Got The TCO Blues? Top 5 Tips To Generate TCO Like A Champ.
The core of assessments that sell is generating an accurate TCO (Total Cost of Ownership) of your customer’s current print and copy environment. Get it wrong and you lose your customer’s trust. Get it right and you can improve your solution close rates dramatically.
TCO generation Doesn’t have to be difficult or time consuming. If you get the right information up front and use the correct tools and methodologies out of the gate you can start generating TCO reports like a champ. Below are the top 5 tips to take your TCO efforts to an all new high:
Get Executive Support on Day One: If you want to make accurate TCO calculations a priority you need to first get buy in from the top. Executive commitment to getting you all the information you’ll need will be critical in ensuring that the entire company is onboard with the things you’ll require. The top brass will dictate how much (or how little!) the rest of the organization buys into the Assessment process.
Pro tip: Let the executive branch know that whether or not they go with your solution they’ll have the best understanding of their document workflow and output costs. They don’t have that today and it’s extremely valuable.
1 Full Year of Invoices: TCO calculations done using 30 days of data collection are never truly accurate. The minute you extrapolate data from a small window across the entire year you are going to have inaccuracies. Certain verticals like education and accounting have high variability and tax season and student enrollment can cause huge spikes in printing activity. If you have executive buy in getting a year’s worth of cost data won’t be difficult. Make sure you ask for all cost items such as copies of leasing agreements, mono and color page counts, all toner purchases and Service invoices.
Pro Tip: If the customer groans at having to pull together all their toner invoices you can ask them to get it from their supplier. A cautionary note: This will save your customer time and hassle but if the supplier is a competitor the request for cost information could raise red flags.
Agreement on Soft Costs: Soft costs are the enemy when it comes to TCO generation. Sure, you’ve had people tell you that it’s important to include them because it can inflate savings generation come proposal time. The problem: The customer often doesn’t believe your savings numbers because they aren’t all from hard dollar costs. Before you include any soft costs in your proposal, make sure you have agreement from the customer that they want them included. Some customers like soft costs included and others think they are pure fluff. Your job is to find out which camp they are in and generate your TCO accordingly.
Pro Tip: Include soft costs on a separate page in the proposal and make sure your hard dollar savings are on another page. This way the customer will be aware of soft dollar costs without any fear of them not believing your hard dollar numbers.
Validate, Validate, VALIDATE: If you are using spreadsheets and manual calculations for TCO generation it is very easy to make mistakes. One extra zero in a meter read or incorrect numbers for toner purchases can make your TCO DOA. Manual TCO calculation is extremely time consuming and errors in data input occur frequently, so make sure you check and recheck your numbers. I’ll often have a colleague go through the numbers as a second set of eyes may see errors that I am blind or biased towards.
Pro Tip: Have a TCO validation meeting with your customer before submitting your proposal. Getting sign off from the customer at this stage will ensure your future-state recommendations are taken seriously.
Use a TCO Generation Tool: If you want to ensure accuracy and save a TON of time on TCO generation you should be using software tools. It is 2017 after all. Digital tools like DOCassess’s Quick Deal TCO offer powerful ways to improve accuracy and dramatically decrease the amount of time it takes to generate current state and proposed state TCO reports. It contains a device database with over 40,000 models and even integrates your dealer price books to save even more time..
Pro Tip: Quick Deal TCO is part of a powerful suite of of products designed to make pre-deal and post-deal management more accurate and less time consuming. Spend less time generating TCO and proposals and more time selling!
Once you start using the 5 tips above you’ll be generating TCO like a champ in no time!
Now it’s your turn! Do you have some TCO generation tips of your own? Are there lessons you’ve learned along the way that you wish you’d had discovered earlier? What are your thoughts on soft dollar costs vs. hard dollar costs? Leave your comments and insights in the comments section.
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