With its newly developed program for processing school lunch applications, Image One plans to complete 80 installations in a two-year span.

The market for document management solutions is huge. You're familiar with the more obvious customers -- banks, law firms, and hospitals that need to improve access to documents and reduce payroll expenses associated with managing files. Image One Corp. (Tampa, FL), a systems integrator and software developer, has big plans to grow its business by pursuing customers in a narrow, not-so-obvious niche of the market -- school lunch programs.

Four years ago, Image One learned about a school district in Louisiana that was using scanners and document management software to process applications it received from prospective participants in the National School Lunch Program. Students who meet certain income guidelines are eligible to receive meals for free or at reduced prices through the program.

Image One, which offers document management software for a variety of business and government applications, figured there must be other school districts that needed help processing their lunch program applications. It was right. Most school districts rely on data entry and manual filing systems to process the applications they receive in the first two months of the school year. For some districts, this can be more than 50,000 applications, so they need to hire temporary workers to handle the workload. Since 2001, Image One has installed document management systems in 19 school districts and plans to complete 100 installations by the start of the 2005-2006 school year. "We knew the size of the market was substantial," says Tom Murphy, general manager for Image One. "There are over 18,000 school districts in the United States."

Build A Customized Imaging Solution
Image One developed its own software, RocketSCAN for Meal Applications, to process the lunch program applications and began selling it to school districts in 2002. "At first we used off-the-shelf software. After our first few customers, we realized we needed to add more features and custom tailoring to the software," says Murphy. It built a program that recognizes the handwriting on the forms and incorporates complex USDA (United States Department of Agriculture) and DOE (Department of Education) guidelines to prevent incorrect validation of applications. The program also features a reporting tool that shows how fast employees validate applications so school districts can gauge worker productivity.

Andy Savitt, sales manager for RocketSCAN, says the company's initial marketing effort involved mailing informational packets on its product to the 100 largest school districts in the United States. That effort yielded a contract with the Cobb County School District in Georgia, which wanted to replace its manual processing of 40,000 applications per year with an automated system. In the Image One system, employees place the applications in Panasonic (Secaucus, NJ) KV-S2046C Document Capture Scanners, which Image One purchases at a discount from Tech Data Corp. (Clearwater, FL). The RocketSCAN program uses ICR (intelligent character recognition) to read the handwriting on each form to identify the student applying for the program and to verify the information that the family is required to report, including household income. The Panasonic scanner, which scans 46 pages per minute, creates an electronic image of each application and uploads the data from the application to the school district's POS (point of sale) software, which then determines the child's eligibility for the meal benefits. The electronic images are saved to the district's server, providing online access to the documents. A typical meal application can be processed in less than 30 seconds, compared with 2 to 3 minutes for applications that are hand keyed.

The document management system has enabled Cobb County to cut the number of employees it dedicates to processing the applications in half, from 12 employees -- including 2 full-time and 10 temporary employees -- to 2 full-time and 4 temporary employees, says Savitt. The savings amounts to about $38,000 per year.

Lower Costs To Win Smaller Customers
After pursuing large districts during the launch of its application processing software, Image One decided to expand its customer base to include smaller school districts with fewer than 15 schools. "Big school districts are the tip of the iceberg. When you look under the water, you find that smaller school districts represent 90% of the market," says Murphy. Murphy says many document management systems cost between $50,000 to $70,000 per year, which is too steep for small school districts. Image One has been able to bring the cost down and market its system to these smaller districts. Image One is networking with POS resellers to expand into smaller school districts. By capitalizing on the relationship these resellers have with the districts, the company will be able to crank up its growth. This school lunch application program will soon become a much bigger piece of Image One's overall revenues, increasing from about 10% of the company's revenues to more than 30% of sales within a year.

Business Solutions, September 2004
Written by: Steve Webb