CARTRIDGE MARKET SET FOR BIG CHANGE

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CARTRIDGE MARKET SET FOR BIG CHANGE

 user 2006-12-04 at 11:02:00 am Views: 57
  • #17158

    Cartridge market set for big change
    Refill market to undergo dramatic shift as retail giants take over, says research firm report.
    Retail cartridge-refilling franchises have proliferated over the past two years, but analysts claim that office supply superstores such as Office Depot and OfficeMax, along with drugstore chains such as Walgreens, will dominate the retail refilling landscape by 2009.An industry research report reveals that the retail giants will account for 62 percent of cartridge-refilling locations in North America in less than three years’ time, a staggering 55 percent increase from 2005.What’s in Store for Retail Refillers in North America is a comprehensive report, released last month by Lyra Research, covering retail toner and ink cartridge refilling. In addition to forecasting the size of the market, the report includes the results of approximately 40 in-depth interviews with owners of independent refilling stores, executives at several major franchises, ink and toner cartridge remanufacturers and suppliers as well as other industry experts.Lyra Research believes that retail ink and toner cartridge-refilling franchises such as Caboodle Cartridge, Cartridge World, Island Ink-Jet, and Rapid Refill Ink will continue to open new stores at a rapid pace over the next few years as the entire cartridge-refilling market grows, but their share of retail locations will decrease from 62 percent in 2005 to only 29 percent in 2009.Retail cartridge refillers are widely regarded as the latest threat to the lucrative imaging supplies business of printer OEMs. These firms have been successful in tapping into the apparent frustration of businesses and end-users with the high cost of OEM inkjet and toner cartridges. As a result, cartridge refilling services at retail level have grown rapidly in number in recent years.These services offer consumers and businesses a low-cost alternative to purchasing replacement cartridges. Some outlets also offer a maintenance service, convenient pick-up of empty cartridges and delivery of refilled cartridges as well as other support services.Their target customers are consumers and small businesses interested in saving money on ink and toner supplies, and willing to try something new.At the moment, there are three main types of retail refillers operating in North America. First are dedicated retail refilling franchises, second, independent refilling retailers and, third, chain stores offering refilling services.And while some of these businesses refill toner cartridges, the majority of retail cartridge refillers predominantly deal with inkjet cartridges.The Lyra report claims that retail refillers will have a greater effect on the aftermarket than OEM cartridge sales although the dedicated refill franchises will increasingly have a smaller part in a bigger market.It forecasts that the number of refilled inkjet cartridges sold in North America through retail refillers – independent stores, chain stores and franchises – will grow from seven million cartridges in 2005 to 40.4 million in 2009.But the report urges caution and for an understanding of the cartridge-refilling market’s size and its degree of saturation, which is crucial for location selection and achieving profitability.”The explosion of franchised refill stores over the past two years demonstrates the frustration of businesses and consumers with the high cost of OEM inkjet and toner cartridges, and they are looking for inexpensive alternatives,” says Tom Baratz, an industry consultant in Lyra Research’s Custom Research and Consulting Group.”Large chain stores that enter the refilling market have the infrastructure and marketing engine already in place to become major players quickly. Consumers also enjoy the convenience of refilling cartridges while shopping for other items, rather than making a separate trip to a franchised refill shop.”