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Quinten
01-21-2013, 09:07 AM
Well, Agfa got rid of their consumer film division, Kodak not. Look now who is the more successful company...

Though the question remains how they got rid of that division.

That is true. Then is it the production process that is so costly that making films on a much smaller scale, for a much smaller market, can't be profitable? Or is the organizational side of downsizing a company with these amounts the real issue? This must be a very uncommon situation you don't learn about in management school, who finds pride in downsizing a company and make it profitable at a size only a few percent of what it once was?

AgX
01-21-2013, 09:22 AM
There are two aspects involved in downsizing: The sale or closure of whole divisions including the manufacturing part of that division; the downsizing of a plant or machinery.

Further more one can try to gather the market-capacity, eased by competitors falling off, to be served by ones own plant and going on without downsizing.

kb3lms
01-21-2013, 09:27 AM
Then is it the production process that is so costly that making films on a much smaller scale, for a much smaller market, can't be profitable? Or is the organizational side of downsizing a company with these amounts the real issue?

No doubt there are HUGE costs in downsizing an industrial giant. It's likely the cost of the legacy overheads are the real cost issues. Production of film at the correct scale probably wouldn't be a cost problem. The issue is getting from where you are today to the correct scale when you have the legacy costs consuming all the money.


who finds pride in downsizing a company and make it profitable at a size only a few percent of what it once was?

If it is done right, bringing a company back to profitability might be a very rewarding challenge. The upside is that once a company is profitable you may get to try again, if you can develop new products and services that someone wants whether they are in your current market or something else.

sly
01-21-2013, 09:38 AM
Now if Kodak, Agfa, and others had concentrated on actively competing in a shrinking market, would Ilford have been able to hold their own? Would they be the strong and dynamic company they are today?

thegman
01-21-2013, 09:41 AM
I'm actually very surprised if it is 10% of the peak number. At film's peak, sales were of course huge, 10% of that number is still really quite a lot, considering the current obsession with smartphone cameras and the like.

If it's 10% of the peak, that really sounds pretty good.

RattyMouse
01-21-2013, 02:40 PM
General Motors and Ford downsized rather extensively, closing dozens of plants worth billions and billions of dollars. Why can't Kodak shut down their plant and build one to fit the current business?

MattKing
01-21-2013, 02:50 PM
General Motors and Ford downsized rather extensively, closing dozens of plants worth billions and billions of dollars. Why can't Kodak shut down their plant and build one to fit the current business?

Automotive sales are on the increase.

Film sales have at best plateaued, and may be still on the decline.

New film manufacturing is expensive to design and build.

And shareholders and creditors demand that that money be spent on growing markets, not markets that are either steady or declining.

If Kodak had been privately held, it probably wouldn't be trying to get out of bankruptcy now.

RattyMouse
01-21-2013, 07:03 PM
Automotive sales are on the increase.

Film sales have at best plateaued, and may be still on the decline.

New film manufacturing is expensive to design and build.

And shareholders and creditors demand that that money be spent on growing markets, not markets that are either steady or declining.

If Kodak had been privately held, it probably wouldn't be trying to get out of bankruptcy now.

GM's market share dropped during their downsizing time. If memory serves GM used to have close to 50% market share in the US around 1980. Today that is less than 20%. Somehow they managed to downsize their operations and continue production.

No one is making any new films. Kodak is just selling their old formulations.

If Kodak downsized properly, they can adjust their facility to be the proper size. According to PE Kodak can produce a years demand of film in one day today. Kodak could easily produce enough to keep sales going while they re-tool their production to the smaller size.

Everyone always comes back with numerous excuses that say can't can't can't. Can't be done. I've never seen a more negative (heh heh) industry than film producing. Why is it ALWAYS can't be done?

ntenny
01-21-2013, 08:02 PM
The only down side to the present time is the much lower selection of available films.

It's not really very low in the b&w world, is it? Color film has narrowed drastically, especially E-6 which I think is now down to five options (Provia and Velvia in two speeds each, plus CR200), but it seems to me like we're a bit spoiled for choice in black and white---a little less so since the demise of Efke, to be sure. There are, what, six or seven 400-speed films to choose from? (Two from Kodak, two plus XP2 from Ilford, Fomapan, two from Rollei if you don't count their infrared film.) I can't find a convenient historical catalog to compare to, but have previous generations of photographers really had more options than that at their fingertips?

