Bringing services into sharp focus

Fuji Xerox, one of the world's largest suppliers of office copiers and printers, plans to accelerate investments in mainland China to expand the company's services business and penetrate more cities.

"China provides us with a great opportunity to develop the high-end market for services, but this will require more investments to grow our sales force and reach the lower-tier cities," Tadahito Yamamoto, president at Tokyo-based Fuji Xerox, said in a recent interview.

The company, a joint venture that is 75 per cent-owned by Japanese firm Fujifilm Holdings and 25 per cent by United States-based Xerox, expected that initiative to boost revenue from China to US$1 billion in the next five years.

Sales of the Fuji Xerox Greater China operation, which includes Hong Kong and Macau, hit a record high US$700 million in the company's financial year to March, about 20 per cent of which were generated from contracts with state-owned enterprises and other mainland government entities.

Yamamoto did not provide investment targets, but pointed out that years of spending on manufacturing has enabled the company to source about 90 per cent of its products from the world's second-largest economy.

An outsourcing operation, Fuji Xerox Global Services China, was set up in April last year with an US$8.5 million investment. About US$7 million was put into establishing in September the subsidiary Fuji Xerox of Shanghai, which oversees production of multifunction devices and toner cartridges.

Fuji Xerox has total investments of about US$150 million on the mainland since starting business in Shanghai in 1987. That included spending on sales and marketing, manufacturing, research and development, software, services and leasing operations.