Canon advances in business and consumer markets

By Stephen Ballantyne

Friday 19th March 2004

For a company probably best known for its high quality camera equipment, it may come as a surprise to learn that about 60% of Canon New Zealand's business comes from the office products rather than the retail sector.

But with the company showing gratifying year-on-year growth and its best results ever in 2003, it's unlikely Canon New Zealand managing director Gordon Lamont minds where the money comes from.

Canon's pendulum appears to be swinging back towards photography, however, thanks to the growth in digital photography, Lamont says.

"Digital photography has created a new market, especially for young consumers who enjoy being able to shoot away freely and only keep the pictures they like. On the other hand, digital cameras have cut into sales of accessory lenses. Digital technology is also improving our position in the market for video cameras."

Canon is the market leader in digital still cameras (albeit by a narrow margin that Sony might dispute) but runs third in video cameras after Sony and Panasonic.

Canon's place in office products is somewhat further behind, although since the company still makes the laser printer engines used in many devices that do not necessarily bear its name, its penetration in the office is greater than Canon sales would indicate.

"Multi-function devices that's where it's all heading," Lamont says. "From a consumer point of view such devices are great because they save money and space. Of course, the important transition now is from black and white to colour, and most of the products that are coming out now are colour-capable."

But Lamont sees the greatest potential for office product growth at the high end of the market.

"We've always been very strong in the middle market and have left the very top end of the market to Xerox. But now that we have machines with the speed to compete with their machines, we're beginning to target that market more strongly.

"We think the driving force behind somebody changing from a high-end Xerox machine to a Canon will be the software at both the front and the back end of the process. We've been working hard to enhance our software and the way it manages documents within the system, and we think our software is good enough to give us an opportunity to get into the top-end market."

Over the next five years Lamont hopes to see compounding growth of 8% to 9%. Canon NZ revenues are running at about $120 million, not bad on a per capita basis.

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