Briefs

Epson revamps distribution model

Epson India announced its new distribution model for its inkjet and all-in-one business segments across the country. Epson has chosen to eliminate its two national distributors and instead opted for a regional distributor model. The new distribution set up aims to reduce the number of tiers operating in the supply chain and hence the total stipulated time taken in the buying process. As a result of this transformation, Epson expects the business focus to shift towards the final tier which actually transacts with the end customer.

This model is expected to be beneficial to the end customer as well because of a uniform pricing structure that will prevail across different markets and outlets. Also, with the supply chain being simplified, more money would now be available to offer to consumers by way of attractive promotional offers and schemes. “The IT industry is progressively adopting the retail model, wherein consumers can pick and choose before they actually buy a product. As a result of this trend, we would gradually notice the number of tiers diminishing at the upper end of the distribution structure,” said S M Ramprasad, Manager-Consumer Products, Epson India.

Epson has been reinventing its marketing strategy for better reach and share. Epson’s increased market share has been attributed to a focussed drive in channel sales, the introduction of several new models, some successful end user promotions and an increased retail presence. Since 2002, Epson has been gearing up its channels for better results and has taken care of some straightforward issues such as improving the turnaround cycle of payments to its partners, which has helped build confidence.

In order to enable its business partners to benefit substantially from the new system, Epson India has also introduced several attractive schemes. One of them is the Epson’s annual incentive scheme called ‘Sales and Gains’.

According to the company, the initial response to the new structure has been extremely positive with the sales numbers beginning to reflect the confidence of the channel in the change. Additionally, the concept of a stable market operating price has taken off well in the key markets on a national scale.

Epson has traditionally been strong in the advertising, photo labs and pre-press segments. One of its marketing strategies has been to target niche segments. When they started their all-in-one segment in 2003, the jewellery segment was a key target sector. They offered jewellers the ability to put a jewel on the scanner, scan and print. The advantage here was that jewellers could copy the jewel by doing a 3D scan. Another plus for this segment lay in the fact that as gold jewellery is the norm, a lot of yellow gets used. Having a separate ink cartridge for that colour helped bring the cost of consumables down.

Recently, the company introduced the Stylus CX 1500 at the entry level targeting home and SOHOs at Rs 5,695. Similarly, Stylus CX 4500 has been introduced for SMBs and the corporate segment and Stylus RX 630 all-in-one targets the photography segment and is priced at Rs 24,296.

According to IDC, Epson’s overall printer market share has gone up over the last quarter by 7.5 percent to reach 22.8 percent for the quarter ended September. Epson recorded the highest growth among all vendors at 58.7 percent over the previous quarter. Increased sales have ensured growth in the market share for Epson in both the inkjet as well as the dot matrix printer segments. In the highly competitive inkjet printer segment, Epson’s India market share has been about 18 percent.