Vendor continues to shine spotlight on print supplies business after EMEA sales fell nine per cent
HP has warned the channel that it will aggressively combat partners trading in counterfeit, cloned and imitation print cartridges.
The vendor's print supplies business has been thrown into the spotlight over recent weeks, after it saw revenue in this area drop three per cent year on year globally, and nine per cent in EMEA.
Speaking to CRN at HP's Reinvent conference in Houston, HP's EMEA print general manager David Ryan said the vendor is taking a zero-tolerance approach as it looks to stem the bleeding in its print supplies business.
"Some partners don't realise that these cartridges are violating intellectual property, and that is something we will tackle vigorously," he said.
"We'll continue to work with loyal partners to take all the action we can where illegal trading practices are being engaged.
"We're increasing our lobbying efforts to ensure that, from a government affairs perspective, the trading practices of some of these clone companies follows the same standards that any product would do - in terms of certification and compliance. That is an area that is under address right now."
On a Q1 earnings call last month, HP CEO Dion Weisler implied that the vendor's print supplies strategy has not received the innovation it requires.
"We can't bring a musket to a drone fight," he said.
HP said that dwindling sales have resulted in a built-up of product in the channel, which has affected pricing. It said it will be working to reduce this inventory.
Ryan claimed that HP's concerns about print supplies extends beyond just its plummeting sales, arguing that the various types of cartridges from other manufacturers are not environmentally safe.
He said imitation cartridges that HP has tested have "high failure rates and poor print quality", while many fail Blue Angel tests (a German certification for environmentally friendly products) or can damage the printer.
These reasons, he claimed, can mean that buying cheaper cartridges is more expensive in the long run.
"Partners that are dealing in counterfeit or imitation supplies are taking a big risk," Ryan said. "It's a risk when it comes to the experience of the end customer, but also environmentally.
"They look very cheap on the front end but when it comes to the percentage of cartridges that fail or don't deliver the print yield, or damage the printer - these are costs that the customer doesn't see when they are attracted to the low price.
Ryan explained that HP categorises cartridges from other manufacturers in the following ways: a clone or imitation cartridge will claim to be compatible with HP printers, while counterfeits will wrongly claim to have been manufactured by HP. HP vehemently opposes both types of cartridges.
Ryan's stance was less aggressive against third-party supplies - some of which are remanufactured, recycled and refilled HP original cartridges - but only in the case of "closed-loop recycling" that is controlled by HP itself.
He claimed that HP's Instant Ink service - which sees cartridges delivered to and collected from partners - has been successful in the UK.
HP has come under intense scrutiny in the past for blocking the use of third-party cartridges in its printers.
In 2016 it pushed a firmware update that blocked the use of unofficial HP cartridges in its printers, claiming it was to protect customers, only to reverse the decision following public outrage.
Ryan said that this time around, HP is set on educating channel partners and customers on why its own products are the better option.
"We think there is a false economy associated with these cartridges," he claimed. "Many of them also violate intellectual property.
"Educating our channel, putting tools in our channel around that, is an important priority for HP.
"We need to educate customers around what they are buying. Many don't know the difference between remanufactured cartridges [and official HP products], so there is a certain amount of education needed to point out the false economy of saving a few pounds but having poorer air quality and print quality."