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State of the channel survey

The MPS channel is optimistic that 2021 will see revenues rebound and growth in opportunities to offer cloud services, contactless printing and support for home printing, as customers adapt to the demands of remote and hybrid working

Quocirca’s State of the Channel 2020 study investigated attitudes among 205 channel organisations selling managed print services in the UK, France, Germany and the US. Although half of respondents reported that revenue has declined in 2020, the majority are optimistic for the next year, with 66 per cent predicting that revenue will rise in 2021.

COVID-19 had a severe impact on the print sector, with 45 per cent of respondents saying customer print volumes have fallen. This rose to 62 per cent among UK respondents and 64 per cent in the USA, while only 24 per cent of French organisations said print volumes had dropped. Overall, just over half (53 per cent) said the pandemic had a negative impact on their business, although for 25 per cent, the effect was positive.

Commenting on the findings, Quocirca Director Louella Fernandes said: “The pandemic has accelerated changes that were already under way in the print market. The channel is optimistic but must adapt fast to capitalise on new opportunities and secure its place as a trusted partner for organisations that are pivoting to hybrid and remote working.”

Mature MPS programmes
MPS programmes are mature and they are delivering additional benefits. 34 per cent of respondents said they had accessed new opportunities to sell value-added services such as information management and collaboration tools; 32 per cent said they have built longer-term relationships with customers and 29 per cent said there were more opportunities to sell non-print related services such as IT services.

Diversification is under way; one-third of respondents (32 per cent) stated that they now offer managed IT services alongside MPS. There are significant regional variations, however. Half of UK respondents offer managed IT services alongside MPS, compared to just 16 per cent of German respondents. Overall, 29 per cent offer print security services and 28 per cent offer cloud print services.

Cloud print
Looking ahead, cloud print services are viewed as the most important growth area in the next two years, followed by the provision of home printing services and contactless printing.

While cloud migration has been a driver for some time, the other areas are directly associated with pandemic factors. This is reflected in the top challenge facing channel businesses in the coming year, with 37 per cent citing broader market disruption as a key area of concern.

“MPS is undoubtedly providing opportunities for the channel to diversify into adjacent areas. It can be a platform for future growth if companies can successfully build partnerships with complementary service providers and invest in the sales, technical and marketing skills needed to deliver a broader range of services,” Louella noted.

Channel priorities
The study identified a disconnect between elements of a vendor’s channel programme seen as important by channel companies and their satisfaction with those elements. Respondents rated training and support for app development, access to market development funds and lead generation as the three most important criteria in a vendor’s channel programme.

However, they were least satisfied with MDF and financial support, and the biggest gap between importance and satisfaction rates occurred in training and support for app development.

“The channel needs to be clear with vendors about the support it needs to adapt to the changing environment, and vendors must respond. The channel recognises opportunities around integrated document workflow apps and solutions, especially for hybrid and remote working environments, but doesn’t feel equipped to capitalise on these,” Louella concluded.

Quocirca’s State of the Channel 2020 contains in-depth analysis of vendor programmes and recommendations for channel partners so they can successfully navigate the challenges ahead.

www.quocirca.com
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KEY FINDINGS AT A GLANCE

*53 per cent of respondents said COVID-19 has had a negative impact on their business
*25 per cent indicated a positive impact
*45 per cent reported a drop in customer print volumes due to the pandemic
*34 per cent stated that selling MPS has opened new opportunities to provide value-added services
*32 per cent said it has helped build longer-term customer relationships
*Broader market disruption is the top channel concern for the coming year (37 per cent)
*Other key concerns were adapting to a managed services model (23 per cent) and digital disruption (22 per cent)
*Cloud is viewed as the leading growth area between now and 2022, followed by home printing services and contactless print provision
*Channel companies report satisfaction gaps with key elements of vendor programmes including market development funds (MDF), training and support for app development and financial support.
*Mature MPS programmes are delivering broader opportunities

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