PrintIT Reseller talks to Phil Madders, Managing Director, PAE Business, about the company’s focus on innovation in an ever-changing marketplace
PrintIT Reseller (PITR): It’s been a while since we last spoke. How’s business?
Phil Madders (PM): We have been growing at about 11.5 per cent every year. We have done for the last nine years. Despite reports of a decline in the number of units sold in Western Europe, our unit sales are also up – about nine per cent per annum. Either our dealers are doing well because they’re partnered with us, or we have a very good bunch of dealers!
PITR: Consolidation and mergers continue apace, what’s your take on the current status quo and how is it impacting your business?
PM: I think acquisitions are being driven in part by customers’ increased requirements for compliance and security accreditations. At PAE, we probably get two to three questionnaires around compliance, security, disaster recovery and quality assurance, a month now – whereas we used to get one a year! For smaller dealers, that’s quite an undertaking and I think that’s driving a lot of the acquisition momentum. Bringing two firms together does bring additional economies of scale, which can help to cost-effectively satisfy what customers need at the larger end of the business scale.
The other interesting thing is that mergers are also bringing automation and process to the fore. We’re seeing a lot of increased demand for solutions to support dealers’ back-office functions, from managing machines in the field to automating processes such as meter readings, and integration with third-party systems is also key. Another step-change is new non-print ERP vendors entering the MPS space, they’re moving in because of the requirement to look after the printers in IT environments.
PITR: What’s new at PAE and how important is it to innovate to differentiate?
PM: We spend a lot of time discussing integration, working out what’s most effective for organisations. Two years ago, we introduced dashboarding, bringing service, finance and device management data into responsive and relevant BI Dashboards for better decision-making. We now have dealers who use our dashboarding, (which was designed to provide an insight into the print environment), to manage their accounts and service management systems at an executive level. I think that probably embodies what I’m talking about in terms of integration and joining things together – removing costs from the business and making it more efficient.
Later this year we’re enhancing our dashboarding to do predictive modelling. This is an idea that has come from our research and discussion with our dealer base to understand gaps in their processes that can be improved and add increased value. PAE BI has been developed to predict device volumes in the future.
The project is about two and a half years in now, and the reason it took so long is because we needed the data to run the tests, to make sure it’s robust enough. We engaged analysts who do actuarial predictions within the insurance and banking sector. They had no idea what a toner cartridge yield was – so approached everything from a fresh perspective. We also engaged a data scientist to check the data and develop the algorithms to make it work. We’re really pleased with the results, we can predict volumes on machines to within about two per cent accuracy. We’re focusing on volumes and toners at the moment, it’ll help our dealers forecast their requirements for stockholding and engineer cover. Once we launch I’m sure our customers will tell us about other things they see as adding value to the business.
We also introduced seat-based billing a while ago. It’s been fairly successful in North America but like all things it’s a slow burn, and needs to gather momentum. We’re piloting in the UK with one dealer, which seems to be going well. We’re quite cautious about these things, and want to get it right. Because it we get it wrong we can’t go back. One limitation at present is that dealers have to be of a certain financial size and have the resources to support it themselves. I think the introduction to the market of Hardware as a Service (HaaS), will see this approach to the market evolve and develop.
We also have a new version of our user management software being launched. We’re rolling it out now, training and showing our dealers the new version – so we are keeping busy!