xerox bit
1. What value does BIT create in the distribution value chain for books?Book-In-Time is a digital low-cost, order-to-fulfillment system for the on-demand printing of books. Xerox's unique technology had been optimized for custom lengths of as low as one but could economically handle up to 1,200 or more.At run lengths of less than 25 books, other printing methods would have to incur a minimum cost of $5,000 or so, whereas Book-In-Time could conceivably deliver at a cost of only $6.90 per book. BIT creates value in the distribution chain in two distinct cost saving ways. First because BIT is a just in time system where publishers can customize the number of book runs they would like to establish. This added flexibility will help reduce the cost of inventory and returned books. According to the case it states that of the publishers selling price 25%
What are the options available for Xerox?There are two options available for Xerox. This would introduce lost sales and may outweigh the benefits of entering the new book publishing market. Who will benefit from BIT?The costs benefits from BIT should trickle down the distribution value chain. Compare the options available and determine what Xerox should do. Before book in time cost per book was a function of print run size. BIT would dramatically reduce or eliminated this cost. Many publishers were reluctant in publishing low demand books because of the increased cost, however BIT can allow the supplier to match the supply with the demand without sacrificing any cost. Xerox could expand its chain of document technology centers to get in to the book production business and compete against the publishers. The cost savings the publisher recognized will then be transferred to the retail chains/wholesalers that purchase the books and then ultimately the customers will benefit from a reduction in price. Option 1 is the most prudent choice, though many of the traditional commercial printers have many of the parts of the BIT system, it is the conjunction of the software and hardware which make BIT unique. Also the authors of books with low demand will benefit because they will have their books in print. If they went on with option 2 they may alienate themselves from current customers (book publishers) who may be customers in a different product category such as printers.
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Acceptance Essays
