Fuji Xerox Nears China Sales Milestone With $1B In Annual Revenue

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Fuji Xerox Nears China Sales Milestone With $1B In Annual Revenue
Printer giant Fuji Xerox nears China sales milestone on services push
Printer giant looks to exploit growth potential in the country by boosting the enterprise services push as it nears the US$1b annual revenue goal
By Bien Perez

Printer giant looks to exploit growth potential in the country by boosting the enterprise services push as it nears the US$1b annual revenue goal

Fuji Xerox, one of the world's largest suppliers of office copiers and printers, expects to ramp up its services business across the mainland, Hong Kong and Macau as the company nears its US$1 billion annual revenue goal in the country.

"We are moving on track with our plan this fiscal year and our mid-range target," said Tadahito Yamamoto, the president of Tokyo-based Fuji Xerox.

The company, a joint venture that is 75 per cent owned by Japanese firm Fujifilm and 25 per cent by US-based Xerox, saw revenue from its China market grow to almost US$800 million in its financial year to March.

However, Yamamoto said it remained "quite weak in terms of market share" because of demand on the mainland for more low-end printer products.

"But that also means we have lots of room to grow and invest in this market," he said.

Data from Gartner showed shipments of regular printers and multi-function printers on the mainland were forecast to reach 10.9 million units this year from 10.8 million last year.

Lam Lai-ling, a senior research analyst at Gartner, said Hewlett-Packard was the leader of the printer market on the mainland, with a 37 per cent share last year. It was followed by Canon, Lenovo Group, Epson and Samsung Electronics.

Masataka Jo, an executive general manager for Greater China at Fuji Xerox, said a greater focus on managed services to large enterprises, both domestic and foreign, would help drive faster growth for the company on the mainland.

"We expect to reach our goal of US$1 billion [annual] revenue in China in 18 to 20 months," said Jo, confirming faster progress towards that goal than in the company's previous five-year plan.

Fuji Xerox initially started engaging large multinational companies from Japan, the US and Europe on the mainland for consulting, document solutions and other services designed to raise office productivity.

"Over the past three to four years, we have also made these services available to large Chinese companies that demand improvements in their office efficiency," Jo said.

With an expanded sales force on the mainland, Fuji Xerox expects to boost the share of services to its annual revenue in the market up to 50 per cent by 2016.

Lam, without providing sales figures, estimated the market for managed printing services on the mainland would increase 20 per cent this year from 13 per cent last year.

An overseas operation, Fuji Xerox Document Management Solutions, is expected to play a bigger role in the Japanese printer giant's services expansion initiatives. The business was Australian firm Salmat's former business process outsourcing division, which Fuji Xerox acquired for A$375 million (HK$2.5 billion) in 2012.

"About 90 per cent of what they [Fuji Xerox Document Management Solutions] are doing is in Australia, but we are now expanding that business across Asia," Yamamoto said.

Fuji Xerox has invested about US$150 million on the mainland since starting business in Shanghai in 1987.

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November 25, 2014 at 10:59 AM