China, one of the most contested MPS markets
China has been the fastest growing major economy for the last several decades. Fueled by hefty foreign investments that started in the 1990s, China has experienced spectacular growth, now climbing onto the world stage as one of the major economic engines. It now has a gross domestic product (GDP) per capita of $7,519 (USD).
Initially, foreign companies came to China looking for low-cost labor in manufacturing. The country’s strong economic growth and massive population of 1.3 billion represent an attractive market for foreign investments. Currently, it is one of the most contested and strategic grounds for managed print service (MPS) vendors looking for global market leadership.
The total MPS market size in 2009 drew $248 million in revenue and is forecasted to grow with a CAGR of 47.3 percent, reaching a size of $1.7B. With such impressive growth, all vendors are actively strategizing their entries to ensure participation.
Major verticals in the region for MPS are:
- Financial industry (finance securities, insurance, banking)
- Manufacturing industry – China is positioned to overtake the U.S. as the num. 1 manufacturer in the next few years (including electronics, automobiles)
- Retail industry – Wal-Mart and Carrefour are both in China, where retail sales grew 16.9 percent on a year-ago basis in May
- Government and related businesses (utilities and transportation) – this vertical will pose some unique challenges, like the “Red document” certification required for some government-related workflow
Major MPS vendors in China include Fuji Xerox, Hewlett Packard, Ricoh, Lexmark, Canon and Beijing Lanxum. Though there are a few emerging success cases, the landscape for China’s MPS channel is complex and is still in its infancy, which will continue to fuel a growing ecosystem.
China presents a powerful opportunity to gain an MPS foothold in Asia Pacific. Its huge population will only increase and the number of companies will increase as well. China has unique requirements related to MPS, but the opportunity is large enough to ensure increasing service revenue will easily cover the additional expense. Most verticals are ripe to have an MPS engagement. Those firms that decide to attack the Chinese market must be prepared to lay the groundwork for education, distribution pipeline and tight operations. For those that decide to wait until the MPS market is developed, it may be too late. Chinese companies tend to be loyal to vendors who provide good service and are unlikely to switch to a new player in the market.
Photizo Group, Inc. recently released the Market Environment Report on China, which gives an in-depth look into:
- An overview of China’s MPS Market including major cities for business
- The different segments in the market and their different requirements
- An overview of the channel and customer profiles in China
- An analysis on the different MPS providers in the market including SWOT analysis. Companies covered include Fuji Xerox, Hewlett Packard, Ricoh, Lexmark, Canon and Beijing Lanxum
Visit http://www.photizogroup.com/research/research/market-reports/china-mps-environment-report/ for more info.
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