December january2013 eu

Big InterviewMark Ward,

CEO of O� ceworks p18

Hot Topic:

The word in offi ce. December 2013/January 2014

Spotlight on one of the UK’s fastest-growing dealers p30 Does Paperworld have a future? OPI investigates

magazine

p26p14 Staples steps up a gear

Offi ce Products International

ISSUE NO.235

DECEMBER 2013/JANUARY 2014

WW

W.OPI.NET

www.opi.net | OPI Magazine 3

ContentsDecember 2013/January 2014 www.opi.net

CategoryAnalysis43 Facilities managementThere are plenty of opportunities in the category, but a laid back approach won’t do

47 Business machinesFrom a gloomy outset, there’s still much scope left in this sector

“The problem with Paperworld is that it lost its way; it’s drifting aimlessly into a very

slow death. It needs to reinvent itself, among other things with new category exhibitors. But what the organisers really need to work out is the value that it brings. Is it an exhibition, a meeting venue, a conference?”... For the full article turn to page 26

18 Channel crossingMark Ward tells OPI about Offi ceworks’ ‘every channel’ strategy and his commitment to the retail channel in Australia

18

26

Shows39 Global Forum 2013The great and the good came together for the best ever OPI top executive event yet

40 Big BuyerStrong turnout at Italy’s premier business products event

30

43

News6 Round-upLyreco teams up with WB Mason while SPR expands ECi alliance and TriMega reports success

8 Facilities focusISSA engages with GSA and reports show success

10 AnalysisNew Depot CEO gets down to work; Staples speeds up transformation initiatives

Features

26 Wake-up callWith exhibitors and visitors alike disgruntled and staying away, are Paperworld organisers waking up to the issues? OPI fi nds out...

30 Universal successYoung and innovative – Universal’s Director Steve Manley talks about the art of diversifi cation

37 Climb of Life The 2013 Climb of Life set another record this year, raising more than £81,000

This month’s cover is supplied by Pilot

Regulars5 Editor’s comment

50 On the move

51 5 minutes with...Thomas Illi

52 What’s onKey dates for your calendar

54 Final wordAddison Farrell


Never a dull momentOffice products have frequently been described as not being particularly sexy – and that’s fair enough… probably – but woe betide anyone who accuses this industry of being dull or boring. That was one of the messages that came across very strongly at the recent OPI Global Forum in Chicago, and it was refreshing and motivating to see the genuine enthusiasm for and commitment to the industry shown by the top-level executives in attendance.

It was pretty impressive that in less than two days most, if not all, of the major issues facing industry players were tackled in some way,

leaving the impression that, while there are undoubtedly challenges, there are also enormous opportunities.

So here we are, already at the end of another year (am I the only one who is wondering where 2013 has gone?), and looking back over some of the things that have happened in the past 12 months, 2013 may be seen by future industry observers as something of a watershed year: dealer groups cooperating to a level that hasn’t been seen before; the number two and three global players merging; the number one global player embarking on a re-invention strategy; vendors merging; and online and mobile commerce continuing to explode.

Perhaps it’s the year the industry really woke up to the fact that digitisation is here to stay and we’d better do something about it unless we want to have a ‘Kodak moment’.

Wishing all OPI readers a happy holiday season (and a pleasant summer holiday for southern hemisphere readers) and a prosperous 2014.

Andy Braithwaite , Editor

Editor’s comment EditorialEditor Andy Braithwaite+33 4 32 62 71 07 [email protected]

Features Editor Heike Dieckmann+44 (0)20 7841 2950 [email protected]

Sales and MarketingVP – Continental Europe, Middle East and Africa Ewan Dickson+44 (0)20 7841 2954 [email protected]

VP – North America and UK Chris Turness+44 (0)20 7841 2953 [email protected]

VP – Asia Tony Yao+86 186 021 29588 [email protected]

Digital Manager India Pride+44 (0)20 7841 2959 [email protected]

Sales Executive Fergus Cox +44 (0)20 7841 2952 [email protected]

EventsEvents Manager Lisa Haywood+44 (0)20 7841 2945 [email protected]

Production and FinanceOperations Manager Nicky Coulson +44 (0)20 7841 2943 [email protected]

Designer Charlotte Gerhardt+44 (0)20 7841 2950 [email protected]

Accountant Charles Edwards+44 (0)20 7841 2956 [email protected]

PublishersCEO Steve Hilleard+44 (0)20 7841 2940 [email protected]

Director Janet Bell+44 (0)20 7841 2941 [email protected]

Offi ce Products International Ltd (OPI), Diamond House, 36-38 Hatton Garden, London EC1N 8EB, UK

Tel: +44 (0)20 7841 2950Fax: +44 (0)20 7841 2951

OPI is printed in the UK by

Follow us onlinefacebook.com/opimagazine

opi.net/linkedin @opinews

CBP0009242909111341

The carrier sheet is printed on Satimat Silk paper, which is produced on pulp manufactured wood obtained from recognised responsible forests and at an FSC® certifi ed mill. It is polywrapped in recycleable plastic that will biodegrade within six months.

While there are undoubtedly challenges, there are also enormous opportunities

No part of this magazine may be reproduced, copied, stored in an electronic retrieval system or transmitted save with written permission or in accordance with provision of the copyright designs and patents act of 1988. Stringent efforts have been made by Offi ce Products International to ensure accuracy. However, due principally to the fact that data cannot always be verifi ed, it is possible that some errors or omissions may occur. Offi ce Products International cannot accept responsibility for such errors or omissions. Offi ce Products International accepts no responsibility for comments made by contributing authors or interviewees that may offend.

Lyreco teams up with WB MasonWB Mason is Lyreco’s new global contracts partner in the US. Lyreco had previously partnered with OfficeMax for servicing its US global accounts, but this arrangement has come to an end following its merger with Office Depot. Although ‘Max doesn’t directly compete with Lyreco in Europe, that obviously isn’t the case for Depot, meaning that Lyreco was forced to find another partner – much like it had to do when Staples acquired Corporate Express in 2008.

“There are incredible similarities between Lyreco’s growth in its home markets and that of WB Mason in the US,” said Lyreco CEO Steve Law. “The culture and spirit already developed between the senior teams of both companies has been excellent. However, what strikes me most is our mutual passion for customer service and close proximity to customers through an external professional salesforce.”

Speaking to OPI, Law said that existing customers under the OfficeMax arrangement would be serviced until their contracts expired – which would take up to 36 months until the final contract ended – and that he was “pleased with the professionalism” of OfficeMax in this regard.

He added that Lyreco and WB Mason would begin working on new contract opportunities “with immediate effect” and that all systems were in place to enable them to “hit the ground running”.

NOPA & OFDA boards combinedA major development has been announced at US trade association NOPA following a restructuring of the Independent Office Products and Furniture Dealers Association (IOPFDA). The NOPA board is to be combined with that of its sister division at the Office Furniture Dealers Alliance (OFDA) into a single IOPFDA board.

In addition to the existing IOPFDA board, which is made up of chairs, past chairs and vice chairs of both NOPA and OFDA, those directors whose terms continue beyond 2013 will be incorporated into the new IOPFDA board. This board will make up the foundation for the association’s operations and joint programmes, while both NOPA and OFDA will continue to function as divisions of the association, with committees formed to address division-specific issues.

“By consolidating the three boards into one, with representation by both office products and office furniture dealers, the IOPFDA will act as the individual voice that dealers trust,” said Mike Tucker, President of office products dealer George W Allen and current Chair of IOPFDA.

The new board structure follows an assessment of IOPFDA by management company Clemons & Associates which took over the running of the association a few months ago.

The IOPFDA team includes Managing Director Paula Kreuzburg and Director of Marketing and Communications Alicia Ellis. NOPA can also count on Paul Miller who is to remain as Director of Government Affairs.

PaperlinX accuses Sappi of anti-competitive behaviourPaper merchant PaperlinX has filed a formal complaint accusing supplier Sappi Europe of breaching European and German competition laws.

