Margins Fit For Print

Well, times appear to be changing. The advent of gee-whiz digital-imaging capabilities, cheaper and faster color machines, fully networkable printers and scanners, multifunction devices, wireless and a host of useful business applications have conspired to spruce up the dour world of printing. These new capabilities can help to meet a plethora of business demands, among them the document-management tasks bearing down on paper-intensive industries, such as financial services, government and health care, which face regulatory mandates for more secure records-keeping, archiving and instant electronic availability of documents.

"This is a business, not an add-on," says Chris Swahn, president of Amherst Technologies, which late last year signed onto Hewlett-Packard's Print Advantage pilot program to sell and service color and monochrome multifunction printers as part of its customers' overall network architecture. "What makes this attractive to us is that we can focus on the value sale that can be made with these devices and the ability to manage them."

The momentum in the market can also be felt at the distributor level, where Tech Data now touts printing and imaging as one of the fastest growth categories among its nine core business units. Likewise, market-leading vendors including Canon, HP, Lexmark, Ricoh and Xerox have stepped up their partner programs to convince VARs of the impact newer printers and imaging technologies can bring to bear on cost and efficiency in today's corporate IT environment. In particular, multifunction printers (MFPs), which handle printing, scanning, faxing and copying, are becoming all the rage.

"If a solution provider can go in and say, 'I can help you find a way to reduce your number of printers, consolidate devices and put you on a monthly bill, and you'll know exactly what you are printing and paying,' then [who] wouldn't say they are interested?" says Peter Grant, principal analyst at Gartner, San Jose, Calif.

Give Me Color

One of the splashier trends in printing these days is color. For years, color printers have been addled by a one-two combination punch of slow performance and high cost. Six years ago, a typical color laser workgroup printer from Xerox, for example, cost approximately $10,000 for a tortoise-like output of two pages per minute (ppm). Today, that same printer, infused with newer technologies, can churn out 16 ppm for a price tag of $2,200.

Higher-end color-laser printers sport even more volume capacity. For example, Xerox's Phaser 7300 boasts 30 ppm and more pristine quality, along with lower prices. Lexmark offers the C10, a high-end departmental color-laser printer, with prices starting below $4,000. Today's devices help pay for themselves over a short period of time, vendors contend, because, among other things, customers no longer need to send color jobs out to costly industrial print shops and wait for their orders to be finished.

Among the enabling technologies driving color into the mainstream is the emergence of single-pass technology, which has boosted the quality of color-laser printers by reducing the number of times a document must pass across the laser from four to one, according to Chris Iburg, worldwide director of printer marketing at Xerox, Wilsonville, Ore.

Not all is rosy, however. The tough economic times of the past two years have posed a challenge to VARs trying to convince anxious customers that the 7-year-old monochrome laser in the corner,temperamental, inefficient, but still working,is worth replacing with anything new at all.

All-In-One

Cost-cutting is one of the mantras emanating from today's hottest printing and imaging trend: convergence. Many of the major vendors have made networked MFPs (color and monochrome) a cornerstone of their businesses, enabling companies to consolidate their hardware, vendor contacts and services' needs.

"One of the last bastions of cost control is in hard copy space," says Rich Raimondi, vice president and general manager of U.S. commercial business at HP's Imaging and Printing group. "If you can integrate functions, you save floor space and cost."

In addition to MFPs, companies such as HP and Lexmark offer modular solutions that allow VARs to equip color-laser printers with scanning devices and software or faxes, depending on their customers' needs.

MFPs are also helping to fuel the growth of digital scanning, which is exploding as a way to reduce office paper by capturing documents digitally on the network. Once scanned into an MFP, paper documents are ready to be e-mailed, faxed or archived in a storage system.

Industries such as shipping, health care and banks that process mortgages and other loans are itching for this type of digital-document scanning. And many of the benefits they hope to nab come not from the hardware itself, but from the opportunity to bundle in software that can be customized for their businesses, including such applications as forms-processing or patient-coding.

"Software is the driver now," says Chris Sedlacek, assistant director of integrated business systems at Canon, Lake Success, N.Y. "It lets you go in and customize an application for a bank or a law firm, and when a VAR does that for a customer, it maintains the relationship and generates revenue down the road."

Sedlacek advises VARs to work with ISVs and storage vendors to devise the right business applications for customers' imaging devices. Adobe, IBM, Legato and others play large in this space. For its part, Canon has partnered with a company called Ecopy to add a scanning hardware and software component to its ImageRunner copier device.

New Approach

All the new capabilities have some VARs re-examining their attitudes toward printing and imaging.

Bicky Singh, CEO of Future Computing and a longtime HP partner, says he started tracking the market about 18 months ago and identified lots of opportunities his company was losing.

"We found out that this market is a huge area of growth, where profit margins are huge also," says Singh, whose company offers a range of infrastructure services.

Singh says the key is taking the solutions-based approach, working with customers on printing-infrastructure assessments and consulting on workflow improvements. From there, the right fit of products and services can be applied. The other crucial piece of the puzzle is partnering with ISVs to design tailored implementations.

Ramp-up is not quick, Singh warns. And the training and certification needed to be proficient in many of today's printing and imaging technologies isn't trivial. "[But the] payoff is there," he says. "You build customer loyalty instead of just selling boxes."