Pitney Bowes (PBI)

Revision as of 17:24, May 14, 2008 (edit) Adamfarren - Sr. Director (Talk | contribs) ← Previous diff		Current revision (11:00, March 31, 2012) (edit) (undo) 66.184.179.250 (Talk) (→Business & Financial Metrics<ref name=10K-10>{{cite 10k|ticker=PBI|year=2009|form=-10-K|link=http://www.wikinvest.com/stock/Pitney_Bowes_(PBI)/Filing/10-K/2010/F47088225|pg=10}}</ref>)
(42 intermediate revisions not shown.)
Line 1:		Line 1:
-	[[Image:LogoPitneyBowes.jpg|300x400px|left]]'''Pitney Bowes Inc. (PBI)''' is the world's largest provider of mail services with over 2 million customers worldwide. Its primary business (half of 2007 revenues) is the sale and operation of postage meters. This business is heavily regulated by national governments, since printing postage essentially amounts to printing money, and this creates high barriers to entry that protect Pitney Bowes' virtual monopoly in this business (PBI controls 80% of the domestic postage-meter market and 65% internationally.<ref>[http://www.smartmoney.com/barrons/index.cfm?story=20060103 Putting a New Stamp On Pitney Bowes, Smartmoney.com, 01/03/06]</ref>). While postage meters continue to be demanded by businesses that need to send large volumes of mail, direct mailing as a marketing technique is slowly being displaced by [[internet advertising]], and this limits PBI's growth opportunities within its core market.	+	'''Pitney Bowes Inc. (PBI)''' is the world's largest seller of postage meters, devices that allow companies to print postage on letters rather than using stamps. The company has over 2 million customers worldwide. Its sale and operation of postage meters is heavily regulated by national governments, since printing postage essentially amounts to printing money, and this creates high barriers to entry that protect Pitney Bowes' virtual monopoly in this business. PBI controls 80% of the domestic postage-meter market and 65% internationally.<ref>[http://www.smartmoney.com/barrons/index.cfm?story=20060103 Putting a New Stamp On Pitney Bowes, Smartmoney.com, 01/03/06]</ref>
-	To build revenues in the long term, PBI has turned its attention outside of postage meters into businesses such as document services, including letter production and design software, and management and marketing services.<ref> [http://news.pb.com/images/30/FastFacts.pdf Pitney Bowes Fast Facts, 2008] </ref> The firm has made $2.5 billion in acquisitions since 2000 in order to diversify beyond the postage meter business. Notable acquisitions in 2007 - when the firm spent $570 million buying other companies - included [http://www.mapinfo.com/ MapInfo ](Troy, NY) and [http://www.digitalcement.com/ Digital Cement ](Toronto, Canada). <ref> [http://news.pb.com/images/30/FastFacts.pdf Pitney Bowes Fast Facts, 2008] </ref>	+	While postage meters are in continual demand by any business that sends a lot of mail, direct mailing is being increasingly displaced by [[internet advertising]], and this limits PBI's growth opportunities within its core market. To build revenues in the long term, PBI has turned its attention outside of postage meters into businesses such as document services, including letter production and design software, facilities management, and outsourced marketing.<ref> [http://news.pb.com/images/30/FastFacts.pdf Pitney Bowes Fast Facts, 2008] </ref> The firm has made $2.5 billion in acquisitions since 2000 in order to diversify beyond the postage meter business. Notable acquisitions in 2007 - when the firm spent $570 million buying other companies - included [http://www.mapinfo.com/ MapInfo ](Troy, NY) and [http://www.digitalcement.com/ Digital Cement ](Toronto, Canada). <ref> [http://news.pb.com/images/30/FastFacts.pdf Pitney Bowes Fast Facts, 2008] </ref>