Sappi has supplied paper products to PaperlinX and its subsidiaries in Germany and other EU countries for a number of years under the parties’ longstanding commercial relationship. However, PaperlinX is now accusing Sappi of restricting the customers to which the merchant can make indent sales, where delivery is made from directly from Sappi to PaperlinX’s customers.

PaperlinX believes Sappi has effectively assigned customers between paper merchants, ensuring that PaperlinX sells Sappi paper products to only certain customers via indent sales and restricting the freedom of PaperlinX under EU and German competition law to sell to whoever it wishes.

The paper merchant commented Sappi had been “unwilling” to engage with it to resolve these issues commercially, forcing it to make a complaint with the competition authorities.

Sappi said that it had been aware of the allegations for some time and would “continue to reject them as being entirely unfounded”.

OPI Magazine | December 2013/January 20146

News from opi.net

Mike Tucker

Amazon reveals drone delivery plansAmazon has unveiled Amazon Prime Air, a project that will see deliveries via unmanned ‘octocopter’ drones. The e-commerce giant said that the goal of this new delivery system was to get packages into customers’ hands in 30 minutes or less.

“I know this looks like science fiction, but it’s not,” Amazon CEO Jeff Bezos said on US TV. “We can do half-hour delivery [...] and we

can carry objects up to five pounds (2.3kg), which covers 86% of the items that we deliver.”

The move coincides with US Federal Aviation Administration (FAA) plans to allow the use of civilian drones by 2015. Europe is expected to follow suit in 2016.

“One day, Prime Air vehicles will be as normal as seeing mail trucks on the road today,” Amazon added on its website.

TriMega reports record yearTriMega has said that member purchases through its buying programmes were at a record level up to the end of October this year.

The US dealer group confirmed that central bill volume was 6.5% up on 2012 till that time, a record performance. The group also said the growth rate and year-to-date trends were due to net increases in membership – now at 588 – and general organic growth from legacy members.

TriMega EVP Member Services Grady Taylor told OPI that the best performing categories were jan/san, breakroom and IT.

Given the issues that many resellers are facing in the technology category, IT may appear to be a surprising growth area for TriMega, but Taylor confirmed that the group’s membership included a number of IT-focused

e-tailers that were “growing dramatically”.

“We remain optimistic about the remainder of Q4 and all of 2013,” added Taylor. “Depending on a category mix shift, we believe 2014 should be a strong year for membership patronage as well.”

SP Richards and ECi expand allianceWholesaler SP Richards and software provider ECi have announced an expansion of their strategic alliance.

Building on an agreement the two firms entered into in 2010, both parties will continue to invest in new software functionality designed to enhance and improve the independent dealer experience, including joint development on ECi’s e-commerce platform ECinteractivePLUS.

As part of the extended relationship, SP Richards’ item files will be integrated with the ECi La Crosse and e-automate ERP systems, in addition to their current integration with the OMD ERP system for office equipment dealers. Integration with the ECi TeamDesign contract furniture software is also in progress. These integrations will be launched in the first quarter of 2014.

Corwell on track with facility expansionEuropean wholesaler Corwell says it is making good progress with the expansion of its warehousing facilities. Work to double the storage capacity of Corwell’s main facility just outside Budapest began in October and the wholesaler is planning to start using parts of the new building from next April.

In addition to the increased warehouse space, Corwell’s offices will be extended to provide a more comfortable working environment. Enhancements include bigger meeting and conference rooms for both customers and vendors.


News

n Rou

nd-u

p

Grady Taylor

ISSA engages with GSA over federal jan/san contractAs OPI went to press, ISSA said that it is still hoping the General Services Administration (GSA) will make modifications to the new federal jan/san contract. Responses to the GSA’s request for quotations (RFQ) for the new jan/san contract were due by the end of 5 December, but ISSA hoped the agency would still take into account proposed changes following dialogue between the two parties over the past few weeks.

Jan/san is the latest category to come under the GSA’s strategic sourcing initiative for federal purchasing (FSSI) and the RFQ proposes to restrict the number of jan/san suppliers to the federal government to 21 blanket purchase agreements (BPAs).

ISSA believes these proposals will have a serious economic impact on the approximately 1,000 small businesses that supply jan/san products to federal customers at present.

The association has put forward a number of proposals of its own to the GSA, which include:• increasing the number of BPAs from 21 to 100• implementing an ‘onboarding’ and small business recertification

strategy that would allow small businesses to be added during the lifetime of the contract

• creating a pool or preference for buying groups• making the new contract non-mandatory or reducing the targeted level

of spend going through the BPAsISSA has said that it is waiting for the GSA’s response to the above

suggestions and has not ruled out the possibility of filing an official protest if the GSA continues to move forward with implementing the RFQ as drafted.

A protest would have the effect of slowing the process down and also provide the industry with the opportunity to negotiate a preferred outcome with GSA officials, ISSA added.

US-based manufacturer rep group Harbinger National has added Market Access Canada (MAC) to its portfolio.

Harbinger, which has a strong presence in the jan/san category, was set up two years ago by former OfficeMax contract division President Mike Rowsey and ex-Fellowes sales chief Bob Compagno.

Joining the Harbinger team are Dwaine and Teague Chrustie, Principal and National Account Manager at MAC respectively.

Dwaine, also the President of MAC, brings with him more than 25 years of sales and management experience, while Teague oversees new channel development in the mass market, e-commerce and technology sectors. MAC is also supported by a national network of co-agents, offering sales coverage in multiple product categories and markets across Canada.

“The timing of the addition of MAC is key for Harbinger National to expand its service to Canada with a North American strategy,” said Rowsey.

Bumper turnout at ISSA/Interclean North AmericaA strong line-up of keynote speakers led to a bumper year at the ISSA/Interclean show in Las Vegas from 18-21 November.

The US jan/san trade association said the seminar programme attracted the highest number of registrants for nearly a decade. Exhibitor numbers were also up, with 143 of the 690 companies participating for the first time. The exhibition featured suppliers from 29 countries, while 21% of visitors came from 78 countries outside the US, underlining the growing international importance of the event.

More than 1,700 people packed the keynote stage area on the Thursday morning to hear from David Blaine. The magician followed an ISSA Excellence ceremony that honoured longstanding ISSA members, as well as the ten Best Service Awards winners.

ISSA used the show to present two of its new programmes, the Transpare.com online registry and its K-12 Clean

Standard, the world’s first scientific-based standard for measuring the effectiveness of ‘clean’ in educational establishments.

Other topics covered during the sessions included the new FSSI jan/san contract (see below) and CIMS, the professional standard for clean, health and sustainable facilities.

The next ISSA/Interclean North America will take place from 4-7 November 2014 in Orlando, Florida.

Promotion for Paradigm’s Bianculli JrJan/san and breakroom products manufacturer Paradigm recently promoted Ralph Bianculli Jr to VP of its Emerald Brands USA unit. Bianculli has been with Paradigm Group – founded in 1999 by his father Ralph Bianculli Snr – since 2006.

Harbinger takes Market Access to Canada

Phot

o: V

enic

e Pa

para

zzi

Mike Rowsey

• making the new contract non-mandatory or reducing the targeted level

Don’t forget to visit opi.net for

more of the latest Facilities

Management news


News

■ Facilities focus

News

n An

alysis


As expected, the US Federal Trade

Commission (FTC) didn’t stand in the way of the proposed merger between Office Depot and OfficeMax, voting unanimously at the beginning of November to approve the $1.2 billion transaction. With the FTC decision out of the way, the closing of the deal was announced just a few days later on 5 November.

There was a bit of a limbo period with the newly merged companies lacking a permanent CEO and headquarters, although it was announced from the start that the company name would be Office Depot, and OfficeMax was now a wholly owned subsidiary – despite continued reference to a merger of equals. To be fair ‘Max does have equal representation on the new board of directors – but one wonders just how much of an influence these directors will have. After all, the boards of both Office Depot and OfficeMax have been accused of impotence to varying degrees over the past few years.

