The Service Department: Charting the Current Challenges and Preparing for the Future

I want you to think back in time, let’s say 35 years or so. You’re working for a typewriter company. The future looks rosy — typewriters are everywhere, and every company has a number of them, so the demand for your service is steady. The future seems bright.

An announcement is made by a company that makes printers — they’re introducing a new product: the HP LaserJet. Your reaction might be “so what?” Just another fad and people will always need a good typewriter.

You could have moved your business in that direction, or maybe you had the opportunity to go into the copier business and thought again “who cares?” Just another fad, they’re too hard to service and people will always need their typewriters.

Then one day you look around, and the typewriter business is dead, nobody needs one, and nobody wants to buy one. The service business is non-existent.

The Current Environment

The current dealership model for copier dealers is facing a similar fate. The external forces in the business environment means dealers are facing dangers as real as the laser printer was to the typewriter, and just as hidden.

Let’s talk about the changes in the market, as well as things you should consider while you still have a business.

Consolidation

One very real danger is that smaller dealers, as well as the markets they service, are being snapped up by larger dealers such as:

• Marco
• Visual Edge
• POA
• Novatech

Collectively these dealers are acquiring small dealers every week. Marco is on pace to become a $500M dealer soon. The others are moving that direction as well.

Staples/DEX

This merger may be the most significant risk to small and mid-sized dealers. You might be in a smaller market and feel that you’re safe from the outside because of your market.

If you have a Staples in town, you have DEX in town — and they will be working to steal your client base. It will take them a while to get things sorted out, but they will eventually disrupt your market.

What Happens

When any of the major players show up in your town, they will be offering a wide portfolio of products and services. They are all well run and very efficient at the important aspects of the business. Because of the economy of scale, they will change the pricing in your market as well as the customer expectations.

Continue reading in our free Member's area or in ENX Magazine   https://www.enxmag.com/twii/service-management/2019/05/the-service-department-charting-the-current-challenges-and-preparing-for-the-future/