-	However, these businesses are relatively new to PBI, which has historically focused exclusively on postage meters since its founding in 1902.<ref>[[Wikipedia:Pitney Bowes]]</ref> Industries such as document management, information intelligence, and legal services are not regulated by the government, and so there are lower barriers to entry which create competition in these markets - something it does not have to deal with in the postage meter business. Furthermore, in these sectors PBI is forced to compete with other firms that have been specializing in these businesses for longer and are more established and experienced. This presents a challenge to PBI as it builds an economic niche outside of its traditional dominance in postage meters.	+	However, these businesses are relatively new to PBI, which has historically focused exclusively on postage meters since its founding in 1902.<ref>[[Wikipedia:Pitney Bowes]]</ref> Industries such as document management, information intelligence, and legal services are not regulated by the government, and there are low barriers to entry which create competition in these markets - something Pitney Bowes does not deal with in the postage meter business. In these markets PBI is forced to compete with firms like [[Xerox]] and [[IKON Office Solutions (IKN)]] that have specialized in these businesses for longer and have established customer relationships. This presents a challenge to PBI as it builds an economic niche outside of its traditional dominance in postage meters.
	==Business Overview==		==Business Overview==
-	PBI biggest source of revenue is its U.S. Mailing division, which represents its domestic postage meter business - U.S. mailing provided 38% of revenues in 2007.	+	PBI's biggest source of revenue is its U.S. Mailing division. The company's 85 acquisitions since 2000, along with its international postage meter operation, make up the rest of PBI's business. PBI divides its offerings into two main sections, Mailstream Solutions and Mailstream Services.
-	The company's 85 acquisitions since 2000, along with its international postage meter operation, make up the rest of PBI's business. PBI divides its offerings into two main sections, Mailstream Solutions and Mailstream Services. The divisions within each of these groups are as follows: <br/> <br/> <br/>	+	===Business & Financial Metrics<ref name=10K-10>{{cite 10k|ticker=PBI|year=2009|form=-10-K|link=http://www.wikinvest.com/stock/Pitney_Bowes_(PBI)/Filing/10-K/2010/F47088225|pg=10}}</ref>===
-	{| {{table}}	+	In 2009, Pitney Bowe
-	| align="center" style="background:#f0f0f0;"|'''Revenue (USD in millions)'''	+
-	| align="center" style="background:#f0f0f0;"|'''2007'''	+
-	| align="center" style="background:#f0f0f0;"|'''2006'''	+
-	| align="center" style="background:#f0f0f0;"|'''% change'''	+
-	|-	+
-	| ||||||	+
-	|-	+
-	| US Mailing||2346||2350||0	+
-	|-	+
-	| International Mailing||1070||1013||6	+
-	|-	+
-	| Production Mail||603||575||5	+
-	|-	+
-	| Software||346||203||71	+
-	|-	+
-	| ||||||	+
-	|-	+
-	| Mailstream Solutions subtotal||4365||4141||5	+
-	|-	+
-	| ||||||	+
-	|-	+
-	| Management Services||1135||1074||6	+
-	|-	+
-	| Mail Services||459||370||24	+
-	|-	+
-	| Marketing Services||171||145||18	+
-	|-	+
-	| ||||||	+
-	|-	+
-	| Mailstream Services subtotal||1765||1589||11	+
-	|-	+
-	| ||||||	+
-	|-	+
-	| Total||6130||5730||7	+
-	|-	+
-	|	+
-	|}	+
-	[[Image:Pbi divisional pie chart.jpg|700px]]	+	===Business Segments<ref name=10K-78>{{cite 10k|ticker=PBI|year=2009|form=-10-K|link=http://www.wikinvest.com/stock/Pitney_Bowes_(PBI)/Filing/10-K/2010/F47088225|pg=78}}</ref>===
-	<ref> [http://www.sec.gov/Archives/edgar/data/78814/000093041308001359/c52528_10-k.htm#A010 PBI 2007 10-K, page 11] </ref>	+	Pitney Bowes has seven reportable operating segments.
-	Total revenues for 2007 were $6.129 billion. Revenues have grown steadily since 2003, although the 6-7% gains in 2006 and 2007 showed a slight slow-down from the 8-11% gains that the firm saw from in 2003-2005. <br/>	+	*'''U.S. Mailing (36.2% of total revenues):''' This segment sells, rents, and finances the company's mailsorted mail and cross-border mail services.<ref name=10K-77 />
-	[[Image:Pbi_net_income_v_revenue_03-08.JPG|700px]]	+	*'''Marketing Services (2.5% of total revenues):''' This segment provides direct mail marketing services on behalf of clients to targeted customers.<ref name=10K-77 />
-	<ref> [http://www.sec.gov/Archives/edgar/data/78814/000093041308001359/c52528_10-k.htm#A010 PBI 2007 10-K, page 9] </ref>	+	[[IMAGE:PBI-Segments2009.jpg]]<ref name=10K-77 />
	==Trends/Forces==		==Trends/Forces==
