Businesses are changing and, as a result so is the channel, writes Nathan Nayagar, MD of Lexmark – South Africa & English-speaking Africa.
Companies are now looking to digitalisation and are increasingly turning to advanced technology to innovate the way they engage with customers and the speed at which they deliver services.
Today, the role of an IT channel partner has evolved. No longer is it a straightforward process of offering hardware and support when necessary, services and solutions now need to be considered. This represents a significant opportunity for resellers to capitalise upon.
This shift in demand is well represented in the printer industry as hardware sales drop and forecasts flatten. According to leading analyst firm IDC, the market for single-function printers has shown a double-digit decline over the past year, while the entire Western European printer market has seen multi-function printers (MFP) account for over 79% of all shipments.
IDC’s forecasts show that colour laser printers, primarily used in business, will see a 2% annual drop in shipments in the next four years, while color laser MFPs will see an annual increase of 12% over the same period.
Seemingly, the market is migrating to devices that can be integrated into end-to-end solutions such as document management, and resellers need to be aware of – and be fully prepared to exploit – the changing dynamics of the market.
In parallel, businesses are now embracing “the third platform” model, a new era of emerging, interconnected technologies represented by social, mobile, analytics (big data) and cloud. IDC predicted that it would result in innovation, growth and disruption across all industries.
As the third platform ecosystem becomes more embedded, growing at over 9% annually, vendors are beginning to adopt a holistic approach to delivering solutions, as connecting software and hardware with services becomes a necessity for companies to capitalize on the opportunities this new tech-enabled ecosystem represents, as well as cope with its complexities.
Managed document service (MDS) offerings conform to this holistic, end-to-end approach, and its encouraging forecasts reflect this new reality.
For many businesses, the idea of fundamental change is one that strikes a note of impending doom. IT resellers however are well-placed to take advantage of these changes. A recent study found that 71% of SMBs that have looked beyond purchased hardware and towards services and solutions have purchased these solutions from a channel partner or recognised software provider as they look to ease the burden of document management and cost.
IT resellers can provide these solutions as well as advisory services, making this change an opportunity rather than a burden. Indeed, global analyst firm Canalys has noted that “channel partners are actively moving to new business models in response to significant changes in the way customers buy, deploy and use technology.”
But how can resellers move to this model with minimal fuss? Resellers must align with the changes in the industry and consider how can they deliver advisory services and value-add to customers. This doesn’t necessarily call for a total upheaval of the reseller’s business – this is evolution, not revolution – just an update of their model so that the services expected can be delivered.
Many resellers have already taken the first step towards successfully updating their models, seeking to work with their customers to understand their businesses, the pressures they are under, and how they can help them to capitalise on the opportunities that digitalisation represents.
Collaboration is key in the new digital economy as Alastair Edwards, principal analyst at Canalys notes: “[Resellers] have evolved from being pure suppliers of products and support to become trusted business partners.”
Resellers must embrace this role and ask what it is that customers need and how can they not only deliver this, but still offer value-add in three years’ time?
For many customers, what they need most is simplicity and process efficiency, especially after adopting complex new technology. Solutions and services from document capture to device and print management have already seen significant growth and, according to IDC, will grow by 5% in the next year, with this growth expected to continue.
Now, resellers should look to foster ease of use and clarity with customers who are faced with this new technology, and look to make their lives as easy as possible. Vendors like Lexmark can support IT resellers to adapt to this change by providing the appropriate programmes.
Vendor programs that connect resellers with the knowledge and expertise on the new wave of devices, software and services and provide guidance on how to implement and offer support to users of end-to-end solutions will prove indispensable. Vendors whose models rely on the approach of “sell them some goods and try to help if it breaks” will quickly become unpopular with resellers and customers and see channel sales suffer as a result.
As the third platform ecosystem becomes increasingly prevalent and the demand for hardware makes way for end-to-end services, IT resellers are well placed to benefit. Their legitimate “right to play” in the services arena is already recognised by their customers. By adapting to the market changes through the use of appropriate vendor support programs (such as the new Lexmark Connect Partner Program), as well as long-term planning and close collaboration with customers, IT channel partners can, and will, thrive in the new digital economy.