Sunday, January 07, 2007

HP Printers vs. HP Ink Cartridges

You can buy an HP Deskjet 3747 color inkjet printer for $29.95. The printer includes a black HP 27 Black Inkjet Print Cartridge that sells separately for $18, and a HP 28 Tri-color Inkjet print cartridge that sells separately for $22. Therefore, it would be $10 cheaper to buy the printer ($30), and throw it out if you wanted the print cartridges for your current printer, compared to buying the print cartridges separately ($40)!

Reason: There are lots of substitutes for the HP Deskjet 3747 printer and consumers would be price sensitive (elastic demand) when shopping for the printer, but there are probably very few substitutes for the HP 27 and HP 28 print cartridges, and so once you have an HP printer that uses those print cartridges, you would be relatively price insensitive (inelastic demand) when buying the print cartridges.

Q: Why doesn't HP sell the 3747 printer at a price of at least the cost of the print cartridges sold separately, i.e. $40?

8 Comments:

At 1/07/2007 2:00 PM, Anonymous Steve E. said...

A: If HP priced the printer at $40, it would not be competitive with the substitutes in the market (Epson, Lexmark printers, etc.) If they can't get the printer sold in the first place (even if its at a loss), they will never get the profits that the cartridges bring. Also, even those profits are not certain since the cartridge market is becoming more elastic with places like Cartridge World refilling them at half HP's price.

HP may be feeling this impact...I purchase a HP printer (not sure of the exact model)recently for $30 assuming I would get a black and color cartridge. It only came with the color, from which it could print black with less quality and efficiency. By the time I purchased a black cartridge and cable, I spent as much as the printer!

 
At 1/07/2007 4:02 PM, Anonymous Walt G. said...

Isn't there two markets at work here: 1) printers, and 2) print cartridges?

If printers are priced in a competitive printer market and print cartridges are priced in a competitive printer cartridge market, why we would expect a market clearing price to be correlated between the two different markets?

I suppose if HP made the print cartridges that carries their name, and there existed no viable substitutes, they possibly could give their printers away and make more profit selling the print cartridges. I used to get a lot of free razors that way.

 
At 1/08/2007 10:53 AM, Anonymous Anonymous said...

I've heard that printer companies have a tendency to put half-filled ink cartridges in new printers for this reason

 
At 1/08/2007 11:48 AM, Anonymous Anonymous said...

That is true, most companies (if not all, by now) ship new printers with half filled ink cartridges.

 
At 1/08/2007 5:18 PM, Blogger Dan said...

I recently set up a new HP deskjet printer. I cannot remember the exact model but it came with trial cartridges

 
At 1/08/2007 6:43 PM, Blogger Mark J. Perry said...

The HP 28 color cartridge that comes with the printer is listed as 8 ml, which is the same ink volume as the print cartridge sold separately? It would appear the the $30 printer comes with two FULL ink cartridges?

 
At 1/08/2007 7:30 PM, Anonymous Joyce H. said...

I don't immediately know how to state my concerns with grace and charm...but I feel like it is also futile to bother. Is anyone concerned about the discarded consumer junk loaded with earth clogging, water fouling chemistry headed for our landfills, only because it is cheaper to drive to the Big Box and buy another? In the long run, wouldn't it be responsible to take another approach, when purchasing? Or...is "cheaper" always the economic choice? I suspect it is another inconvenient truth. I am mad in Minneapolis.

 
At 1/12/2007 2:06 PM, Anonymous d.c.stimac said...

at home I have the same HP 840C printer six years now, (works great for what I need at home), but the cartridges are way over priced. I purchased lower value 1/2 priced cartridges online before with disappointment. Just a few days ago I see my black cartridge is out again. I can print in dark blue, but not black. I need to check what the market has regarding printers and cartridges. Should I buy a new printer, the cartridges will cost at least $40 you are right. FYI: you can go to your local post office and pick up small clear plastic bags with an address stamped on it to mail empty cartridges for recycling.

 

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