Xerox, Debt-Laden But Hopeful, Reveals Plans
Amid asset sales and cost-cutting, a focus on color, big R&D budgets, and new products.
Staff -- graphic arts online, 4/1/2001
At a press conference last month, the financially ailing Xerox Corporation announced a three-part business turnaround strategy, a drive to transform business documents into full color, substantial investments in color and black-and-white technology, new products and enhancements, two major equipment orders, and a reseller agreement involving a high-speed, variable-data web press system.
Anne M. Mulcahy, president and chief operating officer, says the turnaround plan includes:
—generating cash to pay its debts (Xerox recently sold half of its 50% stake in Fuji Xerox to Fuji Photo Film for more than $1.3 billion, plus it sold its China operations for $550 million),
—cutting costs (the company's aim is to squeeze $1 billion out of its cost base), and
—providing for long-term growth (primarily by helping customers create and profit from higher-value documents, which Xerox would deliver through its color products, solutions, and services).
Mulcahy says Xerox, which doubled its color revenues from $1.5 billion in 1997 to $3 billion last year, is emphasizing creation of extensive color platforms designed to capitalize on the appeal and surging demand for color. This year, she adds, Xerox and Fuji Xerox together will invest more than $715 million in color research and development, plus a nearly comparable amount for black-and-white technology.
At the event, the company debuted the 21-page-per-minute (ppm) Phaser 2135, which it claims is the industry's fastest-ever office color printer; the high-speed DocuColor 2006 printer/copier; the 45-ppm black-and-white DocuPrint N4525; and many upgrades.
In a pact worth nearly $20 million, Edward Jones, a St. Louis-based financial services firm, bought 5,000 Phaser 1235 color printers, and New York City-based graphics services provider C2 Media.com spent more than $9 million to acquire 16 DocuColor 2045 presses. Xerox has now sold more than 2,000 units in the DocuColor 2000 series since its launch in June 2000.
Finally, Xerox signed a deal with Scitex Corporation Ltd. to resell its 2,000-ppm VersaMark series of color and black-and-white ink-jet web presses.
