{"id":58404,"date":"2023-12-28T07:44:26","date_gmt":"2023-12-28T15:44:26","guid":{"rendered":"http:\/\/www.enxmag.com\/twii\/?p=58404"},"modified":"2024-01-05T00:53:19","modified_gmt":"2024-01-05T08:53:19","slug":"diversification-ai-and-consolidation-the-many-trends-that-shaped-2023","status":"publish","type":"post","link":"https:\/\/www.enxmag.com\/twii\/state-of-the-industry\/2023\/12\/diversification-ai-and-consolidation-the-many-trends-that-shaped-2023\/","title":{"rendered":"Diversification, AI and Consolidation: The Many Trends that Shaped 2023"},"content":{"rendered":"\n<p>It\u2019s been quite a while since the phrase \u201coptimistic\u201d was applied to a coming year\u2019s business outlook, at least without the qualifier \u201ccautiously.\u201d Without giving into hyperbole, one can almost hear the office technology dealership humming the song \u201cFeeling Good.\u201d After three years of COVID-infested conversations and a business engine that\u2019s been slow to turn over, whatever shape the new normal has taken appears to be palatable. Business, for many, is brisk.<\/p>\n\n\n\n<p>Whether it\u2019s a new dawn and a new day remains to be seen. But there was enough evidence in the tremendous growth experienced by our Elite Dealer ranks\u2014essentially the Fortune 118 of the industry\u2014in 2023 to suggest that the worst of the pandemic hangover has subsided. A degree of this, naturally, is dealers being able to follow through on sales that hung in limbo. But there\u2019s an air of optimism that goes beyond pent-up demand, and it will be interesting to see if dealers can continue to register double-digit, year-over-year revenue increases in 2024.<\/p>\n\n\n\n<p>Let\u2019s not be too Pollyanna about the future. Significant issues are continuing to plague dealers. Output volumes continue to tumble, and finding capable employees\u2014certainly in sales and technical service\u2014is getting increasingly more difficult. The desire of current and prospective team members to continue working from home impacts dealers and their clients, as quality candidates are finding alternatives where remote work is either tolerated or a permanent fixture.<\/p>\n\n\n\n<p>Certainly, these aren\u2019t the only developments visiting our industry. To get a better grip on what\u2019s going on in the marketplace, we cast a wide net to dealers, manufacturers and other providers to the industry for our annual trends and predictions issue. This piece covers the most notable trends industry heavyweights are seeing as 2024 gets underway. A separate article containing their predictions for the coming year can be found on page 26. So kick back, pour a glass of whatever bubbly remains from New Year\u2019s Eve and absorb the viewpoints of these individuals brave enough to offer estimations of what trends have been impacting the industry.<\/p>\n\n\n\n<p><strong>Interest Level<\/strong><\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2023\/12\/Carter-Hertzberg-Nauticon-Office-Solutions.jpg\" alt=\"\" class=\"wp-image-58575\"\/><figcaption>Carter Hertzberg,<br>Nauticon Office Solutions<\/figcaption><\/figure><\/div>\n\n\n\n<p>The Federal Reserve has done what it can to arrest sky-high inflation via interest rate increases. Inflation has been slowly (with slowly being the operative word) receding, and there have been murmurs within the Fed that rates could be cut as early as this spring if the trend continues. Carter Hertzberg, the president of Nauticon Office Solutions in Gaithersburg, Maryland, is concerned about the long-term effects of higher interest rates, as he feels they\u2019ll remain constant for much of 2024.<\/p>\n\n\n\n<p>\u201cThis is just another margin squeeze on the dealer community and the leasing companies,\u201d Hertzberg said. \u201cThis tug-of-war will be interesting to watch as dealers shop rates and some aggressive leasing companies see an opportunity to buy business\u2014but at what cost?\u201d<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>This tug-of-war will be interesting to watch as dealers shop rates and some aggressive leasing companies see an opportunity to buy business\u2014but at what cost?