-	'''The lack of growth in the postage meter market hurts what has, until now, been PBI's most profitable business segment.'''	+	===The lack of growth in the postage meter market hurts PBI's core business segment.===
-	PBI's U.S. Mailing division, which best represents PBI's original core postage meter business, accounted for more than 38% of the firm's total revenues - it posted revenues of more than $2.34 billion. PBI controls 80% of the domestic postage-meter market and 65% internationally. <ref> [http://www.smartmoney.com/barrons/index.cfm?story=20060103 Putting a New Stamp On Pitney Bowes, Smartmoney.com, 01/03/06] </ref> High barriers to entry faced by potential competitors protect this market share; since postage meters essentially print money, there is very high government regulation of the industry.	+	PBI's U.S. Mailing division, which best represents PBI's original core postage meter business, accounted for more than 36% of the firm's total revenues in 2009. PBI controls 80% of the domestic postage-meter market and 65% internationally.<ref> [http://www.smartmoney.com/barrons/index.cfm?story=20060103 Putting a New Stamp On Pitney Bowes, Smartmoney.com, 01/03/06]</ref> High barriers to entry faced by potential competitors protect this market share; since postage meters essentially print money, governments tightly regulate this industry and limit the number of providers.
-	However, growth in this division's revenue is stagnant - it actually dropped 0.17% from 2006 to 2007. <ref>[http://www.sec.gov/Archives/edgar/data/78814/000093041308001359/c52528_10-k.htm#A010 PBI 2007 10-K, page 11] </ref> This lack of growth is due to the fact that [http://www.wikinvest.com/concept/Commoditization_of_PCs the use of computer technology has greatly increased] over the last few years, and as a result, businesses are increasingly using [http://www.wikinvest.com/concept/Impact_of_Internet_Advertising internet advertising] as a less expensive substitute for brochures and catalogs sent through the mail.	+	However, growth in this division's revenue is stagnant.<ref>[[stock:Pitney_Bowes_%28PBI%29/Business%20Segment%20Revenue | PBI 2007 10-K, page 11]] </ref> This lack of growth is due to the fact that [[Commoditization of PCs|use of computers]] has increased dramatically since the 1990s, and as a result, businesses are increasingly using [[internet advertising]] as a less expensive substitute for brochures and catalogs sent through the mail.
-	'''PBI's growth strategy undermines its competitive advantages.'''	+	===PBI's growth strategy undermines its competitive advantages.===
-	The rise of [http://www.wikinvest.com/concept/E-Commerce e-commerce] has significantly decreased the demand for PBI's postage meter services, so PBI has reacted by rapidly expanding into other areas (see list of divisions in business overview above). Although PBI has invested in its own research and development ($186 million in 2007 <ref> [http://www.sec.gov/Archives/edgar/data/78814/000093041308001359/c52528_10-k.htm#A002 PBI 2007 10-K, page 4] </ref>), this expansion has largely been accomplished through $2.5 billion in acquisition since 2000. These purchases have included a wide variety of companies, including [http://www.mapinfo.com/ MapInfo] (location intelligence), [http://digitalcement.com Digital Cement] (customer relationship management), [http://www.ibisconsulting.com/ Ibis Consulting, Inc.] (electronic legal discovery services), [http://www.g1.com/ Group 1 Software, Inc.] (mailing efficiency software), and many others.	+	The rise of [[E-Commerce]] has significantly decreased the demand for PBI's postage meter services, so PBI has reacted by rapidly expanding into other areas (see the list of divisions in business overview above). Although PBI has invested significant capital in its own research and development, its expansion has thus far been accomplished through $2.5 billion in acquisitions since 2000. These purchases have included a wide variety of companies, including [http://www.mapinfo.com/ MapInfo] (location intelligence), [http://digitalcement.com Digital Cement] (customer relationship management), [http://www.ibisconsulting.com/ Ibis Consulting, Inc.] (electronic legal discovery services), and [http://www.g1.com/ Group 1 Software, Inc.] (mailing efficiency software), among others.
