Spicers targeting £10m revenue with MPS

Posted on Jan 13 2017 - 8:05am by Editorial Content
RATING

MPS is no longer the exclusive domain of the print channel, wholesaler Spicers is the latest to report successes within its recently launched Xerox partnered MPS service

MPS brochure

MPS brochure

As MPS has continued to gain traction over the years with more and more businesses wanting to access the cost and efficiency gains a fully managed print service delivers, the number of providers and the scale of vendors’ offers has continued to rise.

One of the biggest negative impacts on traditional OP resellers of the rise and rise of MPS deployments has been on printer and particularly EOS sales.

This trend has seen a number of wholesalers, dealer buying groups and indeed independent resellers take a leap of faith and introduce MPS as part of their offer, moves that acknowledge the reality that dealers that don’t take action could find themselves losing clients to competitors that can offer a more complete solution.

Channel MPS

At the end of last year, Integra, the UK’s largest dealer buying group teamed up with ISN Partners to develop a tailor-made printer control and management solution designed for office supplies organisations, IT services providers and small dealers. The service, which provides a simple entrypoint to MPS and which is open to all members, is delivered in collaboration with Centrex Services.

At Green Light in January, VOW reported that it has been right-sizing and operationalising its MPS category for the channel to support sustainable growth. The wholesaler is building a robust operational and commercial platform to offer MPS through its direct and wholesale channels and also increased the size of its business development team to further maximise the opportunity for conversion.

VOW’s MPS methodology is designed to provide resellers with a seamless and professional approach to cross- and up-selling and by bridging the experience gap, help them to win MPS opportunities. Essentially the wholesale model should provide dealers with an uncomplicated way to move into the MPS market, increase revenue streams, fend off transactional competition and achieve longer term security.

As part of its strategy to transform how its customers manage non-core expenditure, independent reseller Anglo Office established a comprehensive supply chain which saw it strategically partner with a number of specialists in each category.

MPS is one of those areas. The company launched AngloTech, a joint venture with TechnoCopy, a Canon, Ricoh and Olivetti reseller to deliver MPS. Managing Director Gary Naphtali said that when delivering true MPS, it’s important to have have credibility and strong relationships with OEMS as well as the ability to deliver a service agreement. In an earlier interview with PITR he said: “You could potentially spend more money getting it off the ground than you would make a return, it would certainly take a lot longer. TechnoCopy has a ready-made prospect and client base and team of sales people they would have had to fund themselves, so it’s a win-win.”

For Anglo Office, MPS deals secured in the first six months generated a quarter of a million pounds in sales. Importantly, the dealer owns the service contracts, providing a recurrent revenue stream which delivers a healthier net profit than it could achieve by simply selling the individual components.

Guy Church, MPS Operations Director, Spicers

Guy Church, MPS Operations Director, Spicers

Spicers MPS

Recognising both the challenges that its dealers face in delivering an MPS solution and the value that lies in the ability to offer their customers a one-stop service that bundles traditional transactional products such as toners, with service, spare parts and consultancy services in one single contract; just over three years ago, Spicers launched Sprintwise MPS.

The wholesaler appointed MPS provider Balreed (now Apogee) as its partner to deliver MPS services to end-users on behalf of Spicers’ resellers. Under the terms of the agreement, the reseller received an introductory fee and margin share and once the system was set up, Balreed (Apogee) managed the contract.

According to Spicers MPS Operations Director Guy Church, one of the reasons that prompted them to launch an alternative MPS offer for Brilliant Partners was the fact that its resellers weren’t benefiting from an ongoing revenue stream with this offer.

“The legacy programme is still in place and it’s an arrangement that suits some of our partners,” he explained. “However what we wanted to do was provide an alternative that would enable our resellers to retain the customer relationship and see a recognised revenue. Whilst they do receive a percentage kickback under the Sprintwise offer, it’s not the same as achieving the total income as if they were selling a product or service direct.”

About 18 months ago the wholesaler conducted an independent review of the market and looked at a number of options to determine the best route for forming a partnership with a Tier 1 manufacturer. This led to them entering into a relationship with Xerox to offer managed print services, a move that was announced in January this year.

