CARTRIDGE WORLDCan It Sustain its Business Model??<br />
Cartridge World<br />Originally called Australian Cartridge Co., started by Bryan Stokes in 1991<br />In 1999 company’s name was changed to Cartridge World<br />Company founded in Australia<br />Head Quarters in Emeryville, California.<br />Currently Cartridge World has 1575 stores worldwide, located in 45 countries and has appointed 37 Master Franchisees.<br />Cartridge Worldis an international company specializing in the remanufacturing of ink and toner cartridges.<br />2<br />
Cartridge World Cont..<br />As of March 1st, 2008, Cartridge World has over 1,500 franchise locations .<br />The aftermarket currently has close to an 18 percent share of the worldwide ink cartridge market in terms of revenue. <br />Cartridge World was recently named the No.1 Toner Replacement Service franchise and was included as one of the Fastest Growing Franchises in 2004 & 2006 according to Entrepreneur Magazine. <br />Cartridge World<br />3<br />
William (bill) Hewlett and David (Dave) Packard<br />HP incorporated on august 8, 1947, and went public on November 6, 1957.<br />Headquartered in Palo alto, California, united states<br />Specializes in building personal computers, notebook computers, servers, printers, calculators, software and home media devices<br />Largest worldwide seller of personal computers, surpassing rival DELL in January 2008<br />Sales hit a record $ 104.3 billion in 2007 up by 14% <br />5th largest software company in the world<br />4<br />Cartridge World<br />
Case Overview<br />Cartridge World<br />Hewlett Packard<br />Annual sales growing by 10%<br />$ 44 per ounce<br />Cost Effective<br />Environment Friendly<br />Acknowledged by Entrepreneur magazine<br />Most affected competitor<br />50% profits from Cartridges<br />$ 61 per ounce<br />“Perfect Quality”<br />1 Billion on R& D<br />Sued Cartridge World for use of patented ink<br />5<br />Cartridge World<br />
Market Speaks…<br />Over 20 million printers sold annually<br />Sale of cartridges account for more than $ 2.5 billion<br />9<br />Cartridge World<br />
About KILLER CHIPS…<br />10<br />Cartridge World<br />
About KILLER CHIPS…<br />11<br />Cartridge World<br />
Our Analysis<br />If HP uses Killer Chips<br /><ul><li>Restricts consumer’s right to select the mode of replacing cartridges
Piles up huge amounts of waste through disposed cartridges & thereby affects environment
Adversely affects the ‘normal’ customer base who prefer economy to quality
Would end up spelling doom for companies like Cartridge World</li></ul>12<br />Cartridge World<br />
What We Think… The First Way Out<br />HP needs both ‘normal’ & ‘Imaging Industry’ clients to sustain in the market<br />HP should segregate it’s printer range into two<br /><ul><li> Economy Range for normal customers WITHOUT KILLER CHIPS
High End Printers for Imaging Industry WITH KILLER CHIPS so that refilled cartridges do not hamper quality that’s indispensable</li></ul>13<br />Cartridge World<br />
What We Think… The Alternative…<br />Merger of HP and Cartridge World<br /><ul><li>HP has a huge customer base.
Cartridge World on the other hand has the best technology to re-fill the used cartridge.
Together they can penetrate deep into the market to reap huge profits by increasing their market share
Exchange of technology can benefit HP in reducing its cost of production.
Cartridge rates can be effectively brought down.</li></ul>14<br />Cartridge World<br />