March 19, 2015
As we well know, sales of printer cartridges are a vital source of profit for printing companies. Canon, in particular, is well aware of this and works tirelessly to prevent the sale of cheaper remanufactured versions of its cartridges – primarily through excessive patenting.
Unfortunately, as we also know, the remanufacturing industry is a vital contributor to sustaining our environment, and an important way of keeping costs of essential printing equipment for companies and individuals, to a minimum. For these reasons, it is vital that we work out a way to stop excessive patenting and encourage remanufacturing.
Somewhat surprisingly, Canon recognises the value in remanufacturing its printers, stating on its website: “This program reflects the company’s commitment to limit its impact on the environment by extending product life and conserving natural resources through reliable, high-quality remanufactured office equipment.”
So why doesn’t Canon follow this mantra when it comes to remanufacturing its cartridges? Well, the cartridge remanufacturing process requires extra in-house resources and is expensive to maintain; it’s much easier, and cheaper, to ship the products offsite for recycling. In addition, research suggests that when the original manufacturer sells remanufactured products, the perceived value of new products in that industry can be reduced by up to eight percent.
Despite this revelation, I can’t help thinking Canon is missing a trick.
Many other companies have recognised the value in remanufacturing, and are selling remanufactured versions of popular brands of printer cartridges for undercut prices. Additionally, despite the often ‘bad press’ associated with using perceived lower quality remanufactured products, they have developed a loyal market of customers and healthy profit margins by doing so. The reason? Price. If people can get a product for half the price with only a minor risk of lower quality, many will take that risk.
So what can be done?
Well, research also suggests that remanufactured products sold by another seller can increase the perceived value of new products by up to seven percent. This could be for various reasons. Perhaps the customer perceives the industry more favourably given its positive impact on the environment, or perhaps increased product choice for the customer creates higher perceived quality of more expensive products in the range. Either way, remanufactured products in the industry can have a positive impact on sales.
So, is Canon missing a trick? Could Canon support the remanufacturers and develop a remanufacturing arm to its business?
Ian Chai, franchisee and Owner of Cartridge World Slough, thinks it’s possible: “If the OEM brands would certify and supply high quality and reliable remanufacturers with products to remanufacture cartridges, then all of us could be winners.”
However, Canon could go one step further.
By developing remanufactured versions of their cartridges and selling them under an alias brand, but under the Canon umbrella, Canon could increase their customer base and improve sales.
This is nothing new; companies across the globe have different brand names operating under the parent brand and effectively manage to receive sales for both products – clever marketing can take care of that. If Canon took over the remanufacturing market, in time, they could offer all round similar prices for both OEM and remanufactured products. The consumer would have more choice, and both parties would benefit.
Of course, to continue making a profit on OEM cartridges, Canon would likely want to be careful about the brand image it chose for remanufactured versions because this could affect sales of more expensive options. However, there is always a market for premium and lower priced goods, so it is likely they would develop a loyal customer base for both brands.
Perhaps it’s time Canon rethinks its strategy in ink cartridge production and considers how it could use the remanufacturing industry to its benefit. If Canon gets on board with remanufacturing and find ways to make it profitable for their business, they could develop an improved and diversified brand. Perhaps it’s time for Canon to shift their perspective and start thinking green.
Rebecca Griffiths is Director of Rebecca Griffiths Consultants – www.rebeccagriffithsconsultants.com
Categories : Special Report