Launching a successful managed print services (MPS) program can pose a number of challenges for any office products dealer. But a proven recipe for MPS success, such as the one offered by United Stationers, can work even in America’s most competitive marketplace: New York City.
“A successful MPS program doesn’t just happen,” said Sid Lerman of Weeks Lerman, the Big Apple’s largest independently held dealer. “It’s a technology-driven, service-driven business with lots of moving parts. It requires a well-thought-out business plan, in-depth expertise, the right technology partner and constant focus on customer service. But it’s worth the effort — for our customers and for our business.”
Lerman should know. Since 1997, when his Lerman Company merged with Albert Benalloul’s Weeks Office Products, he and Benalloul have provided total office solutions to businesses of all types and sizes throughout the New York metro area and to a growing number of businesses nationwide. Weeks Lerman projects its 2011 sales at more than $110 million. In addition to its comprehensive selection of office products, the company also offers office furniture, advertising specialty items and office coffee service. Currently, a fast-growing percentage of its business comes from its MPS program, which is supported by United Stationers.
“United has always been an important part of our business,” Lerman said. “The original Weeks and Lerman companies were both United first-call dealers. As our business has grown, our partnership with United has grown as well. They’ve worked with us to solve many of our unique logistics and operational challenges and have also helped us develop our brand and marketing strategies and sales training and lead-generation programs. We believe we’ve helped them, too, working with our customers to play an integral role in the birth of some of United’s initiatives. We consider United to be a great partner, and MPS is one more example of how our companies are working together to help one another.”
Lerman said his interest in MPS was initially piqued when he attended a United seminar in 2006 — a time when MPS was still a novel idea for office-product suppliers. “It quickly became clear to us that three developing factors would drive us toward the MPS business,” he explained. “First, the overall market was beginning to shift toward companies’ desire to acquire their imaging and printing hardware, consumables and service through an outsource model. Beyond that general trend, our own customers were also beginning to express interest in the benefits that MPS promised. Finally, there was our own desire to find new sources of revenue and margin growth.”
Building an MPS business plan — and expertise
“United was the obvious choice as our MPS partner,” Lerman said. “It offered the most comprehensive solution, including software and operations support, plus all the contracts, marketing materials and other essentials we would need to get our MPS program up and running.”
Those essentials included extensive training seminars and workshops covering every aspect of the MPS business. “We realized almost immediately that MPS was a specialized concept and that both selling and managing it required in-depth expertise. We knew we wanted to establish a dedicated MPS division at Weeks Lerman, and we were frustrated in our initial efforts to recruit someone with the knowledge and experience to handle the job,” Lerman said.
So the company decided to develop that expertise internally and named Alan Stromfeld its director of MPS sales. “Alan had experience with printers and copiers,” Lerman said. “More importantly, he brought an aptitude and enthusiasm for learning the MPS business inside and out. He attended numerous seminars and training programs — many through United and HP — and soon became as knowledgeable about MPS as anyone in the business. Coupled with his business and management skills, that knowledge gives us a tremendous advantage selling our MPS program and in delivering results for our customers after the sale has been closed.”
The company’s plan begins with market segmentation to identify target customers with the highest potential for success and profitability. “We look for businesses that have what we call ‘operational needs’ — companies that want to improve operations by moving to a more efficient imaging and printing infrastructure.”
Weeks Lerman has also developed and fine-tuned a comprehensive MPS business plan that enables it to maximize its sales resources, increase selling efficiency and generate maximum return on investment for its marketing and sales expenditures.
The company’s plan begins with market segmentation to identify target customers with the highest potential for success and profitability. “We look for businesses that have what we call ‘operational needs’ — companies that want to improve operations by moving to a more efficient imaging and printing infrastructure, improving user productivity, and reducing the overall costs of imaging,” Lerman explained. “MPS can deliver against those objectives. We also look at the size of potential customers. We’ve learned that our ‘sweet spot,’ the place where we’re best able to deliver value, is with medium-size businesses and corporations that have 50 to 100 printers or copiers.
“Finally, we’ve learned to focus on organizations that are typically seen as technology leaders, early adopters and efficiency leaders because they seem to be more apt to adopt new solutions like MPS, which is just beginning to gain widespread traction in many sectors.” These “leader” organizations, Lerman said, include healthcare services, pharmaceutical manufacturers, hospitality companies and financial services businesses.
Marketing, sales and follow-through
Weeks Lerman has developed a wide variety of marketing tools across print, video, online and other media to market its MPS program to a wide variety of audiences. “It can be a challenge to identify the right person, or even the right department, in a particular company and then deliver the right marketing message to that person,” Lerman said. “If the decision is made in the purchasing department, the sales message has to be different from the message we might take to the finance or IT department. So we tailor our approaches and our materials to address the pain points of specific customers and prospects.
“We also depend on our day-to-day sales force to help us identify and reach the right people. Our salespeople have deep, long-standing relationships with customers, and they use those relationship insights to identify customer needs and the right way to address those needs. A purchasing manager, for example, might mention to our salesperson that his or her IT counterpart is struggling to maintain the company’s fleet of printers. That comment can lead to a meeting about MPS with the IT manager, but it’s all based on the initial relationship.”
Once an MPS prospect has been identified, the lead is turned over to Stromfeld and his team for review with Chief Operating Officer Cindy Ciaccio and Vice President of Sales John Merlo. In most cases, the team can develop a general picture of the prospect’s imaging needs (e.g., printing volume and toner/ink/paper types) and draw up a simple preliminary proposal that outlines business advantages. The goal is to use this document as the basis for an initial meeting that can lead to a comprehensive assessment of the prospect’s needs and, subsequently, a fully detailed proposal for an MPS program.
Program implementation, including software development by United, hardware/software installation, customer training (usually in the form of a webinar) and system testing, generally takes four to six weeks. Weeks Lerman then provides ongoing monitoring of the customer’s imaging, automatic replenishment of consumables, quick-response service or equipment replacement when necessary and quarterly reviews that reinforce the value of the MPS program to the customer — all with the help of United’s software and logistics services.
Defense and offense; expertise and patience
What advice does Lerman have for dealers considering the move to MPS?
“I’d start by saying it’s essential to the long-term success of your business,” he answered. “We look at MPS from both defensive and offensive perspectives. Defensively, we can’t afford to lose business to someone else who might sell MPS to one of our customers. As more customers learn to appreciate the value of MPS, we have to be able to offer it — and market it aggressively — or someone else will. Offensively, MPS presents a wonderful opportunity to capture new, high-margin business or to shift existing business to a more profitable level.
“Second, the right expertise is essential. United gives us an industry partner with the experience, resources and dedication to service we absolutely need. But it has also been essential for us to develop our own in-house expertise. Customers want to believe that we know what we’re talking about, and Alan Stromfeld and his staff give us that credibility.
“Finally, a successful MPS program takes planning and patience. Our business plan details not only market segments, but also sales and profit objectives and a roadmap that is helping us reach those objectives. But it takes time — time to get your skills and systems in place and time to turn your hard work into sales and profits. For us, a typical MPS sale can take three to 12 months to complete. That can seem like an eternity for someone used to the quick pace of the office products business.”
For Weeks Lerman, it continues to be time well spent.