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| - | '''Ricoh Company, Ltd.''' (OTC: RICOY) is a manufacturer of office automation equipment. The company’s products include copiers and printers, production printing products, and fax machines.<ref name=google>[http://www.google.com/finance?q=ricoy Google Finance: RICOY]</ref> Ricoh is also a manufacturer of digital and advanced electronic devices, such as semiconductor devices. | + | '''Ricoh Company, Ltd.''' (OTC: RICOY) is a manufacturer of office automation equipment. The company’s products include copiers and printers, production printing products, and fax machines.<ref name=google>[http://www.google.com/finance?q=ricoy Google Finance: RICOY]</ref> Ricoh is also a manufacturer of digital and advanced electronic devices, such as [[semiconductor]] devices. |
| - | Ricoh supports its office and production printing equipment businesses by offering customers various solution systems that work with personal computers and servers, network systems, application software and related product support and after sales services.<ref name=google/> The company’s business segments are Imaging and Solutions, Industrial Products and Other.<ref name=google/> | + | Ricoh supports its office and production printing equipment businesses by offering customers various solution systems that work with [[Commoditization of PCs|personal computers]] and servers, network systems, application software and related product support and after sales services.<ref name=google/> The company’s business segments are Imaging and Solutions, Industrial Products and Other.<ref name=google/> |
| + | |||
| + | Ricoh recently acquired IKON, which has allowed the company to strengthen its position in the U.S. market. Additionally, Ricoh has benefited from the growth of Managed Document Services (MDS), which allow Ricoh to generate recurring revenue by advising companies on how to improve the efficiency of their document printing services. | ||
| ==Business Growth== | ==Business Growth== | ||
| - | During the year, the global economy was still weak, although there were some signs of recovery from the severe | ||
| - | recession which started in late 2008. Our business environment was no exception. In the year ended March | ||
| - | 2010 (fiscal 2010), the consolidated net sales of the Ricoh Group declined 3.6% from the previous fiscal year | ||
| - | to 2,016.3 billion yen, and all segments, including Imaging and Solutions, posted lower sales than the previous | ||
| - | fiscal year. | ||
| - | Operating income decreased 11.5% from the previous fiscal year to 65.9 billion yen. Positive contributions, | ||
| - | such as cost reduction through our group-wide structural reform activities and continued efforts to reduce | ||
| - | manufacturing costs, were not sufficient to offset weaker operating margins and the heavy impact of the | ||
| - | stronger yen. However, when looked at on a quarterly basis, our operating income has been on a recovery track, | ||
| - | demonstrating consecutive quarter on quarter growth for the past four quarters. | ||
| - | Other (income) expense showed sharp improvement compared with the prior fiscal year, mainly due to a | ||
| - | smaller foreign currency loss. | ||
| - | As a result, the net income attributable to shareholders surged 326.8% to 27.8 billion yen. | ||
| + | During fiscal 2010, Ricoh's revenue declined 3.6% from 2009 to 2.0 trillion yen, and all segments, including Imaging and Solutions, posted lower sales than the previous | ||
| + | fiscal year.<ref name=annual/> Operating income decreased 11.5% from the previous fiscal year to 65.9 billion yen. Despite cost reduction through the company's structural reform activities and continued efforts to reduce manufacturing costs, operating margins fell.<ref name=annual/> Other (income) expense showed sharp improvement compared with the prior fiscal year, mainly due to a smaller foreign currency loss. As a result, net income surged 326.8% to 27.8 billion yen.<ref name=annual/> | ||
| + | Sales of Imaging Solutions posted a 5.2% decline in revenue to 1.5 trillion yen.<ref name=annual/> While this subsegment recorded sales growth in the Americas market due to the stronger sales network in the region as a result of the acquisition of IKON and new product releases in the new production printing business, sales in the other markets were affected by the adverse impact of the economic slump and the appreciation of the yen.<ref name=annual/> | ||
| - | Sales of Imaging Solutions posted a 5.2% decline to 1, 516.1 billion yen. While this subsegment | + | Sales of the Network System Solutions segment increased 16.9% from the previous fiscal |
