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Enovation Announces Integration of Fujifilm Graphic Systems Division (Plus WTT Analysis)

Tuesday, April 15, 2003

Press release from the issuing company

- Includes analysis from Robert Fitzpatrick, WTT contributing columnist and co-publisher of THE EAGLE. VALHALLA, N.Y., April 14, 2003– Enovation Graphic Systems, Inc. a Fujifilm Company, announced today the integration of Fuji Photo Film U.S.A., Inc.’s Graphic Systems Division (Hanover Park, Ill.) into Enovation’s current organization. This integration of Graphic Systems Division’s outstanding product development, marketing, sales, training, service and technical support resources will better position Enovation over the long term to meet its customers’ requirements and focus on delivering important value-added resources across all product lines. Combining excellence in distribution, unparalleled technical service and “best in class” products from a wide range of the world’s premier manufacturers, Enovation stands alone in its ability to bring extraordinary resources to all customers in the graphic communications market. ----- We asked Robert Fitzpatrick, WTT contributing columnist and co-publisher of THE EAGLE, to provide interpretive analysis of this announcement. “The "integration of Fuji Photo Film U.S.A., Inc.'s Graphic Systems Division (Hanover Park, Illinois) into Enovation's current organization," as announced today, is another development toward the broader and inexorable reorganization of the entire graphic arts channel. The "integration" is one more step in Fuji's longer term strategy of lowering distribution costs. This strategy was initiated when it acquired several of its largest dealers and established the wholly-owned distribution company, Enovation Graphic Systems. “Fuji, like most other major suppliers has had a two tiered channel (some have more than two). Products are shipped from the factory to a Fuji-owned middle-man company in the US, known as the Graphic Systems Division (GSD), and then on to dealers. Though Fuji owns Enovation, it has still run two separate organizations, GSD and Enovation, each with its own P&L and operating costs. By integrating Graphic Systems Division and Enovation, Fuji is eliminating many of the redundant operational costs. “This is not to be confused with "direct sales" or any consideration of marketing one brand over others. It has little or nothing to do with sales and marketing, except as a cost. Indeed, it is the opposite of direct sales, as Fuji is effectively moving its own dedicated sales force into Enovation, a multi-line, full portfolio distribution company with far more business in non-Fuji products than in Fuji-made goods. Fuji's strategy is to rely on the power of distribution, not on direct sales, to carry its product line.” Please offer your feedback to Robert: robertf765@aol.com or (704) 334-2047. Full Disclosure: The Eagle's publishers have worked with numerous companies within the industry and may have ongoing projects with companies named in their articles. Specifically, Robert Fitzpatrick has ongoing relations with the companies named in today’s article. These companies play no role in the direction of The Eagle's analysis and this summary was requested and commissioned by WTT.




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