The first recent shock to the industry happened last year when Xerox (a hardware manufacturer) purchased a conglomerate of formerly independent copier dealers called Global Imaging (Boise Office Equipment was owned by this Tampa conglomerate). This was a major event in the copier industry because Global dealers represented the market leading manufacturers around the country (namely Canon and Ricoh, but also Konica Minolta, Sharp, and Kyocera Mita). Canon and Ricoh decided to immediately de-authorize the Global dealers to the extent of the law (some parts and supplies support had to stay in place, but they cut the dealers off of new equipment purchases, technical support, warranty support, etc.). Canon and Ricoh therefore lost significant distribution while the Global dealers lost their ability to effectively support their customers. 

The second major shock to the industry came a few weeks ago when Konica Minolta announced they were purchasing Danka. Canon has unofficially announced their intent to drop Danka as soon as the deal closes (sometime between May 31 and June 30). Again, Canon loses channel representation and Danka loses manufacturer support. 

What is the outcome of these shocks? It’s causing a hot acquisition market for non manufacturer-owned channels (like independents and IKON), concern from customers about which servicing partners will be authorized to service their assets in the future, and a manufacturer scramble for channel representation.   

Going forward this will likely lead to three phenomena: 1) IKON being purchased by a manufacturer (most likely HP, Canon, or maybe Ricoh), 2) manufacturers opening more direct operations (in larger markets), and 3) more independent dealers being enabled with more manufacturers. 

For our market in Idaho, the shocks have been a positive for Fisher’s. It never hurts for a large, bureaucratic organization to buy a formerly-nimble, customer focused independent dealer and mess them up (e.g., the Xerox acquisition of BOE). The outcome of the Danka acquisition still needs to play out, but Danka’s Canon base of customers will be looking for Canon servicing partners (good for us) and Danka’s Toshiba base of customers will be looking for Toshiba servicing partners (good for another local independent dealer). 

The negatives for Fisher’s business in the future would be an acquisition of IKON by a formidable competitor (or a manufacturer we represent) as well as the possibility of other independent dealers entering our market. 

In order to take advantage of the shocks that favor us and to mitigate the risks of the shocks that could hurt us, our strategy is to simply be the best at taking care of our customers. As we get that right, we will continue to grow in our market, gain share from those who are falling off, and protect against those who plan to take share from us.