Xerox (NYSE:XRX) has launched a new tool that tracks an end user's printing fleet needs and lets the customer order supplies through a preferred VAR's e-commerce portal, an initiative designed to dramatically increase the VAR's after-market supplies revenue.
The program, detailed last week at Xerox's first big partner event in four years, was met with applause from more than 200 solution providers, many of whom were managed service providers that Xerox is trying to woo into adding managed print services for the first time.
The new eConcierge service should let VARs add revenue that's about 10 times the cost of the printer they sold for little investment and effort, said Deb Koehler, Xerox's director of North American reseller sales, Business Platform, at the Fusion 2011 event in San Antonio.
"You're missing out on supplies revenue on those printers you worked so hard to place," she told VARs. "How long did it to take you to place that equipment with customers? It could be weeks, months. If you're not getting the suplies attach, you're missing out on that revenue."
Xerox executives positioned eConcierge as a complement to the vendor's existing PagePack managed print program, a first step to get more visibility into a customer's printing habits before approaching them with a full managed solution.
Koehler estimated that office superstores and e-tailers take in about 90 percent of ink sales after a printer is sold.
"Why? There are almost as many office superstores as there are Starbucks. They have great online stores. Sometimes they offer rewards benefits. But they're not providing value to your customers. We are told by customers that if they could work with a reseller to bundle supplies with services, they'd be willing to pay more for the convenience factor," she said.
The eConcierge tool also tracks supplies for Hewlett-Packard (NYSE:HPQ) and Lexmark printers and lets them order those OEM-branded suplies too. More vendors will be added to the service, Koehler said. Orders are placed by credit card by the end user and directed by the VAR through one of three distributors: Ingram Micro (NYSE:IM), Synnex (NYSE:SNX) or Tech Data (NSDQ:TECD). VARs get paid up front but retain their regular terms with the distributor, allowing solution providers to improve their cash flow, Koehler said.
Initially, eConcierge only works with network-enabled printers but Xerox expects to include USB-connected printers in the future too, said Koehler.
To entice customers, Xerox is offering a free services contract to end users for Xerox devices if supplies are purchased through eConcierge. That feature could save end users hundreds of dollars in service contracts for each device, according to the company.
"They have the ability to earn a free service contract, the same entitlement they had when the printer was new. They keep that as long as they purchase through the program. And if you're an authorized service provider, you get to do that service," Koehler said.
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