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Tuesday, July 23, 2002
Prodisc to increase own-brand “Smart Buy” CD-R disc shipments


In a move to combat shrinking margins, Prodisc Technology plans to increase shipments of own-brand CD-R discs, with the aim of boosting own-brand sales to 30% of total sales this year. Prodisc said it now ships 12 million to 15 million “Smart Buy” discs per month, double what it produced when the brand was launched two years ago. The discs mainly sell to Japan, Taiwan and Central and South American countries.

Under a recently revamped marketing plan, Prodisc changed the Smart Buy logo and packaging to make them more appealing to young customers and is offering services like downloads of computer desktop wallpaper.

The world’s two largest CD-R disc makers, Ritek and CMC Magnetics, however, have been cautious in growing their own-brand presence, even though own-brand products fetch margins 10-20% higher than those under OEM (original equipment manufacturer) contracts.

To avoid head-to-head competition with OEM clients, Ritek said shipments of its own “Ridata” discs have been kept steady and account for roughly one-tenth of its sales.

At CMC, its “Mr. Data” CD-R line targets Japan and Taiwan and makes up only 2% of CMC’s total sales. CMC said it will raise own-brand sales in Taiwan through the expansion of its home-entertainment media rental stores to 134 island-wide by year-end. Sales figures were not given.


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