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Office channel & MPS: a fundamental shift

IDeAs was recently asked to analyse specifically the Office Channel and MPS. Here are the key points of this magazine encounter.

There has been a lot of noise in recent times about Managed Print Service (MPS), and there can be few office products resellers who haven’t heard of it, and wondered whether they should be getting involved with it. Not only that, but many will have experienced a more pressing impetus from losses of printer consumables sales to MPS providers.

Given the importance of printer consumables within the revenue mix and even more importantly in the margin mix of most office product resellers, this can be a body blow, and the worst of it is that they usually don’t see it coming. Often the first the OP dealer hears of it is when their customer contact, typically a Facilities Manager, informs them that they no longer have responsibility for procurement of printer consumables, and these are now being handled by the IT department under an MPS contract.

IDeAs has worked with several organisations in the Office Products sector, including some of the very largest, to address MPS, as both a threat and an opportunity. We also work with most of the major printer manufacturers, and with compatible consumable suppliers and software providers. Here are some points to consider, based on our experience.

Question: Firstly, is MPS something that the OP channel really needs to engage with, or is it just a passing fad, the latest marketing concept, soon to be replaced by something new?

Answer: Be in no doubt, MPS is not just a temporary phenomenon, it represents a fundamental shift in the way organisations buy and manage print. MPS has been around for over ten years now, and is fast approaching a point where it will become the standard business model for print. You can see this from forecasts made by all the major market research and analyst firms.
For example, the following chart from Photizo Group shows that MPS will account for over a quarter of the Office Printing market in EMEA by 2017. As this is for the whole of EMEA, which includes less developed markets, the MPS share will be higher in the more advanced markets of Western Europe.



This outlook is shared by the leading manufacturers. For example, HP’s view is that total print industry revenue is almost flat – growing at 1% per year. Within this forecast, what they call “core” or transactional print revenues are declining, whereas managed print services are growing at 7% per year.

December 18th: in the next article, you will read on the impact on revenue and margins.

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This article was written on 20 Nov 2014, and is filled under Business Forecast, Managed Print Systems.


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