Adam Gregory
Don’t ever tell Adam Gregory, “You’re going to fail,” because if you do, he’s going to prove you wrong.
The president of Advanced Business Solutions, a virtual document imaging dealership that primarily focuses on the Atlanta, GA and Jacksonville, FL markets, had an idea for a new business model for the document imaging industry back in 2002. When he brought that model to his boss at a small independent dealership in Marietta, GA, he quickly dismissed it.
Two years later Gregory decided to go off on his own and put that business model into action. His boss told him, “You’ll never succeed.”
It’s been 11 years now and that business model of Gregory’s is working out just fine. He has five employees, a new market (Jacksonville, FL), and a network of dealers across the country who help him service customers with locations outside of Atlanta and Jacksonville.
After I first heard about Gregory, I couldn’t wait to talk to him about the inspiration for his unique business model, how customers react to a different kind of dealer, and how he remains competitive going up against direct branches and other dealers operating under a more traditional business model.
How did you get into this business?
Gregory: Before I got out of the Navy in 1999 I went to this big job fair in Atlanta. On the way in, this guy asked me what kind of job I was looking for. I told him, “I don’t know, I just know I like to meet people and like to talk to them.” He goes, “You ever thought about selling?” I thought he was talking about Amway or something like that, but when he said copiers, I asked is that even a business? To make a long story short, about a month later I started working for his independent dealership in Marietta, GA as a sales rep. I was barely making enough money to pay rent.
I worked my way up to sales manager and had five guys working under me. After three years I approached him and said, “I have this idea and I’d like to hear what you think. Every day our sales guys get up at six in the morning, come into the office by 8 and get on their computer and do e-mail or make phone calls. Why do they have to come in here to do that, can’t they do it from home? I can understand if we’re selling cars, but we’re not. I’ve been here three years and I’ve never sold one machine off the demo floor.”
He told me, “We’ve always done it this way.”
I was there another two years and then told him, “You’ve done a lot for me, but I’m leaving and starting my own business.” He looked at me and said, “Don’t do it, you’ll never succeed.” That’s all I needed to hear, that was my motivation.
That was in 2004. I didn’t start with a dime in my pocket and today I’m debt free. I’m a cash run company and we’re doing about $1.2 million.
You needed a product line to sell so you contacted OKI Data, why’d you pick them?
Gregory: I knew it was a secondary line, but there was a lot of potential and there was a lot I could do with that line for the type of business I wanted to build. [My contact at OKI] went to bat for me, I got a small credit line with OKI, and I was off and running.
Tell me more about your business model?
Gregory: This is a new century, a new environment; people can get all the information they need on the Internet. They know more about the machines by the time we talk to them than they ever did before.
I just moved to Florida with my family and I have a guy in Atlanta that’s running that operation. We’ve got three guys who do service for us and they operate out of their home. We have a warehouse where we keep parts and if they need a part they go get it and let me know what they use. We have no overhead, no inventory; we use distributors for everything we need. Toner gets there next day—it’s a great concept.
I have machines in Arizona, Houston, TX, Indianapolis, and Orlando. I have 200 machines in Florida and 500 in Georgia. I use independent dealers and technicians to do all of my service for me, and have never had a problem.
Did you ever get any pushback from prospects about doing business with a company that doesn’t have a physical location?
Gregory: When I first started, the first two, three, four years, I was nervous. I kept telling myself, how do I tell this customer I don’t have a brick & mortar, how am I going to look legitimate if I don’t tell them I have a $5 million business and 15-20 people working for me?
The longer I’ve done this I’ve come to understand that the customer is not worried about that. Sometimes we put too much thought into that. How do I look financially stable to a customer instead of focusing on what can I provide that somebody else can’t?
I just closed an account in Jacksonville with six offices for 47 machines. When I closed the deal I was living in Atlanta, I didn’t even have my house here in Florida yet. I told the CFO, I have five or six technicians in the Jacksonville area; we show up in four to six hours, we get parts there next day. He said, “I don’t care if you live in Hawaii, as long as you can keep my equipment running.”
It was based off a productivity standpoint instead of saying this is what we have. Since we can provide that, customers understand. They think, I don’t care what Adam’s got; I just care that he can provide the service we need.
What were some of the challenges you had to overcome when getting this business off the ground, especially with this business model?
Gregory: When I first started there were some challenges. A machine would break down and the customer might need a loaner. How was I going to get it to them? A lot of that was the money; I didn’t have the money to put a $5,000 piece of equipment in the warehouse as a loaner. Over time that obstacle disappeared.
Another challenge was the A3 market. Here I was an OKI dealer, all we sold was color letter/legal boxes and I wanted to sell A3 and get some bigger machines out there. Then I got into refurbished and connected with a wholesaler in Tennessee. He drop ships my machines wherever I need them to go. I did that with used Canon machines for a long time. As we started to transform, OKI came out with an A3 model.
