The Cannata Report is looking to start a dialog with our subscribers about the changes our industry is going through and strategies for adapting to these changes.
As we battle this pandemic, we have been forced to address every issue of consequence in our lives. As a media participant in the business of imaging, we are doing all that we can to help our partners, clients, and subscribers.
There are no easy answers but there are some fundamental beliefs that we must all accept if our industry is to come out of this stronger than when it began. We share with you our opinions, which some will disagree with. That is not a bad thing and in fact, we are happy to encourage it. The object of the exercise is to examine alternatives.
We should all be willing to listen to contrary views presented in a respectful manner. Let us take a lesson from the framers of our Constitution who held widely different opinions. We are all fortunate that the delegates (55, but only 39 signed it) to the Constitutional Convention unanimously selected George Washington as President. In the end, they succeeded because they listened and compromised. The rest, as they say, is history.
In that spirit allow us to present the following views and possible responses:
The pandemic has accelerated the decline of office/business printing.
The ramifications of this are many. The most obvious is the loss of revenue and profit. Dealers need to get ahead of this by first accepting the fact that A4 MFPs will replace A3 MFPs a lot sooner than they had anticipated. The immediate need will be to diversify the revenue stream to compensate for the loss of printing in the office. This will require the development of a business plan that reduces operational expenses which includes reduction of the work force and an investment in training of those the dealer believes can be successful in coping with all the challenges they will face.
Hiring and retaining the type of representative talent will become an increasing problem for the dealer.
The answer here is changing the compensation model that is predominantly used by the channel. The focus should be on net new business. Hire the best and the brightest coming out of colleges by offering to help them with their college loans. In studies we have read, the average college graduate still owes 44% of the debt 12 years after graduation. It is a debt that limits their ability to marry, buy homes, and raise a family. A program that helps them do just that should have some appeal.
The demands for increasing participation on the soft side of the business will provide tools for dealers to meet customer demands for more effective communication and increased security, especially cyber security.
The use of analytics is part of the next wave that will aid dealers in providing more complete solutions along with new and different approaches to solving business client’s challenges. Add AI and augmented realty and you have the portend for a bright future.
Manufacturers, software developers and distributors will need channel partners more than ever.
Print is far from dead and the only thing that will continue to decline is print on cut-sheet paper. Print production will continue to develop and expand the number of substrates that can be printed on. Today, packaging, label printing, textile printing, large format printing that can provide wraps for vehicles as large as buses are coming into their own. There is no better distribution mechanism that will allow vendors of this technology to provide the support necessary to be successful in all these endeavors than the dealer channel.
The Big Question
As subscribers, you have the right to ask us the following question:
Can The Cannata Report retain viability throughout the pandemic and post-pandemic period and provide our partners, clients, and subscribers the best possible information to help them make the right decisions?
We are practicing what we preach on an almost daily basis. Our staff is ably led by CJ Cannata and his team of dedicated professionals who are responding to each challenge we are facing. We are using much of the communication technology available and will continue to expand in that area. We have furloughed no one and do not anticipate doing so for the rest of the year.
We have assembled a group of six dealers in addition to our Advisory Board to ask their advice as to what we need to provide to help them deal with the present and the future. Their response was to conduct an end-user study.
It was a simple message that resonated throughout our organization. First and foremost, research studies are totally synergistic with what we have done and are currently doing. We are in the process of finalizing our plans to establish a separate division to focus exclusively on research. The plan is moving forward, and we will officially begin working on the first study on August 1, with a launch date of September 1, and completion prior to Thanksgiving.
That was not all we did. We assembled a group of 10 of our key client partners (non-manufacturers) to create a mechanism for the sharing of information and collaboration of their marketing efforts. We have held two meetings, and both have been fruitful. The third is scheduled for later this month.
We, like everyone else, believe our revenue will continue to be eroded in 2021 and our growth will come because of our capability in provide in-depth research. We already do business with all the major manufacturers and fully expect that we will secure research assignments from them.
We also believe that our efforts with our client partner group will be fruitful and will contribute to our success in 2021 and beyond. If we do this right we will have met and even exceeded our plan for the post-pandemic period.
Finally, despite the downturn in business we have not had to apply for any government loans and our business remains solvent. In addition, we have the resources to fully fund the creation of this new research division from our existing reserves.
The question is do you agree or disagree? We would love to hear the opinions of our readers and if you believe we got it wrong, please share with us your views and we will be happy to pass it on. Nobody has all the answers and perhaps together we can come up with some valuable ideas that will give us all something to think about.
Please email your comments to me at fgcannata@cannatareport.com.
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