If you are an MPS provider, you may have realized the “single brand from a single vendor” solution is falling out of favor with end customers. So, what has changed and is MPS a sustainable offering?
As of 2018, we are 20-years into the bell curve for MPS. For many years, prospects were first time buyers who viewed their environments as messy. Printers and copiers were everywhere from different manufacturers and vendors. Control was distributed among departments, Facilities, and IT. Acquisitions methods were just as diverse and included purchases, leases, contracts from local dealers and national supplies resellers.
Print was a big mystery to customers. They had no idea how many devices they had, how many pages they were producing or how much they were spending. They needed a clear picture of what they had and potential solutions. Then they struggled with satisfying all stakeholders and gaining consensus on a final solution. Projects were time consuming, political and even risky for the project lead.
You played a valuable role as an MPS vendor. In the customer’s eyes, you were the expert who taught them something new and showed them a path forward. You offered expertise and people to find out what they have today and were able to develop a complex solution. The journey took many months from concept to assessment to proposal. You earned the role of trusted advisor so it was only natural that the customer would see a “single brand from a single vendor” as the best available solution.
Pricing changed. You wrapped up the solution into bundled pricing that simplified costs for the end customer and enabled you to shield pricing for hardware, maintenance and supplies. After all, there were managed services wrapped around all products so the customer agreed with the bundled pricing format. Bundled pricing enabled you to work with margins behind the curtain.
Come decision time, the customer realized that Implementation would affect every user and the potential cost savings put it near the top for cost-savings initiatives. These two factors elevated the project to the most senior management levels for approval and executive sponsorship. The sales cycle got longer but the project became more important to more people. The final result was often a case study of successful transformation from a messy environment to a lean, managed print environment.
So, what changed in recent years? The MPS market had certainly matured. Customers had lived through the transformation from unmanaged to managed. With the end of their first MPS contract came a new perspective and different buyer attitude. The customer was no longer sick and in dire need of expertise. Their fleet was no longer messy. Devices had been consolidated and processes streamlined. Customers had clear visibility to what they devices they had, how many pages they produced, and the total cost of ownership. The mystery was solved.
Your role changed. In many cases, the customer was more experienced in real-world MPS than your sales team. Sales people struggled to teach customers something new, something of significant potential value. Talk of potential cost savings by switching vendors was no longer compelling – the big savings had already been taken. The MPS story from one vendor sounded the same as the other vendor – in fact, the story sounded exactly the same as the one told years earlier by their current MPS vendor.
Now the end customer was asking about your ability to support their existing fleet, to do repairs and provide consumables. The potential for placing your new hardware was not clear. These new MPS opportunities felt like they belonged more to the vendor service and inside sales teams than to the account sales department. The customer was now clearly in control and driving the sales process.
In the past few years, many dealers have exited the MPS market and refocused on their traditional selling motions. They found MPS operations different and costly. Sales reps were harder to train and it took longer to get them hitting quota numbers. So, like a rubber band, dealers re-focused on their core competency. So, what does the future look like for those dealers wishing to stay relevant in the MPS market?
It is time to look inward to tackle five key obstacles to growth and profitability in MPS:
- Redefine your value and how you will educate the customer
- Define a strategy for pricing and supporting both OEM and compatible supplies
- Justify managed services independent of products
- Learn how to participate in an open sourcing model
- Decide if a fragmented customer environment and sourcing model is good business
The days of single brand and single vendor are gone. Sourcing methods have changed dramatically for everything – including print – and the pace of change is accelerating. Vendors must rethink the value provided and how to educate the customer. MPS vendors will still spend months doing assessments and proposals only to be faced with the purchasing process that would unbundle pricing and force transparency to price by product category. The decision then is can you re-invent your practice to enable you to participate in this new arena and win – profitably.
About the Author
Ben Harris is the Founder of Harris Technologies, Inc. Ben Harris enjoyed a 15 year career in corporate sales, selling and implementing large contracts to Fortune 500 companies around the country. In 2006, he decided to begin a new journey, leaving the big office and tie to start up his own firm. After years of perseverance and dedication, Harris Technologies has become a recognized leader in their space.
