Is It Time to Diversify? Dealers Make Argument for Popular Alternatives

The topic of diversification is always a spirited one, as dealers must weigh the pros and cons that a given product or service will encompass. Every dealer has its checklist of considerations that a new offering must deliver upon. When pondering the merits, it’s funny how the questions just tumble out of one’s mind. For example:

How sophisticated is the technology? Is it an easy sell, and is it a quick sell? Can I bundle it with my current portfolio, or is it a stand-alone proposition? Is it even a good fit for a strong percentage of my customer base? How are the margins? What’s the degree of difficulty when it comes to servicing? Can I count on my vendor for support? Is there an opportunity for recurring revenue?

And those just scratch the surface.

What follows are five examples of dealer diversification, including two for security cameras and access systems, simply because we’re such big fans (kidding, not kidding). But that won’t suffice. Since we wanted to do justice to the State of the Industry focus on diversification, we have a strong lineup of contributed articles from subject matter experts that speak to a variety of possibilities.

Wow Factor

It comes as no surprise that Pulse Technology is among those dealers that got in early on the robotics trend that’s been heating up the past 18 months. After all, top exec Chip Miceli has never shied away from the leading-bleeding edge, particularly when he sees a viable opportunity to go wider and deeper with clients. So when the dealer annexed autonomous cleaning and service robots courtesy of Pudu Robotics, it wasn’t a case of the next, shiny new object. That it rates high on the sexy product scale as part of the AI family is a bonus.

According to Vince Miceli, vice president, the market need was fairly obvious based on the pain points clients were conveying: labor shortages, rising operational costs and a desire to augment efficiency without adding to the W-2 roster. The cries for help came from a fairly broad vertical base: manufacturing companies, healthcare facilities, schools, municipalities and commercial businesses.

“Many clients were actively looking for automation solutions, and we saw robotics as a natural extension of our consultative approach to technology,” he said.

The ability to solve a real business problem is chief among the factors that sway Pulse toward onboarding a new offering, and another is aligning with the existing customer base and sales channels. Offering a recurring service/support opportunity is also paramount.

When robotics is positioned alongside managed I.T., cybersecurity and facility technology solutions, it becomes part of a larger operational improvement initiative.

– Vince Miceli, Pulse Technology

“We have to believe it represents a long-term technology trend rather than a short-term novelty,” Miceli noted. “Pudu Robotics met all those criteria.”

Pudu’s partner support was critical in the early stages and helped alleviate learning curve obstacles. The talk track was critical; both sales reps and clients needed a clear vision for how robotics would fit into daily operations. Miceli pointed out that unlike traditional office equipment, robots frequently require customers to tweak their workflows. Focusing on outcomes as opposed to features paved the way for successful deployments.

Despite the technology sophistication, Pulse didn’t need a dedicated robotics specialist at the outset. “We leveraged our existing technical and sales teams, supplemented by manufacturer training,” Miceli noted. “As the category continues to grow, we anticipate expanding specialized expertise, but in the beginning, the key was education and demonstration.”

The early results have been in line with expectations, and it’s not surprising that adoption cycles tend to be longer than most office solutions. As talking points go, labor savings, consistency, employee productivity and operational efficiency resonated more than the specs surrounding sensors or navigational technology.

Miceli notes there have been opportunities to bundle robotics into broader technology conversations. “Clients increasingly want a strategic technology partner rather than a collection of individual vendors,” he said. “When robotics is positioned alongside managed IT, cybersecurity and facility technology solutions, it becomes part of a larger operational improvement initiative.”

Easy Call

The day Rogers Coxe decided to add barcode printers to his arsenal at Dove Technologies wasn’t exactly the culmination of a drawn-out process. In fact, it might have been the easiest bolt-on he’s ever done at the Florence, South Carolina-based dealership. It was a natural offshoot of the company’s main focus, and it’s not the most complicated sell. Call it Diversification 101.

It’s important to ensure any diversification is broadly applicable to the client base, which is a given, and any customer set that’s involved in shipping or inventory is certainly in that target area. Coxe also underscores the need to ensure any new offering closely matches your sales process. The ability to support supersedes all others in order to avoid onboarding dedicated specialists, he added.

Fortunately, barcode printers easily pass through the diversification checklist. It was simplified further as Dove Technologies doesn’t work with the more esoteric barcode products (the company primarily offers the Zebra line). Coxe felt that made the most sense for his company.

