But, announcing an increase and making it stick are two different things. For one, most of the major buyers of paper lock suppliers into one and two-year contracts. Harry Reiter, head of the 220-store Town & Country buying group said his paper contract goes through next July. No doubt the IPI and PRO groups have long-term deals, as well, that would guarantee the ‘old’ price for some time in the future.
But the equation has changed with the entry of new competition that will no doubt put significant pressure on all parties as they jockey to hold position, as in the case of Kodak, Fuji and Mitsy, or gain position as Lucky and Dai Nippon get into gear. Brand loyalty isn’t the player it used to be as paper users seem willing to switch when someone drops a penny/sq. ft. saving at the negotiating table.
Kodak’s Diane McCue said this about price: “We continue to work with our retail and lab customers to incorporate the price increase into our contract… All paper suppliers are feeling the same cost pressures. Given the pressures of commodities and supplies, we expect to maintain our price structure.”
Bing Liem, said: “Our need for a price increase was driven by cost factors that were beyond our control… [and] made it necessary to pass on as increase.” As for future pricing, Bing said, “We cannot comment on our future pricing strategies…”
Mitsi’s David Bell said that so far his firm hasn’t had any price changes though he expects that longer term, slight increases could be expected due to the same external pressures on other manufacturers. He notes that with Agfa and Konica gone there has been reduced gray market activity which has led to a firming of prices.
What might be expected in terms of pricing from this new lineup? Leaving inside deals aside, it would be expected that Kodak and Fuji will command the high end of the pricing market. After that it’s anyone’s guess.
Royal Marketing’s David Press stated that he will be priced “somewhere below Fuji and Kodak.” How much below? Dai Nippon has been an aggressive pricer for its dye-sub paper line and one might expect that philosophy to carry into silver halide, as well. Both firms are starting new relationships here and pricing might just attract new friends.
Mitsi has long been the U.S. price leader but it might be more difficult to hold that position in the face of two newcomers determined to take a piece of the action. Kodak and Fuji have other cards to play, besides price. How do they plan to fight off the new guys and hold—or grow—market penetration?
For Kodak, Diane said: “We will continue to support our customers with marketing initiatives in both professional and retail markets to point out the advantage of using/specifying the Kodak brand media.” Any new products, Diane? “Stay tuned for a new product announcement around PMA.”
Fuji’s Bing Liem: “Fujifilm is the industry’s ‘only’ full solutions provider that can address every need of the imaging retailer/lab… Clients are not only looking for a fair price, but looking for a partner that has the experience and a sound track record for developing innovative and practical solutions for the imaging market.” The silver halide paper market seems to be alive and well. There must still be some gold—and silver—left in them thar hills.