| - | recorded sales growth in the Americas market due to the stronger sales network in | + | year to 274 billion yen, helped by the growth of Managed Document Services (MDS) and IT services.<ref name=annual/> |
| - | the region as a result of the acquisition of IKON and new product releases in the new production | + | |
| - | printing business, sales in the other markets were affected by the adverse impact of the | + | |
| - | economic slump and the appreciation of the yen. | + | |
| - | Meanwhile, sales of Network System Solutions increased 16.9% from the previous fiscal | + | |
| - | year to 274.0 billion yen, helped by contributions from the growth of new businesses such as | + | |
| - | Managed Document Services (MDS) and an IT services with a strengthened sales network. | + | |
| - | In Industrial Products, we manufacture and market thermal media, optical equipment, | + | In Industrial Products, Ricoh manufactures thermal media, optical equipment, semiconductors, electric components, and measuring equipment. Sales of this segment |
| - | semiconductors, electric components, and measuring equipment. Sales of this segment | + | declined 12.0% from the previous fiscal year to 101.6 billion yen, affected by the global economic slowdown.<ref name=annual/> |
| - | declined 12.0% from the previous fiscal year to 101.6 billion yen, affected by the economic | + | |
| - | slowdown in Japan and the rest of the world. | + | |
| - | Our Other operations include our digital camera business as well as | + | Our Other operations includes Rioh's digital camera business as well as financial and logistic services offered by subsidiaries. Consolidated sales of these businesses recorded a 13.0% decline from the previous fiscal year to 124.4 billion yen, as all these business areas |
| - | financial and logistic services offered by respective subsidiaries. | + | suffered from the negative influence of the economic downturn.<ref name=annual/> |
| - | Consolidated sales of these businesses recorded a 13.0% decline from | + | |
| - | the previous fiscal year to 124.4 billion yen, as all these business areas | + | |
| - | suffered from the negative influence of the economic downturn. | + | |
| ==Trends and Forces== | ==Trends and Forces== | ||
| + | |||
| + | ===Acquisition of IKON strengthens Ricoh's presence in the U.S. market=== | ||
| + | |||
| + | In 2008, Ricoh acquired IKON, a U.S. based distributor of office equipment with a strong sales and service network.<ref name=annual>[http://www.ricoh.com/IR/financial_data/annual_report/ar/10/ar00.pdf Ricoh Annual Report 2010]</ref> The combination of Ricoh’s and IKON’s existing networks has created a strong sales and service network for Ricoh. IKON has added to Ricoh a highly capable sales and service staff, with long-standing relationships with Fortune 500 companies in the U.S. market.<ref name=annual/> In addition, IKON has extensive expertise in Managed Document Service (MDS), helping Ricoh achieve successful growth in this new business.<ref name=annual/> | ||
| + | |||
| + | ===Growth of Managed Document Services (MDS) has benefited Ricoh=== | ||
| + | |||
| + | Office equipment customers increasingly look to printer manufacturers for a comprehensive offering, including not only hardware but also services. Managed Document Services (MDS) is one of the fast-growing new services that Ricoh has introduced. With MDS, Ricoh advises companies on creating a more efficient printing environment and how to improve document-related workflow, resulting in cost reductions for the customer. Ricoh currently offers service at approximately 2,000 sites in North and South America and 200 in Europe.<ref name=annual/> MDS is an attractive service business for Ricoh as it generates recurring revenues in contrast to the one-time revenue generated by printer sales. | ||
| ==Competition== | ==Competition== | ||
| + | |||
| + | Ricoh, a Japanese manufacturer, faces intense competition from other Japanese companies such as Canon and Fujifilm. It also faces competition from American companies such as Xerox and Pitney Bowes. These companies compete both on product offering and price. | ||
| *[[Xerox (XRX)]] | *[[Xerox (XRX)]] | ||
| Line 52: | Line 43: | ||
| *[[Tohken (JSD:6738)]] | *[[Tohken (JSD:6738)]] | ||
| *[[Musashi (JSD:7521)]] | *[[Musashi (JSD:7521)]] | ||
| - | |||
| ==References== | ==References== | ||
Revision as of 11:15, July 1, 2011
Ricoh Company, Ltd. (OTC: RICOY) is a manufacturer of office automation equipment. The company’s products include copiers and printers, production printing products, and fax machines.[1] Ricoh is also a manufacturer of digital and advanced electronic devices, such as semiconductor devices.
