A Brave New World (Expo)
I’ve been attending World Expo for more than 10 years, and during that time, I’ve witnessed a lot of changes at the show. Expo is a must-attend event for anyone who does business in or with the North American remanufacturing industry. It really reflects the trends shaping the dynamic digital imaging supplies industry.
The show has been held since the mid-1990s, and in the early days, companies catering to office machines composed the majority. Then, as the SOHO market exploded, more and more inkjet products and toner cartridges for personal laser printers were displayed as exhibitors sought coveted retail shelf space. The SOHO market is cooling, however, and over the past few years, the industry’s focus has flipped back to business users again.
Walking the show floor last month, I was struck by just how much the third-party supplies industry is now focused on supporting the office equipment channel, especially in terms of managed services. In the old days, of course, office equipment could be leased through some sort of volume-based, or “click charge,” contract. But the technology and programs being promoted at the most recent World Expo are very different than what one found walking earlier show floors. Heck, the stuff I saw last month is vastly different than what was available even a couple of years ago.
I’ve always been skeptical about the opportunities MPS provides to remanufacturers, especially those firms that are attempting to sell consumables exclusively using an MPS agreement. Moving from transactional sales to marketing services contracts is risky business, and the infrastructure required to manage print services can be pricey. The evolution of technologies represented at World Expo this year gives me pause. It appears that third-party supplies vendors are learning to work with technology vendors and hardware providers to support MPS initiatives, and conversely, hardware manufacturers and their channel partners are reciprocating.
Because of the third-party supplies industry’s interest in the subject, for the past several years, World Expo has been offering lots of information about MPS, and it has become a summer destination spot of sorts for the managed print services community. It seems that companies that manufacture and market hardware are as interested in third-party supplies as remans are in supporting MPS. I saw a number of IT VARs and copier dealers at The Imaging Channel’s 2011 Managed Print Summit along with senior managers from various hardware vendors (including Muratec, Sharp and Toshiba). Looking around the room, I also spotted representatives from Hewlett-Packard, Kyocera Mita, OKI and Samsung. Xerox was also represented with executives from its newly acquired NewField IT subsidiary.
Not only were there OEMs participating in the MPS forerunner event, but this year, hardware vendors were even working a couple of booths in the World Expo exhibit hall. Promoting its growing activity in the MPS market, OKI hosted a booth at the show this year. In my memory, this is the first time an OEM hosted a booth at the show. Attendees stopping by the MWA Intelligence (MWAi) booth would have seen Samsung-ites demonstrating Samsung’s XOA devices embedded with MWAi’s technology, which supports fleet monitoring and management.
It makes perfect sense for OEM channel partners to cozy up to remanufacturers. Third-party supplies offer much better margins than OEM consumables. Moreover, the remanufacturing industry today is made up of many companies that market products that are at least as good as the OEMs’ products, if not better. So the channel can make more money marketing products with equivalent quality to what they’re selling now. What’s not to love? And, of course, the OEMs want to support their channel partners as they further penetrate the SMB space, so they’re reaching out to the remans. Oh, brave new world!
The convergence of printers and copiers has yielded some interesting results. Increasingly, there are fewer differences between printer-based MFPs and lower-tier digital copiers. Likewise, printer OEMs offer A3 devices, while copier vendors have rushed into the A4 space. There have also been changes in the channels for the various devices. OEMs learned how to appropriately compensate the various constituents in the channel, and MPS contracts are increasingly available from IT VARs and copier dealers alike. Now it appears the impact of MPS is being felt in the remanufacturing industry. And with the support of the OEMs and their channel partners, the third-party supplies industry has a good chance of success in the MPS space.
When OEMs start staffing booths at World Expo, it’s enough to make even a skeptic believe!
Posted by Charlie Brewer on 08/08/2011