Xerox Corp. reports decreasing demand for printer equipment and consumables as their printing, photocopying and document management business suffered a 12% profit decline. Some industry experts call this latest quarterly financial report the tipping point where the cash cow of the printer/consumables hybrid goes dry and dryer...
Driven by innovative printers , multifunction devices and document management software, the printer business has been lucrative, allowing partners to sell highly profitable consumables (cartridges, ink, paper etc) as well as maintenance services.
But today, as an example, Xerox gets about 33% of its business from printers and consumables, 20% from photocopies and the rest from professional services and business process outsourcing. That's right, Xerox is almost more an IT integrator than a printer/photocopier maker-- and that's a tipping point!
In its new business, Xerox is competing against Hewlett-Packard Professional Services (formerly EDS) (among others), another printer company that's embracing IT services instead of hardware/consumables. Read more...