In this episode, Founder Frank G. Cannata and John Lowery, CEO of Grand Rapids, Michigan-based Applied Innovation, talk candidly about the lagging profits plaguing the channel. Lowery, who has been the main man at the dealership for 41 years, notes that the changes in the imaging business and tough market conditions are indeed real. At Applied Innovation, total clicks per device have dropped from 5,500 in 2019 to 3,750 post-COVID, he shares. That 32% dip translates to $3 million less per month on the aftermarket/service side of the business. The declines in A3 and A4 MFPs have hit hard, too, he adds, while single-function printer unit sales are down by some 50%. Lowery encourages fellow dealers to be cognizant of market trends and take the actions required to sustain their operations.
Applied Innovation is a service business
In this changing business landscape, dealers must uncover additional recurring revenue streams. Lowery describes his company as being in the service business. “Our why . . . is to deliver a tremendous service experience,” he says, wherever that might be: whether it comes from managed IT, telephone, AV, production and wide-format printing, print embellishment, or shredding services. He goes on to explain what Applied Innovation might do down the road with label printing—and why. In the meantime, they’ve gotten into the medical-waste game, which he describes as a supply, pick up, and recycle model. “We’re losing our tail,” Lowery admits, but eventually he thinks it will become a solid business. Whatever that next “it” is, dealer-owners like him can make it happen, Cannata believes. Wishing everyone a safe Memorial Day Weekend!