Key decisionsSince mid-November, however, a number of key decisions have been taken. The first was the appointment of Roland Smith, the former CEO of supermarket group Delhaize America, as Chairman and CEO. Smith comes with something of a reputation as a turnaround and integration expert from his time at Delhaize, the Wendy’s restaurant group, American Golf Corporation

and bowling centre operator AMF. The 59-year-old only took on the CEO role at $18 billion Delhaize America in November 2012, but implemented a number of major changes at the group’s Food Lion chain – including closing underperforming stores and reducing corporate overheads – and sold off its Sweetbay, Harveys and Reid’s supermarkets to Bi-Lo.

Smith wasted no time bringing in a new CFO, former AMF, Arby’s and Wendy’s colleague Steve Hare, as the first confirmed member of his senior management team, although this appointment was greeted with surprise in

some quarters as it meant the retirement of Office Depot’s CFO Mike Newman. “We viewed Mr Newman as highly qualified, and the most important executive at the company during the transition period,” said Janney analyst David Strasser in a client note. “We have known him for years, and have always thought of him as a strong CFO with strong operational and financial skills.” However, the CFO appointment clearly shows that Smith is not afraid to make tough decisions, something he is likely to have to do frequently in the coming months.

The full line-up of the new executive team

should be known by the end of this month. Once this management team is in place – and with the headquarters decision now taken – the integration process will begin in earnest in January. And that’s when the huge challenge of bringing together two former fierce competitors will really start.

Now the hard work beginsNew Office Depot senior management team expected to be in place by the end of December

Just as this issue of OPI went to press, Office Depot confirmed that the headquarters of the merged companies would be in Boca Raton, Florida. Depot will stay at its current 625,000 sq ft (62,500 sq m) campus in Boca Raton which, it said, has “ample space” to accommodate staff that transfer from OfficeMax’s headquarters in Naperville, Illinois.

How many staff make the trip from Naperville remains to be seen, and Office Depot spokesperson Brian Levine told OPI that it was “too early to estimate” the number. There are approximately 1,600 headquarters staff in Illinois and 1,700 in Boca Raton, many over them in overlapping positions. “We will select the best talent available from both locations,” said CEO Roland Smith, giving hope to those currently located in Illinois, but the number of positions eliminated is likely to be quite significant.

Office Depot said that it would maintain a presence in Naperville throughout the headquarters transition and accompanying integration activities, but did not specify a timeframe for the move. The headquarters decision does not impact OfficeMax or Office Depot retail stores, customer service centres, warehouses or distribution centres, and these will continue to operate on “a business-as-usual basis”.

The question of whether Florida or Illinois would be chosen as the preferred location was the subject of much speculation in the US press after the merger was confirmed in November, with consensus opinion suggesting Office Depot would select the state which offered the most attractive tax-incentive package.

Illinois had recently stalled on its incentives proposals and it appeared that Florida was already in the driving seat to be selected. The press release confirming the choice of Boca Raton referred to “the generous support we have received from the State of Florida, Palm Beach County and City of Boca Raton”, but did not provide any further details.

“Incentives from the State of Florida, Palm Beach County and City of Boca Raton were part of the analysis of the headquarters decision,” Levine told OPI, adding: “Until final contracts are entered into with the state, county and city, we do not plan to disclose the amount or nature of the incentives.”

Boca Raton gets HQ nod

Roland Smith: reputation as a turnaround and integration expert

News

n An

alysis


THE coming together of PBS Deutschland

and Georg Kugelmann, effective 1 December, marked what’s widely regarded as the beginning of a renewed and much needed period of consolidation among the German wholesale community.

The deal, which saw PBS Deutschland – the German wholesaling subsidiary of Austria-based parent PBS Holding – buy the “sales and distributions structures” of competitor Kugelmann, came as no great surprise to the country’s OP community at large. And, while it may not have far-reaching consequences for Germany’s OP industry as a whole as several resellers told OPI, it nevertheless puts the spotlight on two companies with a variety of challenges, as well as a wholesale sector that is overcrowded and oversaturated.

Kugelmann is a longstanding German business, dating back to 1840, and a sizeable company with about 120 employees and 2013 sales of €23 million ($38 million). But over the past couple of years it has seemingly lost its way a little.

This is partly a result of too strong a focus on its own brand PAPERheart – own brands still don’t quite enjoy the same popularity in the German market as they do in, say, the UK – especially in the school supplies sector, as well as an oversized and overstocked warehouse.

Rumour has it that the firm was in dire financial straits and would not have seen out this past year.

One down, many to go…As one of Germany’s largest OP wholesalers, PBS Deutschland, buys another in the form of Georg Kugelmann, the spotlight is cast on a rather overcrowded sector

As such, the bait was allegedly thrown to a number of potential candidates, including Berlin-based Iden Group, southern Germany’s soft-carrier and of course PBS Deutschland.

LeadershipEach get-together would presumably have had some merits, but the latter was clearly regarded as the best way forward for Kugelmann’s Managing Director Klaus Danne.

And Danne himself has landed one of the top jobs at

new owner PBS Deutschland. He is now Managing Director of the wholesaler, jointly with Martin Kunow who also holds a Managing Director role. But, according to PBS Holding CEO Richard Scharmann, Kunow in fact occupies more of a CEO position.

Again, the rumour mill suggests that Danne’s appointment comes at a time of a seemingly rudderless direction at PBS Deutschland following the departure of

Jörn Lambertz in 2012, so it will be interesting to see who takes charge in the weeks and months to come.

Danne brings with him good credentials in the areas of field sales and distribution, areas where PBS Deutschland too hasn’t shone over the years.

In terms of customer base, the two companies are fairly well aligned. They can both be described as nationwide operators and the acquisition essentially means one eliminated competitor, although the new entity

is also hoping for a more comprehensive B2B as well as B2C coverage. Scharmann told OPI: “Kugelmann is servicing the whole German market with a strong focus on B2C retailers. Integrating its structures into the PBS Deutschland network will strengthen our position significantly, in terms of field reps and customer coverage.”

He added that the acquisition should increase

his company’s market value considerably, forecasting total sales approaching €100 million. “PBS Deutschland will be by far the dominating B2B/B2C wholesaler focusing on a comprehensive field organisation, fully integrated service models, including ERP and ordering systems, and finally state-of-the-art logistics services.”

New Germany focusThe acquisition comes only a few months after Biella’s wholesale operations in Poland were signed over and integrated into PBS Holding’s PBS Connect Polska, and just over a year after the multichannel operator acquired certain assets of OTTO Office in the Czech Republic and Slovakia. Indeed, the company has mostly recently focused its attention on Central and/or Eastern European markets – Slovakia, the Czech Republic and Poland, for example.

In Germany meanwhile, activities have remained

largely under the radar over the past couple of years. There has only been one small acquisition of regional wholesaler Härtel since PBS Holding’s spending spree several years ago when it bought regional wholesalers Kanzenel & Beisenherz, R&S, Hermann & Meyding and Alka and then, back in 2008, book and OP wholesaler Schreyer.

Now is clearly the time to change that again, with

“I believe this is just the beginning of wholesale consolidation in Germany. It’s high time the wholesale scene

in the country was newly defined”

Klaus Danne and Martin Kunow


News

n An

alysis

several industry peers agreeing that the need for consolidation in Germany, particularly in the wholesale sector, is ever increasing.

One of them is Thomas Apelrath, Managing Director of fellow wholesaler and major

competitor ADVEO. He said: “I believe this is just the beginning of wholesale consolidation in Germany. It will be interesting to see the effect this consolidation will have on purchasing groups like InterES of which Kugelmann is a member. It’s high time the wholesale scene in Germany was newly defined.”

Büroring’s Managing Director Ingo Dewitz added: “It is always regrettable when an industry

player has to give up its independence, especially one that has such strong roots and traditions in the German OP wholesale sector. I’m particularly sad about this loss of independence because Kugelmann has always

fought very hard the cause of independent dealers.

“That said, this is the kind of market development that will continue. I am sure that changes are afoot in the wholesale sector and that we will see more action over the next few years.”

