Canon USA made a major update to their authorized dealer list — in their February 13th update, they removed 86 authorized dealers, nearly 20% of their network. This is one of the largest mass-removals that we’ve seen.
Industry sources tell us that the changes were targeted towards smaller stores, as well as online-only dealers, in a bid to reduce Canon USA’s operating costs — fewer dealers means less Canon USA expenditure on sales management, marketing, operations, and compliance. The wide gap between Canon USA authorized prices and grey market prices suggests that Canon USA’s cost structure has been uncompetitive compared to other global Canon subsidiaries, and this dealer consolidation is the latest in a series of actions that have included layoffs as well as closure of their Jamesburg NJ service center.
Notable removals include military exchanges (Army and Air Force Exchange Service, Coast Guard Exchange, and others) selling at a discount to US military personnel, camera broker KEH (which used to sell new Canon items alongside their used inventory), and eBay dealers Datavision and Profeel. California and New York state saw the largest reduction in dealers, with 15 and 11 removed respectively.
UPDATE: Canon has published a new list as of February 18th, which adds back the military exchanges, and a few other dealers. We are told that these erroneous removals were “administrative errors”.
Sources also inform us of other upcoming price structure and policy changes as Canon USA continues to transform their operating model, we’ll report on this in the future as more details are known. We can only hope that savings are passed onto consumers in the form of lower prices. In general though, fewer dealers and more pricing restrictions generally decreases price competition, a strategy adopted by an increasing number of premium electronics manufacturers in recent years.
