REFILLING INK & TONER ,A BOOMING INDUSTRY
REFILLING INK & TONER ,A BOOMING INDUSTRY
2006-04-18 at 10:23:00 am #15167
Retailers’ refills cut ink cost
Walgreens and OfficeMax offer printer cartridge refills — for much cheaper than the cost of a new cartridge.
CHICAGO – A new battle is brewing in the technology trenches over a very old product: ink.
retailers are cutting the cost in half for refilled inkjet printer
cartridges, taking a once grimy task for hobbyists — who refuse to pay
$20 to more than $200 for a new cartridge — and making it available to
the masses.Last Friday, OfficeMax Inc. kicked off a marketing campaign
for its inkjet refill services across its 900-store chain.This week,
Walgreen Co. begins a rollout of refill stations at 1,500 of its more
than 5,100 stores.
The refill services offer businesses and home
users a no-mess opportunity: sharply lower prices for a 10-minute
wait.”An average cartridge for a good printer or copier is $100,” said
Sean Lowry, a senior vice president for Pacor Mortgage in Chicago,
whose company is hooked on the service. “If you’re using six or seven
machines at the office, that’s a lot of money.”
A booming industry
to the growth of digital photography, desktop publishing and affordable
color printers, the digital-imaging-supplies business will top $100
billion in 2006, according to a report released last week by Lyra
Research in Newton, Mass. By comparison, the hardware market — think
printers — will account for $60 billion this year, the research
found.inkjet cartridges range from basic black for printing simple
documents to more complex models needed for presentations and photos.
Prices exceed $200 for some color models.
“It can cost about as much
as a new printer to buy a set of new cartridges,” said Walgreens
spokesperson Tiffani Bruce.Burt Yarkin, chief executive at Cartridge
World’s U.S. business, said that’s because printer makers follow an
age-old business philosophy.”They will give you the razors and charge
you for the razor blades,” he said.
The biggest challenge for his
chain, which has opened about 370 stores in the U.S. –including two in
Wichita — is to teach people that cartridges can be refilled.
“Walgreens’ getting into this business legitimizes what we do,” Yarkin said. “It’s a good thing for us.”
emerging refill market will put additional pressure on companies such
as Hewlett-Packard Co., where about 70 percent of profit in the printer
business come from supplies.HP has “seen their supplies business get
slowly eaten away,” said Peter Grant, a research vice president for
Gartner Inc. “About 15 to 20 percent of their business is going to
these third parties.”But Pradeep Jotwani, HP’s senior vice president of
imaging and printing supplies, dismisses those concerns.
competition all along,” Jotwani said. “It’s taken various forms at
different times. This is just another wave.”For OfficeMax, the move to
add refill stations “is not about saying we don’t want to sell HP or
Lexmark products,” said Ryan Vero, executive vice president and chief
merchandise officer. “There’s a customer base out there that wants this
OfficeMax technicians can refill about 90 different inkjet
cartridges. Prices start at $12.99 to refill a black ink cartridge and
$22.99 for a color model. That can lead to 40 percent savings over the
price of a new cartridge, Vero said.At Walgreens, customers can drop
off an empty cartridge at the photo counter, and a technician will
refill it in about 10 minutes, Bruce said. Prices vary depending on the
model, but customers should save about 50 percent over buying a new
cartridge, she said.
A question of quality
there is a point of contention in this growing business, it is the
subject of quality.”We think you can save money, but you take a cut in
the quality you are getting,” Gartner’s Grant said.That does not
surprise HP’s Jotwani.”This is not a commodity, it is high-quality
ink,” he said. “Our cartridges and our inks work every time and give
you great output quality each time. Generic inks can’t do that.”All
three retailers offer customers money-back guarantees if they are not
happy with the results from a refilled printer cartridge.