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 user 2005-04-20 at 11:41:00 am Views: 81
  • #8989
    Network color printers gain in popularity,
    especially among SMBs

    The network color-printer market is a healthy one for solution providers, as
    a growing number of small and midsize businesses (SMBs) move out of the world of
    black-and-white and companies of all sizes invest in multifunction devices that
    include color printers

    It makes good economic sense for many businesses and departments within
    organizations to share color printers, so devices that can be networked are in

    “The trend has been to connect more and more; the people who manage big
    fleets of printers want to have them network-connected” as opposed to directly
    linked to individual desktop devices, says Michael Zeis, president of Blackstone
    Research Associates, an Uxbridge, Mass.-based technology research and consulting

    Part of the trend toward network printers comes from companies’ desire to
    better control their inventory of IT assets and eliminate duplicate equipment,
    Zeis says.

    “There’s a big fear on the part of the end-user community that legions of
    direct-attached inkjets are bleeding the company,” he says.

    Also driving demand for network color printers–including higher-end laser
    printers–are declining prices. Recently, the price of some laser printers has
    dropped below the $500 point, and that has made them attractive to many

    “There’s a tremendous amount of price competition in both color printers and
    copiers,” Zeis says.

    Part of the pricing decrease comes from competition from connected copiers.
    These products provide some of the same functionality as network printers, in
    some cases handle wider sets of paper stock and are more suitable for
    high-production jobs, Zeis says. Connected copiers have also decreased in price,
    making them feasible purchases for a wider range of customers.

    “If [connected copiers] become more popular in the office, they will
    gradually take away print volume from color printers,” Zeis says.

    Decreasing manufacturing costs for network color printers are also
    contributing to the lower prices, Zeis says. And with prices falling to more
    affordable levels, many companies are more apt to trade in older black-and-white
    printers for devices that provide both color and monochrome printing.

    “Customers in the general office are requesting color printing and imaging
    more than ever before,” says Tom LaRocca, vice president of partner development
    and programs at Hewlett-Packard’s HP Americas Solution Partners Organization,
    Palo Alto, Calif. “It’s not just a specialty market, tailored to graphics or
    creative professionals, as was the case years ago. Color printing and imaging
    for the general office is faster, easier and more affordable for everyday
    business documents and communications.”

    Solution providers who carry printers also report increased sales of color
    products that are networked.

    “We are seeing companies utilize network color printers for several reasons.
    Primarily, it is more cost-effective to remove individual color inkjet printers
    and reroute that print traffic to a network device,” says Ty Johnson, document
    management specialist at HP partner One Source Document Management, Yaphank,

    Johnson expects to see further price erosion for the products. “The overall
    cost per page for color units will decrease significantly over the next 18
    months,” he predicts.

    SMB Opportunities

    Printer manufacturers say the SMB market is especially ripe for network color
    printers, and that presents a significant opportunity for VARs.

    “Right now, everyone is vying to reach [that] market,” says Gary Gillam, vice
    president of channel operations, North American Resellers, at Xerox, Rochester,
    N.Y. “Because the reseller channel is highly targeted toward the SMB segment,
    Xerox understands that our reseller partners are instrumental in reaching this
    important customer segment.”

    CompuDirect, a Myrtle Beach, S.C.-based company that sells printers from Oki
    Data and other manufacturers, has seen a rising demand for higher-margin color
    laser printers among its customers, primarily SMBs. Its sales of Oki Data
    products rose about 30 percent in 2004, and more than 60 percent of that
    increase came from network color printer sales.

    “As prices come down to more of a commodity level, people are starting to
    look at the color laser products,” says Bobby Gallaher, executive vice president
    of CompuDirect. “People who in the past bought inkjet printers are looking for
    speed and capabilities they need for their business. It’s a growing market.”

    Gallaher says companies in a variety of industries–including real estate,
    legal, recreation and hospitality–are buying network color laser printers for
    their day-to-day and special project printing needs. The move to these products
    will likely continue, he says, as businesses opt to do their own printing of
    brochures, business cards and other documents rather than having these produced
    by an offset printing vendor.

    In addition, many customers are looking at the overall value network color
    printers can bring to their businesses, rather than just price, says Candice
    Dobra, director of printer marketing at Oki Data Americas, Mount Laurel,

    “With black-and-white, more pages per minute is as exciting as it gets,”
    Dobra says. “But when you look at color, you have to consider how the product is
    being used and the tools that can enhance the business.”