Xerox Partner Print Services

Xerox Partner Print Services (XPPS) is central to Xerox’s channel MPS initiative, it offers a range of standardised components to support a multi-vendor environment such as assessment and optimisation, device discovery and monitoring, sales contract management, business intelligence reporting, service management and delivery and a customer service portal.

“With Xerox as a partner, we were able to launch a comprehensive offer from the full product range through to access to a dedicated call centre, helpdesk and over 670 engineers based nationwide,” Church said.

Spicers has a team of dedicated MPS sales executives whose job it is to help its Brilliant Partners to maximise the potential of the MPS market. Dealers know that they have to do more to add value but for nonprint specialists, MPS is still a novel idea and selling managed print services can pose a number of challenges.

“Partners can come to us and tap into our knowledge, support and intellect. We will work together, conduct a joint customer visit and put together a proposal,” he added. The MPS sales cycle is longer and more in-depth than a transactional sale – it’s typically a four-stage process: assess, design, implement and manage that is much more consultative-led than channel vendors are used to.

Spicers MPS specialists will support across all four stages, Xerox has the tools to automate print management, including troubleshooting and repair, supplies tracking and ordering and usage monitoring. It also manages the service and helpdesk functions on behalf of resellers, meaning that partners don’t have to invest or upskill.

“What is important,” Church said. “Is that the contract is between reseller and client which means that the reseller recognises the associated ongoing contracted service revenues, that are secured and can be forecasted in the years to follow, for the life of the contract.”

Early success

Spicers launched the new service to its Brilliant Partners in April. “Of the 165 partners we have, around 25 per cent came back to us to say they wanted to opt in – that’s a pretty good take-up,” Church commented.

The wholesaler has already seen significant success. “To date we’ve closed received revenues of £200k,” Church said, adding that that there is also a strong pipeline of opportunities. “The daily growing pipeline of opportunities is currently around £2 million, which is exactly as we envisaged the demand to be for such services in a shrinking EOS market place,” he added.

Church attributes the early success to the fact that its resellers are pitching the service to ‘warm’ contacts. “It’s not a cold call sales approach. It’s not really new business as the resellers already have the customer relationships and that’s where the value is and why we see this as being a very successful venture.”

Spicers is targeting revenues of £10 million within the next two to three years. Church said: “We very much see this as a powerful tool to support client retention. What’s great about it is that our resellers will potentially be able to offer an even better level of service that a traditional MPS specialist can, they typically have contact with their customers on a weekly basis, the touch points are far more frequent within the OP industry where the majority of sales are transactional.”

To support the service, Spicers has just launched a reseller’s guide to Managed Print, which outlines the importance an MPS solution could play in building a business revenues. The guide also demonstrates how the Spicers MPS service is a true end-to-end solution, backed by a full suite of support materials and guided by a team of dedicated sales professionals.

The wholesaler will also be promoting the programme to Brilliant Partners at a series of event scheduled to take place in November where it will also showcase a number of other initiatives due for launch later in the year. The three regional Brilliant Partner events will take place at its sites in the North, Midlands and South of England.

www.integra-business.co.uk
www.voweurope.com
www.anglo-ltd.com
www.spicers.co.uk

Information at your fingertips

Spicers has also implemented upgrades to all of its online portals and websites to improve the customer experience.
The new www.spicers.co.uk site better portrays the wholesaler and all of the solutions on offer, helping its established customer base to look at new ways to drive their business forward. Marketing Director Rebecca Stallard said: “We’ve seen a 50% increase in hits to the site since launch so it’s created some extra interest.”

Additional investment has also been spent developing extra functionality in the business’ online order portal SpicerVision and product information website www.officerange. com. Launching under a new refreshed design, the site will incorporate better product navigation through improved attribute filtering and has been developed to be more responsive for users viewing on tablets or smartphones.

Having embarked on a journey of an extended range of supplies for broader business needs through its Limitless range, Spicers has also developed the site to enable search within this niche range of products, making it the ideal Special service for customers who demand more today than just regular office and workplace supplies.