Memoirs of a Copier Sales Person

"So, what the heck is a 'head full of hope'? I heard the phrase for the first time while watching the miniseries 'Klondike.' Yes, I am a GOLD Rush freak!

I enjoy watching these guys prospect because prospecting is something I do on a daily basis. But finding GOLD, now that's a whole heck of a lot better than making 50 calls and getting a solid lead.

As a kid, I would often venture out on my own in the woods of Iselin, NJ, to see what I could find. I can remember a place called Fossil Rock, which was located next to the Parkway. Rumors had it that if you could find this rock, you'd be able to break pieces of the rock away to find fossils.

I never found the fossils because I never found the rock. But, I found many smaller rocks that were the hiding places of many critters, most of them being snakes. At first, I used to turn the rocks over by hand; I changed to using a big stick because one day I turned over a rock by hand, and a large snake scared the crap out of me! Heck, at 10 or 11 years old, I was on a mission to find what I could find.

In those days, I guess I could agree that I had a 'head full of hope' because I would leave in the morning with the belief that I would find old coins, treasure, snakes, or critters. Most days I returned with some fine-looking rocks that I thought might be valuable. Yup, I had a 'head full of hope.'

To this day, I still have that 'head full of hope' when it comes to prospecting because, as I think back, prospecting is always something I enjoyed doing. If I turned over enough rocks, I would eventually find something that I perceived as valuable, cool, or even scary (I've had a few prospects who were even scarier than that snake).

Thus, the same is true with prospecting for new customers; as long as you make the calls (phone or in person), send enough emails, do a few mailers, and before you know it, you've got prospects! Of course, some of those prospects won't pan out; others will fall off the face of the earth (we know that, right?), but there's always a few that will buy from you!

While in the office today, I mentioned the title of this blog to Ricky and gave him the outline. He commented, 'When you come to think of it, I was always prospecting before I got into sales.' I asked, 'How is that?' Ricky then stated that in his younger days (before he tied the knot), he would frequent some clubs to meet new women! Well, in my book, that's prospecting, right? When you come right down to it, all of us have some sales traits, and we didn't even know it!

I also have a 'head full of hope' for the Imaging Business. I believe that paper will never just go away, but I'm in agreement that prints from printers and copiers are in decline. There, I finally said it!

But, I've got a 'head full of hope' that new technologies will keep us relevant in the Office Technology business. Thus, in essence, we are still prospecting for hardware, software, and technology that will help our clients and prospects do more with less, save them time, increase efficiency, and help to lower their costs.

-=Good Selling=-"

Below is a blog I wrote about a year ago on the old blog site. I'll be moving these over from time to time.

As we still struggle to keep margins on equipment, maybe we need to become better advocates for presenting shorter terms for leasing equipment. I've been tracking all of my sales for purchases and leases; 92% of them involve leasing the equipment with a third-party leasing provider.

Of that 92%, 89% of the leases I've written were for 60 months. I would tend to think that, give or take a few percent, this might be applicable to most of us.

60 months/5 years is a long time, right?

Dang, I'm tired of my cell phone after two years and my car in about three. Technology changes so quickly nowadays that I want the latest and greatest new car features, whether it's better gas mileage, more comfort, or new technology. The same is true of my cell phone; after only two years, I would like to step up to new technology that may enhance my lifestyle or make me more productive. Wouldn't our customers want the latest technology with their copiers and MFP's also?

Why are we not quoting and selling more 24 or 36-month leases?

Look at it this way: if you put a customer into a 60-month lease, you'll have to wait at least four years until you or the customer has an upgrade path, and 54 months would be the prime time to upgrade. Even at 4 years, the upgrade path may not be as rosy of a picture for your customer.

Putting your customer into a 36-month lease means that the upgrade path is now reduced to two years, and 30 months would be the prime time to upgrade.

A lot can happen when you have to wait 48-54 months to upgrade the system. Items like a major breakdown, a poor service call, your contact being replaced by someone else, and the added pressure from other companies prospecting the same account can put your upgrade in jeopardy. A shorter-term lease will reduce these risks for you.

Take a $20,000 lease that is booked for 60 months, and the customer will pay $24,000 over the term of the lease. Compared to a 36-month lease, the customer will pay about $20,500 (factor of .0284). That's a $3,500 savings to the customer!

So How Can We Get Better at Selling 36-Month Leases?

There's a lot we can do. The first that comes to mind is the savings on interest; that should wake someone up. The second would be to explain the additional costs in maintenance/supply agreements that the customer would incur. Most of us sell maintenance agreements that have an auto-escalator clause that allows the maintenance/supply agreement or the cost per page agreement to increase every year. These annual increases can be anywhere from 5%-10% per year. Do the math!

We'll make it simple. That $20,000 copier/MFP that's pumping out 200,000 pages per year will mean the first-year contract cost is $2,000. With a 7% escalator clause, the 2nd-year cost is $2,140, the third-year cost is $2,289.80, the fourth-year is $2,450, and the last year is $2,621. Add them up, and over years four and five, the customer would pay an additional $1,071 for maintenance and supplies over a 60-month lease.

Invoicing: our customer will have to process at least another 24 invoices. With a small to medium-sized business, the cost to process that invoice and pay it is $15-$35 per invoice. Let's use $20 per invoice, and we've added another $480 over the 60-month lease cost.

In total, that $20K lease will cost your customer an additional $5,000! You've got to have this financial talk with your customer. In addition, if you upgrade the 36-month lease, you will lower the customer's cost of maintenance and supplies cost/cost per page with the new system, and there will probably be a few new features that will increase the customer's productivity!

Show the Savings to Your Account

That $5,000 savings over 60 months would be $83.33 per month. It's a no-brainer. Would the customer like to spend 25% more on a $20K lease? I doubt it. Keep in mind that the 36-month lease rate is the most competitive lease rate from all of the leasing companies; they score additional profit for 24, 48, and 60-month leases. I'd rather have a chance to go back to my customer in 24-30 months rather than 48 to 54.

-=Good Selling=-