To reduce the landfill usage, eco-friendly concepts are nowadays welcomed by the industry to stimulate the growth of businesses during tougher times. Refilling, reusing, recycling is the innovative way to target the price sensitive consumers, thus giving
Gone are the days when refilling printer cartridges was not feasible and one had to spend money on buying expensive cartridges to replace parched ones. The industry grew up and innovative ways were discovered to reuse or recycle the used cartridges. It is said that refilling saves the environment, helps in conserving the natural resources and reduces e-waste. It in now evident from research that refilling is the way out to fulfil the needs of the consumers. To meet the rising demand for new-age printers and cartridges, India`s finest cartridge refilling players are looking forward to cater to the refilling requirements of SMEs, Small Office and Home Office (SOHO), Small Medium Businesses (SMBs), Government and large corporations. Alkesh Agarwal, CEO, Refeel Cartridge Engineering says, “We are targeting one and all, whoever is using printers. Since we have retail stores throughout India, around 55-60 per cent of the total business comes from individuals and SMEs.”
The size of the printer cartridge industry in India is placed at Rs 1,500 crore (2006 – 07) ($375 million), out of which 48 per cent share, by volume, is of recycled cartridges. The CAGR (compounded annual growth rate) of the refill industry in India is approximated to be at 12.8 per cent for FY 2008-09. With exponential growth in a number of small businesses running in every nook and cranny of the country, the cartridge refilling industry too is gaining instant recognition with a plethora of brands coming to dominate the market in an organised way. The industry offers an incredible opportunity to aspiring franchisees. In tough times, when the economy goes down, businesses try harder to cut costs. So, in order to create hassle free businesses, professionals are coming up with new ideas of refilling old cartridges. For franchisees, it is reckoned as a recession proof business as it itself gives an assurance that it will not fail, since the consumption of printing is going up in all sectors. It also intends to drive the eco-friendly concept in order to save the surroundings from e-waste. The cartridge refilling industry is growing exponentially, thereby giving support to augment mass employment, offering refilled cartridges at minimal prices and in turn, increasing the demand for refilled cartridges among the diverse target group of consumers.
Generating consumer awareness
Earlier, the market was not mature enough to recognise the value of the cartridge refilling and remanufacturing market. Owing to lack of knowledge, customers were apprehensive about using the refilled or remanufactured cartridges, due to the myth that it would damage their printer`s performance. Educating customers about the benefits of using remanufactured and refilled cartridges has now become a challenge for organised players. Globally, Cartridge World has helped promote reusing and refilling - the organised way, thereby substantially contributing in creating awareness about the importance of reusing before recycling and saving the environment. While comparing the Indian consumer and his global counterpart, Sandeep Narang, MD, Navsons Cartridge Clinic Pvt. Ltd says, “I think the Indian consumer`s preferences are not much different from the global consumer. Indian consumers are already aware about refilling, the only need is to educate them about better refilling options available through organised units.” On the other hand, Naveen Rakhecha, CEO, Cartridge World informs, “One thing that customers want globally is assurance and reliability in service, superior quality and cost savings when they are printing and that is what we offer.”
Towards organised market
Earlier, the unorganised market in the cartridge refilling industry used to offer low-priced and poor quality refilling alternatives to the consumers, while OEMs used to give quality at a very high cost. The printer manufacturers were not liable for refilling cartridges. Moreover, the person was left with no other choice - he either had to buy a new one or get it refilled from local refillers. Rakhecha elucidates, “Refilling was a bad word – thanks to the way India had been refilling over the years. There were only few or no specialised refill stores. Refilling in most cases was not done scientifically.” To address the growing requirements of the industry, the Indian Cartridge Remanufacturers and Recyclers Association (ICCRA) was formed to fulfil the needs of the printer cartridge remanufacturing industry across the country. Talking about the unorganised industry Agarwal reveals, “At present, only around 35 per cent of cartridges are being refilled in India and out of those, over 95 per cent of the cartridges are being refilled by local unorganised players, providing cheap, poor quality print solutions. Many a time, they even damage the printer because of their faulty refilling methods.” He further declares, “We expect the organised segment to grow over 200 per cent in the coming three years.”
