For businesses that do a lot of printing, ink becomes a major figure in the expenses. If the cost of each of those tiny cartridges was calculated out, the cost of ink would be as much as $4,731 per gallon, according to a National Public Radio (NPR) report. Is ink really that expensive to produce, or do printer companies just have a really great business plan?
The Cost of Producing Ink
If you have ever considered refilling ink cartridges, you probably discovered that bulk ink is relatively inexpensive. A look online reveals gallon sized refill ink for right around $100. Of course, smaller sizes are available as well, but there is a significant difference in that cost and the $4,731 mentioned above. Somewhere along the way, it appears a lot of money is being made in name-brand ink cartridges. Refilling ink cartridges is not exactly the easiest process in the world, and may not be the best idea for the life of a printer.
If ink itself is so inexpensive, is it the cost of producing compatible cartridges that drives costs up? After all, each cartridge is designed for a specific printer and includes a high-tech chip. The demands on these small pieces of plastic are pretty high: a marketing manager at HP says that ink must be able to withstand high temperatures (up to 300 degrees), and travel at 30 miles per hour through a nozzle smaller than human hair. HP also claims to spend $1 billion each year just in the research and development of ink. Still, Andy Lippman, industry analyst, says that a single cartridge costs about $3 to make. If that is the case, why do most name brand cartridges cost around $35?
The Printer/Ink Tradeoff
Many analysts point to the price of printers as being the culprit. According to PCWorld, printer manufacturers actually lose money on their printers, while hitting the goldmine with their cartridge sales. As one blog post put it, ink is the hidden cost you don’t see when buying a printer. Evidently, the idea is to sell printers cheap so that consumers choose their products, and then make the profits by requiring proprietary ink cartridges. The fact that many printers will not function well with after-market cartridges means the companies have their income pretty neatly squared away. Adding to the frustration is that there is not a single catridge for HP, Canon, Lexmark, or other brands. No, nearly every printer has its own special cartridge. Not a bad marketing strategy for the companies, but one that is making many consumers a little riled.
If the price of refill ink is putting a strain on your company’s budget, hold off on laying the blame on the staffer who picked the printer out. Factoring out how much a printer will cost in terms of per-page costs can be a challenge. It seems most companies do not provide easy access to that information, making it difficult for anyone to accurately compare costs by factoring the printer cost and long-term ink replacement costs.
The Bottom Line
Next time your business is in the market for a printer, do a little research on the cartridge costs. Paying a little more for a printer that requires cheaper cartridges may be more cost efficient in the long run. And if your business plan needs revising, consider the printer company model. Of course, your customers might not be too appreciative.
Article by Gabriel Adams.