As COVID-19’s burden on the economy begins to lift, businesses in the office technology industry stand on the edge of terrific growth opportunities.
Reclaiming office environments will require investment in technologies to power the hybrid workplaces, cloud-based solutions and document management solutions that improve workflows and customer experiences. LEAF’s research indicates that 7 of 10 companies returning to their offices in 2021 are planning to increase spending in these areas.
While opportunities abound, capturing those opportunities in a highly competitive industry undergoing rapid transformation is a more complicated issue. Dealers are asking how they can differentiate and win.
Does that mean focusing on IT services? Building an enhanced as-a-service (aaS) platform? Offering early turn-in incentives? All these are terrific ideas, but before you start investing capital, you might want to consider a new line of thinking.
How to Think Vertically
Thinking vertically means building a business development growth strategy around the industries that offer your office technology sales the most opportunity. In 2020, we saw successful dealers move aggressively into health care, warehousing and logistics, food, packaging and building materials, to name a few. These industries caught the headwinds of a public health crisis, and the dealers that built unique solutions grew revenue at a time when the traditional office environment ceased functioning.
One southwest U.S. dealer with a large concentration in retail foodservice was faced with an overstocked inventory of previously leased equipment in April-May 2020. With a bit of creativity, it was able to relieve the pressure on a large restaurant operation by redeploying technology to a local hospital desperate for immediate MFP devices to support short-term needs. The hospital needed the devices at two dozen new remote testing locations.
Every participant in the transaction won. The restaurant relieved a cash flow obligation. The hospital was able to support the crazy swing in document management requirements quickly. And the dealer soon turned a likely financial loss into a significant short-term gain.
But the dealer wasn’t finished. It realized that most health care providers would be in the same situation. Because of its specialty in food service, it had no shortage of opportunities to gather inflight technology that could be redeployed. A creative marketing effort leveraging its recent success opened the door to 14 new health care accounts and six new national restaurant relationships supplying the equipment in only six months. Since that time, the company has added additional new leases in place with all 14 health care accounts and, with the return of food service, increased its 2021 pipelines by over 300% compared to 2019.
A dealer with almost no expertise in health care before 2020 will do over $50 million in revenue in the industry in 2021. That’s creativity. That’s innovation. That’s thinking vertically.
How to Find a Vertical Focus
For the long term, developing the vertical focus of your business development strategy isn’t as simple as jumping from hot industry to hot industry. It’s a commitment to understanding how these industries work and building real solutions through economic cycles. Here are five important points to consider:
- What’s local? Find industries in your geographies that employ the greatest number of people.
- What’s growing? Research the future of the industries in your area. Most state government economic development cabinets publish a monthly list of companies expanding and growing in its region.
- What’s your expertise? If you have a concentration of customers in your book, you probably have in-house expertise in certain industries already. If you’re looking to expand into other industries, adding staff with unique experience in those areas or dedicating a team to deep dive into those verticals is a must.
- What’s the competitive landscape? Many industries are undergoing a once-in-a-generation transformation. In the past, competitive forces could have kept sales from breaking through. Still, with new ideas, approaches and business models emerging all over the place, there are opportunities in all that disruption. Find a niche and run with it.
- What’s the latest digital transformation news? Digital transformation in 2020 rocketed some businesses out of the stone age into this century. The more an industry faces this type of investment, the more they’ll need your technology solutions.
While there are a few dozen ways to identify a vertical approach to business development and capitalize on the growth opportunity at hand, these five questions should help position you for the next step of offering a solution your customers can’t refuse.
How to Win with Vertical Solutions
To make your vertical focus a powerful and profitable driver of revenue, begin with your product offering. Think about how the industry uses the technology. Understand how money and budgets are prioritized and how cash flows. The technology you sell is important, but interpreting how technology can impact an industry in a language that customers can understand and making that technology affordable can be a game-changer.
Could you win by offering an aaS solution to logistics companies popping up new cross-dock operations all over the country? Could you power sales by providing a cloud-based document management alternative for legal teams that no longer have to be in one downtown location? Could you unlock new account opportunities through construction firms with new print-on-demand needs? These are just a few examples of how industry product innovation can lead the way.
Next, tell your story. Your marketing team can help you build the messaging of your industry focus and unique product capability while establishing a proactive marketing plan to create awareness in the segment. They should be working hand-in-glove with your sales team and industry experts on how to position your unique capabilities. Your team should gather any success stories and put them in living color for new prospects to experience.
Once the marketing is in place, it’s time to unleash the sales team—but not just using the tactics of the past. Be thought leaders. Write articles and submit them to industry trade publications. Win the LinkedIn game. When you marry those activities with relentless persistence and a differentiated vertical market offering, pipelines will fill.
Finally, make sure the money works. The product, marketing and sales efforts will open doors, but the ability to easily fit within budgets closes deals. To do this, engage your customer finance partners early in the vertical process. They can help you build a unique bundled payment solution, put a marketing plan in place to target financial decision-makers and more, all while ensuing your new vertical isn’t too much of a credit concern.
How to Capitalize on Today’s Opportunities
It’s time to think bigger and grow again. But to do that, the office technology industry will have to bring new thinking and new approaches to industries undergoing radical levels of transformation. Thinking vertically about strategic business development might be the most powerful long-term decision a dealer can make as the industry evolves to bring more solutions and value to customers. So, engage your strategic partnerships. Challenge yourselves to innovate. Get growth plans off the shelf and take bold actions.