B.B.Somani, CEO, AbbeeFill also shares the same opinion that the cartridge refilling industry, by and large, is still unorganised in India. Over the last three years, a couple of organised players have started this trade in an organised way. The cartridge refilling industry is expected to become more organised as Indian consumers` preference towards using refilled cartridges is now shifting as they focus more on using quality and environment friendly products. Indian consumers too are accepting the organised refillers. Buying a new cartridge from the market is more expensive than refilling the same. Commenting on the ongoing debate about buying new cartridges vs. refilling the same ones, Somani informs, “One new black inkjet cartridge on an average costs Rs 1,000 - 1,500 and a coloured one costs Rs 1,500 – 1,800. A new laser cartridge comes at around Rs 4,000 – 8,000. The same cartridge can be refilled for Rs 150 – 250 and the laser cartridge would cost about Rs 400 – 1,000, without compromising on quality.”
Franchising in cartridge refilling
Cartridge World, Refeel Cartridge Engineering, AbbeeFill, Cartridge Café and Navson`s Cartridge Clinic Pvt. Ltd are aggressively flourishing across the country by means of the franchising model. Besides refilling, there are OEM players like HP, Canon, Xerox, Compaq, Samsung, Kodak, Panasonic and Lexmark that are luring customers to buy new cartridges. While sharing his opinion about franchising in the cartridge refilling industry, Agarwal feels, “The franchise model in the cartridge refilling industry is a proven and successful business model internationally. This is a very dynamic industry driven by very fast changes in technology. Individually, it is very expensive and very difficult to keep yourself abreast with the technological developments.”
Below, we have short-listed the organised players that transformed the overall scenario of the cartridge refilling industry. Except the homegrown players, Cartridge World is the only international player that brought about a change in the Indian market by promoting and encouraging the innovative idea of the recycling, reusing and refilling business.
Cartridge World was founded in Adelaide, South Australia in 1997. It operates on a three tier franchise model (Franchisor – Master Franchisee – Franchisee). All Cartridge World stores are independently owned and operated by franchisees. The company started franchising in 1997, when it appointed the first franchisee in Adelaide, Australia. Today, Cartridge World is the world`s largest retailer of printer cartridge refilling services, with retail revenues of more than $450 million worldwide. There are over 1,675 franchised Cartridge World stores across 51 countries. After entering the Indian market two years back, the company has been able to establish over 75 franchise relationships. Moreover, the existing franchisees of the company have experienced quick success by multiplying their number of stores.
Refeel Cartridge Engineering:
Green Refeel is a retail printer cartridge refilling and recycling chain which was established in 2007, after an extensive research on the cartridge industry for over three years. The company`s well equipped R&D centre and internationally trained personnel, provide cutting edge technology to all its franchisees. Started by young entrepreneurs, the company is now present at over 30 locations, covering over 20 cities across India and evolving continuously in tandem with dedicated and passionate store owners and valued customers. Refeel is a one stop shop for printer and printer consumables; it is also into refilling of inkjet and laser printer cartridges. It also stocks a wide range of OEM cartridges, printers, specialty paper and fax and office supplies.
Cartridge Cafe is a Green company that protects the environment and provides huge savings to the customers` printing cost. It is the only Indian brand that offers tamper proof refilling of inkjet cartridges, without damaging the cartridges. With this process and technology, the cartridges can be filled multiple times. Currently, the company has signed up a number of live stores and is in an expansion mode.
Navson`s Cartridge Clinic Pvt. Ltd:
Navson`s Cartridge Clinic Pvt. Ltd was started in Punjab some three years ago. The company offers highest quality refilling services, compatible printer supplies and laser toners to individuals, businesses, government and educational institutions, through its network of authorised franchisees. From a humble beginning, the company has grown into a network of 14 stores in India, specialising in printer cartridge remanufacturing and printer sales and service.
