No longer just printing

The company is the Australian distributor for the TallyGenicom range of printing solutions, which are exported directly from Japan. Called the Factory Sponsored Program (FSP), it provides the free use of a colour laser printer, which is covered by a free, open-ended warranty plan, so that customers only pay for the consumables they use.

Customers are also unbound by fixed contract arrangements, and can simply upgrade models or numbers as they need.

"From an end user’s point of view the flexibility of the plan and its upgrade path removes the fear and risk of technology obsolescence," Gibson says.

"Also, as it’s a consumables-only plan, the end user can have multiple units in each location with no extra capital cost. Printing 1000 pages on 10 printers is exactly the same cost as printing 10,000 pages on one printer."

For resellers, the benefit is in not having to outlay or pass on any capital expenditure for printing to customers, meaning that the money a customer would normally spend on printing hardware can be spent on other products or services. The program is now being deployed in the UK.

Importantly, Gibson adds, resellers need not worry about losing accounts to vendors going direct. "More and more manufacturers are taking hardware business direct, and specialist consumables suppliers are taking away the aftermarket revenue opportunities."

WPT says that the program has been especially successful in the education and real estate markets where printing volumes tend to be higher and colour is in high demand.

"What it does for the reseller is offer a unique solution for the customer where the Harvey Normans and Office Works can’t compete," Gibson says.

O’Flaherty agrees that consumables are where the real money is in printing. "Like many parts of the IT industry the margin on printer hardware is being compressed."

However, a printer has an ongoing annuity attached to it and too often this margin opportunity is ignored by resellers, she says.

"I’ve often said that if all printer manufacturers stopped selling printers in this country, supplies resellers would enjoy 10 more years of a revenue stream.

"Most retailers are wanting to know now more than ever how to ensure they capture both the printer sales and the supplies sales. Consumables are just the outcome of printer sales and print volume and both are increasing in unit terms."