-	PBI does not have any competitive advantage or market dominance in these areas as it does in its postage meter segment. Other companies, dedicated to these other markets, are much more established in their respective areas. Therefore, the success of this strategy will depend on PBI's ability to acquire strong companies that are already well-established in their markets. All of PBI's divisions (except U.S. Mailing) grew in revenues in 2007, including 71% growth for its software segment (see breakdown above), so the growth strategy has been performing well so far.	+	PBI does not have the same competitive advantages or market dominance in these areas as it does in its postage meter segment. Other companies, already dedicated to these other markets, are more established in their respective specialties and have existing relationships with customers. The success of PBI's expansion strategy will depend on PBI's ability to acquire companies that are already well-established and can maintain a niche in their markets.
-	'''The introduction of shape-based postage pricing increases demand for PBI's services.'''	+	===The introduction of [[Shape-Based Postage Regulations|shape-based postage pricing]] increases demand for PBI's services.===
-	The US Postal Service changed its postage pricing system on May 14, 2007. The most notable change included was a transition from purely weight-based pricing to a new system that took the shape of the piece of mail into account as well. <ref> [http://www.usps.com/communications/newsroom/2007/pr07_041.htm USPS news release #07-041, 5-07-07] </ref>	+	The most notable change included was a transition from purely weight-based pricing to a new system that took the shape of the piece of mail into account as well. <ref> [http://www.usps.com/communications/newsroom/2007/pr07_041.htm USPS news release #07-041, 5-07-07] </ref> Under [[Shape-Based Postage Regulations|the new regulations]], postage will be cheaper for pieces that are more easily processed by USPS equipment. Letter-size envelopes will fare the best, followed by flats (e.g. manila envelopes) and then parcels. Due to these changes, customers - particularly large companies that regularly send large volumes of mail - stand to save lots of money by conforming to the most cost-effective shaping standards.
-	This increase in the complexity of postage rates is a positive force for PBI because customers will want to take advantage of PBI's offerings - such as its [https://www.pb.com/cgi-bin/pb.dll/jsp/ProductDetailShow.do?lang=en&country=us&country=&lang=en&prod_id=6DA-7&store_id=pbs Shape Based Sizing Template] that assist in computing the exact postage necessary for any given piece of mail. The firm offers [http://www.pb.com/cgi-bin/pb.dll/jsp/ProductCategory.do?catOID=-16928&lang=en&country=US mail-folding equipment] as well, which will also become more popular under the new regulations because they will let customers fold mail to meet the most cost-effective sizing standards.	+	PBI will gain in two ways as a result of shape-based pricing. First of all, demand will increase for products like the [https://www.pb.com/cgi-bin/pb.dll/jsp/ProductDetailShow.do?lang=en&country=us&country=&lang=en&prod_id=6DA-7&store_id=pbs Shape Based Sizing Template], which helps mailers compute the exact, correct postage for their mail according to the new, more complex shape-based pricing rules. Secondly, demand will also increase for [http://www.pb.com/cgi-bin/pb.dll/jsp/ProductCategory.do?catOID=-16928&lang=en&country=US/ machines] offered by PBI that fold mail into the specific shapes that cost the least to send under the new system; for example, customers will be interested in machines that will let them change mailings that are currently formatted as flats into letter-shaped envelopes (which are now less expensive). <ref> [http://www.printprofessionalmag.com/story/story.bsp?sid=93771&var=story/ Print Professional Magazine, New View, March 01 2008]</ref>
	==Competition==		==Competition==
