*NEWS*XEROX TO AXES MAJORITY OF EU DIST.

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*NEWS*XEROX TO AXES MAJORITY OF EU DIST.

 user 2006-10-24 at 4:25:00 pm Views: 88
  • #16676

    Xerox to axe majority of its European distributors
    Printer
    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.”