The market research agency Business-Inform from Russia completed a series of research activities about the laser printing market in Russia. Within the research over 16000 local companies and organizations from 35 regions were interviewed. The main goal of the research was to identify sales volumes in different market segments in the Russia market of laser printing and determine the dependence of the regional sales on various factors of the regional economy. It is worth mentioning that in the analysis of the results of this market study accomplished by Business-Inform the sales values for laser printers are given in retail pricing, i.e. they include VAT and sellers' margin. Besides it, within the sales volumes presented, we have taken into consideration not all MFPs (multifunctional products), but only those based on laser printers.

The results presented in the below study gave the possibility to assess sales volumes at the market of laser printing in the regions of the Russian Federation within 2000-2008 and develop a forecasting pattern for the local market.

The study of the laser printing market in Russia included the following market segments:

segment 1 - printers (standalone printers and MFPs) with the print speed of up to 20 ppm for A4 sheets;
segment 2 - printers (standalone printers and MFPs) with the print speed of 21-44 ppm for A4 sheets;
segment 3 - printers (standalone printers and MFPs) with the print speed of 45 ppm for A4 sheets;
segment 4 - color printers (standalone printers and MFPs);

Sales volumes and growth for laser printers (inc. MFPs) in 2000-2008 (in general)

Russia market of laser printers (inc. MFPs) in 2000-2008

The Russian market of laser printers is very dynamic and various. On one hand, one can come across modern models of printers as well as models, which have been put off manufacture for a long time already. The Russian market has both the models shipped officially to the country and models, which were not meant by vendors to be sold in this area. On the other hand, all new models of laser printers and MFPs get to the market at the same time as they do in Western countries. In addition, all the OEM companies renewing annually their line-ups of laser printers and MFPs do present quickly all models at the local public.

The leading vendors for laser printing equipment are Hewlett Packard, Samsung, Xerox taking up to 80-82% of the local market's share in 2003-2008 in terms of price value. As for their own individual shares on year-to-year basis the ratio for Hewlett Packard, Samsung, Xerox looks like this: 52-46%, 16-20%, 13-16%, respectively. The total market share for the above vendors is rather stable because of the four main factors: excellent market publicity, good price/quality ratio for each of the models of laser printers, well-thought and organized marketing programs and well-developed network of dealers and partners in the regions of the country. It is worth noting that the leading vendors (Hewlett Packard, Samsung, Xerox) controlled their total market shares in 2003-2008 and their shares in different segments had not varied a lot.

The results of the study of the Russian market of laser printers (inc. MFPs) in 2000-2008 are presented in Fig. 2. First, the trends identified in 2000-2007 changed significantly. If in 2007 the Russian market of laser printers (inc. MFPs) was growing fast (16-20% every year), in 2008 the market fell as low as 9.9% in terms of value all of a sudden. Taking into account the negative (crisis) trends in the local and global economy, Business-Inform forecasts a continuing negative dynamic in 2009, which may reach -35-40% (or $700-760 million).

Sales volumes and growth of laser printers (inc. MFPs) in 2000-2008 (in total)

Second, even under the economic crisis, which started off in 2008, there is growth in the segment of color laser printers and high-speed monochrome laser printers (Fig. 3). These trends lead to a significant change in the structure of the Russia market of laser printers in favor of color and high-speed monochrome models.

Third, in spite of the significant growth in the sales volume for color and high-speed b/w printers mentioned above, the segment of monochrome laser printers of speeds below 20 ppm remained the prevailing segment of all. Even the diminishment of the share of low-speed monochrome printers in 2000-2008 from 75% to 52% did not change the principal role of the segment toward the printing market. During the same period the sales volume for low-speed monochrome laser printers grew from $298 million (in 2000) to $768 million (in 2007) and only in 2008 we saw a fall of sales volumes in this segment ($601.8 million or 51.7%).

