The OEMs The Dealers The Changes FY24
March is here! The 4th quarter for many of our OEM friends FY23.
Obviously, the OEM in the most critical status is Konica. How will they end the year? As I previously discussed, Big changes are coming. Is this the last qtr for All Covered under Konica ownership? There are lots of things that must be improved for Konica to return to profitability.
I lack confidence regarding Konica's ability to escape their issues after reading the latest articles from the industry's media outlining the content being shared by Konica as they travel through the U.S. Marketplace, meeting with dealers. I can not be the only one asking of Konica, What's different?
As the industry heads into April, many needed adjustments will become visible. With the start of the pandemic, the component of the print industry that sells, supplies, and services print equipment to businesses was presented with new realities as their end-users were awakened to redefine the actual needs of printing within their business processes.
This new awareness is now having an impact. We are witnessing significant changes as organizations recalibrate based on shifting marketplace needs. Recently, Xerox announced substantial changes, and part of those changes included reductions in the workforce. Xerox will not be alone in that strategy, as all the major global players must align costs with today's realities and prepare for what else is coming.
In 2017, Ricoh eliminated most of its U.S. direct operations. A collection of significant acquisitions made in the early 2000's. Ricoh attributed this shedding of direct operations as necessary based on a misaligned delivery cost to support a highly competitive commoditized marketplace.
Unfortunately, I believe Ricoh is attempting to buy its way into IT Services as it did in the print space, especially in the European marketplace. I don't think that strategy will turn out well for Ricoh.
The industry must face the reality that its business model must align with today's realities. This alignment will cause many challenges, changes, and opportunities. One thing for sure is that the status quo to the year 2000 is not an option.
Dealers will have to implement many changes themselves, and we see many doing just that. I caution all dealers, especially the mega dealers, to refrain from betting on the revenues and profits from selling, supplying, and servicing print equipment to businesses to remain sustainable as the go-to-market changes drastically.
The industry must look for ways to cut costs and realign the deliverable to where the marketplace is and is going. Those already in the process of diversification strategies remember that the tenure of using profits from print to offset the cost of diversification is quickly ending.
FY24 will be the intersection where the past and future find themselves frustrated in the traffic of transition. Those who can navigate this intersection without the emotional baggage of the past will steer clear of the status quo, attempting to block the road.
"Status Quo is the killer of all that will be invented."
Ray Stasieczko - Host of The End Of The Day With Ray!
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