USA: The top-selling TV manufacturer you've probably never heard of
Amidst all the hullabaloo of the 2010 International CES, dominated by the massive stands of the best-known global consumer electronics companies, one of the biggest-selling TV manufacturers probably got overlooked by the majority of showgoers.
It's not hard to see why: rather than spend millions of dollars out on the wild prairies of the Convention Centre show-floors, this company chose to set up home in a nearby hotel, where it showed LED-backlit TVs and even a 3D TV concept.
Surprised? You may well be even more so when you read that in the third quarter of 2009, this company had the second biggest sales of LCD TVs in the States, and with a 16% market share was only 0.6% behind the number one, Samsung.
Heading for Number 1?
Plot the sales curves on a bit, and you can see that this brand looks on the way to taking the top spot, having overtaken the likes of Sony – now well down into single percentage figures in the States –, former US market leader (albeit briefly) Vizio, Toshiba and LG.
Even Samsung's sales are down the odd point or two from the same time in 2008, but the brand I'm talking about has more than doubled its share in the past year.
Any guesses? I'll put you out of your misery: the brand in question is Funai.
Whonai? Funai Electric is based in Osaka, Japan, and makes almost all of its products in three factories owned by outsourcing companies in Guangdong, China, where lines run at very high speeds to ensure it can keep up with the demand it's creating with its low-priced products.
It's all part of what the company calls the Funai Production System: lines running fast, fewer people working on them – though the three plants between them employ 13,000 workers – and staff encouraged to solve production problems as and when they arise, getting those lines running ever faster.
All of which enables the company to offer very attractive prices: its entry-level 32in set, for example, sells in the States for $350 (or about £215), about 25% less than the most affordable Sony of that size.
10m TVs a year by 2011
No surprise, then, that Funai is bullish: it expects its sales to grow to 10m units a year within a year or two, and reckons it should be in the black by the end of the current financial year, after a couple of years of losses. Good going, when you see the ongoing plight of Japan's other TV makers.
So if we're talking about Funai, why all the pictures of Philips TVs on sale in the States?
Simple: Funai bought the North American TV operations of Philips a while back, and this year started selling its Philips-branded tellies there on a large scale, through mass-market retailers/online sellers such as Best Buy, Target and Wal-Mart.
The move is doubly clever: the brand-recognition is expected to grow Philips sales to account for 40% of the 5.4m TVs Funai expects to sell in the current financial year, while the cachet of the Philips names means the company can sell those TVs at higher prices.
Around $400 for a basic 32in Philips TV, rather than $350 for an equivalent Funai-branded model, makes very solid financial sense for the company, and the consumers are still getting bargains: how about well under £600 for Full HD Pixel Plus 3 HD-equipped 47in Philips TV?
And the bargain-priced sets, sold through mass outlets, have come at just the right time: as one industry analyst puts it "Even people driving Mercedes are shopping at Wal-Mart these days".