Abbee consumables and peripherals Sshope Ltd., a direct marketing arm of Abee Info-Consumables Ltd., being a pioneer in printer cartridge industry in India, introduced `AbbeeFill Cartridge Refill Station`, to offer products and services that are primarily related to the printing needs of the customers, i.e., refilling of inkjet cartridges, laser cartridges, dot matrix cartridges and more. The company supplies doorstep services in refilling the cartridges of any printer, at an affordable price, with a whole range of warranty and guarantee. The products and services are affordable and easy to implement, easy to use, and delivered by a trusted neighbourhood AbbeeFill Cartridge Refill Station. The company has successfully implemented a `Micro Marketing` concept and within the next five years, it plans to expand its operations by appointing one master franchisee per city, in 65 cities and 1,500 unit franchisees for every pin code area across these cities.
The cartridge refilling industry offers a great opportunity to the franchisees that are looking for prospects to start their own business. On providing effective training and support to the franchisees, Rakhecha says, “A Cartridge World franchisee can look forward to taking advantage of business orientation and technical training programmes, technical support, assistance in store development, manuals for starting and running the cartridge world store, access to global vendor relationships for buying raw materials, financial assistance and marketing support provided by highly qualified, knowledgeable and experienced training staff.” Whereas on the other side, Agrawal clarifies, “From signing a franchise agreement till the store is operational, we assist in site selection, store design and related business start up activities. We have a comprehensive training programme which covers technical, marketing, administration, accounts, customer handling and store management activities.” He further says, “We will be introducing innovative products and services at regular intervals that will give our franchisees an extra earning opportunity.” Whereas Valerian Fernandes, Founder – Director, Cartridge Cafe says, “We provide complete technical training on our process, technology along with company certifications to our franchisees and we retain them through our marketing handholding exercise where the company, along with the franchise owner, goes to market the store and create awareness of this business among the corporates.”
With growing inflation, providers of print technology are now feeling the crunch of mounting costs for manufacturing, buying raw materials and transportation. To seize more market share in the industry, the competition is emerging between the OEM companies and refillers. Nowadays, everybody, whether OEM or refilling players, is actively involved in making different advertising and marketing strategies to stimulate the growth of the products in the market. OEMs provide quality products at highly priced items, while refilling players are providing the refilling alternative for the same products at economical prices. HP Planet Partners, a part of the HP Eco Solutions recently announced its worldwide expansion through a print cartridge return and recycling programme, along with steps to reduce shipping material and increase transportation efficiency. Agrawal says, “Our commitment to provide low cost - high quality print solutions in the least turn around time and our flexibility to adapt to the local conditions is what sets us apart. Our technical, marketing and administrative departments work in tandem with all our franchisees to achieve this common objective.” He further says, “We use over 3,000 different types of raw materials for cartridge refilling purpose. We have a strong logistics and support system to supply raw materials to all the franchisees.” To gain extra profits, the companies plan different tactics to retail their products in the market. “To promote our franchise concept, we are participating in trade exhibitions, release ads in main line print and electronic media. We are also promoting the husband and wife combination for this business,” reveals Somani. Whereas Fernandes says, “Our company strategy is to provide excellent service in the quality of tamper proof refill and remanufactured services.”
In India, the cartridge refilling industry is still emerging. Talking about the market share in the refilling industry Rakhecha reveals, “Through our franchised retail stores, we aim to achieve 10 to 15 per cent market share in the next three years.” Whereas on the other side, Refeel Cartridge Engineering targets a market share of about 5-6 per cent by the end of 2010. While commenting on the future of the dynamic industry, Rakhecha explains, “Reusing the empty cartridge and saving the environment along with money, without compromising on quality is a compelling proposition. Today, with the economic slowdown and cost cutting becoming very important, we see a big opportunity for our services.” He further adds, “Green consumerism is gaining ground in India. With over 70 per cent of cartridges to be thrown into landfill after single use, the opportunity for the refill industry is huge.”
On the other side, Narang feels, “The industry is experiencing sustained growth. The growth pattern is likely to continue in the foreseeable future and the opportunities for growing market share are endless.” The scope of the cartridge refilling and remanufacturing industry is certainly in support of the organised players that have gained success in creating awareness among customers about using cost effective, eco-friendly and recycled products. Another reason behind the growth is the increasing prices of OEM cartridges. The buyers like SOHO are more price-sensitive than large corporations. In addition to this, the market is more likely to transform with the advent of newer technology that will certainly stimulate the growth of the industry. In the future, it indeed offers a fabulous business opportunity to the potential franchisees and ensures gigantic expansion and profits.