Leading barcode printer vendor TSC AutoID Technology (TSC) announced on November 9 that it has signed a definitive agreement to acquire the thermal printing business of Printronix, a company focused on serving the industrial supply chain with its rugged, high-performance thermal label printer product line. This acquisition is expected to close in January 2016. I find this development equal parts interesting and refreshing. It has been a while since the market saw an acquisition by a vendor other than one of the AIDC conglomerates (Datalogic, Honeywell, Zebra Technologies, and the former Motorola Solutions).
TSC had a strong 2014, as indicated in VDC’s recently published 2015 Stationary Thermal Barcode Printers report, and has grown at consistently high rates in recent years while also outperforming overall market growth. The company is an especially strong competitor to Honeywell, SATO, Toshiba TEC, and Zebra Technologies in the Asian market. While TSC has made some headway into EMEA in recent months, its performance in the Americas left much to be desired. This will change with its Printronix acquisition as this vendor earns 90% of its revenues from the Americas and Europe. Printronix exclusively targets application environments in the industrial supply chain with its line of thermal label printers. The company had a lackluster 2014 in terms of sales growth, but saw a leadership change early in 2015 and started laying the groundwork for a new approach to building channel relationships. It is making its way into the low-end industrial market with its entry-level T2N series, priced aggressively at less than $1,000 for the 203dpi model. The company also recently released its second portable printer, M4L2, which is designed for use in industrial and warehousing environments. All of its recent investments prove its commitment to differentiating its product line from both Honeywell and Zebra. Printronix is also the only vendor that offers industrial label printers with in-line verification capability, giving the vendor a distinct advantage over its peers in industries like retail with strict labeling compliance requirements.
Market consolidation and over-distribution has given way to pent-up frustration with what is viewed as weak qualification criteria for premier partnership status especially as channel organizations look to enter/exit deals on a profitable note same as hardware vendors. With Printronix, TSC will now be able to take advantage of the company’s defensible niche position in the industrial label printer market. I expect more systems integrators and solution providers – including Lowry Solutions, Peak-Ryzex, and Supply Chain Services – to now seek out a partnership with TSC with an aim to broaden their solution offerings and include newer brands as part of the portfolio, especially if they can get better price exceptions and deals while also meeting unique customer requirements in the industrial supply chain with all-in-one products.