<\/p><cite>\u2013 Carter Hertzberg, Nauticon Office Solutions<\/cite><\/blockquote>\n\n\n\n<p>While 2023 didn\u2019t quite live up to the previous two years, some see consolidation as a trend that will continue at least in the short term. Count Bob Madaio, vice president of marketing for Sharp Imaging and Information Company of America among those prognosticators. He sees the proliferation of mega dealers and private equity-backed organizations creating national level organizations; several consolidators, in fact, have stretched into new geographies in the past 12 months.<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2022\/09\/Sean-Bell-Solutions-YES.jpg\" alt=\"\" class=\"wp-image-51479\"\/><figcaption>Sean Bell,<br>Solutions YES<\/figcaption><\/figure><\/div>\n\n\n\n<p>The upshot for independents, according to Madaio, is the clear need for carving out a distinct value proposition. \u201cThis forces dealers, both large and small, to sharpen their strategic approaches to clearly define their prime differentiators and what solutions they need to focus on,\u201d he said.<\/p>\n\n\n\n<p>Continued consolidation is in the cards from both a dealer and manufacturer perspective, according to Sean Bell, president of Solutions YES in Portland, Oregon. Whether this is a good or bad development depends on one\u2019s point of view, but Bell sees pluses and minuses.<\/p>\n\n\n\n<p>\u201cI believe [dealer consolidation] will open doors to hire new employees from the industry and add net-new customers,\u201d he said. \u201cI believe we\u2019re aligned with strong vendors, but anticipate that some of our competitors could be negatively impacted [by OEM consolidation].\u201d<\/p>\n\n\n\n<p>One of 2023\u2019s biggest talking points was AI, including generative AI and machine learning, as it applies to the industry. While the technology has been leveraged for predictive maintenance for a number of years, the conversation around its integration, along with digital customer engagement, bears watching, according to Jennifer Healy, senior director, marketing strategy, communications, programs and enablement, dealer and partner channel, Ricoh USA.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>I believe we\u2019re aligned with strong vendors, but anticipate that some of our competitors could be negatively impacted [by OEM consolidation].<\/p><cite>\u2013 Sean Bell, Solutions YES<\/cite><\/blockquote>\n\n\n\n<p>\u201cToday, our digital presence is rooted largely in customer conversation,\u201d she said. \u201cBecause of this, dealers should look to implement digital customer engagement strategies that enable personalized interactions. AI will also play a significant role in how businesses operate and interact with customers. A closed AI system can drive renewals, lower sales costs and improve customer experiences.\u201d<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2022\/12\/Dan-Larkin.jpg\" alt=\"\" class=\"wp-image-53186\"\/><figcaption>Dan Larkin,<br>Marco<\/figcaption><\/figure><\/div>\n\n\n\n<p>Certainly, one of the major talking points for the industry continues to be print security. Awareness is always a key, and as more customers become cognizant of the risks, they\u2019ll demand a robust security strategy, not to mention a vendor that can provide ongoing support and consultation, notes Dan Larkin, solutions sales director for Marco of St. Cloud, Minnesota.<\/p>\n\n\n\n<p>\u201cUnfortunately, not only did the pandemic escalate security concerns, but it also exacerbated underlying issues within our labor market and our supply chain,\u201d Larkin added. \u201cService providers will need to be proactive about managing client expectations and incentivizing workers to consider service technician roles.\u201d<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>Service providers will need to be proactive about managing client expectations and incentivizing workers to consider service technician roles.<\/p><cite>\u2013 Dan Larkin, Marco<\/cite><\/blockquote>\n\n\n\n<p><strong>Leaner Lines?<\/strong><\/p>\n\n\n\n<p>Could dealers actually be looking to reduce the number of OEM lines they carry? It\u2019s definitely a possibility, according to Mitch Leahy, vice president and managing director of sales for GreatAmerica Financial Services. He believes supporting non-secondary lines may become increasingly difficult after dealers cleared out their 2022 upgrade backlog.<\/p>\n\n\n\n<p>\u201cWith&nbsp;inventory&nbsp;normalizing, quotas in place&nbsp;and pricing adjustments continuing, dealers may&nbsp;scale back on&nbsp;lines sold,\u201d Leahy added.