This Fujifilm Company Review offers a lengthy and informational Fuji Photo Film Co. history. Learn how Fujifilm has come from producing photographic paper to the second-largest maker of film for still cameras, disposable cameras, camcorders, digital cameras and more...

Fuji Photo Film Co., Ltd. began as a cinematic-film producer and has grown into a multidimensional manufacturer and marketer of imaging and information products.  Fuji is the second-largest maker of photographic film for still cameras, Fuji also makes motion picture film, videotape, audiotape, and floppy discs.  Fuji also makes popular cameras, including its highly successful disposable cameras, camcorders, digital cameras.  Additionally, Fujifilm makes photofinishing equipment, paper and chemicals, various related imaging and information products for office and medical use.  The company is also a leading supplier of photofinishing services.

The Fujifilm company started in 1934 from the Dainippon Celluloid Company, Japan’s first cinematic film manufacturer, spun off its troubled photographic division.  Named Fuji Photo Film Co., Ltd, the new company already employed 340 people and named Shuichi Asano as its first president.  Its product line included motion picture film, dry plates, and photographic paper.  The company struggled for the first three years, mainly due to the poor quality and high price of its products relative to imports. 

Fuji began to work on building their reputation in the domestic market.  Brand reliability proved critical in the photosensitive materials industry, since buyers were not willing to risk losing a desired image to inadequate materials, regardless of cost.  During those first three years, however, the company continued to lose sales, increase debt, and struggle to meet research expenses. 

With a combination of outside consultation and its own research allowed the company to introduce its first film as an independence in 1936, as well as a motion picture negative film.  The negative film was much more difficult to produce and demonstrated Fuji’s technical competence.

Fuji built a second factory in Odawara in 1938 and color research began a new laboratory in 1939, but World War II halted this work.  During the war, the government set aside all sensitized materials for the military, so consumer-film development had to wait out the war.  In 1945 Allied bombing raids partially damaged two Fuji factories.

After Allied powers allowed civilian trade to resume in 1947, Fuji immediately began exporting to outlets in South America and Asia.  Japanese producers still enjoyed a good reputation in optical products, enabling Fuji to export its cameras and binoculars.  In the area of film and other sensitized materials, however, Japanese technology still lagged behind U.S. and European producers.

As the 1940s ended, so did a shortage of raw materials that kept Fuji from producing amateur photographic products in large quantities.  Licensing agreements between Fuji and Eastman Kodak in the United States allowed Fuji to equal Western producers in terms of black-and-white amateur roll film quality.  Fuji, now able to supply its products in large quantities, introduced its first amateur roll film in 1952.  By 1958 Fuji had introduced three additional black and white roll films.

Fuji enjoyed burgeoning domestic demand for the next 20 years, due in part to tariffs on film imports. During the 1950s Fuji captured the Japanese market for consumer films--a market that would quickly comprise 15 percent of the world's total film sales.

After setting up an export sales division in 1956, Fuji reached 27 export agreements by 1958 in Asia, North America, and Central America. Fuji first entered North America in 1955, and established its U.S. subsidiary ten years later.

As Fuji's international base grew, it still had to fight a perception of poor quality. In order to make a serious drive abroad, the company first had to develop film and paper compatible with the processing systems most commonly used worldwide. In 1966 Fuji introduced its first amateur slide film compatible with overseas processors. By 1969 all its films, photo paper, and chemicals were fully compatible. Employing the sales network it had established in the 1950s, exports began to flow.

In 1970 Fuji had nine overseas offices, and by the end of the decade it had 14 offices and subsidiaries abroad. These subsidiaries then branched out. Fuji's U.S. subsidiary, for instance, opened six offices between 1971 and 1982.

Recognition in these markets proved more difficult. Eastman Kodak's dominance in consumer films forced all producers to make compatible products in the postwar decades. Fuji learned this after it introduced a cartridge-film eight-millimeter home movie system in 1967. Fuji's product had the support of 14 Japanese and European manufacturers, including AGFA-Gevaert, Europe's largest photographic manufacturer. Kodak introduced its own system shortly after, which quickly gained control of the world market. Fuji had to abandon its system and rushed to develop compatible films. Fuji's overseas growth was slow during the 1970s, adhering to the industry's pace of product development.

In 1970 Kodak held more than 90 percent of the $400 million U.S. market, but Fuji's color films were already faster than Kodak's--meaning they required less light for adequate exposure. In addition, Fuji films were better on warmer tones, including red, orange, and flesh tones. While Kodak pursued the convenience-based mass market, Fuji targeted professionals and serious amateurs. Although it would take several years before Fuji posed a serious threat to Kodak, its quality created a position of strength.

Relative to its competition, Fuji strengthened itself during the 1970s, partially due to the appreciation of the yen between 1971 and 1980. One factor in the growth of Fuji's non-Western markets was its development of manufacturing facilities. Operations in Brazil, Korea, and Indonesia began with Fuji assistance. The operations began with package assembly, but eventually produced presensitized materials, color processing chemicals, and optical products for export. Such manufacturing bases made the company less vulnerable to currency fluctuation and reduced overhead.

In the 1980s the U.S. amateur film market changed rapidly. Consumers preferred higher-quality 35-millimeter over Kodak's disc, cartridge, or instant photography. Although the market changed to the advantage of manufacturers like Fuji, who specialized in 35-millimeter films, consumers still demanded convenience. Autofocus cameras and faster film required more sophistication from manufacturers.

Despite this favorable shift in consumer preferences, the photo industry as a whole had matured. Further, while Fuji hoped to gain ground in the U.S. market, that market was only twice as big as the Japanese market in terms of photo sales. Fuji entered the 1980s resolved not only to increase its portion of film sales worldwide, but also to find growth for its products in imaging and electronics.

Newer areas such as biotechnology and office automation had been paid for not with debt but with cash generated from film products and stock sales. Such electronic systems, such as microfilm records for offices and electronic imaging for x-rays, began to contribute to earnings on their own. In addition, Fuji enjoyed high profit margins in all areas. Pretax operating margins increased one-third to 24.4 percent from 1976 to 1981. Fuji's film, tape, and computer-disc manufacturing was highly automated, allowing workers to circulate among factories for increased productivity.

Fuji entered the 1990s in a very strong position in its home market and enjoying increasing success in foreign markets as well. The company then posted three consecutive years of record sales in the early 1990s, culminating in 1992's ¥1.14 trillion in sales. Net income fell 18.7 percent in 1992 from 1991 levels, however, as Fuji began to feel the combined effects of the prolonged recession in Japan and the sharp appreciation of the yen. Nevertheless, Fuji continued to develop and introduce innovative new products, such as 1991's Fujix Digital Still Camera DS-100, which used a memory card to store images; the Fujix Simple-Hi 8 camcorder, introduced in 1993 as the smallest and lightest camcorder in the world; and the Pictrostat instant color print system, also launched in 1993, which could produce color prints from prints, slides, and objects in one minute without using any processing chemicals.  Having weathered the worst of the difficult economic conditions that faced all Japanese companies in the 1990s, Fuji's future appeared bright. It seemed certain that Kodak would have a serious adversary to contend with for years to come.

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