For the next five years, Chamchai feels in a relatively safe position as regards the Ricoh busines He believes he has successfully rebuilt the reputation of Ricoh copiers in Thailand, and ha developed a close network of agents and a dedicated customer base. However, although Rico is not likely to revoke the distribution agreement in the short term, he feels he must make Rico number one in the market to reinforce sustainability of the contract. Ricoh will remain highi committed to distributors who perform. But to date, Gilman has been unable to win th distribution rights for Ricoh facsimile machines. Under the previous tenure of Fantaract, PJcc awarded the facsimile contract to a competitor. As long as his competitor continues to perfon well, Chamchai does not expect to win this contract.
He ki-iows from experience that a distributor always runs the risk of losing the business. Shoi. Ricoh want greater control and greater stability over their product lines in Thailand, it may b to establish a subsidiary company of its own. lf Ricoh seeks to form a joint venture compar Gilman would be the most likely candidate for a local partner. At the moment though, Chamcl prefers the greater independence, flexibility and control over cash flow that Gilman enjoys as independent company, and he does not want to change the present situation. Should Ricoh c to start manufacturing locally, it is likely to turn to one of lnchcape's holding companies to act a local partner. Under current Thai investment promotion law, Ricoh, if deemed eligible by I Board of Investment, could only establish a distribution, sales and service subsidiary, oi manufacturing facility restricted to 49% ownership.
Ricoh has been one of the leading office equipment makers in Japan with the largest mar share in both copiers and fax machines. While it has done well in Hong Kong, it has failed match its domestic performance elsewhere in the world. Of its total 1989 sales of $5.2 bill 63% is in its domestic market Of its export sales 50% are to OEMs, although 100% of sale Asia are of brand-name products.
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