Toshiba Corporation announced that it will reinforce its sales and marketing capabilities in the fast growing Chinese market for LCD TVs through collaboration with TCL Corporation (TCL Group), one of China's leading consumer electronics companies. The companies have agreed to form a joint venture, Toshiba Visual Products (China) Co., Ltd., that will start operation in China in September this year. The new company will be 51% owned by Toshiba and 49% by TCL.
Formation of the joint venture and close collaboration with TCL will allow Toshiba to make effective use of TCL's extensive sales and marketing organization, nationwide sales channels and market expertise, building upon its current base of production and sales and marketing network of China. Toshiba believes that the tie-up with TCL will make possible more effective promotion of Toshiba-brand TVs in China and reinforce the presence of its visual products business in China.
Consumer spending in China remains buoyant. The market for LCD TVs is expected to grow by 190% in the period from FY2009 to FY2012, and forecasts indicate it will become the world's largest TV market in this fiscal year. Expansion is expected to be particularly brisk in inland urban areas, where estimates point to 220 percent growth. Through the JV, Toshiba will be able to expand its business activities in addition to the major marketing zones of the coastal region to reach the medium-sized cities of China's huge hinterland.
In its operations, Toshiba Visual Products (China) will respond to the needs and characteristics of the Chinese market. Alongside mass merchandise stores, where Toshiba already has a presence, it will cultivate ties with smaller retailers and individual stores throughout the country. The company aims to establish a nationwide network of more than 10,000 stores by FY2012. The product line-up will also be expanded and geared to local tastes, and Toshiba will work with TCL to meet the requirements of customers living in middle-sized cities.
Toshiba Visual Products (China) will have an organization that takes into account the necessity of people on the ground who understand China. The company will be headed by a locally appointed president, and will seek to combine the best of Chinese and Japanese management practices in an optimum management style.
Toshiba will reinforce its ability to supply products to the Chinese market from Dalian Toshiba Television Co., Ltd., its production facility in China, by adding TCL as a supplier. TCL owns high quality production facilities able to deliver a broad range of Toshiba-branded products.
Toshiba's TV strategy, embodied in its popular REGZA brand, is based on using its own advanced semiconductors and software to deliver excellent picture quality. This, and a focus on the consumer, has won REGZA LCD TVs a positive reputation in the global market. In FY2009, Toshiba achieved sales of some 10 million units worldwide. In emerging countries, including China, Toshiba will proactively promote products tailored to user needs and carry out marketing activities closely tied with local communities. In the current fiscal year, the company aims for worldwide sales of 15 million units, an achievement that will further enhance its presence and branding in the global market.
Courtesy: Toshiba Corporation
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