Talking about what life looks like in a post-pandemic world is so common now, that I think we’re all a little tired of hearing about it. It’s a tired cliché at this point. However, this transitional period hasn’t passed yet, so try as we might to avoid it, it’s important to grit our teeth, do some planning, and consider how changes will affect the office equipment and technology channel.
As we get more information and patterns and trends get analyzed, it seems that changes are inevitable but still unpredictable. Definitively saying that the office technology industry is going one way or another is about as sure as placing a bet on your favorite NCAA bowl game.
Some employees’ return to working in the office rather than working remotely will re-invigorate the need for print to an extent, but also the changes we are seeing in the print environment (a change from A3 to A4 devices and more need for network services) are going to persist and grow.
What we can say for sure (of any transitional phase) is that flexibility will be the key to successful business practices in 2022, even beyond. The evolution of technology is the one constant and businesses must change with the times to remain viable.
Jay McBain, principal analyst at Forrester, states that over 76% of global CEOs think the current business models won’t exist in five years! (Reference #4) Successful new business models will be ones that leverage the power of the internet and “real-time” commerce to harness a connected marketplace.
The pandemic catalyzed issues that were already becoming apparent in the office equipment industry. E-commerce and desktop printing had already been working to reduce the need for the local copy guy and his A3 fleet. What’s more, the need for print and copy had been declining due to the rise of digital documentation already.
When the lockdown began in early 2020, these challenges were only exacerbated by declining clicks due to the decentralization of the workforce and subsequent supply chain issues, including paper and the microchip shortage. Dealers that were focused solely on copy and print services, or CPC service pricing, were strained and in some cases, struggled to survive.
The question isn’t if or when, but how.
Growth Comes from Adversity
We want to emphasize that this issue is not all doom and gloom – it is simply an evolution of the industry. No doubt this can be frightening, change is always scary, but our greatest moments of growth come from our most challenging times.
Although these challenges were beyond the business’ control, they represent a powerful change force. Very little in the industry is the same as pre-pandemic. The most forward-thinking industry leaders consider this an exciting time of creative change. What will the industry look like going forward?
The first thing to consider is any company’s most important asset – its employees. People come first, so protecting office workers means that manufacturing slowed down because of Covid protocols as well as supply chain issues. The pandemic forced businesses to become “leaner”, but they proved they could be productive and profitable if the Covid retrofit was handled well. Thinking outside the traditional box even has the potential to expand profitability into new directions.
What’s Next for Print? The Demographic Shift
The current workforce is comprised of those referred to as digital immigrants versus digital natives. Baby boomer office workers are used to and more likely to rely on printers while millennials are more comfortable with remote work and a digital document workflow that doesn’t use prints or copies as much.
According to Jay McBain (reference #4), 75% of the workforce will be millennials by 2024, and Gen-Xers and baby boomers will be the minority in the workforce. Businesses will need to continue to assess the role of office space in their organization. “By the end of 2021, around 25% of small and medium organizations will change their real estate footprint by downsizing or dispensing with office space in line with hybrid workplace strategies.” (Reference #6)
What Should Office Equipment Companies Do?
MPFs are clearly required less when everyone works from home. Click volumes on A3 machines dropped dramatically during the pandemic. How should companies respond and adapt to this trend?
First, preparedness is important. Management should have “what if” protocols in place to address unforeseen circumstances. It is also prudent to maintain a “leaner and meaner” approach. An example of this is to reduce capital expenditures for your dealer customers by adopting a “just in time” drop-ship model for the shipment of office equipment supplies (things like toner).
One trend that is already clear is the move from A3 printers to multifunction inkjet A4 devices for at-home and small office printing. However, according to IDC, investment in both A3 and A4 devices is expected to remain flat through 2022, and slowly decline from 2023 through 2025. (Reference #6) With this in mind, office equipment dealers could utilize used machinery and movements instead of selling new machines. Keypoint Intelligence states that “shortages might be the kick in the pants our industry needs to double down on finally automating workflows.” Reference #5
SalesChain’s Inventory Lookup feature is a powerful new tool to help users handle machine availability in real-time and therefore streamline workflow.
What should office equipment dealerships do? All signs point in one direction: diversify.
SalesChain Case Study
Pricing Proposals and Paying Commissions Faster with John Kerling of United Business Systems
How to Grow and Diversify Your Dealership
Businesses should not be afraid to seize parallel opportunities. Adding product lines and services to entice customers is a way to supplement declining profits from machine and print sales.
Managed Print & Document Management Services
Many dealerships are making a natural progression into the managed print services (MPS) space. This allows an easy transitional business that can help make up for lost click volume revenue in the interim, and if done well, can help generate capital for more dramatic business moves.
Another natural progression that we have seen many of SalesChain’s most successful dealer-customers employ is the opening of document management and scanning services businesses. The major advantage of this move is that it allows dealers to capture the customer’s trust in the customer’s digital transition move. If a dealer can become an integral part of a customer’s digital transformation, they can capture their forward-moving business
IT Products and Services
Worldwide IT spending is growing, suggesting an area of growth for traditional print companies to expand into. Once a dealer becomes part of their customer’s digital experience, they can begin to move IT products and services to their base. Now their customer base knows the dealer as the office technology partner for not only print and scanning devices and service but also for IT Products and services. This is the natural evolution for dealers looking to continue being valuable technology partners to their customer base.
Think Outside the Box
There are other avenues for growth that live outside of the obvious path of office technology expansion. Modular office furniture, water, gym equipment, vinyl flooring, and cleaning products are all commodities that may be sought by clients retrofitting offices in the face of hybrid working conditions. Customer loyalty means they are more likely to buy these related products from a company they already do business with.
Key Into Millennial Clientele
Keying into a millennial clientele that prefers internet marketplace buying is also essential. It is not just the workforce that is changing, it is also the consumers who buy machines and print services. Cloud-based tools and services will become more and more in demand as employers offer full or part-time work-from-home options.
Companies poised to expand into these product lines will be at the forefront of future opportunities, as the office equipment channel continues to evolve. In the future, industry best practices will be defined by the ability to provide technical services to an increasing internet-based commercial sphere.
Written By: Matthew Szczygiel and Mary Ellen Hogan