Xerox to Close Almost Half of GIS Offices

from the blog

CRN reports that Xerox is closing many of its 186 Xerox Business Solutions field offices, and is requiring sales teams to work remotely. It’s also laying off support staff, as part of a massive consolidation, according to anonymous CRN sources.

Last month, Xerox re-branded and merged Global Imaging Solutions into Xerox Business Solutions. It’s also transferred some 28,000 small and mid-size government accounts to XBS, and appears to have shuttered the Global Imaging Solutions Website.

According to CRN, two sources “with knowledge of the restructuring” said Xerox plans to close roughly half of the XBS physical locations across the country, keeping the 40 geographical “core” businesses intact but closing many of the smaller field offices.

XBS sales account for 22 percent of Xerox channel sales, with indirect sellers accounting for 37 percent.

One source told CRN that the manager of one core office in California that has 10 field offices was told he had to close five of them.

The moves are part of a restructuring program designed to reduce costs.

Xerox spokeswoman Caroline Gransee-Linsey refused to discuss the office closures, but instead told CRN in an email: “As discussed during our Investor Day, we shared that XBS is an important part of Xerox’s three-year strategy. While we have plans to reduce our global real estate footprint to ensure our facilities meet our operational goals, we also have plans to grow the XBS sales team.”

According to CRN, the XBS teams report to Xerox’s North American sales unit, but are not independent resellers. In fact, in some cases, the XBS teams compete with independent Xerox resellers.

Cost-Cutting Plan

As we wrote about previously, through Project Own It, Xerox is aiming to deliver cost savings of $640 million this year, $450 million in 2020, and $375 million in 2021, but expects revenue to continue to decline for the next two years, falling 5 percent year and 3 percent next year, with growth expected during or after 2021.

Meanwhile, two layers of management will be stripped out of the business, but information on the total number of job cuts isn’t available.

Xerox is also reducing the number of its locations, from 555 to 261, and is also aiming to reduce its 8,000 suppliers to 3,000.

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