REFILLING INK & TONER ,A BOOMING INDUSTRY

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REFILLING INK & TONER ,A BOOMING INDUSTRY

 user 2006-04-18 at 10:23:00 am Views: 50
  • #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.
    Major
    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
    Thanks
    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.”
    Increased competition
    The
    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.
    “We’ve had
    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
    service.”
    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
    If
    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.