Consumer-oriented continuous ink-supply system (CISS) inkjet printers are starting to gain traction in the U.S. after having established themselves as popular options in Asia and Europe. Epson leads the way in the U.S. with its Ecotank series, and other OEMs such as Canon, Brother, and HP have recently introduced new CISS models for Asia and Europe.
CISS printers, also referred to as bulk-ink, feature large reservoirs or tanks of ink, and refills come packaged in bottles rather than cartridges. The appeal of CISS printers is undeniable. Per-page costs are as low as a tenth of a cent, and higher capacity means fewer frustrating disruptions from ink outages. Otherwise, CISS printers use standard inkjet technology. Customer response to CISS printers in the U.S. has largely been positive.
This presents a challenge to resellers in the near future, because while CISS printers themselves cost more than cartridge-based models, there is less money to be made on the consumables side.
The potential loss of revenue from cartridge sales should be taken seriously. Customers are tired of paying high prices for cartridges that don’t last as long as they think they should, and CISS printers provide a significantly lower per-page print cost. In April, IDC reported that inkjet consumables sales in the Asia-Pacific region excluding Japan (APEJ) fell 5.1 percent fourth quarter of 2015 over the third quarter. IDC attributed this drop to an increasing use of CISS printers and conversion kits.
OEMs are making up the difference by charging more for the printer, increasing the profit margin on the hardware. Prices for OEM replacement ink, sold in bottles, range in price from about $35 to $65 for a full set. Third-party CISS consumables are roughly half that. When you consider page yields of 4,000 to 8,000 per bottle, there is little consumables margin left for the reseller.
Asia and Europe were quick to adopt CISS because of a higher sensitivity to operating cost. Epson was the first OEM to offer CISS printers in the U.S. with its Ecotank series. Customer reviews of Epson models show a relatively high level of satisfaction with the Ecotank. They like the print quality, and most say the refilling process is easy and not messy. Common complaints center on slow performance and limited paper capacity and handling features – shortcomings that models aimed at business will have to address.
Perhaps most telling, CISS customers say they won’t go back to a cartridge system. They like the cost savings and less worry about replacing ink.
It’s easy to see CISS printers migrating to business quickly once OEMs introduce higher end models, and that’s simply a matter of time. At the moment, cartridge-based inkjet has an advantage in terms of performance, paper capacity and handling, and overall construction quality. Those differences exist because OEMs are squeezing as much cost as possible out of the hardware to boost margin on the printer. Businesses may be willing to pay a higher price for CISS printers in exchange for lower operating costs.
This leaves resellers with a dilemma as CISS printers make their way into business: Do they offer CISS models and accept less consumables revenue, or do they stick with cartridge-based systems knowing they may lose some sales to CISS? Either way, resellers can’t ignore the potential impact that CISS will have on their business.
