IN THE HOT SEAT: Life altering moments
- 17 August, 2005 16:21
A brush with death (typhoid fever was the likely culprit, although it was never diagnosed) and three months in recovery mode, changed Kyocera Mita managing director, David Finn's, outlook on life - and altered his career path.
With an open mind, a few lucky breaks and a dose of networking connections, he decided to get out of civil engineering and jump into IT.
Finn, a charismatic chap who's passionate about business ethics and the channel, said it was an exciting time for the transitioning printer and copier industry. He is looking to rev up sales in the workgroup and high-end market segments.
How did you get involved with Kyocera Mita?
David Finn (DF): I joined the company in 1997 as managing director. It was meant to be a short-term assignment, but it turned out to be a long-term gig. When I first came on board, my job was to look at the company, which wasn't doing too well, and see if it was salvageable. If it wasn't, I was to deal with it accordingly. I quickly realised there was nothing wrong with the company or the product, it was the fundamentals of distribution. So I needed to put the basics in place.
What changes have you made since coming onboard?
DF: The fundamentals were to establish formal distribution channels, formal relationships with dealers and get proper customer and channel segmentation working. We needed to get the general basics down, get the pricing right, and sell the proposition correctly.
The proposition for Kyocera was always that it was green and it was good for the environment. But the problem was that it was priced at a premium. Even now you can't condition the premium on environmental impact benefits. So you have to be competitive at the cost level. The TCO benefits weren't fully understood, so we reorganised the whole pricing model to what the market expected for a laser at that time, and it took off.
What product categories does the company now offer compared to its early days?
DF: In 1997, there was one product category and about three laser printers that were any good. We had very little to work with. At that point in time, I had about nine people and we reduced the staff to three. Now we have 143 people.
We currently have three categories: the laser printer models, which range from $200 to $20,000, the multifunction devices, which range from 20 pages per minute to 80 pages per minute, and the copier range. We acquired Mita in 2000, which got us into a completely different industry - the photocopy industry. It caused us considerable pain in acquiring and integrating systems, but we are now through all of that.
Where are the biggest growth segments?
DF: The copier and multifunction spaces are the hottest areas. The laser business is seeing moderate growth, but you have to sell so many more units to maintain the same revenue base. The copier business, in particular, is stable and growing nicely. Our new products are sophisticated printers that can print, copy, scan, staple, make books, do all sorts of finishing options and hang off the network.
How is the Kyocera channel model set up?
DF: Our channel consists of a direct relationship with a vast number of dealers. This represents about 50 per cent of our business. These are high-end document management specialists. They sell the multifunction, the copiers, and the services that go with the copiers. Then we have a very stable distributor model with the state-based and national-based partners such as Dynamic, Ingram, BMS, IT Wholesale and J Mills. This group represents about 40 per cent of sales. The remainder is typically government direct sales and the high-end multifunction copier business.
Will the company be undertaking any new channel promotions this year and into next?
DF: Our number one channel plan is to stimulate the reseller. As part of the incentives, we're running a few channel promotions, including a Porsche promotion and a points program. It is a long-term initiative designed to stimulate the channel, focus on our products, and create a bit of excitement. Once dealers register on the website, they receive a passport to accrue points [towards the car or to use at restaurants] on a credit card or debit card.
Any other channel strategies this year?
DF: We want to go after another classification of dealers within the distribution channel. We're calling it Club 100. It will involve 100 dealers, who add value somewhere through the distribution channel. We are going to give them a relationship with us, via the distributors. There are some hurdles to get through to qualify.
Once they do, they will get support from us, marketing, and special recognition. These players are already working through distribution, but not necessarily selling our product. Club 100 will also give them access to the high-end multifunction printers, which are not available through distribution. There is a growing need for integration of these multifunction devices and these partners will have the necessary skills to do this.