Canon Plans Local Manufacture Of Photocopiers

Canon India Pvt Ltd, the 100 per cent sales and distribution arm of the global office equipment giant Canon Inc, plans to set up a manufacturing plant for photocopiers in the country.

The move is in step with its parent company's strategy to drive growth worldwide through greater emphasis on the duplicating machines business.

Canon India was set up early this year to sell the group's range of office equipment sourced from abroad in the country.

Canon India managing director Tony Fitzgerald told Business Standard on Tuesday that the Indian arm will set up a manufacturing base for copiers and also establish a primary network of sales offices.

 

Both these plans, to take place simultaneously, are likely to be completed by mid-1998. He added the establishment of the distribution network and the photocopier plant will involve a total investment of around Rs 3.5 crore.

Explaining the strategic focus on the photocopier segment, Fitzgerald said the group worldwide earns as much as 55 per cent of its total revenue from the division. Canon has 27 per cent share of the global photocopier market.

Canon India is currently in talks with domestic consultants for a suitable site to locate its plant. "It would take eighteen months to set up the plant. Our target is to get it operational by the end of 1998," Fitzgerald said.

"The margins will definitely be bigger if we produce the copiers locally," he said. "This is because the duty rates on the copiers are still very high." Canon India will gradually phase out the imports of copier models that will be produced locally.

Fitzgerald hoped the company would be able to break even in three years. The market for copiers in the country is roughly 32,000 units of which, Canon said it has a 9 per cent share.