<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2023\/12\/Frank-Cucco-Impact.jpg\" alt=\"\" class=\"wp-image-58567\"\/><figcaption>Frank Cucco,<br>Impact Networking<\/figcaption><\/figure><\/div>\n\n\n\n<p>There\u2019s little doubt that 2023 saw many dealers build on their diversification strategies in earnest. Frank Cucco, CEO of Impact Networking in Lake Forest, Illinois, believes risk management, cybersecurity and managed digital transformation services will continue to garner momentum.<\/p>\n\n\n\n<p>\u201cThey provide more growth channels for revenue in a declining hardware market,\u201d Cucco said. \u201cThat means that hardware-centric companies will also have to continue transitioning into managed service providers.\u201d<\/p>\n\n\n\n<p>Are we on the cusp of seeing a stabilization in print volumes? Fernando Maroniene believes that to be the case. The senior director of product marketing for Brother International notes that more device consolidation will translate into greater efficiencies. And with continued digital transformation, an increase in machine learning and artificial intelligence, it will call for more digital workflows that can help a distributed workforce increase productivity and efficiency.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>[Diversifications] provide more growth channels for revenue in a declining hardware market.<\/p><cite>\u2013 Frank Cucco, Impact Networking<\/cite><\/blockquote>\n\n\n\n<p>\u201cThere\u2019s a need for more security requirements as employees continue to work from different locations and require document confidentiality, network security and device security,\u201d Maroniene remarked. \u201cAutomatization and AI will continue to be implemented into several facets of business, which paves the way for innovation. But with this advanced technology, we\u2019re anticipating an increased risk of security breaches and cyberattacks. Therefore, updated fleets of printers are necessary to protect companies from these security threats, and dealers should remain flexible with their most updated security platforms.\u201d<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2023\/12\/Steven-Sauer-Toshiba.jpg\" alt=\"\" class=\"wp-image-58569\"\/><figcaption>Steven Sauer,<br>Toshiba America <br>Business Solutions<\/figcaption><\/figure><\/div>\n\n\n\n<p>Another industry veteran who\u2019s keen to see the trajectory the AI movement takes is Steven Sauer, chief revenue officer of Toshiba America Business Solutions. He thinks the industry has only begun to scratch the surface of AI\u2019s potential.<\/p>\n\n\n\n<p>\u201cI believe AI will dramatically impact intelligent document capture and how we liberate information from paper,\u201d Sauer added. \u201cDoing so will deliver intelligent document capture technologies to SMBs as well as to individuals. Previously this capability was only available at the enterprise level. Toshiba currently harnesses AI to deliver insights into clients\u2019 MFPs to deliver superior client experiences from setup and ongoing management to troubleshooting and support.\u201d<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>I believe AI will dramatically impact intelligent document capture and how we liberate information from paper.<\/p><cite>\u2013 Steven Sauer, Toshiba America Business Solutions<\/cite><\/blockquote>\n\n\n\n<p><strong>Election Splash<\/strong><\/p>\n\n\n\n<p>During past election cycles, particularly when the nation\u2019s chief executive post has been up for grabs, it usually meant an uptick in business as efforts by the incumbent would be taken to boost the economy. That\u2019s been conspicuously absent during recent election cycles, notes Chip Miceli, CEO of Pulse Technology in Schaumburg, Illinois.<\/p>\n\n\n\n<p>\u201cI expect [no business uptick] is what 2024 will hold in store for us,\u201d he said. \u201cAs we watch economic news and anticipate that interest rates may continue to rise, we\u2019ll have to rely on means other than an election year uptick to boost our business fortunes.\u201d<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2022\/10\/Laura-Blackmer-Konica-Minolta.jpg\" alt=\"\" class=\"wp-image-51955\"\/><figcaption>Laura Blackmer,<br>Konica Minolta <br>Business Solutions<\/figcaption><\/figure><\/div>\n\n\n\n<p>In order to grow as a dealer, it stands to reason that vendors would be best served by monitoring vertical markets that have a penchant for growth. Laura Blackmer, president, dealer sales for Konica Minolta Business Solutions, believes health care and the public sector are two business lines that are prime to continue growing.