Majority of SMBs use branded ink tanks

Choosing brand over cheaper compatible cartridges, small and midsize businesses in Southeast Asia could invest US$490 million on printers this year, says analyst.
Written by Aaron Tan, Contributor

SINGAPORE--More than two-thirds of small and midsize businesses (SMBs) across Southeast Asia used branded ink cartridges last year, says market analyst AMI-Partners.

This finding was revealed last month against the backdrop of a cost-conscious SMB market, where cheaper compatible printer cartridges are thought to be preferred.

AMI-Partners attributed the trend to the success of "buy original" campaigns spearheaded by many printer makers, as well as the lack of awareness among most SMBs in the region that compatible printer cartridges are available.

According to Loh Teck Heng, Singapore country manager of Lexmark International, a "big proportion" of the company's customers use Lexmark-branded cartridges. He attributed this trend to how Lexmark integrates its printer heads with print cartridges, making it difficult for third-party vendors to manufacture compatible ones.

Loh told ZDNet Asia that Lexmark's campaigns have also focused on print quality assurances provided by its own cartridges, and added that the company priced its cartridges competitively to combat the lure of compatible ones.

A spokesperson from Fullmark, a Singapore-based compatible printer cartridge maker, declined to comment on its sales volume, but she told ZDNet Asia that customers choose compatible cartridges primarily because of cost savings.

According to AMI-Partners, SMBs in the region are expected to invest more than US$490 million on printers this year. Emerging markets, notably Indonesia and Thailand, will account for more than half of that spending.

Cindy Tan, Singapore-based analyst at AMI-Partners, said in a statement: "To thrive in an increasingly competitive climate, SMBs need to choose systems that can deliver results efficiently at a low total cost of ownership."

Falling printer prices have also driven color printer sales among SMBs, she noted. Medium-sized businesses, with 100 to 999 employees, are recording higher printer penetration than their small business counterparts--companies with fewer than 100 employees, she added.

Tan also noted that more than 50 percent of midsize businesses in Singapore and Malaysia use multifunctional printers and document management systems with networking, copier and printer features.

Of the total SMB printer spending, about 75 percent hail from small businesses. This is despite the fact that the average printer spending by small businesses is lower than that of medium-sized and large companies.

"Many companies are also examining the feasibility of leasing options to manage capital costs, with a small percentage looking at managed print services," Tan added.

Editorial standards