ITEX 2016: Day Two and Three
Andrew Palmer, from Florida – 10 March 2016
ITEX Day Two:
You can definitely see the waves of change coming. There were over 17 different sessions on Day Two, with a very weighted focus on solution selling, managed network services, and growth strategies.
Everyone is noticing the squeeze and the need for diversification is key.
There were also some great sessions on how to remunerate traditional copier sales people under a Managed Services model as they are introducing a SME (Subject Matter Expert) into their relationships. Making sure sales teams are financially compensated is important as it will obviously also drive behaviour.
Some very interesting figures also came out today:
- Average revenue growth of a dealer in the US in 2015 was up 5.1%
- Average margin in the US on copier sales was 12.4% (and we whinge about margins here in Australia….)
- 87% of revenue from the best performing US dealers come from recurring revenue
- Average margin of a Managed IT deal is 17%, however if that same deal is done on a Finance contract that margin jumps to 30%
- The largest US funder does finance for over 1300 dealers. Of those, only 50 have successfully transitioned to Managed Services. This is a conversion rate of under 4%.
There was a lot more information and great insight today that I will expand on when I return to Sydney, however I will finish again with a quote from one of the speakers today:
The further your relationship with a client deepens, so does the client’s expectation for future savings.
The question is: How are you going to do this while still maintaining margins on you traditional copier business?
Day Three sessions were more focused on broad business subjects rather than print specific subjects.
We had a wonderful session on dealing with the upcoming generation of “Millennials”. They get a bit of a bad rap but the fact is that by 2025 they will form 75% of the workforce so the time is now to not only start employing this generation but learning how best to harness their talents as they have many of them. What needs to be kept in mind is that in the near future the decision makers will be these same Millennials and they will want deal with someone they relate to … other Millennials.
There is a normal focus on trying to engage with as many new customers as possible and we have a system and a plan on doing this. However often a strategy for engaging with current clients mid-contract is not a priority.
Customer engagement also needs a long term view – as the sales cycle is getting longer as we are adding more solutions, a long-term view need to be taken with your customer engagement.
We all know technology is making research easier however I heard something today that surprised me: 57% of the customer’s education process has occurred before engaging with the vendor. This demonstrates the importance of playing a role in your customer’s education. This also assists with building relationships as I outlined in my previous post.
It has been a great year over here at ITEX again where I have learnt a great deal on future developments in the industry and I look forward to sharing these with you in more detail in the coming weeks.
If you have any questions on any of the information I have written about please feel free to give me a call and I can pass on any more information I have.
General Manager, S.E. Rentals
S.E. Rentals are the finance as a service specialists that will help you grow your business by providing finance solutions in an 'all things technology' future. We provide you with the flexibility, scalability and agility to help you achieve your Managed Service objectives, and our unique in-house software platform automates the process for you with a One Bill Solution - your bill - your document - your branding.