    Oki Data has seen a huge increase in sales of network color printers,
    particularly in markets such as retail. In January, the vendor unveiled color
    printers that include a new signage feature that enables companies to print
    signs, banners and labels that can be used in stores. While it’s ideal for
    retailers that want to produce in-store signs, the product is aimed at other
    types of businesses as well, Dobra says.

    The Buzz Around MFPs

    Printer manufacturers and solution providers also report an increase in
    demand for multifunction printers (MFPs), which combine color printers, scanners
    and fax machines.

    “Those products come with a wide array of bundled software and utilities, and
    after-market software,” Zeis says. “I see that as an opportunity for the VAR
    community. The software and hardware combinations can be very complicated, and
    there’s a role for third parties to help companies get up and running, for help
    with integration.”

    Pro-Copy Technologies, based in Cincinnati, sells color MFPs from Konica
    Minolta Printing Solutions U.S.A. Many of Pro-Copy’s customers that have
    black-and-white or color printers and fax machines are opting to consolidate
    those functions into one multifunction device, says Scott Runge, color
    specialist at Pro-Copy.

    “It’s a rapidly growing market, our biggest growth opportunity not only for
    hardware, but for our long-term service [offering],” Runge says.

    Gillam says sales of Xerox desktop MFPs through the VAR channel increased by
    43 percent in 2004.

    “We continue to expand the scope of this [MFP reseller] program with new
    products because customers want to consolidate their office products into one
    device,” he says.

    In March, Xerox introduced its latest color MFP, the Xerox WorkCentre C2424,
    which uses the company’s solid ink technology and is aimed at SMB

    Other Enhancements

    In terms of functionality and performance, network color-printer
    manufacturers are continuing to make improvements in their products. That
    includes enhanced print quality; more features, such as built-in digital photo
    printing capabilities, stapling and hole punching; and, in particular, faster
    print speeds.

    “Color products are faster than ever,” LaRocca says. “They’ve hit the speeds
    of black-and-white products and will continue to increase.”

    In addition to faster speeds, he says HP’s new product development efforts
    are focused on making network color printers easier to use and manage.

    Higher-quality printing is also a priority for manufacturers.

    “It’s not acceptable these days to offer ‘business’ quality in a color
    laser,” says Melvin Evans, director of channel marketing at Konica Minolta in
    Mobile, Ala. “New product introductions are featuring professional and
    photo-quality color to suit both general business and design applications.”

    Evans says the trend in network color printers is toward movable, shareable,
    desktop-size devices. Other future developments, he says, will include wireless
    operation, driverless printing from PDAs and cellphones, 64-bit Windows
    compatibility and support for gigabyte transfer speeds.

    Incentives To Do Business

    Network color printer manufacturers are providing an array of incentives to
    resellers to help move their products. Among the offerings:

    Oki Data in January introduced a program called OKIPartners Plus, which
    offers incentives such as an automatic 5 percent purchase discount and an
    additional 5 percent back-end rebate on sales of color printer products.
    Participating solution providers can earn monthly rebates for achieving
    pre-established color sales goals, based on the volume of sales. The OKIPartners
    Plus program also includes cooperative marketing efforts funded by Oki Data,
    sales promotions and access to customized products.

    Xerox’s PEAK Reseller Program offers incentives, such as increased margin
    opportunities of up to about 10 percent for its partners based on their
    commitment to Xerox through training and product volume. In 2004, the PEAK
    program was revamped to provide a new set of rebates that has a simplified
    rebate structure, expanded training offerings and increased marketing
    development funds.

    Konica Minolta Printing Solutions Partner Program provides up-front margins,
    spiff rewards and back-end incentives of up to 8 percent. Partners have access
    to dedicated account reps in the field and on the phone, continuous online
    technical support, free sales literature and marketing collateral, and an
    extensive library of product information and competitive research.

    Hewlett-Packard’s HP PartnerOne program offers a variety of incentives on
    color printing and imaging products, as well as technical support, grants and
    access to direct mail and e-mail marketing programs.

    VARs say they’re pleased with the programs vendors are delivering. “We have
    had excellent support from HP to help us market their products and our
    services,” says Ty Johnson, document management specialist at One Source
    Document Management in Yaphank, N.Y. “They contribute monetarily to help us
    reach our prospects both through mailings and telemarketing efforts. They also
    provide several avenues for development, including product knowledge Webinars
    and the ‘Rolling Thunder’ consultative selling skills program.