Essay About Ricoh Canada And Bargaining Power Of Buyers

Ricoh Canada Case Study Analysis
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Case Study Analysis: Ricoh Canada, Inc.        Ricoh Canada, Inc. (RCI) is a fully owned subsidiary of Ricoh Company Ltd., which is headquartered in Japan. The company is a part of the digital imaging and document management industry, and it specifically offers technical, professional, and managed services. With a world that is quickly moving towards being completely paperless, President CEO Glenn Laverty and “the printer guys” are searching for new, innovative ways to keep up with competition.        A discussion of Porter’s Five Forces and how they affect RCI will serve as a starting point for this analysis. Ricoh Canada’s main competitors are broken down into two tiers with Canon, Xerox, and HP in the first tier and Konica Minolta, Lexmark, and Samsung Electronics Canada, Inc. in the second tier. Other rivals in the broader technology services industry include Google, IBM, and Amazon. Firstly, the power of rivalry is high primarily due to the fact that there are many competitors with close to identical product offerings. Because the companies’ products are so undifferentiated from one another, the industry is characterized by constant price wars. Another reason rivalry is so high in this industry is because mergers and acquisitions are common between existing companies. This creates innovation powerhouses that can easily take away market share from other competitors. In RCI’s case, the acquisition of IKON gave the company an upper leg over Canon Canada, Inc. because Canon was so reliant on IKON for sales and service infrastructure.        Next, the bargaining power of buyers is high for RCI and the entire industry because there are low switching costs among providers and buyers do not have to choose between differentiated products – they are pretty much all the same. This makes buyers very price sensitive in this industry; moreover, their preferences are evolving which makes it harder for companies to pinpoint exactly what they should offer. POWER OF SUPPLIERS