Don’t Forget the Tax Man

Filling out tax forms is a major drag; selling them is anything but. While technology has brought about the demise of many form products and left others mortally wounded and gasping for air, tax forms remain extremely lucrative, in-demand products.

Consider the fact that a trip to the local post office, library or state building to obtain tax forms simply won’t cut it for most enterprises, given their varied and voluminous needs. “This might be an option for very small companies with no more than three employees, but, local government offices have limited quantities and are not designed for large give-aways,” explained Jim Magdaleno, sales and marketing manager for TFP Data Systems, Oxnard, Calif. “Besides, have you ever tried getting anything from a large government office?”

Quantities aside, Joe Abrams, president of Houston-based Apex Business Systems, noted that software programs and printers are important considerations for end-users, as well. “The government only provides a little unit set that wouldn’t run on their software. It would have to be handwritten or typed, and there wouldn’t be an envelope to mail it,” he explained.

If ever there was a situation requiring the expertise of forms professionals, supplying tax forms is it. Best of all, the products translate into profitable, repeat, seasonal business for conscientious distributors who follow a simple customer-contact schedule (see sidebar on the right). And, as Neville Johnson, vice president for Apex Business Systems noted, tax forms open the door to tremendous cross selling opportunities. “For example, tax forms tie in beautifully with our human resources products,” he said. The line of compliance products that the company came out with last year includes items such as mandatory federal and state labor posters, job applications and software.

Many Happy Returns

Both Abrams and Magdaleno reported distributors make 70 percent to 150 percent profit selling tax forms. “We suggest profit margins of 100 percent on cost,” offered Abrams. “On orders for 10,000 pieces, distributors may make 100 percent. But, 100-piece orders can mean 600 percent and 700 percent margins. Even at the most competitive level, the mark ups on tax forms are big.”