As the world's largest producer of postage meters, Pitney Bowes puts it stamp on managing mail. The company, nearly a century old, makes other mailing equipment and provides shipping and weighing systems and it offers online postage services, and financing for office equipment purchases. PB also develops software to create mailers and manage shipping, transportation, and logistics for government agencies and corporations. The company exited the document management services business in 2013 with the sale of Pitney Bowes Management Services. The company gets the majority of its revenue from small and medium-sized businesses (SMB). The company counts 1.5 million customers in 100 countries, but as mail volumes fall, so have PB's sales.
Pitney Bowes operates in three business segments: Small & Medium Business Solutions; Enterprise Business Solutions; and Digital Commerce Solutions. Small & Medium Business Solutions (mail finishing, mail creation, shipping equipment and software) includes North America Mailing and International Mailing. It accounts for 54% of the company's sales.
Enterprise Business Solutions, 24% of sales, includes Production Mail (the sale, support, and other professional services of the company's high-speed, production mail systems, sorting and production print equipment) and Presort Services. The company's smallest business segment, Digital Commerce Solutions, 22% of revenue, offers Software-as-a-Service-based and on-demand applications for mailing, customer engagement, geocoding and location intelligence software.
The company's primary manufacturing and assembly facility is located in Danbury, Connecticut and its principal research and development facilities are in Danbury, and Noida and Pune, India. In 2014 the US accounted for about 70% of the company's revenue.
Sales and Marketing
Pitney Bowes sells products and services to a variety of business, governmental, institutional, and other organizations though its sales force, direct mailings, outbound telemarketing, independent distributors, and over the Internet. The company counts 90% of companies listed in the Fortune 500 as customers.
The company halted several years of declining revenue with uptick in 2014. PB reported revenue of $3.82 billion for 2014, compared to $3.79 in 2014. The company's Digital Commerce segment posted a 21% sales gain in 2014 while the other segments had lower revenue.
Net income jumped 134% in 2014 to $333.7 million. The company gained $190 million from income from discontinued operations (Document Imaging Solutions) and saw lower costs in support services as it focused on reducing reductions and increasing productivity.
Cash flow was $655 million for 2014 compared to $625 million for 2013.
Amid declining mail volumes at home and abroad, Pitney Bowes is working to stabilize its legacy mailing business and grow its digital commerce solutions unit. Pitney Bowes expects that its product mix will shift, and that a greater percentage of revenue will come from sales to the enterprise market. To that end, it's emphasizing more management products and services that help large companies handle both physical and digital communications. It's also cutting costs, selling noncore businesses to generate cash, and paying down debt (it erased $100 million of debt in 2014). Other initiatives include updating its sales practices, particularly for small and midsize customers.
In 2015, the company gained $310 million from sale of its Imagitas marketing services business to a company in that business, Red Ventures.
The company's ailing postage meter business got a boost recently when postal agencies in North America announced discounts for postage meter users, a perk that's anticipated to enhance the value proposition of meter usage.