Warring Views, Hidden Costs

DQW Bureau
New Update


One of my colleagues was

buying a printer few days back from Nehru Place. I asked him why he

would need a printer at home, to which he replied that often there

are a number of personal things that he would like a printed copy.

Now I am sure there are several other home consumers like him who buy

printers. And why not, considering that printer prices have fallen

like anything? However, my advice would be unless you intend to make

some commercial use out of it, think more than thrice before going

for a printer at home, as the hidden costs of printing might lead to

severe holes in your pocket.

Having said that, the

printer consumables segment in India is witnessing a dramatic shift

with printer vendors finally moving away from the razor-blade model

to making products more affordable to consumers. So while every home

consumer would agree that the hidden costs of printing (read

cartridges, toner ink and other consumables) far outnumber the actual

printer costs, this segment has been largely overlooked by the

industry and media alike. After all consumables might be the lifeline

of the printer market, however it is yet not fashionable enough to

merit analyst dissertations.

The printer consumables

industry has always followed the razor and blade model, where the

latter costs higher than the former over a period of time. And the

key printer vendors have been taking advantage of this set-up, with

the consumables serving as the silent cash cow. However, this

scenario is slowly changing with the key OEM vendors trying to strike

a balance between printer and consumables costs by correcting their

pricing strategies and also introducing new technologies. This in

turn has the compatibles market thinking of newer ways to formalize

their business and maintain their lead.

And while there might be

innumerable arguments and counter-arguments over the legality of

refills, it's time we recognize that refills is an important

component of this market, especially considering the India market

dynamics. Another important contributor to the growing refillers

market was the rising demand for laser toners, and the fact that it

was easier to refill these toners to maintain their quality. Last few

years also saw the formation of associations like Cartridge Recyclers

and Traders Association (CRTAI) and ICCRA for the unorganized sector

to unite recyclers and re-manufacturers of cartridges and to gain a

legal entity for their business. The objective of retail players like

Cartridge World and Cartridge Cafe is also to provide high quality

refilling without tampering with the cartridge.

Given all this traction in

the refilling market, there have been attempts to get it organized.

The CRTAI established a Standardized Test Methods Committee (STMC)

certification. It is a specification followed by cartridge OEMs and

remanufacturers globally, among Indian players as well, apart from

educating the yet unorganized section of the industry about

intellectual property matters and technological upgradations.

However, what has sullied the turf and created unnecessary problems

has been CVC guidelines to PSUs and government to only purchase from

OEMs and treat refillers as illegal entities. Rather than leaving the

market alone to play out its own dynamics and give consumers their

own choice, these issues are preventing a level playing field and

instead allowing the referee to start playing at his own will and

convenience. Unless the fair play principals are not followed to a T,

people like my friend would always burn a big hole in their pocket

when they purchase a printer.