On May 2 - 4, 2010 Konica Minolta held their
national meeting, titled, “The Power of Performance” in Los
Angeles, CA. For the first time, the company combined both the
direct (“retail”) and dealer channels. Some would say that this
was evidence of Konica’s theme for the meeting – “One Company, One
Vision, One Voice.” Others – the more cynical – might say that the
company combined normally contentious distribution channels in
order to reduce expenses.
Some observers of the imaging industry can remember a time when
Konica (before the merger with Minolta) would hold a different
meeting for each channel. Not only could these not be during the
same week, but they could not be at the same hotel. The product
expo would be torn down, shipped across town (meetings were
usually in Orlando) and set up again. To paraphrase a commercial
slogan from another era, “We’ve come a long way (baby).”
Regardless of Konica Minolta’s motivation (it may have been a
combination of theme and expenses) you have to admire the effort.
There were roughly 1,000 people in attendance, including Konica
Minolta staff. More than 180 dealers were represented by 380
attendees. Add to this number 125 representatives from the retail
side of the business. The balance consisted of Konica Minolta
staff, business partners and, of course, the analyst community.
Rick Taylor, EVP and COO, served as host and led off with comments
addressing Konica Minolta’s efforts to rationalize their
distribution system. In the past, both dealers and direct managers
have complained about the same brand competition that results from
multiple channels selling in the same market. Rick indicated that
the company had eliminated 97 dealers and 50 branch locations. We
assume that many of the latter were located in markets where there
was still both a Konica and Minolta branch.
Rick went on to state that all of the larger companies in the
imaging industry have a significant branch operation. He stated
that Konica Minolta’s retail operations grew sales by 15% (year
over year) and showed a $70M improvement in gross margin. For the
first time, this operation, accounting for 55% of sales, was
profitable on a “dealer cost business model.” He reported that
retail pricing has stabilized and account competition with Konica
Minolta dealers has been minimized through enforcement of their
rules of engagement. To quote Rick, “We might lose a (retail)
customer, but we won’t lose a dealer customer.”
We found it significant that, while retail sales grew 15%, dealer
sales were reported to be flat. This was, in part, due to Konica
Minolta’s efforts to reduce dealer inventories.
We had a chance to hear from Ned Umehara, the new president and
CEO of Konica Minolta Business Systems (KMBS). He replaced Jun
Haraguchi who has returned to a new assignment (Director and GM of
Sales)
in Japan. In his comments, Umerhara stated that the company would
be expanding their already successful efforts in the commercial
print and MPS markets. At least in the case of Commercial Print,
Konica Minolta’s hardware and software launches shown at this
meeting reinforced this position.
Konica Minolta
bizhub PRESS C8000
Products shown at the expo focused on high end color and
monochrome systems as well as software partners focused primarily
on the medical and legal markets. For example, the company showed
their bizhub PRESS® C8000 shown earlier at the On Demand show in
Philadelphia. The system features a rated speed of 80 PPM in both
color and monochrome modes. A dual fusing system lets the system
run at full speed on a wide variety of stock up to 50 lbs. and
only slightly slower for heavier stock, unlike other production
color systems which slow down for many stocks. Images are produced
at 1200 dpi (native)/8 bit resolution. The company also launched a
60 PPM and 70 PPM version of the same system for shipment later in
the year.
Although previously launched, Konica Minolta showed their bizhub
PRO® 1200, a 120 PPM version of their successful bizub Pro 1050.
As was the case with their earlier model, the touch screen control
panel offers more flexibility than most other systems in this
class.
To address the needs of the very high volume production
environment, Konica Minolta showed the Kodak Digimaster® EX 300
featuring two print engines to yield 300 IPM in the duplex mode.
This system is not new, with variants having been sold by Danka
prior to the Konica Minolta acquisition. There are no plans to
market this system with the Konica Minolta badge. All systems will
have the Kodak logo although they will be sold and serviced by
Konica Minolta staff. Release is currently scheduled for
September.
Konica Minolta
bizhub PRO 1200
Addressing the workgroup segment of the market, Konica Minolta
“previewed” their new bizhub 423 series (223/283/363/423)
featuring (finally) full color scanning on monochrome systems. The
products use the same Empiron® controller as their color MFPs
resulting in a commonality of features. They also offer an open
API for the integration of features and customization of control
panels. Unlike other systems, however, these use a closed language
and must be certified by Konica Minolta before being released. As
of the show, there were only 6 API partners certified, although
more were on the way.
Finally, the company previewed their new A4 product – the bizhub
C35 offering color and
monochrome printing
at 35 PPM. They also showed OEM versions of a monochrome system –
the bizhub 20 and 20P.
Kodak Digimaster
EX300 Dual Engine
Moving away from hardware, Konica Minolta announced the formation
of their Business Intelligent Services (BIS) group, intended to
help customers find new ways to gain efficiency. The group will
employ consultants to bring both hardware and partner solutions to
the customer in such a way as to increase workflow efficiencies.
The company’s Managed Print Services effort (OPS) will be moved to
this group.
So, what did we come away with from Los Angeles? On the plus side,
the company solidified their already solid position in the
profitable production/graphics market with strong products in both
the monochrome and color segments. They brought much needed
features to the workgroup. And, they began to move toward helping
customers with workflow issues, using their new BIS group.
On the minus side (nothing is perfect, after all) last year’s
aggressive push into the MPS market was not reinforced this year.
We did not hear of specific new programs or efforts to support
Konica Minolta’s channels.
I had hoped to see more A4 products. Say what you will about
profitability, these products are essential to a focused MPS
effort. You either sell them or compete with them. Finally, I
would have hoped that their open API systems would be available on
more products and would have supported more solutions.
Konica treated us all to a concert by the (real) Blues Brothers.
It was incredible. They brought the house down. And, they included
a number that, I guess, sums up dealer reactions – “I Got
Everything I Need – Almost.” Perfect.
Andy Slawetsky is President of Industry Analysts, Inc., a
marketing and management consulting firm for the office automation
industry. Much of the company’s research and testing results can
be viewed on their website
www.industryanalysts.com.
