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Mark Davis, Peter Mayhew

Ricoh Invests 85% into a Production Integration Company with Toshiba Tec

Merger will create the largest, international business machine manufacturer

May 19, 2023 12:22:28 PM


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Ricoh officially announced that, as of April 2024, it will integrate the research, development, and production of its business machines with Toshiba Tec. This includes hardware such as MFPs and printers for the office space. The new venture will be mostly owned by Ricoh, which will hold an 85% stake, with Toshiba Tec holding 15%. Both design, research and development, and production divisions will be condensed and absorbed into Ricoh Technologies (a subsidiary of Ricoh), so that the purchasing of parts, materials, and use of production bases can be streamlined.


The move was triggered by the steady decline in print volumes and demand for office MFPs and printers following the pandemic, as well as the rise of remote work. Accelerated digitization resulting from the pandemic has also contributed to the decision, with both companies aiming to hold off the effects of an increasingly hostile business environment and increase cost competitiveness. Indeed, the Keypoint Intelligence A3 forecast predicts an 8.2% decline in A3 placements between now and 2026.



According to an official statement from Ricoh, the merger is a direct response to market changes. They are aiming to combine both companies’ technological strengths in R&D and production of office devices, as well as to collaborate on developing and innovating new solutions in the field of digital transformation (DX) to support hardware R&D and to answer customer needs. Sales and marketing activities for both companies remain unchanged at this time. Supply chain issues resulting from the pandemic and geopolitical incidents have crippled production and supply in the industry, which is why both companies want to safeguard against such incidents in the future.


Ricoh share prices rose by 7% in the Nikkei since the news was leaked prior to today’s announcement. Investors are anticipating improved earnings resulting from this structural change. The merger will move Ricoh and Toshiba to the top spot in world shipments, with the new company expected to take 22.4% of that pie—surpassing Canon, which currently sits at 17.9%.


Keypoint Intelligence Opinion

Joint ventures like this are nothing new in the OEM space. Fujifilm and Xerox operated the Fuji-Xerox joint venture, which was a model very similar to the one Ricoh and Toshiba announced today, successfully for 20 years. Mergers, acquisitions, and joint ventures come and go—the document printing industry has seen many. HP-Samsung is another example that comes to mind. Market conditions, when these two events occurred, as well as the justifying reasoning for each one, were different.


The post-pandemic landscape for document printing is even more challenging. Digital transformation of paper-based workflows and hybrid work are today’s market challenges, eroding page volumes and destroying the old “razors and blades” business model.


In addition, much of the differentiation among MFPs now comes from the operating system and “software stack” that get loaded into machine firmware. Those will remain completely different for each company, with technologies such as Ricoh Smart Integration and Toshiba Elevate Sky enabling differing functionality and user experiences.


Over the years, we have seen OEMs counter these challenges by strategically moving into IT services. Ricoh has been a frontrunner in this race, allowing the manufacturing of hardware to “stand alone” and charter its own destiny is a key transitional milestone.


Ricoh Technologies will need every machine unit sale to maintain a viable “economy of scale” in production volumes. Competition will be fierce for those units—and not just from other manufacturers considering and/or implementing similar strategies.


New and credible challengers with proven and potentially “greener and cheaper” inkjet technology are preparing to fight for manufacturing volume in the office market, too. It will be an interesting technological battle with Ricoh and Toshiba’s toner research, development and production teams aligning to take on both EP and ink jet competitors, rightly the planet, market and end-users will win. 


The race to be the “last man standing” and best available technology for a new environmentally responsible industry to support necessary document printing is on.


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