By Cassandra Balentine
The dealer channel is a key component of the go-to-market strategy for many leading OEMs. Depending on the sales structure, equipment manufacturers rely on dealers to offer expertise and availability where they cannot. To fill this need, both national and local dealers exist, as well as those that only supply consumables such as ink and media.
Skip Grant, president, Grant Graphics, LLC, is a supplier of equipment and knowledge to large format digital printers in the Northeast U.S. region. He offers a breakdown of the different types of dealers that serve the market including local equipment dealers, national equipment dealers, national supply-only dealers, and direct manufacturers. Overseas vendors may also enter the equation.
Pros and Cons
There are benefits to shopping through an authorized equipment dealer and the manufacturer itself. The largest advantage to the former is a dealer’s ability to offer integrated services from multiple vendors.
The level of training, support, and cost benefits can vary greatly between dealers, and it is important that print providers enter a dealer relationship in which they feel confident and comfortable. Depending on the level of support needed, it is important to seek a dealer that is knowledgeable across the entire range of a particular area, extending sales, support, training, and expertise on print engines, finishing solutions, workflow, and consumables.
Brian Phipps, VP/GM, Mutoh America, Inc., says that as a manufacturer, it relies heavily on its dealer channel. “The reason our dealer partners are so important is because they take our products and add the rest of the parts to make it a complete solution for the end user.”
Dealers step in to add media, finishing, and workflow. “More importantly they need to install, train, and support the end user after the sale. This is an extremely important part of what the dealer channel does for customers,” he says.
When a dealer is local, Oriol Gasch, director, Americas large format printing, Hewlett-Packard (HP), points out that there may even be a cost advantage for end users. “The dealer likely has less in-house stock to manage, saving money on storage fees, and customers also save on shipping costs. They may also provide flexibility on payment options.”
The knowledge of a dealer and the personal attention provided is essential to setting up a buyer for success on an investment. Of course, there are also advantages to buying direct. With a direct sale, customers have the benefit of cultivating a relationship with the manufacturer, says Gasch. This may lead to potential opportunities for R&D and custom solutions. “Printers dealing directly with manufacturers also get faster turnaround on product enhancements with early trade units,” he suggests.
Phipps warns that not all dealers are created equal. “All dealers offer different levels of service and products that make up the solution. End users need to do their due diligence to ensure they are buying the right products that meet their needs and make sure they can get the type of support they need for their company.”
Sales Channel Breakdown
Depending on a manufacturer’s sales channel breakout, the reliance and benefits of dealer versus manufacturer varies.
For HP, Gasch says sales channels differ by product type. He estimates equipment in the $15,000 to $40,000 range are typically sold through dealers exclusively, while mid-range equipment is generally a direct sale with the customer deciding how they want to fulfill the order, and high-range equipment is direct sale only.
The division of sales between HP and dealers varies by country based on channel capabilities and coverage. Generally, low-end equipment is moved 100 percent through dealers and mid-range equipment sales are completely assisted by an HP sales representative. “But we see approximately 20 percent of fulfillment through channel partners and 80 percent fulfillment directly from HP for the mid-range stock. For high-end products, 90 percent of sales are direct, with maybe ten percent sold indirectly,” he estimates.
Ken VanHorn, director, marketing and business development, Mimaki USA, Inc., says its sales in the U.S. are overwhelmingly via the dealer channel. “We sell printers and ink through the channel; we don’t supply much media, but many of our dealers do so their customers have a one-stop place to get everything,” he notes.
Mutoh only sells through authorized reseller channels. “We made our channel this way so that end users that purchase our equipment have the best out-of-the-box experience and overall service and support possible,” says Phipps.
Roland DGA Corporation sells its hardware through a network of authorized Roland dealers. “Roland’s network of authorized dealers is an important asset to both the company and Roland customers,” explains Joe Dawson, senior director of sales, Roland. “These dealers receive comprehensive and continuous training that ensures that they have extensive product knowledge and are capable of exceeding all customer expectations when it comes to sales, service, and support.”
End Customer Outlook
Many print service providers look to dealers for a range of needs, including installation, service, supplies, and support.
Minahan Signs, a client of its local Roland dealer, Grant Graphics, has always purchased equipment through a dealer. “The support received from a dealer is well worth any premium charged,” comments Dave Crichton, president, Minahan Signs.
Established in 1951 by the Minahan family, Crichton purchased the business in 2008. It is a full-service sign company with offerings that range from the smallest digitally produced sticker to large electronic message centers. Its digital revenues have increased in the past two years, and its retail and wholesale digital production account for nearly 40 percent of its revenue.
The sign shop’s relationship with Grant Graphics dates back to 2008. “We met Skip and his staff at the USSC show in Atlantic City, NJ,” recalls Crichton. “We were in the market for digital equipment and had the opportunity to buy form several dealers.”
Minahan Signs purchased equipment from Grant Graphics at the show and has not looked back. “We have used Grant Graphics on numerous occasions for staff training and refreshing ideas in the digital world,” admits Crichton.
In addition to equipment, Minahan Signs purchases about 80 percent of its ink and media from Grant Graphics. Crichton notes that total support and commitment offered by the dealer help to ensure their success in the digital print world.
In another example of dealer satisfaction, Grant Graphics’ customer Voss Signs, LLC of Manlius, NY has been doing business with the local dealer for about ten years—the same time they introduced digital to the shop. “We never buy direct, mainly because of the service,” comment John Bower and Jim Menter of Voss Signs. “We buy from Grant Graphics, and have looked to other dealers if something wasn’t available from them.”
Voss Signs was established in 1965 and purchased by Menter in 1998. It offers digital and screen printing, as well as the finishing services that surround the business, offering products and services that include engraving, die cutting, sand blasting, vehicle wraps, and banners.
Menter explains that the need for service doesn’t go away once a printer is installed. “It’s not plug and play with these printers, once you buy a device you need to be set up for service. Six months down the road if you have a problem, you need someone reliable,” he says.
Before selecting Grant Graphics as its primary dealer, Menter recalls interviewing about four local dealers prior to purchasing its first digital printer to get a sense of what they could offer. Grant Graphics stood out.
Menter and Bower say that at least twice a year, and as often as four, Grant Graphics makes a trip to the shop to evaluate the state of equipment. It looks at the age of the equipment, production needs, and compares it to what’s new with Roland’s line to determine if an upgrade is warranted.
Today, the company has six wide format printers on its floor, all from Grant Graphics. Additionally, it purchased complementary finishing equipment, all the RIP stations, as well as inks and consumables.
The Dealer Option
There are two sides to every debate. Not only do print providers get a choice between what equipment they want to use, but also who they want to buy it from. Many equipment investments require more than a simple install, needing service and support to limit any downtime in production. In order to get a foot on the street, many manufacturers invest in dealer channels to ensure their customers remain satisfied and loyal.
Jan2015, Digital Output
