Imaging Channel, Some Questions, Some Thoughts, and Some Answers

 

Why doesn’t the Imaging Channel’s Owners and Leaders pay sales reps 250k salaries with no accountability or quotas?

Why do dealerships have millions in obsolete parts, spend millions on repairs and supplies, have a First Call Efficiencies’ or an FCE rate of less than 72% spend thousands doing Callbacks, spend thousands more on technical staff with very little Owner, or Senior Level executive oversite? Hum, read along and let me know your thoughts.

Let’s talk about the sales rep who wants a 250k salary and insists they have NO Quota. Ok, that would be a short conversation, the sales rep asked, and then you showed them the door and maybe said good luck.

So now let’s talk about the Hundreds of Thousands of Dollars in parts you have written off in the past and at the end of this year will more than likely write off more. Maybe you already know how many Dollars it will be this year? A different conversation the reason is simple. The first conversation you had control over you knew paying 250k to a sales rep with no accountability would be insane and prevented it from ever happening, in all reality by your actions and knowledge you prevented that conversation from ever happening.

The question regarding part write-offs and the components of your service depts. The answer is not so easy. You gave control away, and those you gave control to either weren’t properly trained or lacked near the concern as you about throwing a big chunk of your EBITA in the trash. Many are spending large amounts of unnecessary operating dollars to perform average or below.

All owners love EBITA, so whatever that number is now it will be minus the dollar amount of the parts that will be written of at years end and thrown in the trash. Or maybe the boxes they came in are marked with the letters N/I (Non-Inventory) and then stacked in the section of the warehouse I call the “EBITA Thief Section.” I would say if you're writing off 1-2 percent of service revenue, not total revenue in parts and supplies annually it is a cost of doing business. However, if your writing of more it might be called not paying attention to business, and most would admit that’s a costly mistake, most leaders avoid at all cost.

 “In business, only the profits from good intentions can control the runaway cost of emotions.”

The leaders in the Imaging Channel, for the most part, have an absolute understanding of all the components of the sales engine. Sales leaders continue to get creative in changing and doing the necessary things to ensure that quotas and sales expectations are achieved, and we all know the result of missing expectations. Dealers rank their sales teams, monitor their sales teams activity, provide their sales reps with protective territories, and sales reps most always have one on ones with their managers.

Dealer owners love to cheer on their sales teams; many dealerships have sales boards where they write with green markers how much they sold and how much they made. Dealer owners always know whats going on in the sales department they get the results every month and understand how to manage the areas which need improvement.

Accountability in sales is an absolute. Owners can walk down the hall and gasp as they stare at a blank sales board they quickly scream for reports. The Sales leader is quickly summoned to the office at the end of the hallway. Once inside they would get the message from the questions spoken loudly and passionately “Where’s the sales, was the 30-day hotlist just made up? Or is it a 90-day hotlist? Why are the sales reps not closing? Why don’t we call their forecast a hopecast? Why are Sales Reps not utilizing the CRM Software the company paid thousands of dollars for?” Those reading this who lead or led sales teams will know what the last question asked was as you were dismissed it went something like this. “Can you get this team on track, and get results I can take to the bank or do I need to look for someone else who can? A dealerships sales numbers or lack of them stares everyone in the face constantly. Am I right?

Yes, Sales is managed, monitored, and continuously driven to get results, there are no secrets in sales, every month is a new beginning and the previous month’s dysfunctions always show up in the math.  

What about service? Why should sales have all the accountability fun? The Imaging Channel is a 50/50 split on the revenue of their deliverable half from sales of hardware and the other half from service annuity which by the way contributes nearly all the company’s profits this is an undisputed fact. The EBITA is in the service, and the revenue dollars from hardware will never transition to EBITA. The Imaging Channel is not a retail platform it is a Service Annuity Platform. The healthier the service platform, the healthier the EBITA.

Too many dealer organizations still do not take the same measures in managing service departments and their service personnel as they do in managing sales departments and sales personnel and there are enormous potential increases to a dealers EBITA inside their service departments. This potential EBITA increase will only come from leadership taking charge of driving the best practices. It’s time for dealer owners to inject themselves and their business acumen into the other 50% of their business their Service Departments this is more important than ever in the Imaging Channels history. Here’s why and a solution to help.  

