All Things Managed: The IT Services Story Part 4

Standalone Firm Versus Tech Dealer? The IT Roadmap?

10/21/2019

  

Finding new revenue streams is among the most important initiatives for traditional office equipment dealers that are serious about driving growth. In the document imaging industry managed IT has been a thing for a while now, and although countless dealers have been successful with it, IT is still a pain point for many others. With a big assist from Brian Suerth and Dale Stein, our friends at the Technology Assurance Group, we offer up another entry in our series on the countless aspects, facets, and properties of managed IT.

 

 

Why would an organization choose a dedicated IT house to provide service rather than a technology dealer, or vice versa? What will IT infrastructure look like in the future? Let’s dig in!

 

Different Strokes for Different Folks

“Dealers that have the word ‘copier’ in their company name are ripe to be acquired,” said Dale Stein, Co-Founder of TAG. “These businesses are oftentimes owned by Baby Boomers who are running out of steam and refuse to make any investments. Our advice? Rebrand. Immediately. Remove ‘copier’ or ‘document’ from the company name and be more reflective of the times, not what you were doing a decade ago.”

 

More and more dealers are entering the IT realm (those that have been in IT for at least five years are “truly enlightened”), and more and more customers are asking said dealers to handle the service, according to Stein. In fact, in the last 12 months, TAG has had 10 print services companies join its organization as they’re eager to supplement their document-centric activity. Regardless if a customer decides to partner with either a standalone firm or a traditional dealer, he’s adamant that the company values of one must align with the other, otherwise the relationship will falter, maybe even right from the start.

 

Expertise is the most important trait that dedicated IT houses have over tech dealers. Plain and simple. They possess a deeper and broader understanding of IT. They eat, sleep, and breathe it, every day. And customers can rest assured that their provider won’t place, say, a copier fleet refresh over a Microsoft Azure deployment (listen to our podcast with TAG about Azure). The intimacy/boutique factor is also at play here, as standalone IT providers are much smaller on average—fewer than 10 people—than the typical dealer.

 

On the other hand, traditional office equipment dealers have a larger client base and, by extension, more recurring revenue. Their portfolio is more diverse, allowing them to offer existing customers other products and services that IT houses just can’t sniff. “What we’ve found is that if a customer is happy with a dealer, it’s easier to just turn over all the keys, so to speak, to the dealer instead of vetting a bunch of dedicated IT providers,” said Brian Suerth, President of TAG. “There’s a big difference between a small company and a scale company…”

 

Gaze into the Crystal Ball

“Roads?! Where we’re going, we don’t need roads.” Famous words uttered by the one and only Dr. Emmett Brown. And with IT, that quote rings true.

 

The possibilities are endless. Security—from documents and devices to the entire IT ecosystem and even locations—has been and will continue to be a critical component of the package. Antivirus and dark web monitoring solutions, as well as firewalls, will become more sophisticated.

 

But what are some of the other items on the roadmap?

 

“The generational shift in the workplace is just one reason why it’s clear that collaboration and workflow are going to further increase in importance,” Stein said. “With the way people work today, whether it’s in the office, at home, or on the road, it’s imperative that all the pieces are correctly connected to enable a seamless experience. Video calls will see a significant uptick in the coming years, and adoption of things like Microsoft OneDrive and Teams are on the upswing. Unified communications, real-time collaboration, that’s the goal.”

 

Another serious area of impact is in IoT. As Stein explained, technology gets old, but organizations are always figuring out new ways to explore smart technology. HVAC, lighting, power consumption, and water filtration are but four examples. The development of apps and software to support the seemingly worldwide initiative to bring convenience to anything and everything will also force the boundaries of the ever-changing IT sector.

 

Key Point(s) Summary

The main difference between contracting with a tech dealer and a standalone IT firm is that the former has much more to offer beyond the IT piece. When a dealer (scale company) acquires an IT firm (small company) as its gateway into the space, that dealer gains credibility and instantly has the knowledge and the personnel to make it all happen. And because of the remote nature of IT, the geographical reach has the potential to push into territory that the dealer never would’ve thought it could touch.

 

No matter the industry, security is crucial. Customers not only seek protection, they demand it—that won’t change. Still, as the business world evolves, advancements in collaboration and workflow tools will pay big dividends for both organizational efficiency and productivity. Last but not least, IoT and the cloud will fuel major revenue growth as neither is close to full maturity.

 

Are you ready for 2020, and beyond?...

 

 

Keep Reading

All Things Managed: The IT Services Story Part 1 (Acquire/Build/Partner)

All Things Managed: The IT Services Story Part 2 (Challenges/Opportunities)

All Things Managed: The IT Services Story Part 3 (Security/Cloud)

 

 

All statistics courtesy of TAG, a managed IT “brain bank” that’s been around for over 20 years. The company has its own IT services business and runs the Association of Managed Technology Services Providers, while also offering education on topics such as sales training & management and financial analysis & industry benchmarking, as well as assisting in mergers & acquisitions and employee hiring & retention. With over 400,000 customers in approximately 140 markets across the United States and Canada, the Technology Assurance Group is a powerful resource for all things managed IT.

 

 

Carl Schell
Managing Editor
With over a decade’s worth of experience at Buyers Lab, Carl manages workflow on the BLI side of Keypoint Intelligence’s Office Technology and Services Group. He also manages both editorial content on the KPI corporate site and the BLI newsletter, LabLines. For the past few years his primary interest has been on the channel, specifically writing dealer-focused articles, while his prior responsibilities included producing reports on printers/MFPs and software.