-NT

RattyMouse
01-21-2013, 08:08 PM
It's not really very low in the b&w world, is it? Color film has narrowed drastically, especially E-6 which I think is now down to five options (Provia and Velvia in two speeds each, plus CR200), but it seems to me like we're a bit spoiled for choice in black and white---a little less so since the demise of Efke, to be sure. There are, what, six or seven 400-speed films to choose from? (Two from Kodak, two plus XP2 from Ilford, Fomapan, two from Rollei if you don't count their infrared film.) I can't find a convenient historical catalog to compare to, but have previous generations of photographers really had more options than that at their fingertips?

-NT

B & W film is only lacking in the low speed category.

MattKing
01-21-2013, 08:35 PM
GM's market share dropped during their downsizing time. If memory serves GM used to have close to 50% market share in the US around 1980. Today that is less than 20%. Somehow they managed to downsize their operations and continue production.

No one is making any new films. Kodak is just selling their old formulations.

If Kodak downsized properly, they can adjust their facility to be the proper size. According to PE Kodak can produce a years demand of film in one day today. Kodak could easily produce enough to keep sales going while they re-tool their production to the smaller size.

Everyone always comes back with numerous excuses that say can't can't can't. Can't be done. I've never seen a more negative (heh heh) industry than film producing. Why is it ALWAYS can't be done?

RattyMouse:

Market share doesn't mean squat in a market that is shrinking. And GM's market share was high, but their losses were higher.

Kodak is saddled with the expectations of the holders of what was once a huge market capitalization.

The directors of Kodak are/were required by law to try to replace the profit stream that was film with something similarly profitable. Film will never be that big again.

I believe that film can be a profitable and healthy industry, but I think that Kodak wasted its chance to be a major part of that industry. If they had downsized several years ago, and then used their resources to build other, parallel streams of profits, things would be different.

Remember that it took an insolvency and what was essentially a re-start from almost the beginning to make Ilford the small but apparently successful entity that it is now.

And Ilford remains far, far smaller than Kodak's film and paper business is today.

Mustafa Umut Sarac
01-21-2013, 09:11 PM
If Kodak can manufacture all its film sales in one day , it makes its bigger 400 times they can sell If the film sales dropped 1/10 , it makes Kodak was 40 times bigger than it can sell 30 years ago. Am I wrong somewhere ? I think we did not count movie industry. It makes movie industry was consuming lots of film 30 years ago.

RattyMouse
01-22-2013, 12:55 AM
Kodak is NOT required by law to replace lost profits. The law cannot require either the impossible nor the stupid. The law at best requires the board of directors to follow the best interests of the ownership. If the ownership wants massive profits, then they follow that. If the ownership wants to stay a film company, then they could have downsized. Used the billions of dollars in capital that they had at one time and shrank to what would have been a more sustainable company.

Quinten
01-22-2013, 06:44 AM
No doubt there are HUGE costs in downsizing an industrial giant. It's likely the cost of the legacy overheads are the real cost issues. Production of film at the correct scale probably wouldn't be a cost problem. The issue is getting from where you are today to the correct scale when you have the legacy costs consuming all the money.



If it is done right, bringing a company back to profitability might be a very rewarding challenge. The upside is that once a company is profitable you may get to try again, if you can develop new products and services that someone wants whether they are in your current market or something else.

In a way this is very positive: Kodak films could be saved. But reading the other posts I realize there are more forces, like shareholders, involved. Still a shame the right people didn't see this at the right time to save E6...

fotch
01-22-2013, 08:02 AM
Unfortunately, Kodak is saddled with an idiot at the top, who probably hired, promoted other idiots that agreed with him. It is amazing that he is still there.

Quinten
01-22-2013, 08:49 AM
Unfortunately, Kodak is saddled with an idiot at the top, who probably hired, promoted other idiots that agreed with him. It is amazing that he is still there.

Bad management seems to be their problem since the mid 80s, they basically invented the digital camera, developed stunning megapixel sensors before its competition and they completely missed the boat.

Mustafa Umut Sarac
01-22-2013, 09:46 AM
Inventing something with few newly developed integrated circuits and to produce millions of canon dslrs are completely different things.

jnanian
01-22-2013, 09:52 AM
Bad management seems to be their problem since the mid 80s, they basically invented the digital camera, developed stunning megapixel sensors before its competition and they completely missed the boat.

thats cause they spent a lot of time keeping all their analog / traditional film based customers
instead of dumping us and going full steam ahead into the bright new future which we are all grateful for.
so, in a way their problem is because of us ... hosue could kodak dump the film based history they entrenched themselves in ?
not to mention, when you are used to cooking for 300 million, its very hard to cook for 10 millon / an empty nest
without getting rid of your kitchen and cookware and ... .. ( its like making ramen noodles in a 20 gallon pot . )