“Current Circumstances can postpone the good intentions of change if you fall victim to the delusion of how good things currently appear to be.”

What if there was software that could hold fair accountability to the service department like our sales department? There is it’s called BEI Services the information and metrics gathered by BEI Services for decades on millions of printers and thousands of technicians are unmatched in the Imaging Channel Worldwide. What if there was a tool that managed our parts and inventories eliminating uncontrolled write-offs? There is it’s called BEI Services. If your parts warehouses are loaded with obsolete parts, ask BEI Services about their Overstock Parts Network or OPN Network. BEI Services is the world’s largest Service Partner Platform we can help dealers reduce inventory write off losses by buying their obsolete or overstocked parts and at the same time helping other partners lower their cost on inventory purchases. What if there was a software that defined technician’s territories based on skills and real-life service metrics territory mapping which can be set up in minutes not months? There is, and BEI Services invented it. What if there was a detailed report that owners could look at and identify potential problems which would impact their customer's experience and their bottom line? Again, there is and it’s located in the executive summary section of the BEI Services software.

Imaging Channel Dealer Owners it’s 2017 you know how to run your sales department now it’s time to understand with the expertise only BEI Services data can explain so if you’re ready to hold service accountable in the way’s you have always held sales accountable call BEI Services. As things change and change evermore quickly the time for having total control over your future is now.

“When an industry is experiencing declines, it becomes an absolute necessity to extract as much cash from current circumstances while possible and reallocate it to diversity and transition.”

A warning

Those dealers who are considering Managed IT Services as an additional deliverable I would say this. Managed IT Services is not in any way a sales silo and service silo business model. No successful IT Services company would ever sell anything which they were not clear on the absolute profitability of not only the hardware they understand the cost and the margin required to manage and maintain the integrity of the SLA their customer buys. IT Services is an all-encompassing deliverable. Managed IT Services is delivering Services which may include hardware. IT Service Providers must understand total cost from birth to death of all customer engagements. The Imaging Channel was built on selling products then servicing those products this is the opposite of the IT Service Deliverable; the Imaging Channel must adopt a Service first strategy to transition to Managed IT Services. Understanding the whole story is the path toward respectable improvement to not only your Customers Experience your EBITA as well.

Without the tools of Data, and leadership to oversee their use businesses are crippled by a disease, I call EBITA-Erosis.

Let BEI Services help you keep your business and EBITA healthy.

R.J. Stasieczko

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Comments (6)

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Jf posted:

When an industry is experiencing declines, it becomes an absolute necessity to extract as much cash from current circumstances while possible and reallocate it to diversity and transition.

I have absolutely nothing better to say.

Btw, Ray, it's the 2nd time I'm the first to comment...

Thanks JF

Art Post posted:

Ray, nice,  helps me understand the service pitfalls a little better. Also, I'm no fan managed IT.

Thanks Art, Managed Services is a deliverable description which means many things to many people. The facts are that Services are what built the Imaging Channel. Our future will only remain relevant if we look for additional service reoccurring revenue. Managed Services taught me the importance of truly understanding the profitability of any deliverable from the day one sells it to the day the engagement ends. Successful IT Service providers understand the importance of continually managing and monitoring contract profitability the high cost of delivery demands it.

The Imaging Channel has a window of opportunity to capitilize as much as possible on their print deliverable, and diversify. Many have allowed the status quo of the way it was to Wreak Havoc on their ability to maximizing profits. It's time for a mindset of Continuous Improvement because Continuous innovation and the declining value of print demand we do. There are only two strategies today A Growth with diversification, or An Exit with the maximum on the multiplier. Both these strategies require disciplinary leadership. Those hoping for a continuation of yesterdays current circumstances will simply be left behind.       

When an industry is experiencing declines, it becomes an absolute necessity to extract as much cash from current circumstances while possible and reallocate it to diversity and transition.

I have absolutely nothing better to say.

Btw, Ray, it's the 2nd time I'm the first to comment...

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