Striking the market: the Ricoh way

Managing director and CEO at Ricoh India, Tetsuya Takano speaks to Noel D’cunha on how despite a drop in Ricoh’s sales worldwide, Ricoh India has enjoyed overwhelming success in the Indian market

21 Apr 2012 | By Noel D'Cunha

The first question: Did the natural calamities in Japan and Thailand have any direct impact on your operations in India?
I would like to share the bad part first and good after that. The bad part is that the results showed negatives in this fiscal year. The Ricoh group starts from April, so the present month (March) falls under this fiscal year. The good news is that because of the negatives, the stock prices declined, which has resulted in investors showing interest in the company, which has actually strengthened the financial position of the company.

Around this time last year, Ricoh had forecast ambitious growth with plans to target the fast-emerging graphic arts segment in India. How has the year been?
India is a promising market, which has never changed. Ricoh projected a growth of 300% in terms of unit in the print production segment, and we are proud to say that we have largely achieved our targets. Since September 2010, we have installed 50 units in colour and 70 in black-and-white.

Besides print production, Ricoh has entered and is operating in a new market – managed document services. Can you tell us about other areas in which Ricoh is active?
Yes. Ricoh has entered the Indian market with more than just the print solutions. It is working with worldwide customers on unique solutions, not necessarily only software solutions. Ricoh has chosen India as one of the development sites is a good strategic decision and Ricoh India is working with US arm of Ricoh, California-based Ricoh Innovation Ink, whose president is an Indian. This association is developing something very unique, which I cannot disclose now.

Other print companies have introduced new models that rival your machines and print machine buyers are becoming selective about the products they buy. Have these challenges impacted Ricoh?
No. Ricoh is one of the largest conglomerates in the world when it comes to the printing business. Competition is always welcomed. It plays a role in increasing consumer awareness thereby helping them make an informed purchase decision. From how I see it, it is not only Ricoh which is making an effort to enlarge the digital market. By introducing new models, all the players are making an effort to grow the market. Ricoh boasts of a wide array of products, and superior research and development facilities. We keep ourselves abreast with the evolving consumer requirements. Ricoh is confident of the products and services under its belt and seeks to continue its good form.

Digital print companies are taking to roadshows in tier-b and tier-c cities. Why is reaching smaller cities so important?
Roadshows and similar crowd sourcing activities serve as important touch points for increasing awareness.  Tier-2 cities have shown tremendous growth in terms of all consumer products, durables, IT Products. India’s big offset print volume exist in tier-2 and tier-3 cities like Coimbatore, Surat, Baroda, Tirupati, etc. So we expect the migration of print volume from offset to digital (complementing each other) in these cities. We are also reaching out to far-flung areas of north-east. We shall soon be installing a Ricoh press in Nagaland.

Once print quality is not longer the significant differentiator, and this can particularly be true in smaller cities, the question that comes to mind then is: how to make more money from the digital press?
By providing continuous services without breaks. We believe that after a machine has been installed, it needs to be kept in running condition. This is particularly important when you have volumes. This is a time when you do not want your machine to breakdown, or stay idle because of want of maintenance. We have enhanced our service by recruiting engineers so that our machines are always in usable state and make more money for our customers.

At Drupa, digital inkjet technology is expected to take a leap. Do you see a continued growth in the inkjet printing, new inks, faster speeds, wider web width in India?
A lot of R&D and innovations are happening in the field of inkjet. We have recently completed our merger with Infoprint.  In India though, this technology is still at a nascent stage. If you consider the number of toner-based unit sold against inkjet-based technology, you will know why I say this. Inkjet technology is still not affordable, and it will be sometime before it does. That said we expect a huge growth in inkjet, but in the future. Until such time, toner technology will continue to sell.

Ricoh’s famous fusing technology – faster speeds for the mid production press. Tell us more about the technology. Do you think this is one of the differentiator?
Improved fusing technology and new toner composition helps a customer to achieve better quality (near offset quality) colour prints. When printers purchase such equipment for short-runs/advance copies, the customer expects the print quality to be as close to offset as possible, and Ricoh technology helps the customer to achieve the same.

Was your alliance with Heidelberg more about tapping Heidelberg clients who are looking to enter this exciting market area for the first time? If so, doesn’t this soften your position? If not, what more can we expect from this partnership?
No, it doesn’t soften our position. See here we are not competing with each other but complementing each other. Heidelberg carries a huge brand loyalty in the offset market and with their software solution, it will offer the graphics art market a value-added complementary solution to their existing loyal customer base. This partnership also allows Ricoh to connect with the offset industry in India, an unexplored area for us. We plan to leverage the partnership to grow into this market.

What about click-charges? I know many digital print companies and customers do not like talking about it.
With technology improving day by day, manufacturers will be able to offer more and more competitive offering to the market but there will be a point at maturity stage, beyond which no reduction in prices will be possible.

How do you withstand intense pricing pressures from hungrier competitors like Canon, Konica Minolta, etc?
We encounter price pressure from our competitors, but we do not succumb to such pressure, until the time we deliver value. See there are over five-lakh printers in India, and even if we target one-tenth of such printers, we believe we will be successful.

Finance schemes... What is the Ricoh process?
We have tied up with multiple financing agencies and NBFCs to support our customers funding needs.

With your tie-up with Heidelberg and merger of Infoprint into Ricoh, where do you see Ricoh going in the next year?
We want to achieve the leadership position in every segment we are present in. Acquisition, mergers, tie-ups are the strategies to achieve our goal. We are open to the opportunities for acquisition in Indian market.