As Dr Ueli Wolfensberger prepares to relinquish the Peach CEO role, he and his planned successor Alfred Wirch discuss key new initiatives that will ensure he goes out with a bang
or many years, Dr Ueli Wolfensberger has been one of the most recognisable and well-respected figures in the OP industry.
The Peach CEO has an insatiable enthusiasm for the industry, but plans to take a step back from the controls when he reaches the age of 70 in May next year. The plan is to have Alfred Wirch, managing director of 3T Supplies, take over the CEO role while Dr Wolfensberger will become an active chairman of the board of directors.
True to form, he is not resting on his laurels or looking for a quiet passage into his new role. Rather, he and Alfred Wirch are putting their efforts into Peach’s Revolution Campaign which is proving to be, well, revolutionary.
Dr Wolfensberger says: "I want to have a strategy of fair price or reasonable price applied. In China today, just about everybody can buy for $8 an A4 laminator or a binding machine, but if you look in the catalogues of Spicers, Office Depot, OfficeMax etc, you’ll find the lowest price is probably around $50 and many are above $100. I really don’t see why the customers should pay such a sky-high price.
"My dream is that everybody who is buying a printer should ideally also buy a binding machine and a laminating machine. I know, of course, that this is a dream which will never be fulfilled because today the world absorbs 100 million printers every year and the number of binding machines is just a few hundred thousand, and laminating machines probably two million or three million per year.
"But if we can convince twice as many buyers of a printer to buy a binding machine, already that means an additional two or three hundred thousand binding machines to be sold per year, and I would be very proud if the majority of these would have the Peach brand."
Wirch adds: "The price strategy can also be seen from a different point of view. Before these machines were used in the office, there were different price points. We now say that we have a product which we can see as a consumer product in the household. People will see it under a different perspective. Price is more of an issue in the household than it is in the office.
"As we have seen with printers, they came into houses when prices were reasonable – $99 or something like that. And I don’t think many people will buy a binding machine and a laminating machine for the household for $99. I believe we have to offer something which will bring these products to the home, and if you study our offer now, we say you can have a photo album for $1. Like, say, with our digital photos you can have a digital picture made for $0.29.
"So we have to have a pricing strategy here which is accessible to the market. We have to see it like a consumer product, not just an office product anymore. It is by technology an office product, but sales method and pricing positioning has to change. Also in all our promotions, advertising and things like that, it has to be clear that we’re talking to somebody different. We’re talking to the student, we’re talking to the housewife, we’re talking to different people who make the decision.
"This is a point where I believe the office products industry has a great opportunity. In the last two years, I personally feel very disappointed that a lot of OP people haven’t taken the opportunity. We have certainly seen the retailers jump at the chance."
A key objective of this strategy is also to build brand awareness of Peach at consumer level, as Wirch explains.
He says: "Obviously it’s an objective, because if we get these products broadly distributed and people buy them, it is a kind of advertising. It’s like some people often discussed how we should do paper, and should make no margin on paper, just use it as advertising. To build up a good consumer brand takes five years and $50 million – that’s what everybody says.
"These days you don’t have five years and you don’t have $50 million so you have to find more creative ways to do that, and this is one way."
Dr Wolfensberger adds: "Well, we might have the $50 million, but I don’t have the five years! So we want to do it as quickly as possible, and with as little investment as possible. Wirch says: "I was in China recently as Credit Suisse bank had arranged a trip for entrepreneurs to go to China and see what is going on. You should see the speed with which the Chinese are reacting. We have to behave like the Chinese these days.We have to react fast or otherwise they’ll react faster and there will be no need for us anymore. It’s very clear. This is for everybody in the market I think."
Wirch adds: "We would like people to understand that this is not just about the low price. That’s one part. It’s really that we offer a total system and an opportunity to participate in this booming digital photo market for everybody in the OP industry."
Another key part of the current Peach offering is its Snap and Print product, a new inkjet compatible solution for Hewlett-Packard (HP) printers. The product effectively separates the ink and electronics parts of an inkjet cartridge into two separate components. Peach has created small ‘inner’ ink tanks that snap into the printer and replenishes spent inkjet cartridges while the electronic component remains the same in the printer as it can be re-used time and time again.
Wirch explains further: "The idea is to upgrade your printer. Upgrade your printer as if you have an Epson or a Canon printer where the electronics are in the printer as part of the printer. With HP you don’t have that. You have to throw it away every time. So now, with HP, you can update your printer because you have the electronics inside, and then it stays for the lifetime of the printer if you handle it properly."
Peach also believes it is safe from any negative HP reaction to its product. Dr Wolfensberger says: "We have no patent problem because we are using the original HP electronics. We are buying that product from the firm."
You would forgive Dr Wolfensberger for looking to see out his final days as Peach CEO in a comfort zone with as little to do as possible. Instead, he has chosen this moment to set in place an ambitious new pricing strategy, not to mention taking on the might of HP. A true OP entrepreneur.