-	As mentioned above, the postage meter business is highly regulated by the government because the meters essentially print money. Only four companies other than PBI are licensed to produce and sell postage meters in the U.S; <ref> [http://www.usps.com/postagesolutions/post_mtr.htm USPS - Postage Meters]</ref> their 2007 revenues and revenue growth are listed in the following table:	+	As mentioned above, the postage meter business is tightly regulated by the government because the meters essentially print money. Only four companies other than PBI are licensed to produce and sell postage meters in the United States:<ref> [http://www.usps.com/postagesolutions/post_mtr.htm USPS - Postage Meters]</ref>
-	{| {{table}}	+
-	| align="center" style="background:#f0f0f0;"|'''Company'''	+
-	| align="center" style="background:#f0f0f0;"|'''2007 Revenue (USD in millions)'''	+
-	| align="center" style="background:#f0f0f0;"|'''% Revenue Growth Since 2006'''	+
-	|-	+
-	| '''Pitney Bowes Inc.'''||6130||7.0%<ref> [http://www.sec.gov/Archives/edgar/data/78814/000093041308001359/c52528_10-k.htm#A010 PBI 2007 10-K, page 9] </ref>	+
-	|-	+
-	| [[Neopost]]||1324||2.4%<ref> [http://www.neopost.com/investors/regulated_information/periodic_information/annual_reports/Reports2007/Reference_document_2007.pdf Neopost 2007 Annual Report] </ref>	+
-	|-	+
-	| [[Francotyp Postalia]]||212||1.5%<ref>[http://www.francotyp.com/en/pdf/FPH_GB2007_e.pdf Francotyp Postalia 2007 Annual Report] </ref>	+
-	|-	+
-	| [http://data-pac.corp-com.com/ Data-Pac]||N/A||N/A	+
-	|-	+
-	| [http://www.haslerinc.com/ Hasler Inc.]||N/A||N/A	+
-	|-	+
-	|	+
-	|}	+
-	''Note 1: Neopost and Francotyp Postalia figures were converted from euros using the 12/31/2007 exchange rate of 1.4603 USD per euro.'' <ref>[http://www.x-rates.com/d/USD/EUR/data120.html X-rates.com Exchange Rate Data]</ref> <br/>	+
-	''Note 2: Data-Pac and Hasler Inc. are not public companies, so revenue data is not available.''	+
-	<br/><br/>	+
-	The data above clearly shows PBI's dominance in the postage-meter market - its 2007 revenues were more than 4.5 times those of its nearest competitor.	+
-	However, analyzing Pitney Bowes' competitive position in markets other than its core postage-meter segment is more difficult because the other companies in these areas are generally more specialized than PBI, focusing on just one or a few of the many areas PBI is involved in. PBI's strategy to compete in these markets involves some internal R&D, but predominantly revolves around acquiring smaller companies that are already leaders in their respective specialties.	+	*[[Neopost]]
		+	*[[Francotyp Postalia]]
		+	*[http://data-pac.corp-com.com/ Data-Pac]
		+	*[http://www.haslerinc.com/ Hasler Inc.]
-	That said, the following table compares 2007 revenues and revenue growth between PBI (in its non-meter segments) and the companies that could best be considered its competition in those areas:	+	Pitney Bowes also competes with other companies in its other business segments. These companies include:
-	{| {{table}}	+
-	| align="center" style="background:#f0f0f0;"|'''Company'''	+
-	| align="center" style="background:#f0f0f0;"|'''2007 Revenues (USD in millions)'''	+
-	| align="center" style="background:#f0f0f0;"|'''% Revenue Growth Since 2006'''	+
-	|-	+
-	| [[Xerox (XRX)]] ||17228||8.3%<ref> [http://www.xerox.com/Static_HTML/annualreport/2007/financial_overview.html Xerox 2007 Annual Report] </ref>	+
-	|-	+
-	| [[IKON Office Solutions (IKN)]] ||4168||(1.4%)<ref>[http://www.ikon.com/about/ir/financial_info/downloads/annrep_ikon_2007.pdf Ikon Office Solutions 2007 Annual Report]</ref>	+	*[[Xerox (XRX)]]
-	|-	+	*[[IKON Office Solutions (IKN)]]
-	| [[Iron Mountain (IRM)]] ||2730||16.2%<ref>[http://216.139.227.101/interactive/irm2007/ Iron Mountain, Inc. 2007 Annual Report]</ref>	+	*[[Iron Mountain (IRM)]]
-	|-	+	*[[Bowne (BNE)]]
-	| '''Pitney Bowes Inc.'''||2714||14.7%<ref> [http://www.sec.gov/Archives/edgar/data/78814/000093041308001359/c52528_10-k.htm#A010 PBI 2007 10-K, page 9] </ref>	+
-	|-	+
-	| [[Bowne (BNE)]] ||851||2.0%<ref>[http://www.bowne.com/ir/annualreports/2007/pdf/Bowne_2007_Annual_Report_10-K.pdf Bowne & Co., Inc. 2007 Annual Report]</ref>	+
-	|-	+
-	|	+
-	|}	+
-	The data shows that PBI is still a newcomer to the general document services market, but it showed higher growth than most of its competitors in 2007.	+
	==References==		==References==
	<references/>		<references/>
		+	[[Category:Business Services*]]
		+	[[Category:Mature]]

