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OEM Manufacturers find low profit in ink
THE PRICE to print may seem cheap: You can buy a name-brand inkjet printer for $100 or less. But don’t forget to factor in the cost of ink. Buying four name-brand ink cartridges can set you back another $100. Why is it so expensive? The perception is that big manufacturers like Hewlett-Packard, Canon, Epson or Lexmark are financing their meager printer profits on the backs of cartridge consumers.
One analyst strongly disagrees with that.
“I don’t think the public is being fleeced when you look at the amount of money the printer companies are spending on research and development. HP spends billions of dollars a year in (research and development) on inks and print heads and cartridges, and it’s not a terribly profitable company,” Jim Forrest of Lyra Research said.
According to Lyra, worldwide revenue for ink cartridges last year was $30.4 billion and $24.7 billion for toner cartridges. These figures included those for original equipment manufacturers, and producers of remanufactured, compatibles, refilled and counterfeit products.
Forrest notes that name-brand cartridge prices have fallen precipitously in the last five years and have become more efficient, costing less to print per page than they used to.
Forrest is very bullish on the original equipment manufacturers’ cartridges and inks. He warns consumers heatedly against taking risks with resellers or online purveyors of off-brand labels.
“Without question, printer manufacturers’ ink is good quality. But aftermarket ink is unpredictable. No aftermarket ink matches that of print manufacturers,” he said.
A lot of people don’t care about the quality of their ink. If they’re not lawyers or accountants, they’re probably not going to be creating documents that must last for years. If they’re not professional photographers or artists, the colors need not necessarily be true.
There are myths that should be dispelled about buyingoff-label. One is that your printer’s warranty will be nullified by using off-label cartridges.
HP will not repair a printer whose damage is directly attributed to an off-label cartridge. But Forrest observed that a printer cartridge is hardly likely to damage a printer.
“The worst that could happen is nothing. Maybe the cartridge would leak ink all over the inside of your printer, but that’s not going to hurt it,” the analyst said.
The quality of remanufactured cartridges varies widely by producer, Current Analysis analyst Jana Munford said. But she wouldn’t toss them out summarily.
“Third-party players have come a long way for customers,” she said.
When you have the choice between a name-brand black-and-white inkjet cartridge for $25 or a compatible product for $13, delivered to your door in two days, sometimes the choice seems easy.
But independent testing shows that might not be the case for business users. Hewlett-Packard describes the cost of remanufactured toner cartridges for businesses over time compared with those who buy genuine HP LaserJet printer cartridges. It posits that businesses that rely on remanufactured toner cartridges end up paying more because of costs for reprints, service and additional cartridges and paper.
On the other hand, well-known and reputable remanufacturers also serve businesses.
For the individual consumer who uses the computer for word processing, shopping for economies is not such a big risk to take. An online search for inkjet cartridges will bring a plethora of independents that offer a range of remanufactured or refilled products compatible with your printer.
There are those who will send you something reminiscent of your childhood chemistry kit with instructions to mix and refill your own cartridge. This is messy.
As in so many things, balancing quality, cost and risk requires a sense of humor and patience.
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