Eastman Kodak : retaining its glory in the UK
"Kodak is the largest filmmaker in the UK and the second largest maker of digital cameras, after Sony. The company is currently refocusing on film and digital imaging products. In late 2009, Kodak UK formed a joint venture with computer giant Hewlett-Packard to develop photofinishing equipment for digital photography. Although economic crisis has dampened the growth of the industry in UK in the recent past, it still continues to grow at a higher rate compared to other European regions. Eastman Kodak Co (UK) is a leading photo products firm providing film, papers and processing equipment to professionals and the healthcare and entertainment industries.
The economy is expected to grow by a mere 1.7%. The company, with its existing infrastructure and brand recognition, could easily increase its market share through the introduction of new and extensive line of products in the UK and Ireland markets. The UK accounted for 9% of the total revenue in 2010 at 700 Million. Kodak in UK employs close to 1300 personnel which also includes R&D personnel based in Cambridge, England.
Specialty printing consumable demand in the UK increased 4.8 percent annually between 2006 and 2011 to 17.3 billion. Specialty printing consumables are items that require relatively frequent replacement during the printing process. The company became the second largest digital camera company in UK with a market share of 21.6 % in the third quarter of 2010. In 2011, the company's camera market share declined to 16% and was ranked third after Canon (with 20% share) and Sony (with 17% share). Such a decline in market position could impact the growth prospects of the company.
The restructuring initiatives included shedding of excess capacity and workforce in the UK by more than 18%. As a result of restructuring, Kodak expects to realize around 35 Million in annualized cost savings. This will have a positive impact on its bottom line performance. The company focuses on strategic initiatives that drive its top line growth. To this end, in early 2010, Kodak entered into technology cross license agreements with Samsung Electronics Co Ltd. and LG Electronics, Inc. These agreements will allow the companies to access one another's patent portfolio.
A fast saturating digital camera market poses a major threat to Kodak. Camera makers such as Kodak have started emphasizing product features to customers, who are upgrading to new models or planning to have multiple cameras. In this scenario, IDC forecasts market saturation in UK in terms of number of units shipped after 2010. IDC predicts a 2% negative growth.