The COVID-19 pandemic has turned everything upside down and as many dealers have discovered, selling in a pandemic has become a challenge for which they were completely unprepared. But that doesn’t mean giving up. For Reed Melnick, it means trying harder.
I first met Reed Melnick about 15 years ago when he was president of Nevill Document Solutions in Irving, Texas, one of the top Kyocera dealers in the country. After he sold his dealership to Kyocera in 2015, we lost touch for a few years.
Two years ago he called to let me know that he had purchased Pinnacle Office Group, a RISO dealership based in Carrollton, Texas. Today, the company operates as PopSmart Technologies, serving Dallas/Fort Worth, Houston, Waco, and the Texas Valley. Melnick also owns Professional Office Products in Reynosa, Mexico.
When Melnick acquired Pinnacle Office Group, revenues had been plummeting for three consecutive years. At the time of the acquisition, RISO digital duplicators and ComColor inkjet printers were responsible for about 99% of Pinnacle’s business. The other 1% came from Samsung MFPs.
Pinnacle’s dilemma was crystal clear to Melnick. He needed to sell more than just digital duplicators and inkjet printers.
One of the first calls he made was to Kyocera.
“I told them, you guys did so well for me last time and we had such a great partnership, let’s do this again,” recalled Melnick.
After adding Kyocera MFPs and printers, he rounded out his offerings with Xerox, primarily for its C70 light production units. With a more balanced product line, PopSmart Technologies has grown from $800,000 in 2018 at the time of acquisition to $1.8 million today.
The last two years have given Melnick a greater appreciation for the RISO product line. When he initially acquired Pinnacle, he thought he’d swap out the RISO’s for toner-based copiers.
“Boy, was I wrong,” admitted Melnick. “Some of our RISO customers are producing 400,000 pages per month. The RISOs are tanks. When you look at the reliability and low cost, they do an incredible job.”
Its first year selling RISO with Melnick at the helm, PopSmart Technologies became the second-largest ComColor dealer in the U.S.
“We figured out where the niche was for that product,” said Melnick who touts the benefits of having a mix of technologies.
“You can’t just be a toner company today, you have to have ink. And you can’t just be an ink company without the toner. By combining all the technologies, we can truly pick and choose which is the right technology for the customer.”
During the first quarter of 2020, PopSmart had done close to $600,000 in business. On Monday, April 13, it closed two deals totaling approximately $70,000.
“We are still on track for $2.3 to 2.4 million this year,” revealed an optimistic Melnick. “If the economy opens up again, we hope to be about three million dollars.”
To date, everyone at Melnick’s Texas and Mexico operations is working either remotely or on-site. He has 10 employees in the U.S. and 15 in Mexico. Those working on site are social distancing.
“Everyone understands that they have to do the best they can during this time,” said Melnick about selling in a pandemic.
Part of “the best they can during this time” is making phone calls. Lots of them.
“Before all this happened, we were able to grow by doing a ratio of calls of 25 to one,” said Melnick. “Now, you have to call one hundred people to find that one person. To succeed in this day and time, you have to be a prospecting fool.”
Initially, he struggled with his natural sales instincts about calling on customers and prospects during the crisis. He empathized with their plights, but he also saw this as an opportunity to help these businesses reduce their operational expenses such as by putting them on a program that defers payments for 90 days. This way they have the cash they need and the new technology that’ll help their business.
“I needed to develop a talk track to let people know that not making a decision is making a decision,” said Melnick. “If you want to make the right decision for your business, you need to look at a better way.”
Many of PopSmart Technologies’ customers are SMBs and the strategy for reaching those businesses has been one Melnick has had for years, building relationships and providing great service. Many of his SMB customers purchase A4 devices and PopSmart is now supplying some of them with devices for employees who are working at home.
“I’m taking units that I am refurbishing, certifying, and putting them in their homes to use on the same cost per page [as the devices in their offices],” explained Melnick. “That way we’re creating a partnership. By doing something short term and investing in your customers and having your customers see that you’re investing in them, is the best way.”
Melnick expects to see more people working remotely once the pandemic ends.
“And there’s probably going to be other people that are not going to be at those companies,” he acknowledged.
Because PopSmart Technologies has such a small percentage of the marketplace, Melnick feels as long as they can connect with someone and explain how they can help them, his dealership will get through this. By the way, some of those prospects are former customers of Melnick when he was running Nevill.
“Since we’re a small company, we can make calls and find business,” revealed Melnick. “And it’s new business for us. In the last two weeks, we have gotten seven new customers and placed 14 new pieces of equipment in the field.”
Melnick remains optimistic amidst the current crisis.
“It’s sad and we pray every day about people getting the virus and for those dying. But we can’t let anything hold us back. You can either put in 10% effort or 110% effort. I’m still putting in 110%. I get up at 4:30 in the morning and dress up whether I see customers or not. I comb my hair, shave, put on my suit or my slacks and shirt. That’s important to keep moving forward.”
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