Imaging company Canon India plans to focus on the business to business (B2B) segment as rupee depreciation has hit profitability in the business to consumer (B2C) category. The Japanese company relies completely on imports for its range of cameras and printers, and is now looking at the services segment under B2B to make up for the loss in revenue from its B2C segment.
Alok Bharadwaj, Executive Vice-President, Canon India, said, “The rupee depreciation has hurt us the most, as our products are 100 per cent imported from places such as Vietnam, China and Thailand. We are protecting ourselves with lower inventory and also by focusing on the service portfolio in the B2B segment.”
The company’s service portfolio comprises managing contracts from large companies such as Maruti Suzuki in automobiles, and Hindustan Unilever in the fast moving consumer goods category.
“We manage digitisation and print room services and have contracts with large companies,” he added. Though the B2B segment contributes 47 per cent to the company’s sales turnover currently, revenue is likely to be split equally between B2B and B2C segments soon.
The rupee fall has got the company raising prices by 6-8 per cent, though local manufacturing has been ruled out as the office automation segment is still nascent in the country. Given the slowdown, the company has also decided to prune its media spends. Though it had appointed Sachin Tendulkar as brand ambassador in the past, the company has decided on actress Anushka Sharma for its range of cameras.
sales revenue
“We have been facing challenging times and have managed to grow our sales revenue by just about 1 per cent from Rs 1,850 crore last year to Rs 1,868 crore this year. Unlike cameras, segments such as inkjet printers are expected to grow faster at 25 per cent. We have reconfigured ourselves in the imaging space as there is rupee depreciation and poor consumer sentiment. Categories such as inkjet printers are going to be a big opportunity,” he added.
The inkjet category is estimated at Rs 1,400 crore and is currently growing at 10 per cent compounded annual growth rate, unlike the flat growth in the camera segment. Canon India has launched a range of cloud enabled inkjet printers priced between Rs 6,500 and Rs 20,000. Currently, it has a 27 per cent share in the category and expects to take it up to 40 per cent over the next two years.