Canon USA held a dealer meeting in Orlando FL May 14 – 15. Continuing to build on their promise to engage and open up more to the press, this was the first Canon dealer event in many many years where press and analysts were included, and we were not disappointed.
This was not their full dealer meeting with all dealers, but rather, just the top tier dealers. There were about 200 people at the event, which centered more around updates and briefings than product fairs and hardware, although they spent quite a bit of time providing updates on this as well.
After a nice welcome reception the first night, we began our day bright and early as VP Nancy Langdale took the stage with some opening remarks before introducing Chairman and CEO Mr. Adachi who briefed us on the overall health of Canon.
For Q1, Canon is already off to a great start, with a nearly 4% increase in net sales overall and a 5% increase in office products. Considering the -4% drag by imaging systems (cameras), the overall increase was even more impressive. Operating profit was up nearly 11% over this period as well.
Mr. Adachi shared with us the size of Canon’s different groups and it was an eye-opener to see that office products’ sales account for 45.7% of Canon’s sales. When looking at regions, the US is still Canon’s biggest global contributor at 27%, followed by Asia/Oceana at 26%.
Canon has been a major patent holder and a top 5 global contributor for the last 32 consecutive years. In fact, they’ve been #3 for the last three years and Canon’s investment in R&D has clearly helped keep them at or near the top of the pack. Only IBM and Samsung were received more patents last year.
Next, Toyo Kuwamura , EVP and GM took the stage too give us a deeper dive into the US figures. He told attendees that in a flat market, Canon dealers were up 5% YoY. He then jokingly told the crowd “you can do better…how about 10%?”
Canon’s strong numbers translated into taking the top spot across the board as they are now number one in both color and monochrome A3.
We then heard about some of the improvements to the hardware that has no doubt helped Canon dealers in their sales efforts, particularly with respect to reliability where they are seeing improvements in MPVBC of up to 33. They improved their drum life as well increasing 181% color and 361% mono and they have seen a CPC reduction of 58% for parts and labor. If these numbers are accurate, Canon dealers must be thrilled!
There is a lot of opportunity for Canon dealers in other areas as well as about 80% of Canon customers are not using the security settings/features that come standard with the imageRUNNER ADVANCE line. Security will be a big deal going forward for all brands and Canon is well-positioned for this as long as dealers start helping customers understand and use these features.
Canon executives spent quite a bit of time discussing the importance of dealers to their operation and we heard about the progress their dealer council has made in helping to streamline the marketing programs.
Between presentations I had the opportunity to chat with Canon’s Hiro Imamura who has increasingly taken a larger role within the Canon family over the years. Hiro gets things done and I greatly appreciate his help in getting Canon to sponsor our Ride for Jillian, the charity cross country motorcycle ride I recently completed. Canon was one of our biggest sponsors and it started with an email to Hiro. THANK YOU!
We then heard from Chris Tickler of NT-ware. Chris provided a great update, telling dealers “Why uniFLOW.” During Chris’ session, he told attendees that NT-ware is celebrating their 20th anniversary! He also discussed their incredible growth over the years, highlighted by the 85,000 devices sold in 2017 equipped with this impressive print management software.
Chris Tickler if MT-ware speaks at Canon dealer meeting https://t.co/a8jPig5YOX
— Industry Analysts (@aslawetsky) May 15, 2018
Later, Mason Olds took the stage to provide an update on the dealer channel. Mason is always fun to watch up there. He doesn’t dance around issues and probably causes Canon’s legal team to sweat a bit each time he presents, often using language they’d prefer he avoided. But, that’s what makes him good. He tells it how it is and dealers appreciate that. You can see most of his session in the video below. A key highlight from that video was when Mason told us that Canon dealers have had six straight year of steady growth and their business with the independent dealers is now close to one billion dollars.
Canon execs also spent some time running through success stories of their dealers, something I thought was a nice way to recognize them and motivate their peers. Most of these were around large and wide format products, an area Canon views as a huge opportunity for their dealers.
One thing that struck me as interesting at this meeting is the tenure Canon executives seem to have – something that’s rare in this industry for both dealers and OEMs alike. While many competitors have gone through several management changes in only a few short years, 10 years at Canon means you’re still relatively new! These people seem to stay forever.
It was a short meeting and unfortunately, I wasn’t able to attend the full event. After sitting through the presentations, it’s apparent that Canon is still one of the more significant leaders in this industry and while several of their competitors are struggling, Canon is still pushing forward. It was a very nice meeting and I greatly appreciate Canon including me and the rest of the analysts.