A&B Business Solutions Dealer Profile

Company Owner Credits Millennials for Fueling Positive Change



Carl Schell

A&B Business Solutions Logo

Fast Facts
History in Brief: Founded in 1981 by Art Sinkey and Bill Kominga, the “A” and “B” in the company name; purchased in 1993 by Dennis Aanenson, it offers a range of hardware and a concise software portfolio, as well as MPS and other industry-related products and services, in parts of six states

Headquarters: Sioux Falls, South Dakota

Locations: 18 (Minnesota, North Dakota, South Dakota, Wyoming)

Employees: Approximately 140

Hardware Partners: (A3) Ricoh, Samsung, Toshiba, Xerox; (A4) HP, Samsung; (Production) Ricoh

Noteworthy Software Partners: PaperCut, Square 9

Dennis Aanenson is a risk taker. In the late eighties and early nineties, he worked for another dealer. It was here that he learned what not to do in business, as the company was hemorrhaging money and morale was setting a new high in lows, including in his own professional life. So he quit, without having a job lined up, and went home to figure out his next move.

After much deliberation, Aanenson borrowed some cash from his parents, took out a bank loan and bought A&B Business Solutions for $300K. At the time, the company sold typewriters and calculators and had 50 Panasonic copiers in the field, to the tune of $500K in revenue. As he explained, A&B wasn’t really making money in the mid-nineties, but he never missed payroll. For him it was pure survival mode: Two of his four children had already been born; he and his wife owned a house that he admits was more than they could manage financially; he worked extremely long days; and he and his wife spent weekends at craft fairs selling decorative items for the home.

But the entrepreneurial spirit is a force, and Aanenson is the embodiment of that if ever there was one. A&B was stagnant, desperate for a change. He looked at the employees and realized the company had to get younger. He knew that recurring revenue through services would be instrumental in A&B’s transformation. Beyond that, he was simply searching for more hunger. “I’ve never been scared of much and always wanted to work for myself, but it was rough for a number of years,” he said. “Then, we increased sales and plenty of people have come knocking to buy the company, but I constantly say I don’t want to run a business that’s not growing—which is exactly my point. A&B has grown, slowly but surely, consistently, in many areas.”

Millennials have played a vital part in both the staff makeover and the company’s results on the scoreboard. In Aanenson’s opinion, the current twenties to early thirties set is defined by quirkiness, traveling in groups, and collaboration. “They’re a different breed of cat,” he said. “When I was young only the top three finishers in a sport would earn a ribbon, but now it’s about participation and everybody walking away with a medal or trophy. They aren’t necessarily motivated by money, but even if they don’t give it their all, they still like to be praised.

“The trick is to find Millennials and hope they buck some of those trends,” Aanenson continued. “I’m looking for ‘hard chargers,’ for young people who do care about money and want to make more. It’s a bonus if they’re married, because they tend to understand responsibility and accountability more than the singles crowd. This is our secret sauce.” He also stated that the company is repainting its locations—inside and out—and getting new office furniture to help A&B become even more attractive to Millennials.

“I’ve never been scared of much and always wanted to work for myself, but it was rough for a number of years. Then, we increased sales and plenty of people have come knocking to buy the company, but I constantly say I don’t want to run a business that’s not growing—which is exactly my point. A&B has grown, consistently, in many areas.” –Dennis Aanenson

Service is A&B’s strongest suit, according to Aanenson, with revenue approaching $10M (equipment sales is close to $8M). There’s a certified trainer on staff, and many of the company’s roughly 45 techs are trained in over 80 percent of what A&B offers. “That’s not normal in the industry,” he said. “Our guys aren’t fiddling around. They know what they’re doing and can handle practically anything thrown at them. We don’t lose a lot of customers and we never lose them because of service.” In fact, A&B’s average time from call to door is 2 hours, 42 minutes—most impressive considering how much territory the company covers.

