Xerox touts super-charged office productivity
Speeds and feeds will move to multi-function, low-cost and high-productivity devices in the converged printer market.
Self-styled document company Xerox has launched a raft of digital multi-function products that it hopes will offer its customers 'super-charged' office productivity.
At the same time, it is banking on its latest technology to help reseller partners offer important differentiation in a market that is currently being flooded with rival multi-function printers.
Available now, its new black and white Document Centre 500 series is targeted at small to medium sized enterprises and corporate departments. The range starts at a whisker below £6,000 for the entry level 535, moving up to £16,998 for the fully configured 555 machine with all the bells and whistles. As their designation suggests, the 555, 545 and 535 print at speeds of 55ppm, 45ppm and 35ppm respectively.
The 500 series is being pitched as a 'channel friendly' product and a productivity booster for end-users.
As well as the 'me too' multi-function offerings such as print, copy and scan, Xerox has claimed that its bundled and optional features, such as email, network connectivity, wireless 802.11b support, internet faxing, small form factor and customer replaceable units, will offer compelling differentiation for business partners.
In addition, Xerox has claimed that its machines offer true multi-tasking. With proprietary software, Xerox said that its 500 series can offer 'walk-up' users the ability to start a new job while a current job is being performed.
According to Andy Muskett, solution partner manager at Xerox, this is because the machines can queue the jobs.
Speeds and feeds
Although quick for its class, resellers know that selling speeds and feeds in today's market is not good enough in itself.
Xerox has recognised this and is encouraging partners to talk up the business benefits of multi-function printers, such as built-in security which stops users modifying or deleting documents.
According to the company, this is an important selling point to verticals such as the legal and public sector markets.
Earlier this year, Xerox UK announced that it was merging its copier and printing business. In the US a few months before, Xerox chairman Anne Mulcahy insisted that multi-function was the way forward.
To this end, she said that resellers would have to be able to offer scanning, faxing and copying facilities in addition to printing.
According to Nick Culley, product manager at Xerox distributor Midwich, this move looks set to benefit traditional printer resellers more than the traditional copier channel.
Speaking at the time of the merger of the two business units earlier this year, Culley explained that he felt Xerox's decision would give good incremental revenue for the channel.
Conversely, he believes that the copier dealers have to change if they want to compete in their market which is increasingly being stalked by the printer resellers.
"Midwich has worked really hard over the years with the Xerox concessionaire channel to introduce them to page printers, especially colour-page printers," said Culley.
"We have a field-based business development manager who spends his time all over the country training the 50 or so Xerox concessionaires on how to sell printers and network capabilities.
"But the uptake is still slow because even a £2,000 colour laser printer is perceived to be a low-value product, because many of them are selling a five and six figure copier solution where they are making significantly larger revenue and profit."
Jane Cronin, marketing and channel director, printing solutions and services division at Lexmark, agreed with Culley and believes that printer resellers have additional assets as multi-function printer dealers because increasingly digital multi-function printers "can perform the same functions as copiers".
User tracking
She added that, as the copier comes more under the influence of the IT manager rather than the office manager or human resources department, traditional copier dealers will not be able to offer the networking skills needed to track important cost of ownership and management data now required by end-users.
"If you can track who is printing what, you get a lot of management information. For example, is that printer being used enough? And you can tell what costs are being incurred," explained Cronin.
"As colour printing and copying starts to be deployed more, this will become critical. And colour multi-function printers are a good opportunity for resellers."
But there is still a lot of education to be done in the reseller space on the opportunities posed by multi-function printers, according to Tracey Rawling-Church, head of marketing at Kyocera-Mita.
"Resellers haven't really woken up to the opportunity," she explained. "They are perfectly placed to sell networked multi-function printers. The problem with some resellers is that they are reactive, and not proactive.
"We are still finding that most multi-function printers are being sold through the office products channel.
"Mmulti-function printers have to have more than two functions. If a machine can copy and print then it is just dual function; it must be able to print, copy and either fax or scan. The industry has not found its level yet and there are some confusing definitions."
However, she added that a true multi-function printer should be able to multi-task as well as multi-function.
At the higher end, Xerox has taken the wraps off its colour 2240 and 1632 machines. Again, the company said that it is supplying its product in multi-configurations to give resellers differentiation and up-sell opportunity, according to Paul Birkett, business manager at Xerox UK's channel solutions group.
Opportunity knocks
For those seasoned in the printer market, for the past few years vendors have been saying that colour printing in business is just around the corner.
But with a fixed cost per page of colour in its click pricing model, Xerox hopes that more business users will take this function. For its 2240 (22ppm colour, 40ppm black and white) and 1632 (same convention) Xerox claims that users can produce documents and copies for less than 10p a page.
Although Xerox has developed its machines to have plenty of customer replaceable units, the company would not be drawn as to when or if these consumables, which can make quite a lot of margin, would be available through resellers.
For Rawling-Church this decision is a mistake. "We are 100 per cent channel, although we cannot guarantee that the reseller which sold the original hardware will get the consumables too, but someone in the channel definitely will," she said.
"Vendors have shot themselves in the foot because they have been too greedy. They have been selling their own consumables, and began adding proprietary designs, blocking rivals' consumables from working with their hardware and forcing lock-in.
"The European Union is now investigating this, so it has come back to haunt them. If they hadn't been so aggressive in selling their own consumables the EU wouldn't be involved now."
Leasing programmes
Rawling-Church explained that the best way to ensure the consumables, and therefore make margin on multi-function or normal printers, is to do leasing. Kyocera-Mita has its own branded leasing programme, run through CF Asset.
"This encourages resellers to provide everything; it's a total document management solution," she said. "The customer gets tied to the reseller for three to five years.
"The only conditions are that it must be a minimum £10,000 contract [over the three or five years] and the reseller must pass the CF Asset credit check.
"This means that the reseller secures the consumables, increases the longevity of the relationship with the customer and minimises the focus on costs, as the reseller can talk about cost per quarter, not just per multi-function printer."
Although it has perhaps dragged its feet in the space by launching a product relatively late to market, Hewlett Packard (HP) and its channel is still the biggest threat, according to Birkett, who said that following the Compaq merger HP has a "stronger bat to hit people with".
Rawling-Church agreed that it wasn't until HP bought out its multi-function printers earlier this year that these converged products were legitimised in the market.
However, she added: "HP's multi-function printers are not all that good. Usually if a vendor is routed in one direction it will tend to show a bias towards that technology, so HP's copier standards aren't as good as its printing."
David Poskett, commercial sales director at HP's Imaging and Printing Group, said: "The value of the channel in terms of imaging has increased, and there is even more scope to develop services and solutions around imaging.
"Printing has moved on from selling boxes and it now needs the channel to deliver value to the customer."