“If you want to dive deeper into it, you can definitely expect a steeper learning curve, especially in dealing with some of the specializations they have,” he said. “In those cases, it’s necessary to have a champion within your dealership and a more involved level of partner support.”

When you can help your customer develop a strategy to ensure that they can always overcome downtime, that’s worth a lot to their organizations.

– Rogers Coxe, Dove Technologies

While technical sophistication wasn’t a sticking point, Coxe feels the greater obstacle is the path to getting significant adoption within the sales force. Achieving 100% adoption is a tall order for any offering, and many account representatives love to stay within their comfort zones. What can help prime the offering staff-wide is identifying a rep who’s eager to tackle it and can enjoy some early success selling it.

“That can really excite the sales force, get them motivated and help them understand how it can be a viable option for them as well,” Coxe related.

A proper marketing push powered by a long-term strategy that reinforces the new offering can make a huge difference. Oftentimes, customers are slow to discovering the dealer has a new offering—plus, he said, the longest-tenured customers will be the last to know.

One of the interesting elements in gauging the barcode printer’s early performance was the unexpected places in which margin presented itself, including the hardware side. It also calls for a significant service component. Coxe points out that when a barcode machine goes down, it cripples the entire manufacturing line or shipping and receiving lines.

“When you can help your customer develop a strategy to ensure that they can always overcome downtime, that’s worth a lot to their organizations,” he said. “A line having to shut down unexpectedly is a huge cost, so allowing these customers to plan and avoid it based on your service strategy, that’s definitely valuable.”

Access Granted

Security cameras/access control systems—one of the hottest product additions—offer an impactful solution for clients that have a critical need for security. Unfortunately (or fortunately, depending on your POV), the vertical fits continue to billow: educational environments and healthcare facilities have long sat atop the list, but law firms, manufacturing/warehousing operations, legal and retail spaces have sought to ramp up access and monitoring protocols.

Automated Business Technologies (ABT) of Centennial, Colorado, picked up on the fact that many clients and prospects have existing systems that have matured to a point of ineffectiveness. CEO Mike Piche notes the technological advances within the space have opened the door to providing more effective solutions.

“For us, all the products we sell need to support the business technology needs of our customers,” he said. “Ideally, there would be an aftermarket component. But in certain cases, if we can obtain an acceptable margin, we’ll take on hardware products without an aftermarket stream of revenue knowing that such products will lead to follow-up business.”

Ideally, there would be an aftermarket component. But in certain cases, if we can obtain an acceptable margin, we’ll take on hardware products without an aftermarket stream of revenue knowing that such products will lead to follow-up business.

– Mike Piche, Automated Business Technologies

Vendor support was critical for ABT; Piche notes in-house expertise can be developed over time. Having the sales support and technical staff in-house can be effective to a point, but he believes only a good vendor partner can provide the expertise to address certain opportunities and environments.

The products have grown beyond Piche’s expectations, but that can open the door to challenges that tax both sales and the tech staff. Highly regarded brands are needed to deliver value; low-cost options don’t boast the superior functionality clients seek, he added.

“Margins improve with volume of sales, so you really need to find a good partner and standardize with them,” Piche remarked. “With these products, given the relative lack of aftermarket revenue, you have to hold your margins.”

Conference Coups

As the pandemic became smaller and smaller in the rearview mirror, companies gradually brought team members back to the office. Most businesses adopted a patchwork policy for in-office and remote work, which opened the door for companies such as Green Office Partner of Chicago to enjoy growth via conference room technology. From cameras to microphones, touch displays to room scheduling tools, and conferencing platforms to the integration work tying it all together, the dealer has thrived at fostering enhanced meeting and collaboration experiences.

According to Gerard Iannuzzelli, director of strategic services and solutions, many hybrid work scenario clients were dealing with rooms that were under-equipped, over-complicated or not being used to their full potential. With Green Office Partner boasting a strong track record with traditional workplace technology, that opened the door to furnishing configurations that improve productivity, collaboration and the overall employee experience.

Among the diversification triggers for Green Office Partner are solution-driven offerings that fit within its expertise and service model for proper post-sale support. “It should create opportunities for deeper client relationships, recurring value and consultative conversations,” Iannuzzelli said. “Most importantly, it has to make sense for the customer. If the product helps clients work better, simplifies their day and creates measurable value, then it’s worth exploring.”

