Resource: Case Studies: Mercia Laser
Mercia Laser is a rapidly growing business which produces high quality remanufactured laser toner cartridges, the market for which has significant growth potential.
Friday, 17th November 2006
About Mercia Laser
Mercia Laser remanufactures laser toner cartridges for all major brands of mono-colour laser photocopier, fax etc. A small part of its business is directed to manufacture of cartridges. It is a rapidly growing business employing around 25 people with a turnover of about �3m per year (2001). This represents around 120,000 cartridges handled, in a total market size of 45 million units per year, of which over 25% are remanufactured. Special Features of Mercia Lasers Operations Mercia Lasers growth is attributed to its product quality: they are one of about 10-15 major remanufacturers who set the quality standards in the industry. Toner cartridge cores are sourced from brokers at market prices. Each is inspected, stripped, renovated, filled and tested. Completed items are boxed and packaged under the brand name of a number of dealers. The reputation of remanufactured goods is such that this is the most viable route for a quality operator; it is difficult to sell direct to customers. Cost effectiveness is boosted by the ready supply of components and cores, commonly shared product knowledge, and product design that has been consistently conducive to remanufacture. Special Features of the Sector In the UK, and in the USA and EU, the cartridge market has been stagnant for the last 5 years. However, toner manufacturers do report sales growth in Eastern Europe, which is likely to reflect underlying cartridge consumption. The "creators" of the photocopier industry, such as Canon and Mitsubishi, have commonly released design and manufacturing details to major component suppliers at launch. Full remanufacturing kits are therefore available from day one. Indeed, it appears that cartridges were made to be easily remanufactured to further stimulate the demand for the primary products: photocopier engines. They have encouraged their own component suppliers to sell into the remanufacture market.
Over the years there has been movement towards standardised toner systems, suitable for many applications and copiers. There are indications that mono-colour copier technology has stagnated and engine technology has plateaued. New model printers offer few new quality features attributable to the basic engines as opposed to the OEM software driving them. New copiers may require novel cartridge forms, although the components will be similar. Although colour copiers have been introduced, there has been little remanufacturing due to sparsity of users, and complexity of the toner systems. Over 25% of items are remanufactured, probably more if there is a hidden reuse through returns to the OEM. The market has potential to grow to 50%? - provided that cartridges can stand multiple use. Because OEMs are losing high value business, the overall size of the economy will reduce, but a significant environmental burden will be reduced. 11 million toner cartridges equates to several 10,000 m3 of non-degrading plastic waste. Paper packaging and metallic and Mylar components replaced during the remanufacturing process can be recycled. Because remanufacturing of cartridges is easy, there are few barriers to entry. Poor quality remanufacture can attract larger margins than good quality, while the business lasts; most of these operations are very small, typically less than 1000 units per week. Larger operations tend to be higher quality, but may be limited by the ability to source sufficient cores of the required type within a reasonable catchment. However, copier OEMs are beginning to object to the drain on their business. Some new cartridges contain use-once chips that enable certain printer functionality, or refuse to print once the cartridge is empty. This signals that remanufacturing may be at a level of significant threat to OEMs.
Caterpillar Remanufacturing celebrates 35th anniversary
CAT Reman opened its doors in Corinth and Alcorn County in Mississippi, USA in 1982 with just 11 employees. 35 years on, there are over 1,300 men and women working at CAT Reman’s four sites there.
Why textile process waste should be remanufactured
H&M Foundation Global Change Award winner calls for remanufacturing of textile waste - a significant economic opportunity for textile mills that will also improve supply chain transparency/traceability and create new, circular business models.