2015 will be a challenging year 4/4

By Jean-Louis de la Salle

We saw in the former article that volumes could very well fall by 15% over the next two years.  And this is a “nice” scenario as we have seen that one of the two “reasons” for printing is the need to keep a paper copy in the organisation, which will be quickly reduced by the adoption of Content Management and Electronic Archiving.

Now a client in his right mind (and the data is now visible thanks to automated reporting) will certainly ask for a major rearrangement of his fleet and do the following

• Not buy any new devices and extend further current devices that have not reached their end of life because they printed less than planned at the signature of the contract
• Reduce the capacity of the fleet by discontinuing certain end of life assets
• Require revised volume commitments on existing devices and contracts

The first two mean a further reduction of net new sales.
On the third point, Vendors may decide to enforce strictly the 5-year contracts to maintain short-term revenue levels but the backlash will come at renewal time. We are fully aware that it is very difficult to downsize a fleet at such a fast rate, as leases are in place and assets need to be amortised.

My question to you as providers: are you ready for that bloodbath?

We can have an infinite discussion on the calculation and on the original analyst data and come to agree that maybe the “correct” figure is 10%, or maybe 20%.

If Revenues from print (HW and supplies) are really down by 10,15 or maybe 20% in 2015 (now only 18 months away), have you got a strategy to replace these revenues quickly enough?

Shall we see after all these years this consolidation happen? At the Vendor level? At the Channel level?

Our advice to Channel partners is that you transform at a much faster rate than you have been.

Our advice to Vendors is that you make sure you are betting on the right channel partners.