Document Advisors | IDeAs blog, for better document strategies.

Document Advisors | IDeAs blog, for better document strategies.

Also on Twitter | @DocAdvisors

Rumor or speculation?

Lexmark does not comment on rumor or speculation” company spokesman Jerry Grasso said. Since October 22th, rumors are spreading fast. If it is not such a surprise for the experts, “Lexmark for sale” is nevertheless significant news in our sector. The key question to ask is: who is ready – we say ready, not able – to pay more or less $2 billion for this group?

At the same time, the outlook is somewhat uncertain for Xerox too. They announced quite disappointing Q3 results. Revenue fell by 9.6%… When such a company says it would undertake a “comprehensive review of structural options“, we all know what it means, although we should point out that, as Xerox made clear, this does not imply putting the company up for sale.

Perhaps the real take-out from all this is to recognise that the long forecast decline in print revenues is now becoming a reality. Although some vendors are doing better than Lexmark and Xerox, it is clear that the industry as a whole will see growing pressures on both revenue and margins. As we at IDeAs have pointed out for some time, that should not come as a great surprise, when customers are routinely being offered MPS solutions, which say they will reduce their print expenditure by 20-30%. If customers generally are being helped to reduce print expenditure in this way, it doesn’t need a mathematical genius to work out the impact on industry revenues. And now the trend is being reinforced, by evidence that print volumes are really starting to fall significantly, as has long been anticipated.

Now of course, vendors are right to help customers improve the efficiency of their printing with MPS solutions, and if they don’t, they will lose out to competitors who will. However, the challenge is to find new and profitable revenue streams to offset the decline in expenditure on print. We have all been playing lip service to this for some time, but now it is becoming an urgent necessity.

Where and how to do this is the big question, with which at IDeAs have been grappling.

Leave a Reply


This article was written on 20 Nov 2015, and is filled under Point of View.


Current post is tagged

, , ,