<\/p>\n\n\n\n<p>\u201c[These verticals provide] a lot of opportunities for dealers to create better workflow opportunities with product and save money,\u201d Blackmer noted. \u201cTraining is imperative to understand market demands, offerings and how solutions play into that.\u201d<\/p>\n\n\n\n<p>As for diversification-minded dealers, Blackmer suggests penetrating the industrial print space\u2014packaging, label and wide-format devices\u2014for profitable revenue streams.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>Training is imperative to understand market demands, offerings and how solutions play into that.<\/p><cite>\u2013 Laura Blackmer, Konica Minolta Business Solutions<\/cite><\/blockquote>\n\n\n\n<p><strong>Diversification Options<\/strong><\/p>\n\n\n\n<p>The need for diversification is clear as dealers seek to evolve from a pure-play MPS strategy, according to Ray Belanger, president of Bay Copy in Rockland, Massachusetts, although what that looks like will vary from dealer to dealer. He also believes that dealers on a fast track to significant growth must be mindful of maintaining meaningful relationships with clients.<\/p>\n\n\n\n<p>\u201cOne of the advantages smaller companies had was the ability to maintain close contact with customers and this can sometimes be difficult with larger organizations,\u201d Belanger noted.<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2022\/06\/Erik-Crane-CPI-Technologies.jpg\" alt=\"\" class=\"wp-image-50423\"\/><figcaption>Erik Crane,<br>CPI Technologies<\/figcaption><\/figure><\/div>\n\n\n\n<p>Erik Crane, president and CEO of CPI Technologies in Springfield, Missouri, is another diversification proponent who sees managed services\u2014managed IT in particular\u2014as being the top choices. He notes that with many partners to choose from and an MFP base to sell into, it\u2019s become easier for dealers to launch these initiatives.<\/p>\n\n\n\n<p>\u201cVoIP systems is another way to gain wallet share with your&nbsp;existing customers. Again, with many vendors to choose from, it\u2019s easy to find a partner that will fit your&nbsp;needs,\u201d Crane remarked. \u201cThere are many other options. Physical security and EV stations look promising for our channel as well.\u201d<\/p>\n\n\n\n<p>Diversification is all about attaining a greater wallet share with existing customers through a broader set of related technologies, states Elliot Williams, director of product marketing, business imaging, for Epson America. It may start with print, but it can serve as a gateway to many opportunities.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>Physical security and EV stations look promising for our channel as well.<\/p><cite>\u2013 Erik Crane, CPI Technologies<\/cite><\/blockquote>\n\n\n\n<p>\u201cWhile most initial client engagements are centered on solving an office print challenge, there\u2019s a great opportunity to increase the share of wallet by providing complementary office equipment technology based on a client\u2019s industry or scope of business,\u201d Williams said. \u201cThis mindset is the key to the evolution from copier dealer to technology partner.\u201d<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2023\/12\/Rob-Richardson-Allied-Document-Solutions-Services-1.jpg\" alt=\"\" class=\"wp-image-58573\"\/><figcaption>Rob Richardson,<br>Allied Document <br>Solutions &amp; Services<\/figcaption><\/figure><\/div>\n\n\n\n<p>Rob Richardson, president of Allied Document Solutions &amp; Services in Swedesboro, New Jersey, sees the humble A4 device growing in stature with dealer portfolios. One facilitator is the increase in finishing options manufacturers are increasingly including.<\/p>\n\n\n\n<p>\u201cA3 continues to be a less used paper type, but there\u2019s always been a gap in not being able to provide finishing on A4s,\u201d Richardson said. \u201cHigh-speed, low-cost ink output devices will also continue into 2024 by the manufacturers. This will further provide margin opportunities for dealers.