Kinko's Inc. Takes Control of Kinkos.com Inc. Joint Venture
The move, however, will cost some 70 jobs and the closure of the kinkos.com Inc. office in Alexandria, VA. Styled as "a merger" between Kinko's Inc. and kinkos.com, the announcement comes amid a slew of failures, layoffs and warnings of imminent closures by Internet companies.
"This is a necessary business decision," Joe Hardin, president/CEO of Kinko's Inc., said in a statement released Jan. 3. "Improved cost-effectiveness will make us even more competitive and productive in an increasingly rugged and challenging marketplace."
While financial implications of the decision were not made public, it is likely that Kinko's Inc. gained control of kinkos.com from site co-founder liveprint.com and investors such as America Online Inc., Flatiron Partners, Chase Capital Partners and Clayton, Dubilier & Rice.
All laid-off employees will receive severance pay and outplacement assistance. Key executives will be offered the option to relocate to Kinko's Inc. headquarters in Ventura, CA.
Kinko's Inc. is a leading player in the $16 billion domestic copying and reproduction market, with more than 1,100 stores. Revenue in 1998 for the privately held company was estimated at $1.5 billion.
This setback comes only five months after Kinko's Inc., kinkos.com Inc. and FedEx Corp. partnered to allow online printing and physical delivery of documents in as little as four hours. Kinko's Inc. and FedEx have a similar alliance in Kinko's stores nationwide, going back nearly seven years.
Kinko's Inc. said in the statement that the "current kinkos.com products and services will not be impacted and the change is expected to be transparent to consumers."
A systems integration between the dot-com brand and its namesake owner is already under way. The integration process also covers areas such as marketing, merchandising, business development, strategic partner relationships and new product development.
The goal is to make kinkos.com "a natural extension of the Kinko's brand," the Kinko's Inc. statement said.