Ricoh supports its office and production printing equipment businesses by offering customers various solution systems that work with personal computers and servers, network systems, application software and related product support and after sales services.[1] The company’s business segments are Imaging and Solutions, Industrial Products and Other.[1]
Ricoh recently acquired IKON, which has allowed the company to strengthen its position in the U.S. market. Additionally, Ricoh has benefited from the growth of Managed Document Services (MDS), which allow Ricoh to generate recurring revenue by advising companies on how to improve the efficiency of their document printing services.
Contents |
Business Growth
During fiscal 2010, Ricoh's revenue declined 3.6% from 2009 to 2.0 trillion yen, and all segments, including Imaging and Solutions, posted lower sales than the previous fiscal year.[2] Operating income decreased 11.5% from the previous fiscal year to 65.9 billion yen. Despite cost reduction through the company's structural reform activities and continued efforts to reduce manufacturing costs, operating margins fell.[2] Other (income) expense showed sharp improvement compared with the prior fiscal year, mainly due to a smaller foreign currency loss. As a result, net income surged 326.8% to 27.8 billion yen.[2]
Sales of Imaging Solutions posted a 5.2% decline in revenue to 1.5 trillion yen.[2] While this subsegment recorded sales growth in the Americas market due to the stronger sales network in the region as a result of the acquisition of IKON and new product releases in the new production printing business, sales in the other markets were affected by the adverse impact of the economic slump and the appreciation of the yen.[2]
Sales of the Network System Solutions segment increased 16.9% from the previous fiscal year to 274 billion yen, helped by the growth of Managed Document Services (MDS) and IT services.[2]
In Industrial Products, Ricoh manufactures thermal media, optical equipment, semiconductors, electric components, and measuring equipment. Sales of this segment declined 12.0% from the previous fiscal year to 101.6 billion yen, affected by the global economic slowdown.[2]
Our Other operations includes Rioh's digital camera business as well as financial and logistic services offered by subsidiaries. Consolidated sales of these businesses recorded a 13.0% decline from the previous fiscal year to 124.4 billion yen, as all these business areas suffered from the negative influence of the economic downturn.[2]
Trends and Forces
Acquisition of IKON strengthens Ricoh's presence in the U.S. market
In 2008, Ricoh acquired IKON, a U.S. based distributor of office equipment with a strong sales and service network.[2] The combination of Ricoh’s and IKON’s existing networks has created a strong sales and service network for Ricoh. IKON has added to Ricoh a highly capable sales and service staff, with long-standing relationships with Fortune 500 companies in the U.S. market.[2] In addition, IKON has extensive expertise in Managed Document Service (MDS), helping Ricoh achieve successful growth in this new business.[2]
Growth of Managed Document Services (MDS) has benefited Ricoh
Office equipment customers increasingly look to printer manufacturers for a comprehensive offering, including not only hardware but also services. Managed Document Services (MDS) is one of the fast-growing new services that Ricoh has introduced. With MDS, Ricoh advises companies on creating a more efficient printing environment and how to improve document-related workflow, resulting in cost reductions for the customer. Ricoh currently offers service at approximately 2,000 sites in North and South America and 200 in Europe.[2] MDS is an attractive service business for Ricoh as it generates recurring revenues in contrast to the one-time revenue generated by printer sales.
Competition
Ricoh, a Japanese manufacturer, faces intense competition from other Japanese companies such as Canon and Fujifilm. It also faces competition from American companies such as Xerox and Pitney Bowes. These companies compete both on product offering and price.
- Xerox (XRX)
- Canon (CAJ)
- Oce NV (OCENY)
- FUJIFILM Holdings (FUJI)
- PITNEY BOWES (PBI)
- Chyron (BER:CZCA)
- Tohken (JSD:6738)
- Musashi (JSD:7521)
References
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