\u201d<\/p>\n\n\n\n<p>The migration from larger, departmental A3 units to smaller A3 and A4 devices is opening the door for providers to bring managed print services into the mix, notes Jay Cartisano, president of Prosource in Cincinnati. He believes manufacturers will focus on subscription sales and software-as-a-service add-ons to bring more value to customers while generating increased revenue.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>High-speed, low-cost ink output devices will also continue into 2024 by the manufacturers. This will continue to provide margin opportunities for dealers.<\/p><cite>\u2013 Rob Richardson, Allied Document Solutions &amp; Services<\/cite><\/blockquote>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2022\/10\/Clark-Bugg-Lexmark.jpg\" alt=\"\" class=\"wp-image-51957\"\/><figcaption>Clark Bugg,<br>Lexmark<\/figcaption><\/figure><\/div>\n\n\n\n<p>Also, with clients constantly seeking to reduce the number of vendors they do business with, providers with the broadest of portfolios will ultimately win the day. \u201cIn 2024, I think the gap will widen between companies that have diversified and those focused only on print,\u201d Cartisano noted.<\/p>\n\n\n\n<p>Dealers need to continue to promote enhanced cloud services and infrastructure. According to Clark Bugg, director of North America channel sales for Lexmark International, the cloud offers scalability, flexibility and cost savings, making it essential for modern businesses.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>Leveraging cloud infrastructure can improve operational efficiency and reduce costs for channel partners.<\/p><cite>\u2013 Clark Bugg, Lexmark<\/cite><\/blockquote>\n\n\n\n<p>\u201cThe channel must adapt to meet the changing needs of customers as more organizations migrate to the cloud,\u201d he said. \u201cThis includes offering cloud-based print management, remote device monitoring and secure document storage. Leveraging cloud infrastructure can improve operational efficiency and reduce costs for channel partners. For instance, remote monitoring of printing devices and cloud-based document storage streamline workflows and enhance productivity.\u201d<\/p>\n\n\n\n<p><strong>Remote Issues<\/strong><\/p>\n\n\n\n<p>For certain segments of the country, including northern New Jersey, the after-effects of the pandemic have been slow to dissipate and continue to hamstring businesses. Andrew Ritschel, president of Electronic Office Systems in Fairfield, New Jersey, says office occupancy rates remain quite low, which has had a deleterious impact on business. He recently sat in on a Zoom meeting for the Commerce and Industry Association of New Jersey, during which the pros and cons of remote work were explored. While some indicated success, many pointed out the flaws.<\/p>\n\n\n\n<p>\u201cSome people talked about employees cheating on their hours, people working two jobs at the same time, a lack of team building and idea collaboration, and the difficulty of training new staff and sharing corporate culture,\u201d Ritschel remarked. \u201c[Not to mention] declining business opportunities and revenue.\u201d<\/p>\n\n\n\n<p>Ritschel also bemoaned another negative trend\u2014the dwindling personalization of business engagement. Automated phone systems lack operator assistance and department extensions. Voicemails often lack introductions, and voicemail inboxes are frequently full. Plus, the most visually appealing websites are often missing key contact names, phone extensions, email addresses and cell phone numbers.<\/p>\n\n\n\n<div class=\"wp-block-image is-style-default\"><figure class=\"alignleft size-large\"><img loading=\"lazy\" width=\"150\" height=\"200\" src=\"http:\/\/www.enxmag.com\/twii\/wp-content\/uploads\/2021\/12\/Mark-DeNicola-Centric.jpg\" alt=\"\" class=\"wp-image-48104\"\/><figcaption>J. Mark DeNicola,<br>Centriworks<\/figcaption><\/figure><\/div>\n\n\n\n<p>Some dealers feel production print is a tool better suited for larger dealers. According to J. Mark DeNicola, CFO\/CSO for Centriworks of Knoxville, Tennessee, few small- and mid-sized dealers are equipped to effectively scale the offering.<\/p>\n\n\n\n<p>\u201cThe manufacturers and industry pundits tout production print, and this segment may be profitable for the manufacturer and large dealers,\u201d he said. \u201cBut for small- to mid-size dealers, production print is a loser or only a marginally profitable business when considering all the resources required to support the client and the manufacturers\u2019 very low end-user pricing when in competitive deals.