Dewitz in particular had more than a passing interest in Kugelmann. The wholesaler had in fact been the chosen partner for Büroring’s recently announced

“PBS Deutschland will be by far the dominating B2B/B2C wholesaler [in the German market]”

virtual warehouse because of its focus on school supplies. As a result of the takeover, however, the partnership came to a sudden halt, with Dewitz assessing all his options, including presumably a straightforward swap to the new PBS Deutschland/Kugelmann entity.

(For more info on this and the activities of Büroring in general, look out for our Big Interview with Dewitz in February OPI.)

Staff uncertaintiesAs always with any M&A activity where the various parties complement and overlap each other rather than adding a completely new facet, it must be a difficult time for staff. We can only assume that there’s no way PBS Deutschland will need a further 120 staff, nor a big under-used warehouse.

Answers to those questions will no doubt come over the next few months as the integration process gets under way and is completed – within about six months, according to Scharmann.

News

n An

alysis


Retail woes – and not just in

the office supplies channel – have been well documented over the past few years, but as consumer electronics retailer Best Buy recently showed, turnarounds can be achieved with a focused strategy and strong execution.

Staples isn’t quite there yet – retail is not the only string to its bow, of course – but it’s not far off as it accelerates its beyond office supplies (BOSS) strategy. Massive SKU expansion, a vertical markets focus, large digital commerce investments and store network optimisation: Staples is leading the charge on a number of fronts as it aims to reinvent itself as, in the words of CEO Ron Sargent, “the destination for every product that businesses need to succeed”.

Apple progressAt retail, the 3% comparable decline at Staples’ US stores in the third quarter was entirely due to lower customer traffic, so actually getting people into stores remains a key issue.

Staples steps up a gearIt was another tough quarter for Staples, but it continues to make progress with its strategic transformation

Stocking Apple hardware would be a major boost in that respect, and Staples continues to edge towards that goal as it expands its relationship with Apple to the online channel in the US.

During the Q3 earnings conference call, North American Stores and Online (NASO) President Demos Parneros said that the relationship with Apple was “moving along just fine”, but that there was “a little more work to do” before he could talk about being able to stock iPhones, iPads and iPods in Staples’ stores.

Staples added 70,000 new products to its .com assortment in the third quarter and is on track to reach its target of 300,000

online SKUs by the end of the year. Sargent gave more details of Staples’ verticals strategy as it targets specific business sectors. Schools (early education products) and retailers (retail point-of-sale supplies) have been two of these and now

Staples is adding more than 20,000 products aimed at the restaurant vertical.

Sargent revealed that these new BOSS categories are adding

$3 million per week in incremental sales on the Staples.com, Staples.ca and Quill.com sites, while adjacent categories such as furniture, facilities and breakroom, print and promotional products will account for about $200 million in incremental revenue in the North American Commercial (NAC) division this financial year.

Aggressive restructuringDeclines in traditional categories – which are still happening faster than expected – as well as investments in online initiatives and new categories have hit profits and are being paid for with more aggressive restructuring actions. More than 1,400 jobs were cut in the third quarter, including about 15% of VPs and Directors in North America. About half of the redundancies were from the International division, including a further 600

from Europe in addition to the 1,000 positions that have already been eliminated in the past 12 months. In all, the European workforce will have been reduced by about 20% over a two-year period.

In North America, some traditional OP sales reps have been replaced by adjacent category specialists in what is being called a “reinvention” of the contract salesforce as Staples looks to accelerate its BOSS strategy amongst corporate customers.

The changes haven’t finished either. Mike Patriarca has been drafted in from Quill.com to fill the

new role of SVP of Global Transformation, and he will lead an initiative aimed at further reducing costs.

Commenting on the recent Office Depot/OfficeMax merger, Sargent said the “disruption” caused by this transaction would benefit Staples, and the NAC division reported strong customer acquisition and retention rates – although these weren’t specifically attributed to the merger. NAC President Joe Doody said the focus during the

next few quarters would be to drive increased sales with existing customers as part of the BOSS strategy.

In the US, Staples is virtually synonymous with ‘office supplies’. And while it’s great to have that strong brand recognition, it’s also a bit of a millstone around the company’s neck as it looks to achieve credibility in other product categories and services. That’s why Staples is preparing for a major brand relaunch in the new year. Details haven’t been released yet, but it is set to be the biggest campaign since the ‘That was easy’ tagline was introduced ten years ago.

Staples is adding more than 20,000 products aimed at the restaurant vertical

• Totalsalesof$6.1billion,anunderlyingdeclineof2%

• NorthAmericanStoresandOnline(NASO)salesof$3billion,withUSsame-storeretailsalesdown3%

• Staples.comsalesup3%• NorthAmericanCommercial

(NAC)salesup1%to$2.1billion

• Internationalsalesdown7.6%to$1billion

• Adjustedoperatingprofitof$430.7million,almost14%lowerthanlastyear

StapleS’ Q3 reSultS at a glance

RonSargent:Bigpushbeyondofficesupplies


News

■ An

d � nally...

CommentTWEET CHAT follow us on Twitter @OPInews, @andy_opi,

@Staples RT to inspire your followers to use K-Cups to perk up their holiday decorations this year!

@AveryProducts Homemade edible treats make some of the best presents. Wrap up your goodies with personalised Avery labels and tags.

@npdgroup If Amazon can deliver packages by drone, what about drone #pizza delivery?

opi.net poll resultsHow was your Q3 2013 performance compared with the same period last year?

$57.4 bi l l ion

Total retail spend in the US during the Thanksgiving

weekend, according to the National Retail Federation – a 2.7%

drop on last year

200million Number of LaserJet

printers HP has shipped since 1984

11% Rise in attendance at this year’s offi ce*

show in London

SNAP SHOT

A disaster

Amazon is to start Sunday delivery in the US. What do you think this will mean for office suppliers going forward?

Andrew Stephens, Account Manager, Egyptian StationersHow many office managers or purchasing agents are in the office on Saturday placing orders? Then how many of those same offices or companies are open on Sunday to receive the order? I don’t see this as nearly as big a threat as the same-day delivery that Amazon is unleashing.

Lia Michael, Director, Office Power AustraliaWe can all say it will not have an effect on our business, but do we realise that the staff who buy office supplies spent time on their computer at home and look at what deals they can receive for work? They hope that this will give them an increase in wages or promotion to a better position in the workplace. We all have different thoughts and opinions, but so do the staff.

Lance Brams, VP Sales, Sunset Office SupplySunday delivery may appeal to the home office segment, but luckily I don’t see it having any effect on the Mon-Fri 9-5 businesses. Regardless of when they deliver, they still don’t have the personal touch that so many purchasing agents want and need.

Larry Goodman, Director of Marketing, SP RichardsI agree with the above posters. It may be embraced by a certain customer segment, though for most office products dealers not the segment they serve to any great extent. Still, it is another inroad for Amazon to touch consumers in a positive way and build affinity to their brand.

November was Movember – the moustache-growing month to raise awareness of prostate cancer. Six staff members at UK dealer services group nectere got into the spirit of things by growing ‘mos’ for the month, raising money for prostate cancer research at the same time.

Worse About the same Terrific 8% 26% 19% 14%

Don’t forget to take part in the

discussions on the OPI

LinkedIn page

@npdgroup If Amazon can deliver

Better 33 %

News

Big Interview | Mark WardBig Interview | Mark WardMark Ward

Channel crossingThere is still “huge” potential in the business supplies market, Offi ceworks CEO Mark Ward tells OPI

BIG BOX sales and profit growth – not to mention retail

expansion – isn’t something you see every day in today’s OP world. One notable exception is Australia’s leading multichannel player Officeworks. In its most recent financial year, sales increased almost 2% to A$1.51 billion (US$1.4 billion) and EBIT jumped more than 9% to A$93 million. When we found out that CEO Mark Ward was attending the World Retail Congress in Paris in early October, OPI Editor Andy Braithwaite hopped on a train and met up with Ward in the French capital to find out more about Officeworks’ recent success and its strategic direction.