Sales volume growth for laser printers (inc. MFPs) in various market segments in 2000-2008

The reduction of sales volume in this segment can be explained by two main causes. Firstly, the price of entry models of the second segment (22-24 ppm) got in line with the most productive first-level printers (18-20 ppm). Secondly, the number of newly released models with <20 ppm was really low. Thus, in the second half of 2008 53 models of printers with the print speed of 21-44 ppm were presented to the Russia market. As for the segment of <20 ppm only 14 models came to the market at the same period. In 2008 a number of leading vendors discontinued the manufacture of monochrome models with speeds lower than 20 ppp (Ricoh, Kyocera, for instance).

All the known brands of printing equipment, such as: Hewlett Packard, Xerox, Samsung, Canon, Kyocera, Ricoh (including NRG), Lexmark, Epson, Oki, Konica Minolta, Brother, TallyGenicom, are present in the segment of the Russia market of monochrome laser printer with the print speed under 20 ppm . HP is still the indisputable leader in the market. But his position is being weakened (see Fig. 4): in 2002 sales volume for HP products was $218.4 million or 58.7% of all the market, in 2006 it was $313.4 million or 44.4%. The main reason for the shrinking market share for HP consists in an aggressive entry onto the Russia market exercised by Samsung Electronics (Samsung's sales volume was $38.0 million or 10.2% in 2002 and $202.9 million or 28.7% in 2006) and solid foundations of Xerox and Canon in terms of market shares.

The leading brands Hewlett Packard, Xerox, Kyocera, Ricoh (incl. NRG), Lexmark, Epson, Oki, etc. are also present in the segment of monochrome laser printers with print speeds within 21-44 ppm. In 2000 sales for monochrome laser printers within this speed range totaled at $58.8 million or 14.8% of the market. In 2008 it got to $287.7 million or 24.7% of the printing equipment market. HP is a long-stand leader - in 2002 HP's sales were at $70.7 million or 69.3% of the market; in 2008 - - $161.7 million or 56.2%. Xerox was the runner-up getting closer to the leader in 2002-2006. However, the advancing of Samsung in the segment of laser printers and MFPs pushed Xerox to the third place: Samsung sold laser printers and MFPs for $46.7 million (17.6% market share) in 2007, whereas Xerox - $39.3 million (14.8% market share). In 2008 Samsung had sales covering 15.3% market share and Xerox was at 12.65%. The changes brought to the streamline of Samsung's laser printers in 2006-2008 will probably lead to a larger share of printers of this brand in 2009-2010.

The third segment (monochrome laser printers with print speeds over 45 ppm) has a new leader now. HP, the habitual leader of Russia's market of printing equipment, was pushed from the first place by Xerox, another well-know manufacturer of laser printers, in 2003 (see Fig. 4). If in 2002 HP's market share in this segment was 43.6% and the sales volume was at $7.85 million, in 2003 HP's share diminished to 25.5% and sales totaled at $5.36 million. In 2004-2008 the ratio between Xerox and HP got "adjusted" at 46-53% and 22.5-25.5% respectively, which allow constant sales growth on the year-over-year basis.

In the segment of color laser printers we saw stable growth in sales in all sub-segments. HP and Xerox are the leading vendors in this market. The interesting fact here is that in 2002-2005 Xerox was catching up with HP in this market, but in 2006-2008 HP left its competitors behind owning to the release of new color MFPs and printers, which hit it off very well with the customer. HP's sales in this market in 2008 were at $80.4 million or 41.1%; Xerox was at $ 71.6 million or 35.6% (see Fig. 4). A lot of corporative customers know which brand they stick to, others, which have no brand preference, buy well reputed models of other vendors: Samsung, Konica Minolta, Ricoh (incl. NRG), Canon, etc.

Dynamics of market shares for the leading vendors of laser printers at the Russia market.

а) market in general

b) less than 20 ppm

c) 45 ppm and over

d) color printers

Looking at the Russia market of laser printers (incl. MFPs) as a whole, it is noteworthy to mention the leading position of HP: in 2002 the company's sales were at $312.8 million or 58.9% market share, in 2003 - $348.9 million or 52.5% market share, in 2008 - $601.5 million or 51.65% market share. The value growth for HP printers is really impressive. Samsung took the second place: in 2002 it sold printers for $38.0 million or 7.25% market share, in 2003 - $107.0 million or 16.4% market share, in 2008 - $220.4 million or 18.9% market share (see Fig. 4). The changes brought to the streamline of Samsung's laser printers in 2006-2008 may probably lead to a larger share of printers of this brand in 2009-2010 (up to 22-23%).

