Viewlogic extends distribution pact with Marubeni to hike Asia sales

Electronic News, July 27, 1992

MARLBORO, MASS.--Design software vendor Viewlogic Systems Inc. has extended a six-year-old exclusive Japanese distribution relationship with Marubeni Hytech as part of a multi-pronged effort to increase Asian sales.

The new two-year deal with Marubeni is expected to bring more than $14 million in revenues to Viewlogic, an annual increase of more than 50 percent over last year. Viewlogic also gets the right to use its own Japanese organization for "marketing activities in areas and accounts they might not be covering," said senior vice president of sales and marketing Gene Robinson.

Included in this are OEM agreements under the company's Silicon Design Alliance and PCB Design Alliance programs, which account for 17 percent of the company's sales.

In addition, board design software supplier Zuken Corp., already an OEM reseller of some Viewlogic products, has been named a sub-distributor to Marubeni and will sell Viewlogic tools to Zuken users. Expected reveues from this are over and above the $14 million.

"In the Japanese market, there are associations between corporations, and implied linkages," said Mr. Robinson. While he noted that Viewlogic does not want to have too many distributors, he explained "Having many different forms of distribution, that respect those links, is the way to go for market coverage."

Japan represents 12 percent of Viewlogic's sales, and the Asian market about 17 percent. The company has set a goal of boosting that to 25 percent in the next two years--"obviously not by downsizing U.S. sales," quipped Mr. Robinson. The company has about five people in its own Japanese organization, and Marubeni has "in excess of 30 people dedicated" to Viewlogic products, said Mr. Robinson.

While Japan has traditionally been a PC-oriented market, said Mr. Robinson, Viewlogic's new Powerview Unix-based design environment has been making inroads. A recent seminar in Tokyo had standing room only, and Mr. Robinson said "The business looks quite good."

Mr. Robinson noted that earlier agreements with Marubeni Hytech had been for periods shorter than two years, and said the longer term would bring advantages. "Now we have the opportunity to feel that more investment is a good idea," he said. "Also, there had never been a specific commitment on the amount of what was to be sold."