In Canada there are three manufacturers of postage meters that are approved by Canada Post, Francotyp-Postalia, Neopost and Pitney Bowes. Given that they all have direct sales operations in Canada why should you not buy directly from one of them?
Here are 18 reasons why a dealer may be a better option.
1. When you negotiate with the manufacturer you are one company, doing one deal, usually one that you only do once every 5 or so years. Your bargaining power is low.
2. Your deal is looked at by the manufacturer as a single unit, (unless you are big enough to do multiple locations) for a single contract term.
3. Manufacturer postage sales people have only one product grouping to sell, postage equipment. They see you as a single deal purchaser with no potential for future or repeat business. Some manufacturers rotate their sales people every 18 to 24 months to avoid them getting connected to their customers.
4. Right sizing your device is not as much of a concern as it might be with a dealer due to the situation above. Getting a deal done, as quickly as possible is the objective of the sales person.
5. Dealers will review your current situation, not just try to maximize the ‘take’ by selling the largest device you will purchase. Its in their interest to satisfy you over the long term.
6. We have seen manufacturer reps price a replacement unit with a premium to what are general margins just to come slightly under the price of a previous contract, even though normal pricing could be as much as 20% lower.
7. Manufacturer reps are extremely reluctant to quote on a downgrade to a lower volume device even if your volume has dropped and you could be happy with such a change and the lower cost.
8. Manufacturer support is national in focus with little knowledge or focus on the local area where you operate.
9. Dealers by nature are more locally focused and operate their service directly in the local area where you purchase. For national areas a local dealer would be contracted whenever possible to ensure similar personalized service.
10. Dealers tend to setup contracts to match the time needs of the client and also to let such contracts run to the end of term unless client business needs dictate a change. Manufacturer reps tend to operate on ‘there is no time like the present to sign a new contract’ even if there are two or more years to go. Often the new contract includes the payout cost of the old contract within the pricing (unknown to client) creating what the industry calls ‘air’ in the deal. This is good for the sales rep not for the customer.
11. Does your rep explain all of the pricing components and clauses in a contract which could affect your costs? Dealers are much more likely to do so.
12. Does your rep show you how to avoid insurance fees added to contracts or leases? If you have a PB contract and are paying ‘ValueMax’ you are paying an insurance fee which likely is not needed as your business insurance will cover the device if you provide the manufacturer or leasor with a certificate of coverage usually available at no cost from your broker.
13. Does your rep explain which postal rate schedules are included as part of your meter contract? Some brands charge more for extra schedules while others include them all. You should know.
14. Are there hidden clauses for postal rate changes or support which are not identified? Dealers are more likely to show you how the price is structured.
15. Is support included and at what rate? Dealers deliver support directly and therefore are much more sensitive to making sure you understand what it costs and what it includes.
16. Dealers can often offer a better rate than the manufacturer offers to you since they do larger volumes with the manufacturer and are aware of what is charged in other deals and more likely to provide you with similar rates.
17. Most postage dealers also offer other products, such as multifunction printers, IT services, document management services or workflow design. They have the potential to do further business with a client between mail equipment renewal cycles and therefore are going to be more concerned with maintaining a positive relationship with the client. This can affect how they price and deliver their mail related products.
18. Most dealers are owner operated and the principals of the business are known and accessible. Do you think you can talk to Mr. Pitney, Mr. Bowes, Mr. NeoPost or Ms. Francotyp-Postalia?
There are probably other reasons, but these 18 give you lots to think about and consider.
What has your postage equipment purchase experience been like? How do you rate manufacturer offers vs. dealer offers? Is there a dealer in your local area you could consider?
Lee K
