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Meiko Shokai Looking to Expand into the U.S. Shredder Market

4 Oct, 2005 By: Tetsuo Kubo imageSource

Meiko Shokai Looking to Expand into the U.S. Shredder Market

During a press conference at
Meiko Shokai’s office shredder production factory in Thailand, Hiroshi Hayasaka,
executive director and general manager for its Overseas Division, revealed the
company’s intentions to enter the U.S. shredder market.

“We have planned to go into the U.S. market for our office shredders and we will
produce the products in this Thailand factory,” he told reporters. “Gaining
ground in the foreign market is to realize the idea that Eiji Takagi, our
president, has kept in his mind for as long as ten years.”

Currently, the Thailand factory is producing 2,000 units per month and is
shipping all the products to Japan. A new facility adjacent to the factory has
been completed, and it will increase the capacity to 3,000 units per month. The
company has also obtained another site (162,000 square feet) for a new factory
to prepare for further increased yield.

Meiko Shokai established an affiliate in Thailand, TOM Industries, in June 2004,
and started operation in October 2004 in order to increase production yield and
create cost reductions. The company is currently leasing a 10,800-square-foot
facility that has already become too small.

The domestic shredder market in Japan has showed unprecedented activity
following the enforcement of the Personal Information Protection Law. Meiko
Shokai is now producing 1,000 units each of V231 Series and V150 Series in the
current facility.

The V150, with an MSRP of approximately $1,400, is a best selling product in
Japan that can be used with 100V/15A power, provides one-cut cross cutting of
14-15 papers at a time, and is capable of shredding CD-R and plastic cards. A
majority of the parts for the machines are produced in Thailand.

Currently, the factory is developing the V260, which is features minute cross
cut shredding with 100V/15A power for users in government offices who have
higher security requirements. They have also planned to start production of the
V140 Series exclusively for the U.S. market.

Meiko Shokai, which has obtained overwhelming market share for shredders in
Japan, is envisioning expansion to markets throughout the world with the
Thailand factory as its major production base.

New Business Needs have Manufacturers Changing Focus

There have been plenty of themes in the copier industry this year and each
manufacturer has been trying to expand their territories beyond their core
strong areas. For example:

•  Following the spread of color MFPs, some new manufacturers entered into
the market. Copier shipments in the Japanese market are recovering, which has
been driven by color MFPs.

•  Security concerns for MFPs and printers have attracted attention with
the enforcement of the Personal Information Protection law. MFPs with IP-FAX
functionality that can reduce fax communication costs have been gaining interest
from customers. There is still a need to send and receive paper-based drawings
and documents over the fax between particular companies. IP-FAX is a great fit
to such customers since it provides quick communication, high 600-dpi scan
resolution and significantly lower communication costs.

Competition in each of these areas has been increasing. So, it has become an
important element to grasp an understanding of customers’ needs accurately.

Users’ needs for MFP solutions vary depending on the scale of network, IT
infrastructure level, business or operations. Some MFPs and printers are
integrated in the total system relating to customer IT strategies like groupware
or ERP software.

There are other customers who want functionalities to handle electronic
documents to reduce storage space for standard documents or drawings, or
security solutions to print confidential documents without the risk of exposure
to other people. Solution proposals have worked well in order to dodge
customers’ strong cost reduction requirements.

Customer needs have become very diverse. Skills to be able to respond to a wide
variety of needs is necessary, whether you are in Japan or America.

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