Pitney Bowes 2015 Annual Report Download - page 22

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6
Through our wholly owned subsidiary, The Pitney Bowes Bank (the Bank), we offer a revolving credit solution to our SMB clients in
the United States that enables them to pay for postage, the rental of certain mailing equipment and purchase products, supplies and
services. The Bank also provides an interest-bearing deposit solution to those clients in the United States who prefer to prepay postage.
We also provide similar revolving credit solutions to our clients in Canada and the U.K but do not offer these through the Bank in overseas
markets. Our financing operations face competition, in varying degrees, from large, diversified financial institutions, including leasing
companies, commercial finance companies and commercial banks, as well as small, specialized firms. Not all our competitors are able
to offer these financing and payment solutions to their customers and we believe these solutions differentiate us from our competitors
and are a source of competitive advantage. The Bank is chartered as an Industrial Bank under the laws of the State of Utah, and regulated
by the Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions.
Production Mail
We face competition from other companies that offer large production printers, inserters or sorters. We also face competition from the
fact that some companies choose to outsource although those outsource providers can also be our customers. Our competitive advantage
lies in our ability to offer all of these products and services and integrate them into an end-to-end solution. The principal competitive
factors include functionality, reliability, productivity, price and support.
Presort Services
We face competition from regional and local presort providers, service bureaus that offer presort solutions as part of a larger bundle of
outsourcing services and large entities that have the capability to presort their own mailings in-house. The principal competitive factors
include innovative service, delivery speed, industry expertise and economies of scale. Our competitive advantage includes our extensive
network of presort facilities capable of processing significant volumes of mail and our innovative and proprietary technology that enables
us to provide our clients with reliable and accurate services at maximum discounts.
Software Solutions
We operate in several highly competitive and rapidly evolving markets and face competition ranging from large global companies that
offer a broad suite of solutions to smaller, more narrowly-focused companies that can design very targeted solutions. The principal
competitive factors include reliability, functionality and ease of integration and use, scalability, innovation, support services and price.
We compete based on the accuracy and processing speed of our solutions, particularly those used in our location intelligence solutions,
the breadth and scalability of our products and solutions, our geocoding and reverse geocoding capabilities, and our ability to identify
rapidly changing customer needs and develop technologies and solutions to meet these changing needs.
Global Ecommerce
The market for international ecommerce software and fulfillment services is highly fragmented, and includes competitors of various
sizes, including companies with greater financial resources than us, some that specialize in point solutions or freight forwarding services,
full-service ecommerce business process outsourcers and online marketplaces with international logistic support. In addition, major global
delivery services companies are acquiring the technology to improve their cross border ecommerce shipping capabilities. The principal
competitive factors include reliability, functionality and ease of integration and use, scalability, innovation, support services and price.
We compete based on the accuracy, reliability and scalability of our platform, and our ability to provide our clients and their customers
a one-stop full-service cross border ecommerce experience.
Financing Solutions
We offer a variety of finance and payment solutions to clients to finance their equipment and product purchases, rental and lease payments,
postage replenishment and supplies purchases. We establish credit approval limits and procedures based on the credit quality of the client
and the type of product or service provided to control risk in extending credit to clients. In addition, we utilize a systematic decision
program for certain leases. This program is designed to facilitate low dollar transactions by utilizing historical payment patterns and
losses realized for clients with common credit characteristics. The program defines the criteria under which we will accept a client without
performing a more detailed credit investigation, such as maximum equipment cost, a client's time in business and payment experience.
We closely monitor the portfolio by analyzing industry sectors and delinquency trends by product line, industry and client to ensure
reserve levels and credit policies reflect current trends. Management continues to closely monitor credit lines and collection resources
and revise credit policies as necessary to be more selective in managing the portfolio.