Canon EMEA operates in a declining market with vendors competing intensely for market share. This is creating a contrast between a business model traditionally driven by new product sales, and an emerging business model that emphasises the cultivation and reutilisation of existing deployed assets. Customers are also increasingly looking for end-to-end managed solutions.
In order to improve profitability and sustainability, Canon EMEA introduced two pathways for recovered printer assets:
- Remanufacturing. Specific printer models are designated for remanufacturing, targeting best-sellers. Remanufactured printers are re-branded and include at least 80% re-used parts.
- Refurbishment. Printers at end-of-contract that are returned to Canon EMEA and which are not target models for remanufacturing will be candidates for refurbishment and re-sale if they are in sufficiently good condition and customers can be found.
Canon EMEA is also growing its Managed Print Service (MPS) offering. MPS focuses on performance outcomes and improvements to customers, rather than being driven by equipment specifications. This enables the deployment of remanufactured and refurbished printers within a service-centric business model, while also maximising the lifetime value of all assets. It also enables take-back/buy-back of printers at end of contract for remanufacturing or refurbishment.
Making the business case for a re-manufacturing or refurbishment models requires a whole lifecycle perspective: considering products in the field (installed base) as a key asset with the potential to drive new and recurring revenues, and that products at end-of-cycle have significant value and potential for re-sale or life extension.
- Integrating remanufactured and refurbished products within a manufacturer’s overall product line-up allows the company to strategically plan new product design and production, and incentivises sales teams to actively offer these products to customers.
- Service-centric propositions such as MPS enable remanufactured and/or refurbished products to be re-deployed together with new equipment, as the focus is on performance outcomes rather than product specifications.
Circular Economy Business Models
To date, the remanufacturing programme has been commercially successful for Canon EMEA. The company has achieved economies of scale for remanufacturing operations, and has successfully positioned remanufactured product with a distinctive brand, emphasising the ‘as new condition’ and the additional benefit of sustainability.
Furthermore, the remanufacturing model enables significant material efficiency and carbon savings compared to manufacturing a new product, as it re-uses at least 80% of materials from the original printer.
Canon EMEA’s refurbishment business remains relatively localised, however there is strong commercial potential for growth. Refurbishment creates important carbon and environmental benefits by extending the lifecycle of machines that are still in working order, and embedding them within a service contract instead of using new equipment.