It’s almost like everything fixed itself. It’s just taken time.
Who are your customers?
Gregory: I have a $200 million company with 70-100 machines in six states, I’ve got your mom & pops, CPA offices, big doctor’s offices with 30-40 machines. Sixty percent of my business is small businesses with up to 25 employees, another 35 percent is probably midsize companies, and the rest are large businesses.
Who do you view as your competition?
Gregory: Direct branches.
How do you compete against these big guys?
Gregory: I’m loving it. Let me be honest, when [the OEMs] started buying dealers out over the past few years, it was like, “Oh my gosh you have Xerox coming in buying people out, IKON sweeping people up,” and I thought, “Okay that could be a bad thing for the market, but for some small guys that was a good thing. It’s something we could market against.”
My main competitors are Konica Minolta and Ricoh, and I tell customers, “You want service from Ricoh, you’re just a little bitty number on a big old list. You can call me directly or text me on my cell phone and we’ll fix it immediately. Which would you prefer?” That’s usually the breaking point for us right there.
People go, “I don’t want to wait a whole day for a technician, or I want to talk to the owner, the owner of the company has some meat in this game.” I’d tell them, “Good luck talking to the owner of Ricoh.”
You represent OKI Data, Canon, and HP, how do each of those lines fit into your business model?
Gregory: Canon fits in with more of our A3 line, but we sell mostly refurb. I don’t sell as much HP because you can get reman toner for HP like crazy. The way I look at it is, if I put a printer in somebody’s office and there are 20 guys around the block that can get the toner for that customer, anybody can walk in and knock me off my feet. If I go in with an OKI Data, you can hardly find reman toner on the color side, and I can just about sell them a machine for the same price as an HP. But I guarantee you I’m going to have that toner business with OKI because there are only a couple of us OKI dealers.
HP is about 10 percent of our market, OKI is 70 percent and the rest is Canon. We have OKI everywhere. The system OKI has set up for dealers allows me to stretch my hands across the country and find people to service my products. That’s what makes this [business model] possible.
You’re doing well with A4, is that the best product segment for this business model or doesn’t it matter?
Gregory: I don’t think it matters. Whether it’s another dealer you signed a contract with to work on it for you or an independent tech, it doesn’t matter as long as you’ve got someone that can work on it.
Do you anticipate branching out into other product segments?
Gregory: We’ve gotten into document management on the software side, but outside of document management, maybe wide format. It’s something we’re looking into, but it’s hard to find guys to work on those things. We’re trying to decide if it’s worth our time and effort. I’ll be happy staying where I am for the next 10 years because I’m comfortable knowing that people are going to keep printing for another 10 years.
How difficult is it finding other dealers and distributors who can help you sustain this business model?
Gregory: Not at all. I’ll tell you why, and I’d love to use this example of Managed IT. Everybody in the copier industry wants to offer Managed IT. With Managed IT companies you’re either going to have to buy them or they’re going to be [upset] with us. We’re trying to take their business. They might want to take our business and sell printers and copiers.
There’s a guy out there with a small company who started out as a Managed IT company, he now sells Canon, another line, and just picked up OKI Data. He had them for about two years when I closed this deal with this big customer in Phoenix. I called him up and told him I have six or seven machines [that need servicing] and I’d like to meet him for lunch. I worked out a deal where I paid him a flat rate to work on the machines. He sends me an invoice and the rest is history. If he needs parts he’ll use his if he has them, if he doesn’t, I’ll ship them to him.
That’s how I’ve gone about finding people. Most independent dealers are like me and if somebody calls and says I have 10 machines coming to Jacksonville, can you service them, I’d say “Hell yeah,” because we’re competing against these big guys with offices all around the country. If we don’t all work together, who’s going to help us?
One of the companies I work with is right here in Jacksonville, in the same market, but we help each other [provide] service to each other’s customers. We have a gentleman’s mutual agreement that their customers are theirs and mine are mine.
The Gregory Family
What do you do for fun when you’re not working?
Gregory: Spending time with my beautiful wife, Melissa and our children. We have four girls and three boys. You get one shot in this life, so enjoy it with those that mean the most to you when you have the time.
A fun question, what’s the one thing you’re good at that your employees and customers would be surprised to hear?
Gregory: Karaoke. I sing pretty well.
Another fun question for you, if you had to choose your final meal, what’s on the menu?
Gregory: A medium well rib eye, baked potato loaded with butter and sour cream, a piece of garlic bread, and a big old glass of sweet tea.
How does the rest of the year look for Advanced Business Solutions?
Gregory: It looks great. We expanded into Florida the end of last year and I’m looking for another 10-15 percent growth over this year into 2016.