Xerox also experienced a significant sales growth: in 2002 this company's sales were at $56.7 million or 10.5% market share, in 2003 – $85.1 million or 12.8% market share and in 2008 - $174.9 million or 15.0% market share. Xerox has a well recognized brand of a reliable vendor for laser printers and MFPs, good price/quality ratio for every model shipped to the Russian market, well thought marketing policies and large network of regional dealers. Therefore, despite episodic activity of various vendors at the Russia market, Xerox's share of laser printers will be at 14-15% market share in terms of value.

Another important factor impacting the distribution of market shares among the leading vendors is that local consumers have a growing interest to new MFPs and printers beginning with 2005-2007 (see Fig. 5). In 2000-2003 the share of MFPs was around 20-25% of the total market of monochrome laser printers; in 2004, 2005, 2006 and 2007 it was 49%, 62%, 66%, 68% respectively. Besides it, before 2003 the share of MFPs in the speed range above 20 ppm was quite insignificant; in 2004-2007 it grew immensely from 37% to 58% of all presented models (in the < 20 ppm segment it grew from 54% to 78%).

Shares of laser printers and MFPs in the total lot of monochrome laser printers

Russia market of printing supplies for monochrome laser printers (incl. MFPs)

The Russia market of printing supplies for laser printers is a reflection of the main trends at the laser printing market and its indispensible part. The growth in sales of printing devices in a specific market segment leads inevitably to the growth of sales of respective printing supplies. Or vice versa - low demand for printers in a market segment leads to shrinking sales of respective printing supplies. It's worth mentioning that the market of laser printing is just a part of the Russia printing market. So, it also reflects the particularities of the other segments of the market (esp. the market of inkjet printing).

The Russia market of printing supplies for laser printing can be virtually divided into 3 main parts (segments):

- market of genuine printing supplies, which are manufactured by the vendors of laser printers and shipped to Russia;
- market of compatible printing supplies, which are manufactured by third-party companies for laser printers and shipped to Russia;
- market of refilled genuine and compatible cartridges for laser printers shipped to Russia.

In addition, the Russia market of printing supplies for laser printers (on top of the above groups) has two more groups of printing supplies: counterfeited cartridges sold as genuine and licensed cartridges manufactured by vendors of laser printers for use in printing equipment of other vendors under the permission of the latter. Counterfeited and licensed cartridges do not represent a large share of the printing market and there are no reliable data as to their shipments to the market. Thus, we will not take them into account separately.

According to the market research agency Business Inform, in 2008 the sales of genuine printing supplies in Russia totaled $1100 million in terms of value, which stands for over 25.5 million units (only for sale of genuine cartridges for laser and inkjet cartridges and desktop MFPs). As a whole, in unit terms inkjet cartridge exceed significantly laser ones, but the situation is quite opposite in terms of value. In 2008 14.7 million ink cartridges were sold in the country, which is equal to $262 million. As for laser cartridges, 10.7 million cartridges were sold during the same year; their value is $832 million. The basic assessment information about the Russia market of printing supplies in 2004-2007 obtained by Business-Inform are presented in Fig. 6 and Fig. 7. Those will be part of the continuation published in the October issue of RechargEast Magazine.

