have done so. The four minute mile revolutionized running. So too will the $100/month color MFP. Are you ready to run? Let’s chat.
