Commissions for Clicks "Is .002 Per Page To Much to Ask For"?

In a recent article from Lou Slawetsky of Industry Analysts titled "Your Reps are Starving; PART 2", Lou made mention that the going rate for commissions for clicks seems to be .002 per page.  Lou did not elaborate about color pages so I can only assume that he was referencing black pages.  I would tend to think that color clicks should pay a higher click rate.

Black Pages

So, how much is .002, I know, I know, well I think I know, however I though I would double check my math skills and .002 is two thousands of one cent. Seems pretty pitiful right?  One black maintenance and supply agreement for 10,000 page per month would generate $20 per month in commissions for the rep.  So, lets look try and find the average per page cost of a black maintenance agreement.  Now depending on your market, I'm sure the averages will vary, but lets take .01 as the average if you're a down the street rep.  Based on the .002 commission this would be 20% (geesh I hope I doing this right) .01 * 20% = .002.  What I'm trying to get a it what would be the commission rate for color pages.

Color Pages

We can now talk about color pages, in the down the street model (500-1,500 color pages per month) what would be the average color cost per page, according to a poll we had on the print4pay hotel forums that average would be about

Has The Time Come for Sales People to be Paid on Click Revenue?

In the world of MPS (Managed Print Service), commission for clicks is the common method pay compensation for reps.  Most time commissions are paid off the monthly revenue click from systems that our under a MPS agreement and in some cases commissions are paid one time for the first months worth of billing.

The copier commission world is a completely different story, reps are paid either paid on the percentage of gross profit or a percentage of the revenue for each copier that is sold.

Traditionally copier reps can also make commissions on the maintenance or cost per page agreement, the commissions range from 5%-10% of the annual agreement. In recent months I've heard some grumblings that dealers are pulling back and not offering commissions on maintenance agreements or cost per page programs.  Which I find surprising since maintenance and cost per page agreements are the life blood of the dealership.

If I were not getting a commission to sell a cost per page agreement or a maintenance agreement I would hard pressed to sell an agreement at the time of the sale.  Matter of fact, if I thought the break and fix model was better for the customer I would make the recommendation to go that way, my thought process is why muddy the waters and fight the battle with pricing on the maintenance or cost per page agreement if I'm not getting paid on that.

Personally, I would like to see some kind of ongoing

Top 7 Solutions @ Transform 2012 Conference "Intellinetics @ #1"

Cost Per Page Billing for Document Management Services

Photiizo’s Global Transform has concluded for 2012.  I'll be attending the conference in Scottsdale for 2013. 

About two months ago I wrote a blog about "Managed Documents the Next Big Thing" which I related to Managed Print.  The thought was to have an MFP connect to the cloud, and then scan documents directly to a cloud based document management system or a folder in the cloud.  After the documents were there the dealer would then manage the documents to have them indexed, OCR’d.  The dealer could then charge either a monthly fee for the service or a click charge that could be added to the existing maintenance agreement.  The benefit to the customer would be no upfront cost, no training (except to retrieve the documents), no internal IT support, and no maintenance fees.  The dealer could then remain “more sticky” in the account and offer the value added service.

While at the Transform Conference I ran across an Enterprise Content Management solution that was right up my alley.  The Intellivue ECM platform from Intellenetics is available as a cost- per-page model where you pay a low monthly fee based on the number of pages you use to the software to manage.  There is no upfront cost!  Billing would be enabled on a cost per page model, there would be one cost per page for a black scan and one cost per page (higher than the black cost) for a color scan, the reasoning for the higher cost for the color is that the color scan created a larger file size. With this SaaS solution a company can realize and immediate return on investment from the first month Intellivue is deployed.

Another excellent benefit to the dealer is that they can charge professional services for the installation and training to the end user. I’m more of a fan of the dealer performing the indexing of the documents for the end user and I’m not entirely sure this can be accomplished with Intellivue.  I will be making a call to them to see if there is a way this can be done.

The concept is for the user to scan2file from the MFP, the user would then index the file and submit to the ECM on the cloud (this is the part I’d like to see the dealer do so you it could be a seem less solution for the customer and you would be able to bill professional services).  Intellivue then retains the document for Archival in the Cloud or Premise Solution.  Intellivue would then create a monthly total of Pages in the Archival tabulate the monthly bill based on the cost per page.  Intellivue can then feed the monthly page totals and cost to the MPS billing software (I’m hoping that this will also work with MFP billing software).  You MPS software would then generate the total bill including line items for hardware, supplies, services and Intellivue.  Royalties are paid to the reseller from the ECM revenues collected.

The power of this solution is that there is no upfront cost and I see Intellivue as a tremendous value for the SMB customer.  For too long the SMB customer has shied away from content management due to the upfront cost, the training, the IT infrastructure and the thought that they would have to dedicate and employee to operate the software.

BTW, this is the first blog in a series of 7 for the top 7 solutions at Transform 2012 Conference.

-=Good Selling=-

My 2nd Reason Why Managed Print Services is a Loser

My first reason for Why Managed Print Services is a loser was waste and maybe that was to broad of a reason.  Waste can come in many different forms, such as waste in energy, waste is resources, waste in consumables, waste in landfill, waste of space, and waste of time!

As the second reason, I'd like to focus on waste of energy.  Think about it, 50 lasers printers firing up everyday, heating and cooling all day long. It's gotta take it's toll on energy consumption.  For those of you who are not aware of the laser engine technology, I'll make is real simple for you. Toner is needed to make a print, in most laser printers toner is housed in the print cartridge. Toner is fine plastic resin particles. In order for the toner to adhere to the paper it must be heated and fixed.  All laser printers have a heat roller or heat belt that melts to toner.  In order to have the printer print quickly most of these devices maintain a temperature threshold.

