Thursday, February 16, 2006

Hackborne's Printers still alive and well

HP increased both sales and profits under its new leader. As a former HP-er, I found the following most interesting.
HP's Imaging and Printing Group saw sales improve 8 percent to $6.5 billion. Within that, consumer hardware revenue increased 1 percent while commercial hardware grew 6 percent. Supplies - a big profit driver for the company - jumped 11 percent.
Richard "Dick" Hackborne is exclusively credited with making HP the industry leader in the printer biz. When I worked there it was referred to as the "Gillette" model of business. We don't care if we make money on the printers themselves so long as you come back and buy your ink and paper from us, which we make a boat-load of profit on. Here, the razor is free, need some replacement blades? It has turned out to be a brilliant strategy and they are still, despite the mismanagement of a couple CEOs in a row, a thriving business for the company. They are still the industry leader. I have two printers in my home, both purchased after I left HP, and both have HP plastered on the front.

An 11 percent improvement in printer supplies is huge. If you are an HP stockholder, thank Dick for the money you made today.


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