An interview with Grant Levy, Expense Reduction Analysts’ Photocopier specialist.
Before joining ERA, Grant Levy was a partner in a global reprographics consultancy enabling clients to move to digital strategies and work smarter initiatives. With a focus on professional services, Grant was provided with the opportunity to excel in office, reproduction, and bureaux print services.
Grant, what about the paperless office?
In the 1970’s, the concept of the paperless office was introduced, and in 2018 we are no closer to this then we were back in the ‘70’s. The difference today is that software is more capable and provides far more choice than ever before, so this coupled with activity-based working should help clients move to ‘paper light’ without negatively impacting staff.
What is happening in the Photocopier Industry at the moment?
The industry is reporting significant losses because they have a history of buying business rather than winning it! As has been seen in the press, Fuji Xerox, for example, have reported massive losses resulting in top executives being asked to leave the company.
The benefit to the consumer is that prices are probably at an all-time low. However, the industry cannot maintain the pressure and prices will start to rise.
A major advancement in recent years is digital workflow, i.e. rather than printing forms, applications etc., these are now being done online. This saves on paper and print costs, but also makes processes more streamlined and work more efficient. This is creating a situation for copier suppliers where their revenue and profitability from print is decreasing, and they have to create alternate revenue streams.
An example of changes to revenue streams is where clients are starting to be being charged a flat monthly fee for scanning, even if they do the very little scanning. The justification is that whether the company is scanning or not, there are still costs involved in maintaining and servicing machines, and the monthly scan charges will cover those costs.
Similarly, some authorised dealers will charge a minimum cost/month rather than for a minimum number of copies, to cover engineering, parts costs etc.
Tell me more about Digital Disruption in the Copier industry.
There is a saying that “If you print everything, your organisation moves at the speed of paper”!
If a company is only using copiers to print and copy, they are not getting the full benefit of the industry.
Most companies are moving towards improvements in workflow by automating the process in historically high-volume paper areas such accounts payable and document management systems (DMS).
Clients should be aiming only to print external copies such as sales presentations and sending everything within the organisation digitally. Examples of this are online forms, digital signatures, workflow-based rules approval.
Digitisation reduces the cost of printing but also improves productivity as there are less human touch points in the document flow (lifecycle).
How does one differentiate between copiers? There seem to be so many – is any one of them better than another?
It is difficult to differentiate between Tier 1 and 2 copiers. Ultimately it comes down to personal preference – for example, I have one client who chose a particular copier because it provided a longer staple, which they needed for their thick documents.
All copier companies today focus on quality, reliability and all will include green initiatives.
People decide based on brand loyalty and on incumbency. There is a perception that it is difficult to change suppliers.
Changing suppliers is only tricky if the supplier is providing an in-house software solution such as document workflow or follow me print. If the software is supplied by a third party such as Nuance or Papercut, it becomes simpler to make a change as only the hardware needs changing, and the users will already be familiar with the software features.
So where are the opportunities for cost reduction?
There are significant changes in the way printers are being used, and one of the most important is “follow-me” print. This means that documents can be printed from any device within an organisation, with the user having to enter a pin or use a fob to release documents. This has major benefits:
- Security – printed documents are not lying on a printer for anyone to see.
- It also means that it is not necessary to have private printers for security and the number of devices may be reduced.
- Less printing. Printers will purge print jobs at the end of a specified period which leads to a decrease in overall volumes. Research has shown that there are always uncollected documents lying around at the end of the day and that documents get reprinted the following day because the author has forgotten about them!
2. Price
Because there has been so much competition, prices which have bottomed out, are starting to rise. This is an excellent time to be reviewing all print contracts. Expense Reduction Analysts will review contracts and ensure that the fleet is fit for purpose.
What would you identify as being the biggest risks regarding copier charges?
Firstly – the contract! Copier contracts are notoriously opaque. Clients are often sold on “savings” that are based on a like for like but do not take into account fit for purpose need, or changes to business practices, resulting in paying for “fresh air”.
The consumer needs to ensure that they see invoices for all the costs associated with the copier – not just the copies, but also the device charges if they are rented/leased. Contracts that have the cost of the devices built into the copy charges have the highest overall cost of ownership.
ERA recommends that depending on usage and reliance on high-quality colour reproduction, that 4-5 years is the optimal contract length. ERA has seen clients in the past that, due to company policy, are replacing devices every three years resulting on a lower return on investment (ROI) as copiers are designed to have an effective life of more than three years.
Devices also need to be fit for purpose – right size, output, capability and quantity. Expense Reduction Analysts can help you analyse your usage and patterns and ensure that you are not contracting to more or fewer devices than you actually need.
About Expense Reduction Analysts (ERA)
We help clients to support the health and growth of their business, whatever its nature, focusing on proactive expense and supplier management. As an Australian and global company, Expense Reduction Analysts can benchmark costs and spending, follow the latest supplier innovations, and have real-time data on changes and advancements. This strength gives Expense Reduction Analysts the recognition and power needed on supplier markets to best serve your interests.
For more information please contact Ruth Cohen at rcohen@expensereduction.com
