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| According
to VU TRAN, Lexmark intends to lower the total
cost of ownership in the Indian corporate printing market |
One
of the biggest beneficiaries of the intense competition in
the printer space is Lexmark, currently at the third position
in the printer pie in India, behind undisputed king HP and
the challenger from Japan Epson. According to IDC, in March
2001, Lexmark had 4 percent share of this market, quite insignificant
in comparison to the 79 and 12 percent market share enjoyed
by HP and Epson respectively. Though no definitive figures
are available for what happened in the last 9 months, reliable
industry sources claim that Lexmark had definitely upped its
market share by at least 2-3 percent.
Lexmark’s gradual rise in printer market share has been
further bolstered by the recent launch of a host of printers,
catering to a wide segment from SOHO to large corporate users.
“The management of hardcopy and electronic documents
impacts all,” comments Vu Tran, product marketing manager,
Lexmark. “By managing information effectively and printing
strategically with advanced print solutions from Lexmark at
extremely competitive prices, corporates can definitely speed
up their business.” Lexmark is currently looking at a
20 percent growth in India by the end of this year. “This
will be primarily driven by inkjets, which is a viable market
in India,” comments Frances Duggan, GM, India Sub-Continent,
Lexmark.
The different models launched include Lexmark C910, Lexmark
E322, Lexmark E210, all of which cater to the SOHO and SME
segments, whereas Lexmark T, W, X, X73 and X83 cater more
towards the higher corporate echelons. The last two are incidentally
multifunctional devices coming with printing, scanning and
copying options, and with competitive pricing of Rs 18,000
and Rs 20,000 respectively, Lexmark is surely trying to enter
territory dominated till now by HP and Modi Xerox.
Lexmark’s
principal strategy in India to increase its market share is
aimed at lowering the total cost of ownership (TCO) in the
corporate printing market. Part of the problem, as Vu sees
it, is the fact that most corporates do not have a firm grasp
of their printing assets. “Printing is not something
that most people pay attention to and many corporate customers
wouldn’t even be able to tell you how many printers they
have, let alone how effectively they are used,” comments
Vu.
“If
you take a look at the overall cost of printing, most people
will look at only the cost of the hardware, and we believe
that is potentially only five percent of the cost of the printing
solution,” says Duggan. The remainder of the costs are
the supplies, the administration of the printer, the management
and maintenance costs. Lexmark’s strategy in India to
help corporate customers print less appears at first to contradict
its stated aim of increasing market share. But Duggan says
that it is more a case of short-term cost for long-term gain.
“In the short term, it may result in us selling fewer
printers and potentially even selling less toner or less ink
but if we can be the [customer’s] printing solution provider,
then we can do well in the long term.”
“The
acquisition costs represent, according to an industry research,
around 15 percent. Over and above that, you have supplies
and energy at around 30 percent, IT support at around 20 percent,
service and maintenance around 25 percent and lack of availability
at around 10 percent,” informs Vu. One of the key factors
that can help to reduce corporate printing TCO is reliability.
“In India we are actually doubling the warranty on our
printers. So if you look at the cost of printing, our information
is that around 25 percent of the total cost of printing is
around service and maintenance, and as we have doubled our
warranty from one to two years standard, we are trying to
lower the TCO costs for the customer today in a very effective
way.”
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