Russia’s market of genuine imaging supplies in 2004-2008 (value)

Russia’s market of genuine imaging supplies in 2004-2008 (units)

From the above values one could see that the volume of official shipments of genuine printing supplies onto the Russian market grew by 71% (from $640 to $1100) in term of value and by 80% (from 14.1 million units to 25.4 million) from 2004 to 2008. With all these it’s worth noting that the volume growth is more significant in the segment of laser printers. In 2004-2008 the growth rate for genuine supplies shipments for laser printers was 78% in terms of value (from $468 million to $832 million) and 81% in terms of units (from 5.9 million to 10.7 million). As for inkjet supplies the growth rate for genuine supplies was 56% in terms of value (from $168 to $262 million) and 79% in terms of units (from 8.2 million units to 14.7 million units). An increased and positive growth of the segment of laser printing supplies in 2004-2008 lead to the fact that the market share of genuine supplies for laser printing devices did not change in terms of units (42%) and kept the largest share in terms of value (73% in 2004 and 76% in 2008).

Another interesting trend seen in Fig. 8 consists in the decrease in the share of grey market of imaging supplies for laser printers from 12.2% to 8.4% in the total number of genuine supplies for laser printers in 2004-2007. This trend supports the overall shift to improved legal shipment schemes for genuine supplies through the distribution network of the main vendors in the country. The sudden jump in 2008 as for the share of the grey market from 8.4% to 11.4% is easily explained as the market entered the crisis and such behavior is more than peculiar to such situations.

Share of the grey market (laser printing)

The market of genuine printing supplies for laser printers is represented by eleven leading vendors in the market: Brother, Canon, Epson, HP, Konica Minolta, Kyocera, Lexmark, Oki, Ricoh, Samsung, Xerox, which ship cartridges for their printing equipment. These vendors account for 98% of all sales at the Russia market in terms of units and value. However, the prevailing volume in sales of genuine cartridges belongs to the following 4 vendors Canon, HP, Samsung и Xerox, whose equipment represents the main bulk of the installed printers (including MFPs). HP is the leader being positioned well ahead of its closest competitors at the market of laser printers. The company has been in this position for over a decade now, this giving HP a large installed base and, respectively, a wide potential market for supplies.

Here are the main values for shipment of monochrome laser printers and supplies in 2004-2008 obtained by Business-Inform staff. These show some really interesting trends (Fig. 9).

Russia market of printing supplies for b/w laser printing (up to 45 ppm A4)

First, the market of compatible cartridges was in constant growth in 2004-2008, which tells about quite satisfactory print quality offered by compatible products. The total amount of compatible supplies grew from 3.1 mln units in 2004 to 5.9 mln units in 2008. The quantity of compatible supplies sold at the Russia market (not taking refills into consideration) is around 50-60% of all sold original cartridges and comes in the highlight in the entire structure of the printing supplies market (see Fig. 9).

Second, the refill market for laser cartridges built as an addition to the existing services offered by the companies in the market (distributors and dealers of compatible and original cartridges) shaped itself into an independent segment at the market of printing supplies between 2004 and 2008. The total number of refills for laser cartridges is believed to reach the amount of $613-630 in 2008, that is over 80% (!) of the value of the market of original cartridges for laser printers.

Third, the larger portion of refills is attributed to the segment of up to 20 ppm printers. But the market of refills for the segment with speeds within 21-45 ppm for A4 inconspicuous in 2004 ($28-30 mln in value or ~ 900 000 refills) is now catching up and reached the value of $213-220 mln or 7.6 refills in 2008.
Fourth, the analysis of the dynamics of the overall quantity of original supplies in the segments of up to 45 ppm and the total number of refills in these segments shows that the ratio “refills vs. original and compatible cartridges” grew significantly in 2004-2008 (from 1.25 to 2.08). This is a proof to the fact that end users’ trust to refilled cartridges for laser printers is increasing (Tab. 4).

Table 4.
Growth of refills of original cartridges for laser printers (up to 45 ppm, A4).

Thus, the studies accomplished by market research agency Business Inform (Russia) resulted in an evaluation reflecting on the structure and dynamics of Russia’s market of printing equipment and supplies. Business-Inform specialists hope the presented information will be useful to all those interested in the Russia market of laser printing.

This study and its results were presented during RechargRussia Expo 2009 in Moscow in July 2009. The market research agency Business-Inform is the initiator and author of the study. For detailed information about this and other similar studies about Russia's printing market, visit www.bizinform.ru