Nov 22, 2013
The past few years have been difficult for Sharp. The company has experienced a significant decline in revenue and profits primarily from its domestic business (down 37% in FY 2013 from its peak in 2011), intense competition in the LCD market, and high cost structure. As Sharp restructures its business portfolio, there has been industry talk about whether or not they would stay in the office products and solutions market. Doug Albregts, President, Sharp Imaging and Information Company of America spoke candidly about Sharp’s financial status and made several important announcements atÂ their recent national dealer meeting in Orlando, FL that indicate Sharp is committed to the Business Solutions Division.
While Sharp’s revenue is down 18% since FY 2011, Albregts noted that through the first six months of 2013 fiscal year improved significantly versus the same period in 2012. In the first six months of 2013 Sharp Corporation posted revenues of $13.7 billion which was 22% better than 2013. Operating income has been positive for four consecutive quarters and in the first half of 2013 was $340 million versus a loss of $1.7B in 2012. Operating efficiencies and increased revenues are the primary drivers of the improvement in operating income. In addition, Sharp Corporation’s worldwide Business Solutions Division achieved revenues of $1.6 billion in FY 2013, a 14% increase over 2012.
Sharp appears to have weathered the storm by making necessary cuts (R&D, staff, underperforming businesses), focusing on the Asian market, and benefitting from a weaker Japanese Yen. The company is now focusing more on its core product development and go-to-market capabilities. In these areas, Albregts and his management team highlighted several important initiatives about the company’s distribution, product line, and cloud services.
Sharp Announces Partnership with Tech Data
During the general session, Sharp announced a new strategic relationship with world class distributor Tech Data. Starting in December 2013, all Sharp authorized dealers would be able to purchase directly through Tech Data and would have access to their entire product offering set in addition to Sharp’s. This will allow Sharp to outsource business functions that are non-core to their new charter of becoming a partner that is easy to do business and, what a better way to do this with a word class distributor like Tech Data. The new relationship will employ a vendor management inventory approach with Tech Data providing:
– Single Invoicing
– Tech Support Services
– Expanded Warehousing
– Guaranteed 2 to 5 day deliver turn time
Sharp believes this partnership will help them focus on growing their core business and provide more support and services to their dealer community. InfoTrends believes this to be a significant shift in Sharp’s business model and will no doubt reap the company dividends for years to come by way of reduced operational overhead.
New Products & Solutions
In addition to the new channel announcement, Mike Marusic, Senior VP, Marketing & Business Solutions Group presented their new products and solutions. At the event, Sharp announced their entry into the A4 MFP market space with the MX-C250, and MX-C300W desktop level color A4 MFP document systems. The new products are capable of output speeds of 30ppm and offer print, copy, scan and fax features. Both products will be available mid-December timeframe.
Sharp also demonstrated a refresh of their monochrome A3 MFP product line-up with six mid-high end monochrome workgroup MFPs ranging from 36ppm, 46ppm and 56ppm. The products are split into two versions, a new Advanced Series and an Essential Series to make it easy for customers to choice the performance and features that are best suited for their work environment. The Advanced series are the “Cadillac” MFPs with 10” tablet-style touchscreens, wireless networking, and retractable keyboard plus are cloud portal office ready, while the Essential series are just that “Just the Essentials” and are ideal for bid situations and cost conscious customers. The new Advanced and Essential Series will be available for purchase Q1 2014 via authorized Sharp dealers and direct sales.
According to Sharp, their new cloud solution “Cloud Portal Office” is first-of-its-kind software designed for an increasingly mobile workforce where companies need to share information while maintaining control and security over critical documents. The software provides:
– Secure anywhere, anytime access to business content
– Facilitates both remote and in person collaboration
– Creates a single repository for both electronic and hard copy documents
– Accessibility from a wide range of business platforms including tablets, smartphones, traditional PCs, as well as Sharp’s AQUOS BOARD Interactive Display Systems and Sharp OSA enabled MFPs.
Sharp further identified what differentiates their Cloud Portal Office from other cloud solutions currently in the market is the unique combination of capabilities it brings together, and the solution’s optimization for the Sharp B2B channel allowing businesses to connect, collaborate, conference, capture and control business content.
After speaking with many Sharp dealers and business partners at the event, the viewpoint we took away was of a company in transition that recognized the challenges within their business and instead of keeping on course they have changed direction in an effort to adapt and grow. Still, there are some general concerns of “too little, too late”. Our take is that Sharp is in a much better financial situation, but needs to demonstrate to their dealers over a sustained period of time the company’s commitment to the business solutions market through ongoing investments in its products, services, and demand generation programs. These initiatives coupled with a senior leadership team that is perfectly well balanced with a clear view of their own business horizon will help to guide their company forward. The 2013 dealer meeting was a good start.
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