Donnellon McCarthy Enterprises (DME) in Cincinnati, Ohio, serves as a prime example of a successful office technology dealership leveraging strategic acquisitions and an expanded portfolio of services to fuel its growth. One of its most significant 2024 milestones was the acquisition of Ohio Business Machines (OBM), a $20+ million dealership based in Cleveland. Competing against industry giants, Donnellon McCarthy Enterprises’ successful bid underscored its aggressive strategic growth plan. But for Jim George, president of DME, this is just the beginning. With additional acquisitions on the horizon, along with organic growth initiatives, the dealership is anything but complacent.
Acquiring to Expand Reach and Capabilities
George is no stranger to acquisitions and frequently receives calls from larger entities looking to buy his dealership. “I’ve gotten calls from everybody out there, and I always just flip it on them and say, ‘Well, that’s interesting. I’m glad you called. I had you on my list to call. Where do you guys stand? Are you ready to sell?” he said half jokingly.
While many mega dealers focus on acquiring smaller dealerships, DME remains open to any size dealership, as exemplified by the OBM acquisition. That acquisition will expand DME’s footprint across Ohio, Pennsylvania, and Michigan.
Beyond geographical expansion, acquisitions also bolster DME’s capabilities, allowing it to offer a broader range of services, a critical business strategy in a rapidly evolving market.
Jim George, president (from left), Jim Donnellon, CEO, and Rich Brandenburg, senior vice president of sales.
Managed Network Services and Cybersecurity
One of the dealership’s fastest-growing segments is managed IT, a division that’s seen more than 25% growth in the past year. “It used to be a ‘cool to have,’ then it was a ‘neat to have,’ and now it’s a ‘must-have’ because this is a chunk of our profitability,” said George about managed IT. The company has transitioned to offering full-service contracts, focusing on managing a customer’s entire IT infrastructure rather than just selling hardware or providing one-off project support.
With OBM’s integration, DME now provides 24-hour internal support for managed IT services, a crucial differentiator in a highly competitive market.
Recognizing that protecting clients’ networks is as important as maintaining them, cybersecurity represents another growth area. That business segment is expected to grow even more with the acquisition of OBM, which has a strong cybersecurity business.
The dealership’s demo room includes Ricoh production print equipment.
Diversification Beyond Print
The traditional office technology market continues to evolve, and George is keenly aware of the need to diversify beyond copiers, printers, and multifunction devices. “We’re now into IT services, mailing, EV chargers, thermal barcode printers, and then there’s the hardware and software,” he noted. These expanded offerings ensure DME remains relevant as customers and prospects modernize their operations and adopt new technologies.
Thanks to its latest acquisition, the company will also offer physical security solutions, specifically security cameras. The acquisition highlighted the potential in this space, as OBM had a thriving security camera business, a market DME hadn’t previously explored. “For me, that is absolutely sexy,” said George, who revealed that his director of IT would tell him that customers frequently ask about security cameras. “I’m excited about learning more,” he added.
George referenced an OBM customer with 46 cameras who needs another 500 for its seven other buildings. “There’s money in them hills,” said George, identifying opportunities in hospitals, schools, and government buildings.
Another area of growth has been e-commerce. DME is one of those rare dealers with an e-commerce platform. Indeed, the first thing that pops up when you visit its website is an option to order online. “I always like to be cutting edge and willing to jump in headfirst,” said George about the dealership’s e-commerce initiative.
Although George initially envisioned e-commerce driving A4 and printer sales, most activity centers around A3 devices. “Customers like to build their own units and are becoming much more informed, and ask better, more qualified questions,” he said. Although e-commerce has yet to reach its full potential, George remains committed to refining the platform and integrating AI-driven solutions, including chatbots, to enhance customer interactions.
Expanding Production Print and IT Hardware
George also recognizes the potential in production print, an area he’s eager to expand by adding personnel. The company has been successful selling production devices from Sharp and Ricoh and plans to continue building this momentum. “The clicks from those units are absolutely gorgeous, and I want to keep growing that area because it’s critical for our business,” said George.
The dealership’s IT hardware business, particularly Sharp Dynabooks, has growth potential. “We get the occasional sale, but for our IT clients, it’s a huge convenience,” said George. With managed IT clients increasingly purchasing laptops as part of their service contracts, the dealership has an inventory of Dynabooks ready for delivery at a moment’s notice. “Like us copier people like to do, I can get them a new laptop out in four hours,” said George. “It’s that white glove service we’re used to providing.”
The OBM acquisition should also boost the Dynabook business. When George did his due diligence before finalizing the deal, he visited the company and saw stacks in inventory. “They are turning them over nonstop,” he reported.
George is also exploring emerging opportunities in artificial intelligence, viewing it as a potential game-changer for the office technology industry. Additionally, he believes EV chargers represent a long-term growth opportunity, despite slower adoption rates in the United States compared to Europe. “Technically, EV cars have not taken off the way they have in Europe, but if you go to California, you’re not going to see a lot of combustible engines. The biggest problem is that charging stations are broken down everywhere, and it is so simple to get them back online.”
Robotics may present another area of opportunity in the future. “I think that could be fun like R2-D2,” said George, who describes himself as a Star Wars freak.
Expanding Its Workforce
The acquisition of OBM added 80 employees to the DME, raising the total to around 200. However, hiring remains a priority and a key element to organic growth, with a particular emphasis on recruiting young talent. “There isn’t an area that we’re not looking to grow, and if a superstar walks up to me, I’m going to make a run at him or her in any category,” said George.
The Donnellon McCarthy Cincinnati team. The company employs close to 200 at its various locations.
His mantra to his sales and service leaders is “hire, hire, hire.” “We have a program to bring in younger individuals through an apprenticeship-type program where they learn about copier hardware and IT services. This initiative is in response to an aging service force. Over 25% of our technicians are now under 30 years old, which I never would have thought possible a few years ago,” George noted.
DME prefers to recruit from outside the industry, primarily because of its evolving products and solutions offerings. “Sometimes, when you just look for a copier rep, that’s all they know, and teaching them the entire [product] portfolio is challenging,” observed George. “Sometimes the candidate with a clean slate is better.”
He added, “If you don’t offer these young professionals an opportunity or a growth path, they’re not going to come in just to fix copiers. They do like playing with screwdrivers, believe it or not. They want to learn that and understand the electronics behind it, but you have to fortify and back it up with IT services and cybersecurity. Give them all those different options and allow them to choose the path they want to travel.”
A Bright Future for DME
DME remains well-positioned for continued success with an aggressive acquisition strategy, a rapidly expanding managed network services division, and a strong focus on diversification. Meanwhile, the company is closing in on $50 million in annual revenues, which has George excited. “Having a five-year goal, all I can say is we’re on track,” he said. “My number one goal, which was the goal when I first started here, is to grow a privately held, family-owned company from coast to coast and to provide really good service. I believe in this industry and DME’s future. We’re ready for 2025, and it will be an amazing year.”
Besides traditional imaging technology, Donnellon McCarthy Enterprises also offers FP mailing systems.
