Buyers Lab - Dealer Profile

Thursday, October 22, 2015 (All day)
Whether it’s a business, a basketball team or a band, success is almost always the result of many factors, not just one. Still, there tends to be single part of the equation that rises above the others to become the ultimate difference maker. For Jeff Boate, PERRY proTECH’s president, that thing is easy to identify: security.
 
The company has long since made the subject a priority, with its staff consistently stressing how important security is during interactions with clients of any size. In 2011, however, PERRY proTECH kicked it up a notch. Based on market trends and customer feedback, the company decided to invest heavily in security, believing it would both drive business and be a differentiator in the secondary and tertiary markets it covers between Detroit to the north, Cincinnati to the south, Columbus to the east and Indianapolis to the west.
 
The biggest move PERRY proTECH made that year was purchasing Digital C.O.P.S. (Computerized Observation Products and Services). Boate noted that the Perry Corporation had been securing its clients’ documents from the day it was founded, then began protecting devices and networks in the late ’80s. But through this acquisition, as well as by forming relationships with multiple surveillance and monitoring partners, PERRY proTECH could now provide security for physical locations. “Today, we’re not a copier company, we’re not a tech company—we’re a security company,” he said. “We put a holistic wrapper around the topic for our customers. We can be different this way.”
 
D-C.O.P.S. employs a trio of retired police officers who continue to put in 12 hours a month at the stationhouse to retain their commission, but still have some work left in them, as Boate explained. Thanks to their law enforcement background, these three full-time “cops” have immediate credibility with customers, which enables them to effectively sell locational security systems, from a one-camera setup at a gas station to a more sophisticated deployment covering a state university’s sprawling campus. The division—in just over three years!—was responsible for 5 percent of PERRY proTECH’s $60+ million revenue last year (IT in total was 34 percent), not to mention that four installers were added to the team in the past nine months (there are now nine altogether), with four more hires slated for 2016.
 
“Security is going to be at the forefront of all our high-value conversations, and we feel we have a huge leg up because of how we’ve positioned ourselves, particularly over the last decade,” Boate said, adding that opportunities with panic buttons in buildings and cameras on buses will help deepen the dialogue with K–12 schools. “Who knows, maybe security will be bigger than the imaging space in 10 years?”
 
Jeff Boate, PERRY proTECH’s President
 
PERRY proTECH is active with software, but less than 5 percent of its revenue stems from this space. Boate did say, though, that nearly all MFP sales include at least a simple app that can run on the display. “Close-to-the-device solutions, something to make the hardware more intrinsic on an everyday basis—that’s what customers want,” he said. “While larger software systems are great from a revenue standpoint, we’re finding they’re just not yet as valuable to our clients as a connector to a cloud-based file archive or a routing tool.”
 
Regardless, PaperCut continues to move up PERRY proTECH’s “potential flagship solution” ladder and has been a hit in education, the vertical in which the company enjoys its second most success. Plus, this software’s secure pull printing capabilities speak not only to the environmental message but the critical nature of protecting sensitive documents, too. “In environments with five or more devices, you’re doing your customer a disservice by not installing PaperCut,” Boate said. PERRY proTECH’s No. 1 market is healthcare (“fewer clients, more pages”), and it also does well in general office settings. In any case, the company is equipped to do forensic exit interviews on all digital devices to show everything somebody has done on them in the last 30 days.
 
Industry-wide, Boate thinks the number of sales reps who lead with hardware instead of solutions is very high, but that it’s not at all surprising. “We’re changing our plan to reward the people who start the engagement with software or security, because as more competitors come into our area, we recognize there has to be a shift,” he said. “But if we turn that 20 percent into 80, perhaps we can accelerate growth beyond current levels.”
 
The company enjoys a healthy relationship with Konica Minolta and has used the OEM’s All Coveredservices on numerous occasions. “It’s tactical blocking and tackling for us: We use the rebates and can augment our offerings through All Covered’s comprehensive portfolio,” Boate said, citing the examples of 24-7 helpdesk support and after-hours coverage.
 
“With managed IT (MIT), the whole idea is that the customer has to be all in with you,” he said. “And if that customer wants something you don’t carry…we don’t allow it. By controlling the experience for the client, it ends any finger-pointing and maximizes the quality of the service delivery, and MIT will really help boost profits as its CAGR far exceeds those for hardware and software. Managed IT also lets us stretch beyond our traditional regions, so capturing this recurring IT revenue is going to be more and more crucial.” PERRY proTECH is passionate about combining an MIT opportunity with an MPS opportunity and considers this both a natural occurrence and a great way to drive deeper into any account.
 
 
“Today, we’re not a copier company, we’re not a tech company—we’re a security company. We put a holistic wrapper around the topic for our customers. We can be different this way.” –Jeff Boate
 
 
Boate, who claims he’ll always be a geek at heart, brings a ton of passion to whatever does, evidenced by the energy he brought to our conversation. Over the past few years, he’s been working out religiously and running half marathons, during which he enjoys focusing his thoughts on the important things in his life and what the future holds for him, both personally and professionally. “This really revitalizes me and makes me feel good, and when people feel good it’s contagious,” he said.
 
Of course, Boate’s three daughters provide plenty of fun and excitement in and out of the house, but even he can’t move beyond looking at his girls for some market research. “None of them print,” he said. “They just want a tablet, not a laptop or a PC. They’ve never not lived in the cloud—and before we all know it, the generation behind the Millennials will be making business decisions. The younger set these days wants instant access and the ability to communicate via social media, and we as a company need to capture this spirit.
 
“Looking at these trends as far ahead of the curve as possible is key, especially for organizations like us that are an ESOP (Employee Stock Ownership Plan),” Boate continued. Next year marks the 30th anniversary of PERRY proTECH becoming an ESOP, with a robust 13 percent average stock increase year over year since 1986, and its employees become vested in the program after 7 years of service. “We’re an aggressive company that always asks ‘how do we leave it better than the way we found it?’ The answer is we invest a lot in our people, plain and simple.”
 
Even more impressive is that this year is PERRY proTECH’s 50th anniversary, and, indeed, it’s been a very successful half century of business, growth and development. “Innovation never happens at the management level—it’s about the employees in the trenches who truly push a company forward,” Boate said. “Our dealer app for scheduling service calls and other service-related items is a great example of this, as it was an entry in one of internal contests that help us decide direction. The ESOP component is certainly big for us, but ultimately it comes down to the people and our overall muscle memory to change ahead of the market transition.”