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KPG Comments on the U.S. Dealer Channel, Imation Integration & Enovation

Tuesday, March 26, 2002

Press release from the issuing company

March 26, 2002 -- (WhatTheyThink.com) -- KPG (Kodak Polychrome Graphics) has commented on their support of the distribution channel which sells their products to graphic arts professionals in North America. Speaking in an interview with WhatTheyThink.com, Don Whaley - KPG’s Director of Channel Management, discussed the integration of Imation’s Color Proofing business, their current relationship with Enovation and the overall state of the U.S. dealer channel. Imation: The acquisition of Imation’s Color Proofing business has been very important for KPG and their channel partners. “Our dealer channel was very similar and there was a lot of overlap, which helps us going forward. The acquisition gives us a broader, more powerful set of product offerings, which increases the value we bring to our dealer and end user relationships. This helps to maintain "mindshare" and improve alignment with our channel,” says Whaley. Enovation: Last year, Fuji Photo Film USA acquired three of the top seven dealers in the U.S. -PrimeSource, Heartland Imaging & Graphic Systems. This created a new $800 million subsidiary and dealership called Enovation. Many speculated as to whether companies that compete with Fuji, like KPG and Agfa, would continue to sell products via Enovation. Last November, Agfa terminated their relationship with Enovation stating that it would not be in their best interest to use the Fuji owned company as a sales channel. So far, KPG is staying the course. Says Whaley, “Fuji’s entrance into the distribution business via the formation of Enovation is certainly a significant change to the graphic arts distribution model in the United States. Enovation is currently a distributor of both KPG and Anitec products. Beyond that, we don’t comment publicly on our relationships with specific distributors.” The U.S. Dealer Channel: Recent economic challenges and consolidation in the dealer channel has caused many to examine this method of delivery to the end user. Whaley says KPG’s focus is on the relationship. “The majority of our products are sold through our authorized dealer networks. This clearly makes the dealer channel an important part of our go-to-market strategy. The health of the dealer channel is very important to KPG. In terms of long-term viability, it’s no secret that it’s a struggle [to survive] in the graphic arts distribution business. Dealers and manufacturers continue to experience top-line pressure on their consumable business brought on by the transition to digital technology. More than ever, dealers are looking for ways to augment their traditional products and services. Our focus is on maintaining stable relationships with our key dealers, understanding the drivers of their businesses and delivering value to the relationship via our products, services, people and programs.” Premium Access Members at WhatTheyThink.com can view the entire interview. Mr. Whaley discusses: - The channel’s recent evolution - KPG’s retention plan with their network - Staying in touch with end users - The Tech Services International and Imation net benefit - The Graphline connection - Investing in the channel and a look at alternative channels




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