\u201d<\/p>\n\n\n\n<blockquote class=\"wp-block-quote\"><p>But for small- to mid-size dealers, production print is a loser or only a marginally profitable business when considering all the resources required to support the client and the manufacturers\u2019 very low end-user pricing when in competitive deals.<\/p><cite>\u2013 J. Mark DeNicola, Centriworks<\/cite><\/blockquote>\n\n\n\n<p>The increasingly evolving nature of the post-pandemic business theater will continue to tax end-users as they struggle to maintain the pace of change while operating under hybrid work environments. Thus, Karl Boissonneault, leader of Xerox Canada and North America channels, believes it\u2019s important for dealers to remain flexible and focused on delivering solutions that support increased productivity.<\/p>\n\n\n\n<p>\u201cTo achieve this, companies must be nimble and work to provide highly tailored solutions that meet clients\u2019 unique needs,\u201d he said. \u201c2024 will be the year of customization and bespoke solutions \u2014 off-the-shelf offerings won\u2019t set clients up for success or help win new business.\u201d <\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>It\u2019s been quite a while since the phrase \u201coptimistic\u201d was applied to a coming year\u2019s business outlook, at least without the qualifier \u201ccautiously.\u201d Without giving into hyperbole, one can almost hear the office technology dealership humming the song \u201cFeeling Good.\u201d After three years of COVID-infested conversations and a business engine that\u2019s been slow to turn over, whatever shape the new normal has taken appears to be palatable. Business, for many, is brisk. Whether it\u2019s a new dawn and a new day remains to be seen. But there was enough evidence in the tremendous growth experienced by our Elite Dealer ranks\u2014essentially the Fortune 118 of the industry\u2014in 2023 to suggest that the worst of the pandemic hangover has subsided. A degree of this, naturally, is dealers being able to follow through on sales that hung in limbo. But there\u2019s an air of optimism that goes beyond pent-up demand, and it will be interesting to see if dealers can continue to register double-digit, year-over-year revenue increases in 2024. Let\u2019s not be too Pollyanna about the future. Significant issues are continuing to plague dealers. Output volumes continue to tumble, and finding capable employees\u2014certainly in sales and technical service\u2014is getting increasingly more difficult. The desire of current and prospective team members to continue working from home impacts dealers and their clients, as quality candidates are finding alternatives where remote work is either tolerated or a permanent fixture. Certainly, these aren\u2019t the only developments visiting our industry. To get a better grip on what\u2019s going on in the marketplace, we cast a wide net to dealers, manufacturers and other providers to the industry for our annual trends and predictions issue. This piece covers the most notable trends industry heavyweights are seeing as 2024 gets underway. A separate article containing their predictions for the coming year can be found on page 26. So kick back, pour a glass of whatever bubbly remains from New Year\u2019s Eve and absorb the viewpoints of these individuals brave enough to offer estimations of what trends have been impacting the industry. Interest Level The Federal Reserve has done what it can to arrest sky-high inflation via interest rate increases. Inflation has been slowly (with slowly being the operative word) receding, and there have been murmurs within the Fed that rates could be cut as early as this spring if the trend continues. Carter Hertzberg, the president of Nauticon Office Solutions in Gaithersburg, Maryland, is concerned about the long-term effects of higher interest rates, as he feels they\u2019ll remain constant for much of 2024. \u201cThis is just another margin squeeze on the dealer community and the leasing companies,\u201d Hertzberg said. \u201cThis tug-of-war will be interesting to watch as dealers shop rates and some aggressive leasing companies see an opportunity to buy business\u2014but at what cost?