Solution providers find easy profits when they don't overlook the obvious benefits of toner and ink replenishment contracts.

Solution providers that concentrate on selling only printing and imaging hardware may be walking away from some easy money. Printer supplies, including toner and ink cartridges, are a natural source of ongoing profits and a potential springboard for conversations about more ambitious technology projects.

The beauty of supplies contracts lies in their simplicity. Comprehensive managed-services contracts, enterprise-wide document-management systems and large-scale tech-refresh programs may represent long-term growth opportunities for sophisticated solution providers. But to succeed in these areas, the companies often need to invest in staff training and some revamping of their printing and imaging practices.

A supplies focus requires far less upfront work. Often solution providers only need to ask current customers to commit to an ongoing consumables-replacement agreement to elicit a positive response, vendors say.

But despite the relative ease of cultivating supplies sales, this area remains an untapped opportunity. “Many partners that we talk to today get the hardware business but never see a toner sale,” says Laurie Eldridge, national channel sales manager for the Imaging and Printing Group of Hewlett-Packard. Solution providers that get customer commitments for multi-year contracts may see margins triple compared to hardware deals hardware, she says.

Supply-replenishment arrangements are easier to manage than ever, thanks to administrative software available from the leading printer and multifunction product (MFP) vendors. These predominantly Web-based tools let solution providers remotely track usage rates among networked devices to determine when to replenish consumables.

The straightforward supplies strategy may also help keep margins stable in the solid but increasingly competitive color printing market. As color hardware prices continue to fall, margins gradually shrink. Fortunately, add-on supplies sales can soften the blow and create opportunities for ongoing sales, says Don Hsieh, vice president of marketing for Konica Minolta. “Supplies revenues have grown in the double digits as color MFPs grow in the double digits. It’s a unique opportunity right now for solution providers," he adds.

End-user relationships based on supplies sales also provide solution providers with an entree to talk about future projects, says Anneliese Olson, Hewlett-Packard’s director of Laser Jet category management, imaging and printing in the Americas.

“The opportunity to upgrade the installed base is out there today. It’s very much tied to the conversation around supplies,” she says. “Orders for monochrome printer supplies or even copier supplies are a great lead-in to talk about upgrading,” she says.

Solution providers can set up a supplies contract that upgrades the old devices and establish a subscription service so the customer gets the hardware and supplies bundled together for a monthly charge based on usage rates. Solution providers can also wrap maintenance services and extended warranties into the contract.

“Supplies are the obvious place to start for these types of opportunities,” Olson says. “It’s a great way for a partner to earn more money.”