The external threats that Xerox faces are the following; Increased competition from low-cost-high-quality products from domestic and foreign manufacturers, economic recession, and finally, deregulation's of trade barriers by the implementation of the World Trade Organization on January 1st, 1995. First, in recent years, foreign competitors and domestic competitors have cannibalized a large market share of the copier market from Xerox. These competitors will most probably be able to improve quality and maintain low prices. Many companies may not be prepared to pay a high price for image and reputation. In addition, the copier market is highly sensitive to economic trends. As a result of economic depression, businesses are less willing to invest in assets and may chose to "sail through" the recession utilizing what the company already has. Investments are therefore discouraged. This fact could certainly affect Xerox's market place. Also, unfavorable government intervention such as the lowering of import barriers of goods and services to the United States in accordance to the new GATT agreement may impose a major threat to Xerox's largest market, which is currently the USA. This will make imported copiers less expensive to buy in the domestic market, since importing foreign companies will face lower ad-valorem trade barriers.