In a move to further grow its market share in the digital printing industry in India, Xerox India announced two new schemes, “Summer Specials” and “DC 12 CP Boom” for channel partners of its Production Systems Group.
Valid for the period May-June 2006, the schemes provide a new growth opportunity to Xerox channel partners. They also offer channel partners an opportunity to earn significant cash incentives by selling digital printing presses in India.
In the past, Xerox has relied extensively on customer financing and has been reducing their reserves for doubtful receivables - both trade receivables and financing receivables. Furthermore, the reduction in reserves does not appear to be resulting from improved collections, as the new amounts reserved each year have been less than the actual bad debt losses.
Xerox has also avoided declining revenue primarily due to the temporary benefits of currency fluctuations. It also doesn’t hurt that analysts have stuck to their pattern of ignoring the “one-time” restructuring charges that seem to occur on an annual basis.
Xerox is showing steady improvement. However, it is in a race to see whether these improvements can materialize before the company runs out of accounting levers and one-time benefits that are keeping up appearances. The new incentive program suggests to us that the race is far from over.
XRX 1-yr chart: