Eastman Kodak Company

Jessica Lo

Calvin Ng

Yvette Olmos

Tiffany Taubodo

Tuan Tieu

Julie Xiong

Kodak’s History

• The history of Kodak began in 1879

• George Eastman

• Henry A. Strong

• The world’s first Kodak camera was born in 1888

• “You press the button, we do the rest.”

• “Share moments. Share life.”

Company Name Chronology

• Eastman Dry Plate Company (1881)

• Eastman Dry Plate Film Company (1884)

• Eastman Company (1889)

• Eastman Kodak Company of New York (1892)

• Eastman Kodak Company of New Jersey (1901)

George Eastman’s Four Basic Business Principles

• Mass production at low cost

• International distribution

• Extensive advertising

• Focus on the customer

George Eastman’s Three Additional Policies

• Foster growth and development through continuing research

• Treat employees fairly and with respect

• Reinvest profits to build and extend the business

Financial Highlights

2002• Net sales= $12,835 million

• Stock price per share at year end= $35.04

• Net earnings= $770 million

• Shareholders at end of year= 89,988 million

2003• Net sales= $13,317 million

• Stock price per share at year end= $25.67

• Net earnings= $265 million

• Shareholders at end of year= 85,712 million

Financial Highlights 2003

• Net sales increased by a tad bit

• Net earnings decreased significantly

• Stock prices dropped

• Shareholders disappeared

• Less employees in U.S and worldwide

Kodak’s Stock Price

• As of 4/17/04, Kodak is selling their stocks at $25.35 per share

• From previous close of the stock price, it rose $0.40 cents.

Today’s Competitors

• Sony, Olympus, and Canon are all leaders of the digital cameras

• Kodak falls short at fourth place

• Kodak holds 14% of the market share

Nikon10%

Olympus18%

Kodak14%

Canon16%

Sony19%

Others23%

Single-Use Cameras

• Kodak dominated the market share when the single-use 35mm cameras were still around in 2001

• Sony held 51% of the market share

Concord4%

Kodak51%

Jazz10%

Others3%

Fuji32%

International Service Locations

• All of the Americas Region, the Latin America Region, Japan, the European Region, the Greater Asia Region, and the Middle East and Africa

• Within these regions, Kodak exists all in the major cities

U.S. Major Headquarters• The four major headquarters in the U.S. Are located in

-Windsor, Colorado

-Atlanta, Georgia

-Oakdale, Minnesota

-Toronto, Ontario

Purchasing & Suppliers

• Keykode equipment and software itself holds at least twenty-six suppliers from all over the world

• Kodak purchases 3 main material

1. Imaging material manufacturing

– chemicals, fuel and energy, and packaging supply

2. Equipment manufacturing

– circuit boards, plastics and electronic components

3. Non Manufacturing goods and services

– advertising, IT services, and travel/fleet

Kodak’s IT Department

• Electronic Retrieval Workstations• Kodak i7300 Scanner• 2400 and 3000 DSV digital scanner/printer

• IBM– Directly buying from IBM– Standardizing all hardware and installing a set of

preinstalled software on all PCs• reduces on-site problem solving• saves $200 per person by help desk

Porter’s Competitive Forces Model

• Market leader in traditional film

• Main focus in manufacturing digital cameras and photo processing services

• Imaging Industry

• Entry barriers

Porter’s Competitive Forces Model Continue

• Industry Demand for digital imaging equipment and services

• Bargaining powers of buyers

• Substitutes

• Existing Competitor Threats

SWOT Analysis

• Internal Strengths

• Internal Weaknesses

• External Opportunities

• External Threats

Kodak’s Internal Strengths

• Kodak Brand Name

– Biggest Strength

– “Kodak moment”

• Kodak Image

– Environmentally & socially conscientious

• Website

– Great detail of product features & uses

Kodak’s Internal Weaknesses

• No E-Commerce

• Being Innovative with IT

• Acquiring without profitability

– Expanding just for the sake of growth

• Product offering

– Need to narrow their focus

External opportunities• Camera phones

– Kiosks

• Cinema – Investment

• Multi-Cultural marketing

• Health care– Expansion

External Threats• Competitors

– Sony– Canon– Olympus

• Distinctive Industries– Healthcare– Professional and consumer photography– Government– Cinematography– Docking and imaging

SWOT Analysis Conclusion

• Based on the SWOT analysis, Kodak may improve by

– Investing in selective industries

– Improvements in products and services

– Brand name recognition in digital industry

– Innovation

Competitive Position

• Cost Leadership

– Producing products and services at a low cost

– Supplying photography tools to a large number of people

– Maintaining a cost advantage over competitors

• Differentiation

• Growth

Differentiation Strategy

• Infoimaging

– Form of technology that uses image science and IT

– Tool for developing new products and services

– Improves communication and commerce

– $385B industry

Differentiation Strategy cont.• Industry Expansion

– Consumer and Professional Photography

– Health, Entertainment, Printing, Publishing

– Document Imaging

• Investment in Research & Development

– Product Development

– Technology Research

– Imaging Research

Growth Strategy• Switching from traditional film to digital

• Entering new markets

• Earnings Growth– Increase Profits and Productivity– Cutting Costs and Dividends

• Acquisitions– $2-3B acquisition strategy– Acquired at least six leading companies in several

industries