Friday, March 21, 2008

MFP's & Total Document Volume

Manufacturers continually talk about TDV (Total Document Volume), capturing TDV is easier today considering that most MFP manufacturers now have a complete line of network printers and MFP's that encompasses low end and high end systems.

The problem facing most reps in the field is we do not receive revenue based on the ongoing revenue streams for these systems. Typically, we can sell supplies with the initial order and receive a very small commission. With CPP (cost per page) programs more popular than ever, we are quoting and selling CPP's and receiving nothing. Usually these CPP's will last the term of the lease and create a very profitable revenue stream for the dealer or manufacturing, considering that the customer is locked in for the duration of the lease.

Now, more than ever it seems that there are many small MFPs or printers that complements the larger system, and allows workers to be more productive with printing, fax, scanning and copying from their desk. The problem with most of these small MFP's and printers is that they are more expensive to print, short life cycle, and if a service call is needed most users must bring the systems to a repair facility or the customer will just go out and buy another inexpensive printer or MFP and through the old one out (what a terrible waste)!

Since we are not paid on the on going revenue stream, along with the fact that we receive very little commission's on the low end printers or MFP's, we tend to focus on the larger systems, place the units and then move on to the next customer that has a need for our services. There is no incentive to place our lower cost per page systems, and capture TDV! Many times I have gone back to see a customer a few months after the sale, only to see additional systems that we not purchased from our company.

MY opinion is that we can capture TDV in most offices! I have done this with a few accounts, however it was very time consuming process for so little. WE have the knowledge and the resources to capture TDV, but most of us are lacking the support from management to implement CPP programs on all of our devices.

So, what can be done to implement TDV, well the first step is to offer an ongoing commission for the revenue stream that each printer of MFP in the field. The second step is to implement a device that will capture all of the meter reads and report back to your billing department (Ricoh uses @ Remote). The third step is pay a fair commission on the revenue based on the clicks, click commission should vary with different devices that is fair to the rep and the dealer. The fourth step is a software program that will calculate clicks and commission on a monthly or quarterly basis.

When was the last time you actually tried to sell a maintenance agreement or sell additional supplies? How many of us actually shy away from selling maintenance agreements or CPP's, and tell the customer take the initial warranty and supplies and then call us? When was the last time you actually focused on TDV in a customers office?

Receiving an ongoing revenue stream will allow us to focus more on every device in the office, and allow us more time to truly consult on the CPP's of printing devices. Everyone will benefit! The customer will benefit by having one supplier amd service provider for all devices, along with the benefit of truly knowing what their CPP is for thier TDV. The dealer will benefit from more devices being placed and capturing service and supplies for all devices! The sales person will benefit from the on going revenue stream plus the incentive to capture all of the output.

It's all about the clicks!

1 comment:

Greg Walters said...

"Residuals" - great idea, and not a new one.

In the industry, as you know, one of the most common area's of customer complaints revolves around billing.

From IKON to "X", customers have been under billed, over billed and sometimes never billed for service/clicks - now throw in calculating commissions on top of that cluster!

I agree with the premise but unless this is built into the fundamentals of billing, I only see the smaller dealers in a position to implement.