Cartridge World is an international company that specializes in remanufacturing ink and toner cartridges. It currently has over 1,500 franchise locations worldwide. While Cartridge World is growing at 10% annually, its main competitor HP earns around 50% of its profits from cartridge sales. HP is concerned that Cartridge World's remanufactured cartridges could hamper print quality and has sued Cartridge World for patent infringement. However, restricting consumers' choice to replace cartridges themselves would hurt the environment and customers who prioritize cost. The document analyzes options for HP like segmenting its printer lines or merging with Cartridge World to increase market share through lower prices.

1. CARTRIDGE WORLDCan It Sustain its Business Model??

2. Cartridge WorldOriginally called Australian Cartridge Co., started by Bryan Stokes in 1991In 1999 company’s name was changed to Cartridge WorldCompany founded in AustraliaHead Quarters in Emeryville, California.Currently Cartridge World has 1575 stores worldwide, located in 45 countries and has appointed 37 Master Franchisees.Cartridge Worldis an international company specializing in the remanufacturing of ink and toner cartridges.2

3. Cartridge World Cont..As of March 1st, 2008, Cartridge World has over 1,500 franchise locations .The aftermarket currently has close to an 18 percent share of the worldwide ink cartridge market in terms of revenue. 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. Cartridge World3

4. William (bill) Hewlett and David (Dave) PackardHP incorporated on august 8, 1947, and went public on November 6, 1957.Headquartered in Palo alto, California, united statesSpecializes in building personal computers, notebook computers, servers, printers, calculators, software and home media devicesLargest worldwide seller of personal computers, surpassing rival DELL in January 2008Sales hit a record $ 104.3 billion in 2007 up by 14% 5th largest software company in the world4Cartridge World

5. Case OverviewCartridge WorldHewlett PackardAnnual sales growing by 10%$ 44 per ounceCost EffectiveEnvironment FriendlyAcknowledged by Entrepreneur magazineMost affected competitor50% profits from Cartridges$ 61 per ounce“Perfect Quality”1 Billion on R& DSued Cartridge World for use of patented ink5Cartridge World

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9. Market Speaks…Over 20 million printers sold annuallySale of cartridges account for more than $ 2.5 billion9Cartridge World

10. About KILLER CHIPS…10Cartridge World

11. About KILLER CHIPS…11Cartridge World

12. Our AnalysisIf HP uses Killer ChipsRestricts consumer’s right to select the mode of replacing cartridges

13. Piles up huge amounts of waste through disposed cartridges & thereby affects environment

14. Adversely affects the ‘normal’ customer base who prefer economy to quality

15. Would end up spelling doom for companies like Cartridge World12Cartridge World