The imaging industry may be past the worst of its pandemic era issues, but challenges remain. Getting new product into the sales channel can still be difficult, even if finding it is a lot more feasible – and more affordable – than it was a year or two ago. Many dealers are diving head first into new products and services, with the setbacks and lessons learned that come with branching out and trying something new. And while we’ve heard the same drumbeat for years, printing continues to slowly decline, despite a few bright spots. What can companies in the imaging industry do to keep up with the competition and not only survive, but thrive?
The new normal
According to IDC, 2022 saw a 1.4% decline in global shipments of hardcopy peripherals (single-function printers, multifunctional systems/MFPs, and single-function digital copiers). This came despite a holiday season rally where Q4 2022 saw an 11.6% YoY increase to 25 million units shipped. It’s also worth noting that the overall value of shipments increased 0.7% in 2022 compared to the year before. Looking ahead, the U.S. market won’t necessarily shrink in terms of revenue, but revenue will stagnate and decline in real terms.
In sum, we’re seeing a major increase in supply, but it’s still not enough to offset the decline in demand for copiers and printers from the work-from-home boom. Products are also getting more expensive, partially because of inflation and industry-specific increases in the costs of components and labor, which brings advantages and disadvantages. More expensive products mean potentially bigger sales, but at a time when customers are trying to spend less, this could mean that a small business will only buy three (more expensive) printing peripherals, instead of the four or five they might have a few years ago.
Amid this backdrop, the world has settled on, if not a happy medium, the compromise of hybrid work. Employers aren’t eager to have totally remote workforces that never enter the physical office, but employees aren’t clamoring to be back in the office five days a week, every week. Again this brings advantages and disadvantages to the imaging industry. Demand for budget, low-volume printers for a home office has fallen, but demand from enterprise and education customers is strong right now.
Capitalize on current opportunities
Post-pandemic, the industry has major opportunities that won’t be around forever. Even if it’s under hybrid conditions, many large customers – commercial businesses, government offices, or educational institutions, for example – are returning to their campuses, and they need not only printers and copiers, but parts, services and long-term support. At a time when many dealers are following in the modern trend of selling services in conjunction with or even in place of products, this is a prime opportunity. Major customers like a local school district returning to in-person classes don’t just want to buy printing products, they want to ensure they can maximize the value of these major purchases and keep them up and running for years to come. For vendors in the imaging channel, this is a key opportunity to secure long-term revenue in product support contracts.
Get more out of existing products
There’s still a lot of life in the core products that got many companies to where they are. Maximizing it means ensuring access to repair and maintenance services. Going green and limiting waste isn’t likely to go out of style with customers soon, either. Survey after survey has confirmed that members of Gen Z are the most likely to make their purchase choices based on environmental sustainability. It goes without saying, this generation will be key in maintaining the health of the imaging industry over this next decade.
There’s also an advantage in using new technology to allow your employees to do more with the same amount – or even less – of time and effort. Take the current technological trend of AI and large language models, which offer (depending on who you ask) excitingly or frighteningly realistic conversational abilities. Are the likes of Chat GPT ready to supplant every job? No, and they might never be. But can this technology still help employees and make our industry more efficient? The answer is undoubtedly yes.
Take, for example, the customer journey. Salespeople get products and services into the hands of customers, and then the customer support staff is responsible for keeping our customers happy and coming back. Large language models can’t replace the required skills for these jobs, but they can support salespeople and customer service employees. For example, few salespeople love the more tedious, but critical aspects of their job, such as crafting messages for mass outreach campaigns. This work can also be a big time sink at a time when the industry is frequently asking its salespeople to sell more products and services, often for the first time. These new AI technologies can pick up many of these tasks, even if it’s just to offer up a first draft or jumping off point, freeing up salespeople to devote their time and energy to selling. On the customer service end, the Chat GPTs and their less glamorous but still tremendously useful relatives, improved chatbots, can help out nearly every business in the imaging industry. All companies rely on customer service in one way or another, and it’s no secret that traditional phone trees and chatbots aren’t customer favorites. These new chatbots offer companies the chance to make their customers happier, especially as more and more customer interactions are in the virtual world and not in-person.
Invest in people
Perhaps the greatest challenge our industry faces is that of finding and retaining the best employees possible. It may be of small comfort that this is a problem that isn’t exclusive to the imaging industry, but it’s one that must be addressed. The simple fact of the matter is that employing the best candidates possible is more expensive than it was pre-pandemic, or even during the pandemic. Data from the Commerce Department pegged inflation in April 2023 4.7% higher year-over-year and 0.4% higher month-over-month. Employees are keenly aware of this and want compensation that reflects this.
It’s not easy as an employer to navigate this labor market, but ultimately, we believe investing in employees is paramount. The cost of hiring new employees is expensive – around $4,000 on average, once you factor in all the time and energy spent finding new applicants, screening them, and training them. Every workplace is different, but we believe investing in our company to ensure we have the best possible people for the job is going to only become more critical in the years to come.
Stay agile and follow the data
It may sound trite at this point, but our industry must keep adapting in this rapidly evolving world. Not every new idea is a good one, but we can’t afford to pass up the good ones. We’ve constantly sought to adapt to our customers’ needs, whether it’s expanding our services or offering support in new countries as the world becomes increasingly interconnected. For dealers, this agility has often been in offering more services for their customers. Whether it’s managed print services, 24/7 IT support on office devices beyond printers, or investing in cybersecurity solutions for small businesses, dealers are selling more than they ever have. There will be growing pains and misfires, of course, but that comes with the territory.
These new opportunities bring with them a treasure trove of data beyond just successes and setbacks. With the right data, we can gain valuable insight into how our customers use our products and services. In turn, this offers our companies the chance to get ahead of the curve and anticipate what they will need in the years to come. And as any employee or employer will attest, it’s far better to be proactive than reactive.