---

Current revision

Pitney Bowes Inc. (PBI) is the world's largest seller of postage meters, devices that allow companies to print postage on letters rather than using stamps. The company has over 2 million customers worldwide. Its sale and operation of postage meters is heavily regulated by national governments, since printing postage essentially amounts to printing money, and this creates high barriers to entry that protect Pitney Bowes' virtual monopoly in this business. PBI controls 80% of the domestic postage-meter market and 65% internationally.^[1]

While postage meters are in continual demand by any business that sends a lot of mail, direct mailing is being increasingly displaced by internet advertising, and this limits PBI's growth opportunities within its core market. To build revenues in the long term, PBI has turned its attention outside of postage meters into businesses such as document services, including letter production and design software, facilities management, and outsourced marketing.^[2] The firm has made $2.5 billion in acquisitions since 2000 in order to diversify beyond the postage meter business. Notable acquisitions in 2007 - when the firm spent $570 million buying other companies - included MapInfo (Troy, NY) and Digital Cement (Toronto, Canada). ^[3]

However, these businesses are relatively new to PBI, which has historically focused exclusively on postage meters since its founding in 1902.^[4] Industries such as document management, information intelligence, and legal services are not regulated by the government, and there are low barriers to entry which create competition in these markets - something Pitney Bowes does not deal with in the postage meter business. In these markets PBI is forced to compete with firms like Xerox and IKON Office Solutions (IKN) that have specialized in these businesses for longer and have established customer relationships. This presents a challenge to PBI as it builds an economic niche outside of its traditional dominance in postage meters.

Business Overview

PBI's biggest source of revenue is its U.S. Mailing division. The company's 85 acquisitions since 2000, along with its international postage meter operation, make up the rest of PBI's business. PBI divides its offerings into two main sections, Mailstream Solutions and Mailstream Services.

Business & Financial Metrics^[5]

In 2009, Pitney Bowe

Business Segments^[6]

Pitney Bowes has seven reportable operating segments.

