Xerox 2007 Annual Report Download - page 34

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32
We are creating new market opportunities with digital printing as a complement to
traditional offset printing through a market transition we call “The New Business of
Printing”. We are driving the New Business of Printing opportunity by identifying
applications which are suitable for digital production and represent what we refer to
as the “eligible offset” market. With our leading business development tools, workfl ow
and digital technology, led by our market-making Xerox iGen3® technology, we are
uniquely positioned to meet the increasing demand for short-run, customized and
quick-turnaround offset quality printing.
Over the past year we have scaled up our presence in the small and mid-size business
(SMB) market, most notably through our acquisition of Global Imaging Systems, Inc.
(GIS). This increased distribution capacity, along with a strong product portfolio in this
segment, is expanding our participation in SMB and opening up new growth
opportunities.
Our products include high-end printing and publishing systems; digital multifunctional
devices (MFDs) which can print, copy, scan and fax; digital copiers; laser and solid ink
printers; fax machines; document-management software; and supplies such as toner,
paper and ink. We provide software and workfl ow solutions with which businesses can
easily and affordably print books, create personalized documents for their customers,
and scan and route digital information.
Our business model is an annuity model where post sale and fi nancing revenue growth
is driven by increasing equipment installations which increases the number of page
producing machines in the fi eld (MIF) and expanding the document management
services we offer our customers. 72% of our 2007 total revenue was post sale and
fi nancing revenue that includes equipment maintenance and consumable supplies,
among other elements. We sell the majority of our equipment through sales-type
leases that we record as equipment sale revenue. Equipment sales represented 28%
of our 2007 total revenue.
Our business