*NEWS*XEROX TO AXE 46 EU. DISTRIBUTORS

[Anonymous]

Xerox to axe majority of its European distributors
New
Office Group model means printer vendor can cut costs and improve
efficiency,Find your ideal joPrinter vendor Xerox has unveiled plans to
drop 46 of its European distributors as part of a new distribution
model for its Office Group.
Xerox
Office Group’s two-tier distribution model consists of 49 country-based
tier-one distributors serving about 8,000 resellers. But this will be
restructured to comprise three regional master distributors: Tech Data,
Ingram Micro and Scribona.
Under a scheme known as the Smarter
Distribution network, Tech Data and Ingram Micro will cover the bulk of
western Europe, while Scribona will provide distribution in Scandanavia.
In
the UK, Xerox will retain Micro Peripherals as a hardware distributor
to work with Ingram Micro and Computer 2000 (part of Tech Data). The
transition from Xerox’s current distributors to a new model will take
place throughout 2006.
Richard Gibbs, European distribution
operations director at Xerox Office Group, said: “The new model will
improve overall consistency of products and service levels, and extend
Xerox’s reach in the market. The new model is flexible and strong
enough to enable us to hold onto smaller, local distributors.”
Gibbs
added that the new model will benefit UK VARs as availability of
products should improve. “VARs will have more points to purchase from
because of the addition of Ingram, and the new model will enable us to
better manage our distribution,” he said.
Clive Longbottom, service director at analyst firm Quocirca, said the move is more about cost-cutting than anything else.
“There
was a time when a colour laser printer cost between £2,000 and £3,000.
Now, if you look at a base level Hewlett-Packard [colour printer], it
is going for between £250 and £300, and a Konica model is about £250.
“Xerox
used to be able to offer five margin points, but its distributors are
now looking at making £15 a box if they are lucky. Xerox has realised
it has to trim its whole approach to the market. At the moment it is
costing more for it to sell than it is getting back out of it. It needs
a much sharper channel to cope, to keep inventory out of the channel
and to get the product flow just right.
“This move will give Xerox a
better focus on the channel, and it is just a reflection of the market.
The high-margin, high-price printers are just not there anymore.”
Kevin
Jones, managing director of Xerox reseller Printware, said: “I think
Xerox has done this more as an internal move to make it easier for it
to handle its distribution.”

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February 9, 2006 at 9:59 AM