• U.S. Mailing (36.2% of total revenues): This segment sells, rents, and finances the company's mailsorted mail and cross-border mail services.^[7]

• Marketing Services (2.5% of total revenues): This segment provides direct mail marketing services on behalf of clients to targeted customers.^[7]

^[7]

Trends/Forces

The lack of growth in the postage meter market hurts PBI's core business segment.

PBI's U.S. Mailing division, which best represents PBI's original core postage meter business, accounted for more than 36% of the firm's total revenues in 2009. PBI controls 80% of the domestic postage-meter market and 65% internationally.^[8] High barriers to entry faced by potential competitors protect this market share; since postage meters essentially print money, governments tightly regulate this industry and limit the number of providers.

However, growth in this division's revenue is stagnant.^[9] This lack of growth is due to the fact that use of computers has increased dramatically since the 1990s, and as a result, businesses are increasingly using internet advertising as a less expensive substitute for brochures and catalogs sent through the mail.

PBI's growth strategy undermines its competitive advantages.

The rise of E-Commerce has significantly decreased the demand for PBI's postage meter services, so PBI has reacted by rapidly expanding into other areas (see the list of divisions in business overview above). Although PBI has invested significant capital in its own research and development, its expansion has thus far been accomplished through $2.5 billion in acquisitions since 2000. These purchases have included a wide variety of companies, including MapInfo (location intelligence), Digital Cement (customer relationship management), Ibis Consulting, Inc. (electronic legal discovery services), and Group 1 Software, Inc. (mailing efficiency software), among others.

PBI does not have the same competitive advantages or market dominance in these areas as it does in its postage meter segment. Other companies, already dedicated to these other markets, are more established in their respective specialties and have existing relationships with customers. The success of PBI's expansion strategy will depend on PBI's ability to acquire companies that are already well-established and can maintain a niche in their markets.

The introduction of shape-based postage pricing increases demand for PBI's services.

The most notable change included was a transition from purely weight-based pricing to a new system that took the shape of the piece of mail into account as well. ^[10] Under the new regulations, postage will be cheaper for pieces that are more easily processed by USPS equipment. Letter-size envelopes will fare the best, followed by flats (e.g. manila envelopes) and then parcels. Due to these changes, customers - particularly large companies that regularly send large volumes of mail - stand to save lots of money by conforming to the most cost-effective shaping standards.

PBI will gain in two ways as a result of shape-based pricing. First of all, demand will increase for products like the Shape Based Sizing Template, which helps mailers compute the exact, correct postage for their mail according to the new, more complex shape-based pricing rules. Secondly, demand will also increase for machines offered by PBI that fold mail into the specific shapes that cost the least to send under the new system; for example, customers will be interested in machines that will let them change mailings that are currently formatted as flats into letter-shaped envelopes (which are now less expensive). ^[11]

Competition

As mentioned above, the postage meter business is tightly regulated by the government because the meters essentially print money. Only four companies other than PBI are licensed to produce and sell postage meters in the United States:^[12]

• Neopost
• Francotyp Postalia
• Data-Pac
• Hasler Inc.

Pitney Bowes also competes with other companies in its other business segments. These companies include:

• Xerox (XRX)
• IKON Office Solutions (IKN)
• Iron Mountain (IRM)
• Bowne (BNE)

References

1. ↑ Putting a New Stamp On Pitney Bowes, Smartmoney.com, 01/03/06
2. ↑ Pitney Bowes Fast Facts, 2008
3. ↑ Pitney Bowes Fast Facts, 2008
4. ↑ Wikipedia:Pitney Bowes
5. ↑ PBI 2009 -10-K pg. 10  
6. ↑ PBI 2009 -10-K pg. 78  
7. ↑ ^{7.0 7.1 7.2}
8. ↑ Putting a New Stamp On Pitney Bowes, Smartmoney.com, 01/03/06
9. ↑ PBI 2007 10-K, page 11
10. ↑ USPS news release #07-041, 5-07-07
11. ↑ Print Professional Magazine, New View, March 01 2008
12. ↑ USPS - Postage Meters

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.