Channels to MPS

Posted on May 7 2017 - 8:30am by Editorial Content

Quocirca has published a competitive overview of some of the key channel MPS offerings in the European market. The report also includes highlights from a Quocirca study, conducted in April 2016, investigating attitudes to solutions and services amongst 300 resellers in the UK, France and Germany. Louella Fernandes, Associate Director for Print Services and Solutions at Quocirca, shares her thoughts

Louella Fernandes, Associate Director, Print Services and Solutions, Quocirca

Louella Fernandes, Associate Director, Print Services and Solutions, Quocirca

The print channel faces challenging times. Hardware commoditisation and shrinking margins are creating the need to create new revenue opportunities around services and software.

The top concern for the channel today is competition from other resellers, noted by 56 per cent of reseller survey respondents. This was strongest in the UK, where 65 per cent reported it as a top concern. Resellers are also challenged with decreasing marketing development funds (MDF), reduced leads from vendors and a lack of marketing resources, particularly in the UK and France.

Redefining the role of the channel

The dynamic change in the way customers wish to purchase, consume and pay for their IT products and solutions is redefining the role of the channel. The momentum of cloud computing, evolution of customer choice and continued margin erosion, means that channel partners need to build a new business model that is both sustainable and flexible for the longer term.

With commoditisation driving a decline in hardware profit margins, the print channel needs to look beyond transactional sales towards building a services model that enables recurring revenue, new incremental revenue streams and longer term customer relationships.

Channel-packaged MPS offerings aimed at smaller and mid-market businesses vary in depth and scale. An entry-level MPS for example, offers a way for smaller organisations to purchase printers combined with supplies, maintenance and support, through an all-inclusive contract. Customers can choose to purchase devices outright or lease them.

With some contracts, users only pay for what they print. However, there may still be a commitment to a service contract for a minimum period. Depending on their capabilities, resellers may offer additional services as part of an MPS, such as assessments, device consolidation consultancy or document workflow solutions. Some also offer flexible packages that enable businesses to scale up their usage as they grow.

Untapped opportunity

The channel plays a critical role in how print manufacturers address the largely untapped SMB opportunity. However, resellers face many challenges in making the transition to MPS. For many, the service delivery, billing and internal processing involved with MPS, requires a step into the unknown.

Resellers that want to offer MPS may find themselves with a need to build new platforms and design new services, alongside managing billing processes and service delivery to support their customers’ demands. Dealers must ensure they can execute successfully in bringing new MPS offerings to market. They need to understand exactly what their customers want and position their offering to address this.

Without previous experience in MPS, this can present a high risk. In many cases, these challenges can be too high an obstacle to overcome, particularly for smaller resellers that do not have the time, resources or funds to invest in an entirely new business model.

Making MPS accessible

More print manufacturers are simplifying and expanding their channel propositions to make MPS accessible, regardless of the MPS maturity of the channel partner.

Today, many print manufacturers are leveraging existing enterprise MPS infrastructure to develop flexible channelled MPS offerings. Because of the disparate nature of the printer and copier reseller channel, manufacturers recognise the need to develop a broad range of modular services with options to suit the expertise and maturity of each of their channel partners.

The report provides a comprehensive overview of the MPS programmes from major vendors including HP, Lexmark, Samsung and Xerox. These vendors are developing a broad range of support; including centralised portals, technical resources and support, as well as marketing and financial aid, generally accessible via cloud-based platforms. This helps resellers maximise their chances of succeeding.

Xerox has an established lead here with decades of experience in delivering MPS through its channel partners. It has a broad continuum of offerings from a single device to full MPS and perhaps one of the most advanced channel partner communities in the industry.

HP is catching up, having spent the past few years refining and simplifying its channel-led MPS programmes. From simple ‘print-as-a-service’ to broader MPS offerings, HP has removed the complexity of its previous patchwork model for MPS. Its acquisition of Samsung’s printer business and its push into the A3/copier market relies on effective engagement of the channel. As such, the coming year will be critical for HP in recruiting not only the right type of partners for its A3 business, but also in driving momentum in its traditional channel base.

A full report is available to purchase separately directly from Quocirca.

www.quocirca.com