MPS is another space where A&B hasn’t just made inroads, it has thrived. The company employs three specialists for MPS and document management, all of whom are Millennials. Fortunately for Aanenson, they’re aggressive and do what needs to be done, including putting together case studies, evaluating businesses and doing walk-throughs. He believes that the majority of dealers are still out there “hocking” glorified maintenance contracts, while with his team it’s about managing print and internal paper movement. “Be a true partner,” he said. “Engage with your customers. Offer quarterly reviews to enable adjustments to a fleet and the output. And don’t worry about price: Only the solution matters.”

One thing you won’t find A&B taking part in, though, is managed IT (MIT). Aanenson mentioned that the company lost $250K with MIT in 2010. “I don’t think the consultants, who have high fees to begin with, know that much about it even today, and from the conversations I’ve had with dealers, many of them aren’t bringing in real money with it,” he said. “Managed IT is consuming tons of time, so much so that organizations are losing sight of their core business.”

Software, however, is a significant differentiator for A&B. Aanenson described, in a general way, how the sales rep broaches the subject during the approach stage to gauge need, after which one of the specialists can be brought in to drill into the specifics—putting the collaborative nature of Millennials into action. The company has been a Top 9 reseller of Square 9 in the United States over the last two years, has also done quite well with PaperCut, and counts healthcare and legal as its two key verticals (20–25 percent of revenue is tied to MPS and software). “Our strategy is to keep it simple, as it’s virtually impossible to know everything when you have too much on your plate,” he said. “We’re on the verge of formalizing a dedicated document management department, and between this and the momentum we have, I’m excited for the opportunities with software in 2016.”

“Be a true [MPS] partner. Engage with your customers. Offer quarterly reviews to enable adjustments to a fleet and the output. And don’t worry about price: Only the solution matters.” –Dennis Aanenson

Aanenson’s story isn’t just about A&B. Hardly. Frustrated by bigger vendors that wouldn’t order lesser known brands of wine, he started a boutique distributor called Cask & Cork, which allows him to travel to places like Napa Valley and drink pristine reds and whites. “We had no customers on the first day eight years ago, and now the operation clears $4M in revenue,” he said. “An A&B tech might have to deliver toner to one client, then go around the corner and drop off a case of Cabernet to another!”

His business ventures run far and wide. Due to his love of cooking, he opened Cleaver’s Market—a specialty food store—in 2007 and recently launched a New York-style deli, Cleaver’s “Bad” Deli. And then there’s The Truck Wash. “We don’t clean the exterior,” he said, pausing briefly before adding that the interior needs to be hosed down after dropping off all the hogs at the plant. “At one point early on it lost $180,000 over six months, but we righted the ship and today it’s turning a nice profit.”

Still, A&B remains his primary focus, and rightfully so. The company was stuck at the $12M threshold for several years but finally broke through in 2011, thanks to the shift toward hiring Millennials, its strong service and being more diligent about selling MPS and solutions. Also, margins have improved and, well, it doesn’t hurt having 50 Ricoh production devices in the field throughout the Dakotas alone. All told, A&B’s revenue for 2015 was just north of $22M.

Always one for humor, Aanenson said that the company’s greatest challenge is dealing with “competitors that don’t know what they’re doing. We just made an asset acquisition, but I don’t think we’ll have to buy up any of our competitors—we’ll probably wind up buying them from the bank.” The U.S. dealer population, in his opinion, will be reduced by a third in five years because many of them aren’t changing fast enough.

Change even on the smallest level is very important to Aanenson. Several months ago, he ordered over 100 license plate holders that read “A&B Business: Just Do What’s Right.” That’s the sort of friendly confidence he exudes, confidence that has already led to considerable growth and will help the company reach one of its next goals. “We’ll get to $30,000,000 quick,” he said.

Dennis Aanenson, Owner of A&B Business Solutions

Dennis Aanenson, Owner of A&B Business Solutions