[Anonymous]

Refillable printer cartridges catching on
Market remains small but H-P, Lexmark watching closely
Computer
ink is getting cheaper and refillable printer cartridges are quickly
gaining share in the $6.5 billion aftermarket for these products.
If
you need a new cartridge for your printer, you can now go to a store
like Cartridge World — or even go to your local drug store — and
they’ll take care of you in minutes. Inside a Walgreens store in
midtown Manhattan is an Ink-O-Dem machine. “It takes the old ink out of
the cartridges and replaces it with new ink and cleans the print head
and electrically tests it,” says Harry Nicodem, CEO of TonerHead. All
in three minutes or less.
But what’s really luring customers to
these machines is the cost – a refilled cartridge is about half the
price of a new cartridge from the manufacturer. A Hewlett-Packard 78
color inkjet cartridge costs only $27.50 at a Walgreens Ink-O-Dem kiosk
— on H-P’s website, it’s $54.99.
The kiosks — designed by toner head — will be rolled out at 1,500 Walgreen stores starting next month.
Refillable
cartridge franchises, like Australia-based Cartridge World, now have
over a thousand stores worldwide and have quickly established a
foothold in U.S. And some analysts estimate the refillable ink
cartridge market will double to nearly $2 billion by 2009. That’s a
tiny fraction of the $23 billion ink cartridge business of
manufacturers like H-P and Lexmark International.
But the big guys
are taking notice — though H-P says its had “similar competition for
some time and we feel we’ve had better customer satisfaction. We still
feel we have the best overall value,” says H-P spokesperson Sarah
Steven.
Lexmark International says it believes the impact of the
refillable market on its business is “very small,” according to
spokesperson Tim Fitzgerald.
Indeed, unless the quality of these cheaper cartridges stacks up, the refillable business won’t catch on.
“The
challenge for emerging refillers is to make sure their quality is
really good,” says Charlie Brewer of Hard Copies Supplies Journal. “You
have one chance to attract a buyer over to alternative products. If
that chance is not maintained if value slips at all, you’re not going
to get that customer back.”
Even though the market for recycled
cartridges is a very small compared to new printer cartridges, it could
start to eat at sales of companies like H-P and Lexmark. But for now,
it’s just an industry that they’re watching.  

[Author]

February 8, 2006 at 9:34 AM