\u201d This tug-of-war will be interesting to watch as dealers shop rates and some aggressive leasing companies see an opportunity to buy business\u2014but at what cost? \u2013 Carter Hertzberg, Nauticon Office Solutions While 2023 didn\u2019t quite live up to the previous two years, some see consolidation as a trend that will continue at least in the short term. Count Bob Madaio, vice president of marketing for Sharp Imaging and Information Company of America among those prognosticators. He sees the proliferation of mega dealers and private equity-backed organizations creating national level organizations; several consolidators, in fact, have stretched into new geographies in the past 12 months. The upshot for independents, according to Madaio, is the clear need for carving out a distinct value proposition. \u201cThis forces dealers, both large and small, to sharpen their strategic approaches to clearly define their prime differentiators and what solutions they need to focus on,\u201d he said. Continued consolidation is in the cards from both a dealer and manufacturer perspective, according to Sean Bell, president of Solutions YES in Portland, Oregon. Whether this is a good or bad development depends on one\u2019s point of view, but Bell sees pluses and minuses. \u201cI believe [dealer consolidation] will open doors to hire new employees from the industry and add net-new customers,\u201d he said. \u201cI believe we\u2019re aligned with strong vendors, but anticipate that some of our competitors could be negatively impacted [by OEM consolidation].\u201d One of 2023\u2019s biggest talking points was AI, including generative AI and machine learning, as it applies to the industry. While the technology has been leveraged for predictive maintenance for a number of years, the conversation around its integration, along with digital customer engagement, bears watching, according to Jennifer Healy, senior director, marketing strategy, communications, programs and enablement, dealer and partner channel, Ricoh USA. I believe we\u2019re aligned with strong vendors, but anticipate that some of our competitors could be negatively impacted [by OEM consolidation]. \u2013 Sean Bell, Solutions YES \u201cToday, our digital presence is rooted largely in customer conversation,\u201d she said. \u201cBecause of this, dealers should look to implement digital customer engagement strategies that enable personalized interactions. AI will also play a significant role in how businesses operate and interact with customers. A closed AI system can drive renewals, lower sales costs and improve customer experiences.\u201d Certainly, one of the major talking points for the industry continues to be print security. Awareness is always a key, and as more customers become cognizant of the risks, they\u2019ll demand a robust security strategy, not to mention a vendor that can provide ongoing support and consultation, notes Dan Larkin, solutions sales director for Marco of St. Cloud, Minnesota. \u201cUnfortunately, not only did the pandemic escalate security concerns, but it also exacerbated underlying issues within our labor market and our supply chain,\u201d Larkin added. \u201cService providers will need to be proactive about managing client expectations and incentivizing workers to consider service technician roles.\u201d Service providers will need to be proactive about managing client expectations and incentivizing workers to consider service technician roles. \u2013 Dan Larkin, Marco Leaner Lines? Could dealers actually be looking to reduce the number of OEM lines they carry? It\u2019s definitely a possibility, according to Mitch Leahy, vice president and managing director [&hellip;]<\/p>\n","protected":false},"author":166,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1641],"tags":[],"_links":{"self":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/58404"}],"collection":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/users\/166"}],"replies":[{"embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/comments?post=58404"}],"version-history":[{"count":13,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/58404\/revisions"}],"predecessor-version":[{"id":58644,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/58404\/revisions\/58644"}],"wp:attachment":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/media?parent=58404"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/categories?post=58404"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/tags?post=58404"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}