Kodak in China
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Case Code: BSTR146 Case Length: 14 Pages Period: 1984-2004 Pub Date: 2006 Teaching Note: Available |
Price: Rs.400 Organization: Kodak Industry: Imaging Countries: China Themes: Entry Strategy, Inorganic Growth |
Abstract Case Intro 1 Case Intro 2 Excerpts
Background Note
Kodak, founded in 1884 and headquartered in Rochester, New York, had revenues of $13.3 billion in 2003, an increase of 3.8% over that of the previous year. Net income came down by 65.5% from $770 million in 2002 to $265 million in 2003.
The company manufactured and marketed consumer, professional, and health imaging products and services. In 2003, Kodak was the market leader in 32 product categories within its five business areas. By 2003, Kodak had almost 28,000 U.S. patents, of which 5,000 were earned between 1995 and 2000. The 2003 Tech Brand Scorecard by Forrester Research mentioned Kodak as the second most trusted manufacturing brand. Since the inception of the Academy Awards in 1929, every Oscar for Best Picture has been awarded to a movie shot on Kodak film. Kodak established its first representative office in China in Shanghai in 1927. In 1984, when China wanted to strengthen its own photo industry, Kodak helped Xiamen Fuda Photomaterials Co., (Xiamen) in building a color film plant.
In 1993, Kodak operated from the three locations of Beijing, Shanghai, and Guangzhou and had an employee strength of 30. It was only after George Fisher (Fisher) became the Chairman and CEO of Kodak in December 1993 that the company went into an expansion mode in China.
Making Inroads Into China
Throughout the 1980s and till the mid-1990s, Kodak was a poor rival to FujiFilm (Fuji) and Lucky Films (Lucky) in China's photographic-products market. Kodak's 500-odd branded outlets in China in the mid-1990s were less than half of Fuji's. Succeeding in China was important for Kodak, as according to Fisher, "To be the leader in the world, you have to be the leader in China." The first Kodak Express shop in China was set up in 1994. In 1995, China was Kodak's 17th largest market. In 1997, Kodak had sales of $250 million in China. In 1997, the company moved the office of the assistant chief operating officer of Kodak to Hong Kong from the Kodak Headquarters at Rochester...
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