OPI: When we last did the Big Interview with you [in March 2008], you’d only been at Officeworks a few months and the global financial crisis hadn’t kicked in. How would you summarise those six years in charge?Mark Ward: We’ve spent the past six years or so resetting the foundations of what the business is about and what we wanted to deliver to the customer. So we’ve spent a lot of time and effort on updating the stores and getting the ranges right, introducing everyday low prices and focusing on our service areas. We’ve made investments in the systems, the processes and the people to put us in a strong position to continue growing – which we have done.

OPI: And since then you’ve developed this multichannel strategy? MW: Yes, we call it ‘every channel’. We put ourselves where we believe our customers expect us to be, whether that’s online, mobile, in the store, via phone, fax or social media. And across all that is the same offer; so the same range, the same price and the same service. That’s why we’re calling it every channel and we encourage the customers to use the channel that suits them so that they’re able to shop whenever, wherever and however they want to.

OPI: In the last full year you achieved just slightly above A$1.5 billion in sales.MW: Yes, the first time we’ve hit A$1.5 billion, which was a really good result for us. We’ve also opened our 150th store and we had a really good profit result from a lot of good work from our team. So we’re very pleased.

OPI: Your EBIT margin was 6.2% of sales. Is that the key indicator your shareholders are looking at?MW: No, return on capital is what the shareholders are looking at. That’s still not where we want it to be so we’ve got some work to do, but as I said we spent six years addressing and improving the foundations of the business to put us in a position to drive faster growth and increase our return to shareholders.

OPI: And what kind of EBIT figure are you looking at?MW: We would ideally like to get above A$100 million as a first step. That’s a good psychological bridge to cross, and then we go from there. We’d like a bottom line of about 8% EBIT to sales. We think that’s pretty much best practice around the world.

OPI: When you look at the EBIT growth, how much of that is due to efficiencies and cost cutting?MW: Our merchandising team has done a really good job of buying better and getting better terms. I think across our business we’ve done a lot on efficiency without the need to cut costs, so they’re different things entirely. We focus on improving processes and the way we do things and then take a proportion of that for the shareholders, and the rest you then reinvest in the business. So we have not had to implement any redundancies or major cost-cutting exercises; it’s actually just been about a mindset of ‘if you want the lowest prices then you have to have the lowest costs’, and that’s what we continue to do.

OPI: We hear a lot about the challenges of retail in general.

“We have not had to

implement any redundancies

or major cost-cutting exercises”

ChannelChannelChannelChannelChannel crossingcrossingcrossingcrossingcrossingThere is still “huge” potential in the business supplies There is still “huge” potential in the business supplies There is still “huge” potential in the business supplies There is still “huge” potential in the business supplies There is still “huge” potential in the business supplies market, Offi ceworks CEO Mark Ward tells market, Offi ceworks CEO Mark Ward tells market, Offi ceworks CEO Mark Ward tells market, Offi ceworks CEO Mark Ward tells market, Offi ceworks CEO Mark Ward tells OPI

sales and profit growth – not to mention retail

expansion – isn’t something you see every day in today’s OP world. One notable exception is Australia’s leading multichannel player Officeworks. In its most recent financial year, sales increased almost 2% to A$1.51 billion (US$1.4 billion) and EBIT jumped more than 9% to A$93 million. When we found out that CEO Mark Ward was attending the World Retail Congress in Paris in early October, OPI Editor Andy Braithwaite hopped on a train and met up with Ward in the French capital to find out more about Officeworks’ recent success and its

OPI: When we last did the Big Interview with you [in March 2008], you’d only been at Officeworks a few months and the global financial crisis hadn’t kicked in. How would you summarise those six years in charge?

We’ve spent the past six years or so resetting the foundations of what the business is about and what we wanted to deliver to the customer. So we’ve spent a lot of time and effort on updating the stores and getting the ranges right, introducing everyday low prices and focusing on our service areas. We’ve made investments in the systems, the processes and the people to put us in a strong position to continue growing – which we have done.

OPI: And since then you’ve developed this

Yes, we call it ‘every channel’. We put ourselves where we believe our customers expect us to be, whether that’s online, mobile, in the store, via phone, fax or social media. And across all that is the same offer; so the same range, the same price and the same service. That’s why we’re calling it every channel and we encourage the customers to use the channel that suits them so that they’re able to shop whenever, wherever and however they want to.

OPI: In the last full year you achieved just OPI: In the last full year you achieved just OPI: In the last full year you achieved just slightly above A$1.5 billion in sales.slightly above A$1.5 billion in sales.slightly above A$1.5 billion in sales.MW: Yes, the first time we’ve hit A$1.5 billion, Yes, the first time we’ve hit A$1.5 billion, Yes, the first time we’ve hit A$1.5 billion, which was a really good result for us. We’ve also which was a really good result for us. We’ve also which was a really good result for us. We’ve also opened our 150th store and we had a really opened our 150th store and we had a really opened our 150th store and we had a really good profit result from a lot of good work from good profit result from a lot of good work from good profit result from a lot of good work from our team. So we’re very pleased.

OPI: Your EBIT margin was 6.2% of sales. Is that the key indicator your shareholders are looking at?MW: No, return on capital is what the shareholders are looking at. That’s still not where we want it to be so we’ve got some work to do, but as I said we spent six years addressing and improving the foundations of the business to put us in a position to drive faster growth and increase our return to shareholders.

OPI: And what kind of EBIT figure are you looking at?MW: We would ideally like to get above A$100 million as a first step. That’s a good psychological bridge to cross, and then we go from there. We’d like a bottom line of about 8% EBIT to sales. We think that’s pretty much best practice around the world.

OPI: When you look at the EBIT growth, how much of that is due to efficiencies and cost cutting?MW: Our merchandising team has done a really good job of buying better and getting better terms. I think across our business we’ve done a lot on efficiency without the need to cut costs, so they’re different things entirely. We focus on improving processes and the way we do things and then take a proportion of that for the shareholders, and the rest you then reinvest in the business. So we have not had to implement any redundancies or major cost-cutting exercises; it’s actually just been about a mindset of ‘if you want the lowest prices then you have to have the lowest costs’, and that’s what we continue to do.

OPI: We hear a lot about the challenges of retail in general.

crossingThere is still “huge” potential in the business supplies

OPI: In the last full year you achieved just slightly above A$1.5 billion in sales.

Yes, the first time we’ve hit A$1.5 billion, which was a really good result for us. We’ve also opened our 150th store and we had a really good profit result from a lot of good work from good profit result from a lot of good work from good profit result from a lot of good work from

OPI: Your EBIT margin was 6.2% of sales. Is OPI: Your EBIT margin was 6.2% of sales. Is OPI: Your EBIT margin was 6.2% of sales. Is that the key indicator your shareholders

shareholders are looking at. That’s still not where we want it to be so we’ve got some work to do, but as I said we spent six years addressing and improving the foundations of the business to put us in a position to drive faster growth and

OPI: And what kind of EBIT figure are you

A$100 million as a first step. That’s a good psychological bridge to cross, and then we go from there. We’d like a bottom line of about 8% EBIT to sales. We think that’s pretty much best

OPI: When you look at the EBIT growth, how much of that is due to efficiencies

Our merchandising team has done a really good job of buying better and getting better terms. I think across our business we’ve done a lot on efficiency without the

processes and the way we do things and

reinvest in the business. So we have not

“We have not had to

implement any redundancies

or major cost-cutting exercises”


by Andy [email protected]

Offi ceworks | Big InterviewOffi ceworks | Big Interview

Are you happy with the general health of your retail network?MW: Yes, we’ve spent a lot of time over the past few years reshaping the network and adding a lot of new stores. I think we’ve opened or relocated more than 40 stores in the past

five years and we’ve also upgraded about the same number.

OPI: I think about half the stores are now in your updated format.MW: Yes, and in some shape or form every store’s been touched. During this financial year we will touch nearly every store with our biggest programme ever, expanding and

realigning ranges across the entire network.

OPI: What new categories are you developing at retail

level?MW: Well, if you look at the total

addressable market – which is about A$30 billion if you include

things like advanced print and copy, commercial furniture and technology

– it’s clear that there is plenty of runway ahead of us, and with all the foundations in place we’ve entered a

new phase where we can focus on a wider opportunity set.

