The Evolving Landscape of the Office Equipment Market

Office Equipment is a multi-billion-pound industry; its solutions are used in every business, government, office, home, school, hospital, and warehouse across the UK. But what are the recent challenges that the market has faced?  

In this article we explore the changing dynamics of the Office Equipment market, alongside our BNP Paribas Leasing Solution experts, Mark Harris, Office Equipment Sales Director, and Mark Broad, National Account Sales Manager. We’ll be looking at the key challenges faced by dealers and manufacturers, and the strategies employed to overcome them. We’re keen to be at the forefront of shaping the future direction of the market and the emergence of new business models and collaborations.

Addressing Pandemic-induced Shifts

The 2020 pandemic brought about a significant shift in work culture, with the rise of remote work leading to reduced time spent in traditional office spaces. Consequently, the demand for office equipment such as printers and copiers declined, causing a substantial drop in recurring revenue for dealers in that market. “Anecdotally, we have heard that some dealers experienced a staggering 40% decline in revenue, creating a challenging environment for their businesses to thrive” explains Mark Broad. FLA figures support this evidence, showing that the IT equipment finance sector has reduced in new business volume by 58% from this time last year (figures taken in March 2023)⁽¹⁾. 

To mitigate this revenue loss, Office Equipment dealers have been actively exploring new revenue streams and diversifying their product offerings. Recognising this shift, top manufacturers are adjusting their business models to support the dealer network. However, the ability to adapt and diversify remains a crucial factor in determining the long-term survival of dealers in the evolving market.  

How is the market evolving to overcome challenges? 

Despite the changes brought on by the pandemic, Mark Harris believes that “print is not going to disappear entirely from all office environments. Instead, it is likely to evolve based on business needs and models. Finance firms are working towards staying relevant by offering the right products and supporting diversification efforts”. 

An interesting point to note is that the challenges posed by supply chain disruptions have accelerated trends towards sustainability and innovation industry-wide. The circular economy is gaining prominence, with a focus on refurbishing and reusing office equipment instead of sending it to landfill. Offices are increasingly seeing their e-waste as part of their ESG and CSR ambitions. Using refurbished office equipment and being able to refurb and recycle their redundant tech helps support their sustainability goals. For instance, electronic waste is the fastest growing waste stream on the planet, and the source of 70% of landfill toxic waste. Re-use reduces clients’ e-waste contribution by around 48%⁽²⁾. 

We have also seen more joint ventures and mergers in recent years. These collaborations allow manufacturers to achieve economies of scale, diversify their suppliers and future-proof their operations. This approach not only helps mitigate supply chain issues but also fosters greater collaboration among manufacturers in the Office Equipment market. 

A Future of Adaptation and Collaboration

The Office Equipment market is currently in a discovery phase, as stakeholders are actively exploring new ways of operating in response to changing demands. Partners are seeking more flexibility, leading to a shift towards documentation and contracts that accommodate the sale of multiple products on a single agreement. Mark Harris considers that this would be a significant step forward, “Traditional contracts are less relevant to new technologies. The industry has already been working towards developing a “universal contract” that can encompass various products and terms in one contract, adapting to the evolving needs of customers.”  

Moreover, the future of the Office Equipment market may likely witness a consolidation of print manufacturers through collaborations and joint ventures. Mark Broad deduces that, “Through collaboration, manufacturers are motivated to future-proof their businesses against supply chain disruptions and gain the advantages of economies of scale. Notable collaborations, such as FujiFilm and Xerox, highlight this trend towards increased partnership and consolidation.” 

While the Office Equipment market has faced challenges and experienced declines it is far from dying out. Instead, it is finding a new balance in response to changing demands and work environments. Dealers and manufacturers are adapting their strategies, diversifying their offerings, and exploring collaborative partnerships. As the market continues to evolve, the industry is embracing more flexible contracts and sustainable practices, ultimately paving the way for a resilient and innovative future in the Office Equipment market. 

⁽¹⁾ Asset Finance Summary – Finance & Leasing Association (fla.org.uk)

⁽²⁾ BNP Paribas 3 Step IT launches European sales offer for technology equipment