So, lets be bold and say we have 50 laser printers firing up and staying on all day wouldn't it be smarter to have 5 work group Multifunctional Copier Devices that could support every ones printing.  

Gesh, what would it cost on energy to run let's say a certain "Q" color laser printer?

Is there a better printer or copier that would do this type of work?

Here's an email I got from one of my Blog readers.  Special thanx to that person and I hope we've helped and a Certified P4P Hotel Member should have contacted you by now.
Art,

I read your advice on total cost of a Ricoh Aficio SP 430DN. do you have any suggestion of a longer term lower cost solution. I have real estate agents that we produce marketing materials for in color. Our current color printer(HP3600n) is way under powered for what we need. I like the Ricoh because of the low cost of consumables, realize that once you hit 50,000 prints there are quite a few components that need to be replaced.

We are printing newsletters on legal paper from Word, two sided in color, then we fold them with a machine. The goal it to send a print job of 1500 newsletters and let it rip. 25-30 prints per minute will do, speed is not the main goal, reliability and low cost per print is.

Is there a better printer or copier that would do this type of work? We're trying to keep the initial outlay at $1000 or less. I'm ok with a used machine if the copy count is low. I'm a pretty technically skilled end user and refill my own print cartridges and can change out drums myself. I'm looking at buying two machines (two offices) and purchasing bulk toner to refill the cartridges.

Your suggestions?
You posed this: "The goal is to send a print job of 1,500 newsletters and let it rip".

Me:  How often will you do this per month or per year? (I had an answer a day later that the volume was going to be 15,000 - 20,000 color pages per month)

This will give me a better idea of what to recommend.

There's a funny thing about color printers and it's from all of the manufacturer’s not just one of them. When a manufacturer states a cost per page most times (95%), it does not include certain parts that need to be replaced in order to maintain optimum print quality, thus the low cost of consumables is not that low any more. These items are usually the transfer belt (imaging belt) and fuser (fixes the toner on the paper). Plus another not so well know fact is the page coverage for printers is rated at 4% coverage, which means if you condensed all of the image area into a square it can't cover more than 4% of the total area (for color printers this gets raised to 16% since there are four colors). I doubt that you are only printing 16% coverage on the page and probably more likely it's 40% (you could email me a sample page for verification).

Another not so good thing about color printers is most manufacturers over state how long the consumables will last. Printing onto thicker stock, envelopes, thin stock, printing less than 5 pages at a time, heat, humidity all take their toll. It's very rare that I see a printer get the manufacturer’s suggested yield for transfer belts, drums, fusers and developers.

Service usually is not included, meaning if the printer breaks and needs a part you'll need to pay extra for this, again this drives up your cost per page. So, where the Ricoh 430DN is .0976 (I don't believe this is correct, however that's what Ricoh states, I think it's more like .15 cents per page when you factor in service, parts and premature consumables) per page is does not include parts, nor service, nor premature failure of the parts I just mentioned.

What I'm getting at is your printing 1,500 pages and the cost per page of the new Ricoh is .15 cents that means on average you’ll spend $225 per month in consumables, service, parts and maintenance. Plus the cost of the printer, let's say you bought it for $1,000, amortized over 36 months means another $30 per month in the hardware cost. You add the consumables and the hardware and you're spending $255 per month. Odds are the printer won't last 5 years either and you'll have to buy another, and that adds another increase to your costs~

I'd like to see you get a color copier/printer that will last for years and years! These systems can be leased for 5 years for $83 (MPC 2030) per month and you can buy a cost per page agreement. The cost per page agreement means that the dealer will charge you .09 cents per page for color and bill you for 1,500 pages each and every month for a total of $135. Included in the $135 is all consumables, all parts, labor, maintenance and service, and basically you could put as much toner on the page as you want. So for $218 you have maintenance, service and parts included!! Not a bad deal.

My point, color printers are sold so you'll keep buying the consumables, it's a never ending cycle. Color copiers by far are the best choice as long as you have the volume. The more you print on a color copier the cheaper it becomes.

If you're in need of an expert to help you in making a total cost of ownership decision, I have Certified Print4Pay Hotel members that can consult and lead you in the right direction.
You posed:

I'm a pretty technically skilled end user and refill my own print cartridges and can change out drums myself. I'm looking at buying two machines (two offices) and purchasing bulk toner to refill the cartridges.

My response:

I'm not being rude, but if your volume is the 1,500 pages per month, you need to concentrate on your core business which is selling and not jerking about with refilling, replacing, and ordering of cartridges, you'll make more in one extra sale per year.

-=Good Selling=-

Commission for Clicks "Selling MFP's"

Has The Time Come for Sales People to be Paid on Click Revenue?

Here's how are P4P members responded:

79% Yes

13% No

8% Not Sure

8 out of 10 reps would like to be paid on click revenue. To me, its the smart alternative to keep clients for years and to really have the time to consult for solutions that will add productivity and lower costs.

Recently, I read a post from an Ikon rep, the person stated that at the beginning of the month they sell solutions such as Print Management, E-Copy, and Document Management. At the end of the month the sell Canon and Ricoh! Funny, now all they will be selling is Ricoh........but don't count the chickens before they hatch. I've heard rumors of a bidding war for Ikon! LOL