At the beginning of June this year, HP Inc. and the Xerox Corporation announced an expansion of their existing business relationship. While the announcement comes as a surprise, the deal benefits both organizations in the medium term. Speculation was rife earlier in the year that one of the other major manufacturers in the industry would acquire Xerox, and this deal makes that less likely to occur in the near future.
Xerox needed to strengthen their revenue streams after having a weak first quarter in 2019. The deal will ensure they can boost profits in the short term, as it would give them a more substantial portion of the consumable market. HP, for its part, will gain access to the secure B2B channels Xerox has with its customers.
Competitors and Allies – Strategic Partnership Benefits the SMB Market
The expansion of the relationship between HP and Xerox seems to be a case of “the enemy of my enemy.” The Original Device Manufacturers (ODM) market is a robust industry. Existing relationships between Xerox and Fuji Xerox soured somewhat in 2017 after Fuji Xerox failed to close a merger deal to acquire the Xerox Corporation. Similarly, HP acquired Samsung but couldn’t leverage the new product offerings into external revenue streams. This deal seems like a win-win for both companies.
Here's what the deal includes:
- HP will provide A4 and A3 (Samsung-sourced) print engines to Xerox for the ConnectKey enabled product line. (This consists of the AltaLink and VersaLink devices).
- Xerox, in turn, will supply toner to HP, increasing their consumable revenues.
- Xerox will also become a reseller of HP Personal Computer products, expanding the offerings to their customers and become a program partner for HP’s Device as a Service (DaaS) solution.
- HP for their part gain access to the Xerox DocuShare Flex software solution as an optional inclusion on all HP PCs.
The biggest takeaway from this for Missoula businesses is access to better solution offerings without needing to engage with multiple service providers. This is the primary strategic intent for forging such a deal between two historical competitors. What this shows is both companies are willing to work together to strengthen certain positions in the market to the detriment of other manufacturers such as Canon and Fuji Xerox.
Benefits and Solutions of the HP and Xerox Partnership
While the companies both benefit from this partnership, the biggest winners are the customers who work with either of these companies. Customers can now engage with Xerox to provide both printing and document management solutions but also source HP branded computer equipment from them directly. For HP, access to the robust Xerox reseller network could strengthen their hardware portfolio within the small to medium business market.
How HP and Xerox Will Work Together
As an office productivity solution provider, Xerox’s products focus on a reduced printing footprint, with enhanced business process automation software. HP traditionally served enterprises, providing hardware, network, and software solutions for large, distributed teams. By combining forces, the more significant product bundles offered to a broader base of customers will ensure both entities secure a portion of the lucrative SMB digital transformation market.
Xerox DocuShare Flex Solution
DocuShare Flex is a software solution that brings together electronic document management, enterprise content management, workflow, and process automation capabilities. When integrated with multifunction printers (MFPs), Xerox DocuShare Flex centralizes all of a company’s content management processes.
DocuShare Flex features include:
- Content security with role-based access control
- Data capture capabilities using OCR and Webforms
- Reusable electronic workflows to streamline company information flows
- Document and content lifecycle management including storage, archiving, and indexing
- A complete audit trail for compliance audits
If a company sources HP PCs, they have the option to include DocuShare Flex as a pre-installed software component for the hardware. This enables Xerox to leverage existing relationships and generate additional revenue from customers. Any improved sales similarly helps HP, who now has an external consumer of their Samsung A4 and A3 print engines.
For their part, HP provides integrated computer and printing equipment for healthcare, education, retail, and other industries. HP manufactures a comprehensive technology stack, which also includes proprietary software solutions.
HP products include:
- Desktop and laptop PCs
- Tablets and 3-in-1 touch devices
- Servers and storage boxes, as well as networking products
- Thin Client workstations, monitors, and other peripherals
HP also offers printers with the best security in the industry. They have a lavish suite of software solutions that also provide workflow and process automation, as well as content management capabilities.
Kelley Imaging – Your HP and Xerox Experts in Missoula, Montana
Kelly Imaging serves Missoula County, providing office productivity solutions from the biggest brands and manufacturers. Operating since 1974, Kelley Imaging offers document management, managed network, and managed print services. Working with customers to find the best custom solutions enables Kelley Imaging to improve any office’s productivity.
For any questions regarding HP or Xerox products, contact one of Kelley Imaging’s technicians today.