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Brother to spend €599m in assault on printer market
599,000,000.00 Euro = $ 776,631,054.87 USD United States Dollars
01.2007
– Japanese office equipment manufacturer Brother has said it is
planning to spend nearly €600m as well as boost research and
development (R&D) spending by 46pc in an all-out bid to capture a
significant slice of the world laser business.In Spain this week the
company unveiled a new range of colour laser printers at a pan-European
press conference, reinforcing its commitment to an increasingly
competitive market.On show were the HL-4040CN and HL-4050CDN, the first
colour laser printers to include Brother’s own colour engine.
Previously, it sourced the technology from other manufacturers like
Hitachi. Brother has taken the decision to build its own product in its
entirety at a time when colour laser accounts for 15pc of the print
market with only HP growing faster in the segment in terms of value and
units.“We have always been a company that has evolved steadily and we
felt the time was right,” said Yuji Furukawa, chairman of Brother.
“Together with our mono lasers we can now provide the full service to
the customer. This year, colour laser will be the big hit from
Brother.”Brother expects the new range to gain them 10pc of the colour
laser printer and multi-function category in Western Europe. There will
be a range of models with different functionality though all will have
network capability as standard. Products are expected to launch in
Ireland in the early Autumn.The company also used the event to announce
a 46pc increase in R&D funding – totalling €685m – and an
allocation of €599m of to support its ambitions in the colour printing
market and new generation technologies.The announcement of the
company’s strategy comes as it prepares to reveal a year of record
sales and profits. Worldwide, Brother is forecasting sales of €3.7bn
with profits of €175m, with more than €1bn of sales coming from Europe
alone.The company will continue to develop it multi function range –
the single units that combine fax, printer, copier and scanner – though
it stressed the stand-alone market was still strong.Black-and-white
printing is also holding up well, according to Brother; after the
colour boom of a few years ago people are recognising that there are
savings to be had in mono form laser printers that are better quality
than inkjet and increasingly affordable.Brother specialises in the SME
(small to medium-sized enterprise)) and SoHo (small office, home
office) market. It was established in Ireland 49 years ago as a sewing
machine manufacturer.Sean Sheehan, managing director of Brother
Ireland, said: “We have the largest dealer network of any manufacturer
in Ireland. We’re very strong in the channel because we’ve been
committed to it in Ireland for decades.”A strong reseller network is
increasingly important in a market where price erosion has been a
characteristic of the last few years. Aldo de Smedt, researcher from
GFK, said prices have bottomed out but painted a bleak picture. “None
of the print companies are making money by selling printers and more
and more third party companies are eating into their profits in
consumables,” he told siliconrepublic.com.The high price of inkjet
refills, for example, has been a tidy revenue stream for manufacturers
but as third-party manufacturers dramatically undercut the branded
product it is a revenue source that is becoming less secure. The price
of branded cartridges has created some interesting anomalies. It can be
cheaper in some places to buy a new printer than a refill cartridge
from the manufacturer.Sean Sheehan said: “It’s about how we convince
the end user that they should buy the branded version. It’s about good
quality and long life. You will see us developing some marketing around
this is the next 12 months.”
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