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Reply to "Ricoh Ikon Letter"

It would seem that it all depends on where you structure your profitability.
Since Ricoh is a Japanese manufacturer and sells its product to the US Ricoh company and then US Ricoh sells it to a dealer or direct, the profits can be structured to be very little if any in the US and very profitable in Japan. Ex: cost to manufacture is 10, sell to US mfg. sales concern for 20, US concern sells it for 22, dealers or direct sell it for 24. The cost of goods to the US is high and the profits remain in Japan and very little profit is made in the US, hence less taxes paid here and more money at home in Japan. Remember these manufacturers are in the business of manufacturing and panic when inventory is not sold off and then they create new distribution channels to move inventory. Profitability of the distribution channel is of minor concern only in as far as it enables sales distribution and the continued ability to manufacture. If anything, it is volume of units sold in the US that is of greatest interest. So they play a fine line of placating dealers to keep them selling vs losing them or until a better distribution sales model comes along at less cost. Or so I think.
My 1.5cents worth of thoughts . I'm not an economist but I know how to spell it.
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