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Sony to drop four-fifths of its parts suppliers in 3 years
Tokyo, Aug 18: Sony Corp., the world`s second-largest consumer-electronics maker, will cut the number of parts suppliers it uses by four-fifths in the next three years to reduce costs and help it compete with rivals in South Korea and Japan.
Tokyo, Aug 18: Sony Corp., the world's second-largest consumer-electronics maker, will cut the number of parts suppliers it uses by four-fifths in the next three years to reduce costs and help it compete with rivals in South Korea and Japan.
Sony will buy parts from about 1,000 companies by the end of March 2007, down from 4,700 now, said Yuriko Nakatani, a spokeswoman for the company.
Chief executive Nobuyuki Idei aims to raise profit margins by cutting the cost of making products such as Vaio Personal Computers, Wega televisions, and playstation 2 game machines.
Sony will buy more parts from its biggest suppliers and cut back on smaller ones, Nakatani said. The company expects buying more from each supplier to reduce parts prices.
Sony's decision to reduce suppliers follows earlier moves by competitors in Japan. Matsushita electric industrial co., has cut its list of suppliers to 3,000 as of March 31, from 6,000 a year earlier and plans to eliminate a further 1,000 by the end of March 2004, a Nikkei report said.
Sony aims to raise its operating-profit margin, excluding its financial businesses, to 10 per cent by the end of March 2007. It reported a level of 4 per cent for the year ended March 31, excluding restructuring costs.
Bureau Report
Chief executive Nobuyuki Idei aims to raise profit margins by cutting the cost of making products such as Vaio Personal Computers, Wega televisions, and playstation 2 game machines.
Sony will buy more parts from its biggest suppliers and cut back on smaller ones, Nakatani said. The company expects buying more from each supplier to reduce parts prices.
Sony's decision to reduce suppliers follows earlier moves by competitors in Japan. Matsushita electric industrial co., has cut its list of suppliers to 3,000 as of March 31, from 6,000 a year earlier and plans to eliminate a further 1,000 by the end of March 2004, a Nikkei report said.
Sony aims to raise its operating-profit margin, excluding its financial businesses, to 10 per cent by the end of March 2007. It reported a level of 4 per cent for the year ended March 31, excluding restructuring costs.
Bureau Report