I think we’ve become much stronger in

printing and

copying. We introduced the first self-serve printing units into Australia last year; that’s been quite significant for us and a very big growth engine.

Canteen and cleaning products have been huge. We’ve put a lot of effort into that in the past 36 months and that’s getting exceptional growth for us, as it is for a lot of OP players around the world.

The cables area is something relatively new to us; we saw an opportunity to expand that in Australia because there weren’t too many destinations for it. Every piece of tech that you and I have got has a cable and an adaptor, so that’s been a big expansion for us.

At the same time we’ve worked to innovate in mature categories like writing instruments by freshening them up with things like loose pens – that way we can provide choices that are exciting for our customers. We’re also embarking on a journey to build a very strong commercial furniture base, which we’ve never really been in.

OPI: You’ve said before that you don’t believe in the death of retail and that the retail network is key to your future.MW: Absolutely. We are an every channel business, but we understand that what’s unique about a web-based business is a great range of products, you’ve got to be in stock, you’ve got to have very efficient delivery, you’ve got to have great information and visuals on your website and there have to be minimal clicks to order. But we also understand, in a store sense, that if you want to keep that business thriving then you have to add uniqueness to it.

So that’s where we do things that a lot of stores don’t do: things like the loose pens I

mentioned; we do information classes for customers every weekend; community

groups use our stores to raise funds; we’ve got free meeting rooms for any customer to use in our stores. So we work really hard on making sure that we’re giving customers a reason to visit. Stores will die if we don’t give customers a reason to visit them and those that are dying reflect the mindset of their owners.

OPI: What is the mix of customers – business versus consumers – at your stores, and is that at where you want it to be?MW: It’s about 60/40 – 60% personal shoppers in a broad sense and 40%

Are you happy with the general health of your retail network?MW: Yes, we’ve spent a lot of time over the past few years reshaping the network and adding a lot of new stores. I think we’ve opened or

copying. We introduced the first self-serve printing units into Australia last year; that’s been quite significant for us and a very big growth engine.

Canteen and cleaning products have been huge. We’ve put a lot of effort into that in the past 36 months and that’s getting exceptional growth for us, as it is for a lot of OP players


At the same time we’ve worked to innovate At the same time we’ve worked to innovate At the same time we’ve worked to innovate in mature categories like writing instruments in mature categories like writing instruments in mature categories like writing instruments by freshening them up with things like loose by freshening them up with things like loose by freshening them up with things like loose pens – that way we can provide choices that pens – that way we can provide choices that pens – that way we can provide choices that are exciting for our customers. We’re also are exciting for our customers. We’re also are exciting for our customers. We’re also embarking on a journey to build a very strong embarking on a journey to build a very strong embarking on a journey to build a very strong commercial furniture base, which we’ve never commercial furniture base, which we’ve never commercial furniture base, which we’ve never

OPI: You’ve said before that you don’t believe in the death of retail and that the retail network is key to your future.

Absolutely. We are an every channel business, but we understand that what’s unique about a web-based business is a great range of products, you’ve got to be in stock, you’ve got to have very efficient delivery, you’ve got to have great information and visuals on your website and there have to be minimal clicks to order. But we also understand, in a store sense, that if you want to keep that business thriving then you have to add uniqueness to it.




OPI: What is the mix of customers – business versus consumers – at your stores, and is that at where you want it to be?MW: It’s about 60/40 – 60% personal shoppers in a broad sense and 40%

relocated more than 40 stores in the past five years and we’ve also upgraded about

the same number.

OPI: I think about half the stores are now in your updated format.MW: Yes, and in some shape or form every store’s been touched. During this financial year we will touch nearly every store with our biggest programme ever, expanding and

realigning ranges across the entire network.

OPI: What new categories are you developing at retail

level?MW: Well, if you look at the total

addressable market – which is about A$30 billion if you include

things like advanced print and copy, commercial furniture and technology

– it’s clear that there is plenty of runway ahead of us, and with all the foundations in place we’ve entered a

new phase where we can focus on a new phase where we can focus on a new phase where we can focus on a wider opportunity set.

I think we’ve become I think we’ve become I think we’ve become much stronger in much stronger in much stronger in

printing and printing and printing and

huge. We’ve put a lot of effort into that in the past 36 months and that’s getting exceptional growth for us, as it is for a lot of OP players around the world.


At the same time we’ve worked to innovate in mature categories like writing instruments by freshening them up with things like loose pens – that way we can provide choices that are exciting for our customers. We’re also embarking on a journey to build a very strong commercial furniture base, which we’ve never really been in.

OPI: You’ve said before that you don’t OPI: You’ve said before that you don’t OPI: You’ve said before that you don’t believe in the death of retail and that the believe in the death of retail and that the believe in the death of retail and that the retail network is key to your future.retail network is key to your future.retail network is key to your future.MW:MW:MW: Absolutely. We are an every channel Absolutely. We are an every channel Absolutely. We are an every channel business, but we understand that what’s unique business, but we understand that what’s unique business, but we understand that what’s unique about a web-based business is a great range of products, you’ve got to be in stock, you’ve got to have very efficient delivery, you’ve got to have great information and visuals on your website and there have to be minimal clicks to order. But we also understand, in a store sense, that if you want to keep that business thriving then you have to add uniqueness to it.




OPI: What is the mix of customers – business versus consumers – at your stores, and is that at where you want it to be?MW:personal shoppers in a broad sense and 40%



Officeworks | Big Interview

business customers. And we’re OK with that. We’ll try to drive both of them higher, but it’s pretty natural that the business customer is also using the online business. So we’re reasonably OK with that split.

OPI: Tell me something about this smaller city store format that you’ve been piloting.MW: We’ve got three new distinct models under trial in Sydney and Melbourne. The two smaller ones are between 400 sq m [4,000 sq ft] and 600 sq m and the other one in Sydney is 900 sq m, so it’s a bigger store. We think we have got a concept that makes sense, but it’s still got some evolution to come and maybe we can do it far smaller than those as well.

So we took the opportunity to take the leases on the properties that were available; they’re in great locations and we’re just seeing how they go and tweaking and changing things. And as I said, we’re working on what size can we actually do and I think we can go a bit smaller.

OPI: And looking two or three years down the road, how many of these smaller format stores do you hope to have?MW: If we get the model right, we could probably have 20 or 30 because the whole idea of these things is that they’re small and they’re convenient, but they’re close so you don’t have to go far. And the 900 sq m one may still have a role to play in the city, operating as a hub store, if you like, with additional product ranges but still not too far away. That’s something we’re testing.

OPI: What’s the average size of your typical store?MW: I think it’s probably about 1,400 sq m.

OPI: We hear a lot about store downsizing. Is that something that you are actively doing or thinking of?MW: No, not at all. We’re actually working on putting more product range in and trying

to make them even more intense and more inviting. I’m not saying we’re going to go and build bigger stores, but we’re certainly not looking to downsize. We actually see that our network has the opportunity to expand its offer rather than build a smaller network, so we won’t be going on any downsizing campaign.

OPI: Let’s look at online. Obviously, that’s been an area of investment over the past few years.MW: Yes, it’s our biggest trading store – about 12% to 13% of our total sales – and we get more than 20 million visitors each year. We’ve had an online presence since 2004, but we’ve invested quite heavily over the past five years and our plan is to do all of that investment again, plus some, over the next five years.

You’ve got to keep this up to date and for us that means a new product information system this financial year, a new trading platform, updating the back-end engines and a number of things that we’ve got to do to make the shopping experience easier and better for the customer.

That’s this year and then next year we’ll be doing it all again because you’ve got to keep evolving this, whether that’s from your tablet, PC or mobile. So this is an ongoing investment for us that we’re committed to, the same as we are investing in the store network.