Once we positioned [conference room] as a customized workplace solution, supported by knowledgeable staff and strong partner relationships, the offering became much easier for both our sales team and our clients to understand.

– Gerard Iannuzzelli, Green Office Partner

The addition was fairly seamless for Green Office Partner, which sources the products from its incumbent distribution/partner channels. The dealer also onboarded technology support staff who were well-versed in room environments, client collaboration needs, the software platforms they use and how employees interact with the technology on a daily basis.

While partner support was vital, Iannuzzelli notes the greatest challenge was building the internal confidence to sell and support the solution the right way. “Our team had to learn how to ask different questions, think beyond the equipment and focus more on the client experience. There were some natural learning curves around design, implementation, training and service expectations, but having the right people in place allowed us to work through those challenges.

“Ultimately, the biggest tripping point was making sure we didn’t treat conference room technology like a simple product category,” he added. “Once we positioned it as a customized workplace solution, supported by knowledgeable staff and strong partner relationships, the offering became much easier for both our sales team and our clients to understand.”

The offering has exceeded growth expectations, and demand continues to rise, according to Iannuzzelli, and the tech behind the equipment keeps elevating the offering’s value proposition. Hardware and software were only half the battle; even with many of the conferencing tools available for purchase online, users weren’t always gaining maximum efficiency. They weren’t fully versed on what the tech could do, and learning complicated systems turned off many people.

That prompted Green Office Partner to change its thinking on the subject of pricing, margin and value. “We realized clients weren’t just paying for cameras, microphones, displays or software licenses. They were paying for a better meeting experience,” Iannuzzelli said. “The real value came from helping them understand how their teams collaborate, how their rooms are used and how the technology could be customized around their workflow and culture.”

The upshot became bundling opportunities tied to consultation, installation, training, support and ongoing optimization. “We became experts in customizing the user experience, and in some cases, even using AI to help integrate the meeting room experience with the client’s company culture,” he said. “Ultimately, we learned that clients perceive the most value when the technology feels simple, intuitive and aligned with the way their people actually work.”

Timing Is Everything

When you’ve had stints with various dealerships over a 30-plus year career, there’s a good chance you’ve had experience with most mainstream offerings in addition to a few that are off the beaten path. That was certainly the case for Scott Schnabel, the president/owner of Denver-based EverWorx, who had experience with security cameras and access systems at a previous stop. But what really brought the offering onto his radar screen was having a pair of clients inquire about its availability within the span of a week. Schnabel was able to secure reselling agreements with several vendors, led by Verkada, one of the acknowledged leaders in the space.

The biggest question for Schnabel when it comes to any significant diversification is whether his team can support it effectively. Fortunately, he has a VP of service and operations whose career also dates back some 40 years, and has experience in this area. In addition, EverWorx contracts a third-party electrical specialist to help guide the installation, and some early hand-holding was essential in getting the dealer more comfortable with the process.

“We have a really good installer who will join us on the sales call, make sure they understand the application and what we’re trying to do,” Schnabel noted. “That way, they can feel good about effectively executing on the project. It also helps that Verkada is a very supportive organization. They were involved on the front end with solution recommendations and helping us price out effectively. With all that hand-holding, it was a pretty easy decision to enter the field.”

It also helps that Verkada is a very supportive organization. They were involved on the front end with solution recommendations and helping us price out effectively. With all that hand-holding, it was a pretty easy decision to enter the field.

– Scott Schnabel, EverWorx

From a challenges standpoint, Schnabel saw a lot of parallels with early document management solutions when it came to price objections. Thus, it was important to cultivate multiple options for cameras/access systems that would align with clients that don’t require a full-fledged solution.

“We’ve been able to complement the Verkada solution, so we can provide multiple offerings based on what the customer’s appetite or needs might be,” he added.

One soon-to-be customer unwittingly turned into a case study of sorts. A local plumbing company that’s a neighbor of EverWorx had one of its trucks broken into and robbed. Since Schnabel’s operations had cameras pointed outside, his dealership was able to provide footage to help with the investigation. Since that encounter, Everworx now has a great business relationship in place with their neighbor, supporting their technology and security needs.

Interestingly, EverWorx’s takedowns have almost exclusively been stand-alone deals. More recently, however, the dealer has been able to segue from managed IT and copiers into security/access solutions when prospective clients were approaching the end of their previous agreement.

“Clients are always looking for that single supplier who can support all their needs,” he added. “Just having the offering has kept us engaged in more conversations.”