OPI: How big a player is Amazon in the Australian market and how much of a benchmark is it in terms of what you are trying to achieve online?MW: I think Amazon is still the clear leader in online. It’s very, very good at putting the product in front of you, product personalisation and recommending products to you, in addition to the delivery service. So yes, I think Amazon is still the clear benchmark for all businesses to aspire to and one thing we know about Amazon is that it keeps reinvesting in continual improvement. It’s not sitting back and waiting for everyone else to catch up. You can’t just get there and say, “We’re done”. You’ve got to keep investing.

OPI: We’ve seen the big US OP retailers putting kiosks in their stores. Are you doing something like that?MW: Yes, we’ve got that in our stores already, so you can come into our store and see our entire range online, which is wider than what we carry in-store, and you can order it there.

OPI: What’s the difference between the online SKU numbers and in-store SKUs?MW: On average, we stock about 8,000 products in-store and about 20,000 online, so a 12,000

“Stores will die if we

don’t give customers a

reason to visit them”


Big Interview | Mark Ward

SKU gap. You can order products at the kiosk to be delivered to the store you’re standing in, your home, your business or wherever. It’s completely up to you.

OPI: When you read that Staples.com in the US is going to carry 300,000 SKUs by the end of this year, what does that make you think?MW: Managing inventory for that number of SKUs could be a significant challenge. I don’t know whether it will be successful for them or not, but they’re having a go which is good on them. I don’t know what else to say about that.

OPI: Where might you go with SKU expansion online?MW: Well, it’s an opportunity for us, but you’ve got to be able to do it properly and I don’t think we’re in a position yet where the range is exactly where we want it in our supply chain.

OPI: How are your online orders serviced in terms of distribution locations?MW: We have four fulfilment centres around the country so the customers’ orders go directly there. Order before 11am you can have it same day, order after 11am it’s next-day delivery.

OPI: How big is that same-day delivery offer and how much of a unique selling point is that for you?MW: Well, it’s exactly that: a unique selling point. I won’t tell you the number of clients that take it up because that’s commercially sensitive, but it is a proposition that some customers value and it is a unique selling point for us compared to other people in the marketplace. And we’ve had this since before my time; it’s been in the business for seven or eight years and nobody else in Australia has taken it on yet on a national scale.

OPI: What are you seeing in terms of orders coming from smartphones and tablets?MW: As I said before, we’re investing in updating our platforms right now and that includes a better mobile platform that will bring us up to where we should be and also improve the seamlessness of the experience for the customer. So mobile apps and connectivity is a big growth area for us. We’ve got a lot of people viewing us via mobile, but as yet the order numbers are still reasonably low-ish.

OPI: Do you offer price matching on certain products?MW: On any of our platforms if you find something at a lower price we’ll beat that by 5%. There’s a bit of price matching going on, but

we’re happy to have that position and beat the price for the customer.

OPI: But you’ve got a knock-on effect on your margin when you have to do that.MW: Yes, but that’s the price you pay when you take the price position we do. We established that five years ago, do it across our entire range and it’s got really good customer trust. They know that we’re an everyday low price business; there are no high/lows, there are no gimmicks and if they find a better price then we’ll beat it by 5%.

Sometimes you win, sometimes you lose, but we’d rather be really honest with the customer and say, “Well yes, we’ve mucked it up because someone else has got a better price than us, but you get the benefit because we value you as a customer”.

OPI: You’ve also been investing in the B2B business. How’s that doing?MW: That’s going really well. We’ve been ramping up our business team for the past 24 months and we’re up to about 60 account managers on the road, which is a really significant increase for us.

OPI: Aimed at SMB customers or corporate accounts?MW: SMB primarily. Our core target in that area is the small customer, medium-sized business and schools, and that’s where our account managers are focused going forward. We’ve got a lot of upside there that we still want to work our way through and a huge amount of growth potential. So we’re going to keep expanding that team at a rapid rate.

OPI: What about the large corporates and the government sector?MW: We’ve got a number of corporate customers, but it’s not an area that we are actively pursuing for major growth. The same with government. We are on a Queensland government tender and we do have a number of government departments that deal with us, but it’s not an area that we’re particularly trying to break into – the margins in that area are low and the service expectations are pretty high. In addition, you’ve got range requirements that add another level of complexity.

So we’re working with those partners in government where it makes sense for them and where we can do what they want well. That’s a good partnership, as opposed to getting a contract at any cost, adding complexity and cost, and then poor execution of that contract to the customer.

“We’re an everyday low price business;

there are no high/lows,

there are no gimmicks and if [customers] find a better price then

we’ll beat it by 5%”


OPI: If we just step back and take a bird’s eye view of the Australian business supplies market, how would you summarise it at the moment?MW: It’s challenging but there are always opportunities. From a challenging point of view we know the market is in real decline in dollars and usage and that has been going on for some time now. The opportunity is for anyone in the industry to come up with new and innovative ways to drive and increase usage of products, rather than just sit around and claim that it’s dying. What can we all do as an industry to drive a higher usage of the products we sell? That’s where it comes to product innovation, personalisation, style, fashion and all of those things. So it’s a very interesting market and it’s a good market, but you’ve got to work hard.

OPI: When you look at the impact of digitisation on paper-based products, are you able to quantify the declines?MW: Not particularly. We notice a couple of things, but I don’t think in Australia we’ve seen some of the reduction that’s gone on in other parts of the world. That’s not to say we’re not going to see it, but we haven’t seen it at this point in time.

OPI: A quick look at some of your competitors in the market. What impact did Staples’ acquisition of Corporate Express have on Officeworks?MW: I’m not going to comment on competitors, Andy! We are focused on our direction, not what our competitors are doing.

OPI: Fair enough. Do you expect any impact on the market from the merger between Office Depot and OfficeMax?MW: Well, I guess in Australian terms, I would possibly see an opportunity for OfficeMax to get better buying power in the Australian and New Zealand markets. In a more global sense, I think we’re going to see a pretty radical shake-up of those merged businesses in terms of the way that they go to market and their store network, and all sorts of things. So I think, handled well, it can only be good for the industry in future, that’s my view.

OPI: Do you see the need for further consolidation in the office supplies space in Australia?MW: I don’t necessarily see the need for it, but I believe it’s going to come because, if the market continues to be challenging and/or in decline, we’ll see fallout. So I don’t think that’s consolidation, that’s exiting. If those conditions continue globally then I expect that’s what we’ll

see around the world, but I don’t know that we need that to happen – it will just be a by-product.

OPI: What about the possibility of Officeworks being an acquirer in the market?MW: We look at opportunities all year around. We have yet to find anything that we’re happy to buy, but we keep looking and every time we evaluate an opportunity we learn something – that’s the important thing.

OPI: How much does it help being Australian-owned versus some of the US or French-owned global companies?MW: I don’t think it makes any difference at all, unless you’re an unliked brand – that’s different as your ownership starts to come into it a bit. But I think customers are so global these days that they just don’t worry about it. Maybe another way to think about it is that lots of people shop in their local areas to support local businesses where they live, but for the other stuff in their lives I don’t think it matters whether you’re Australian-owned or not.

OPI: It appears you play an active role in the local community. MW: That’s a big thing for us. All our stores get a budget every year to spend in the local community. How they spend it is up to them – within certain guidelines about who they support – and that gets them great awareness.

The way we talk about it is that our staff live there, they work there and they raise their families in that local community, so it’s important for us to be able to be part of the growth and development of those communities. So we’re a strong partner in the local community and that is important to our overall philosophy.

OPI: Just to wrap things up, how do you see the future developing for Officeworks?MW: We see huge opportunity in the Australian market. Huge. We’re not wanting for ideas; we’re actually more frustrated because we’ve got so many things we want to do and we have to choose what we can do because we want to do them well. We’ve got no concerns at all about growth for this business in Australia going forward. None at all.

“The opportunity is for anyone in the industry to come up

with new and innovative

ways to drive and increase

usage of products”

Officeworks | Big Interview


Hot Topic | Paperworld Hot Topic | Paperworld

Wakeupcall

“FOR companies in the paper, office supplies and

stationery sector that are looking for international markets as well as for manufacturers wanting to present new and innovative products, Paperworld in Germany remains the most important international trade fair.” These are the words of Paperworld Director Michael Reichhold.

It’s difficult to argue with this statement. But why is it then that there is such discontent among visitors and manufacturers alike when it comes to what, once upon a time, was an absolute must-attend/exhibit event in the OP calendar; an event that would raise eyebrows if anybody important in the sector dared to miss it?

Just from a manufacturer point of view, there’s possibly been no other

With Paperworld in Germany looming large, there again comes the inevitable criticism. But this year more than ever, exhibitors and visitors alike are actively voting with their feet. Are the organisers aware of the ticking clock? OPI � nds out…

year when such a large proportion of brand manufacturers – Faber-Castell, Novus Dahle, Staedtler, edding, Durable to name but a few – have withdrawn their support, not necessarily for Paperworld as a total event, but certainly for 2014.

Lack of relevanceFor some of the resellers attending as visitors, it’s simply a lack of relevance. Christian Langvad, OTTO Office’s Head of Procurement & Business Development, is brutally open about the fact that his staff just don’t want to go anymore because of this lack, so much so that the company cancelled all participation for next January. He says: “We have been loyal to Paperworld for many years, during all the years of changes and discussions about the event. We always went with our full team – about 20 to 25 people – but nobody, including our category

managers, wants to go in 2014 and one of the reasons is that the relevant exhibitors or partners they want to meet are simply not there.”

And that, Langvad continues, is not just because the big OP vendors are increasingly staying away, either completely or just from the exhibition ground, instead basing themselves in nearby hotels. “Office products account for about 50% of our total sales; the other half is generated through partners like HP or Canon, office furniture manufacturers and other new categories like facilities management (FM). So if only 50% of revenues

are generated through OP companies and if a sizeable percentage of those partners aren’t even there, I completely

understand why my buyers say ‘we

don’t want to go’.”

by Heike [email protected]

Lack of relevanceFor some of the resellers attending as visitors, it’s simply a lack of relevance. Christian Langvad, OTTO Office’s Head of Procurement & Business Development, is brutally open about the fact that his staff just don’t want to go anymore because of this lack, so much so that the company cancelled all participation for next January. He says: “We have been loyal to Paperworld for many years, during all the years of changes and discussions about the event. We always went with our full team – about 20 to 25 people – but nobody, including our category

(FM). So if only 50% of revenues are generated through

OP companies and if a sizeable percentage of those partners aren’t even there, I completely

understand why my buyers say ‘we

don’t want to go’.”

Paperworld Director Michael Reichhold


Paperworld | Hot Topic

Wakeupcall

The fact that many of the ancillary categories that OP resellers are typically selling now as part of their overall offering – technology, FM and furniture to name but a few as mentioned above – barely make an appearance at the fair has been a longstanding discussion point.

Reichhold’s comment when approached by OPI about this

appetite for a broader range was evasive, to say the least, and is unlikely to engender confidence that a Kimberly-Clark, SCA, Ecover, Nestlé or Douwe Egberts is ever going to be on the list of exhibitors. “We realise that there is a trend towards a broader range of products and that the visitors like to see additional products at the fair,” he says. “That’s why we develop this concept from year to year. We have the product group of Remanexpo with the recycler industry that is very interesting for a broad part of visitors. Also there is the special event ‘Mr. Books & Mrs. Paper’ that shows additional office and paper products for the book traders.”

International focusPart of the attraction of Paperworld in the past has been its growing international focus and the fact that it not only attracted buyers from trade and retail operators in Germany and neighbouring countries – as was perhaps the original remit many years ago – but a solid and high quality delegation from the large global players.

Lyreco is one of them, but Group Marketing Director John Watson doesn’t rate the quality of the event anymore, with all its individual parts

not coming together to make it a rounded and – it’s been said many times before – must-attend event. He says: “The problem with Paperworld is that it lost its way; it’s drifting aimlessly into a very slow death. It needs to reinvent itself, among other things with new category exhibitors. But what the organisers really need to work out is the value that it

brings. Is it an exhibition, a meeting venue, a conference?

“My team and I don’t go to Paperworld anymore to see the new product launches; that’s gone and probably finished 15 ago. But it’s

still done in the same format, with big spaces for big stands to display products. For a distributor

like Lyreco that’s just not relevant. What we go for is the big picture, the year ahead. What are the key directions that I need to be aware of with my team?”

The view that new product launches are not important should ruffle more than a few feathers among the manufacturing community (not to mention organisers Messe Frankfurt), but is perhaps given credence by the fact that a sizeable glut of big name international vendors descend on Frankfurt’s nearby hotels year after year, presumably having those big picture discussions Watson is talking about – without the new products in tow.

The target group of Paperworld exhibitors isn’t of course just the larger operators and the always

thorny issue of piggy-backing onto those vendors that pay a hefty price for their presence in the product-orientated halls is one that is longstanding and unresolved.

Product launchpadAnd there are definitely many vendors that view Paperworld as a great launchpad for new products. Indeed, says Durable’s Senior Marketing Advisor Horst Bubenzer, the reason the company cancelled its participation next January is chiefly a result of its new products not being ready. “If we had exhibited, we wouldn’t have had enough news basically and without having anything to show, four days at Paperworld with a sizeable stand is a hugely expensive undertaking.”

As explored in more detail on page 28 (see ‘Paperworld time-wrestling: Yearly or Biennial’), the innovation cycles of many OP manufacturers are not as frequent anymore and that’s essentially why several companies are increasingly opting to exhibit every other year, a fact that Paperworld organisers are finally beginning to acknowledge and address. This is no doubt a hugely difficult undertaking given the event’s entanglement with same-time events Christmasworld and Beautyworld.

Fellowes has already been alternating its attendance over the past eight years and will again be present with a stand next year. And for the US-based company too, the event is indeed an opportunity to show its new products, plus a good time to finally put its difficulties in China behind it.

Hugh Darcy, VP of Global Sales and Marketing, Business Machines, says: “It was never our intention to formally

“Nobody at OTTO Office wants to go to Paperworld in 2014 and one of the reasons is that the relevant

exhibitors or partners they want to meet are not there”

in the same format, with big spaces for big stands to display products. For a distributor

like Lyreco that’s just not relevant.

Some of the speakers lined up for the next CES event


Hot Topic | Paperworld

One of the discussion points surrounding Paperworld is the regularity of the event. Given the cost associated with attending with a full-scale stand in the main exhibition area – €0.5 million ($0.69 million) is not an unusual amount – plus the somewhat slowed innovation cycle of certain strands of some of the exhibition’s product ranges, a two-yearly cycle has been mentioned more than a few times. Indeed, judging by comments from some exhibitors that have chosen to stay away next January, it’s less a lack of support for the event as a whole rather than lack of support of its current format.

Below are the views of just some of the many – often longstanding – exhibitors that have cancelled their exhibition participation at Paperworld 2014.

“Faber-Castell will not exhibit at Paperworld in Frankfurt for 2014. Due to reduced visitor traffic from both local as well as international retail and wholesale customers, we have decided to focus on smaller local fairs in Europe. We will analyse the results of this approach and will decide about the feasibility of a Paperworld participation again in

2015 and every two subsequent years.”Karl Heinz Raue, Head of Business Development, Faber-Castell

From 2013, Novus Dahle with its partner Schneider Schreibgeräte and the mutual distribution company Schneider Novus will no longer attend Paperworld on a yearly basis, but will be represented in a two-year rhythm from 2015 on.

Managing Director of Novus Dahle, Frank Indenkämpen, refers to changing markets and, as a result, declining visitors at the fair. “With our approach we will meet the consequences these changes have and at the same time remain loyal as a standing exhibitor,” he says.

“Paperworld is an important international information and communication platform, and we have always been pleased with all aspects of our attendance in recent years. However, we also think it needs some changes, which is why we are looking forward to experiencing the fair’s new features when we next attend. Furthermore, it’s clear from feedback from many of our partners that, given the length of innovation cycles, it makes more sense to exhibit every other year,”

Per Ledermann, CEO, edding

“We’re planning to launch a comprehensive range of new products next year, but we simply won’t be ready at the beginning of the year, so we decided not to exhibit at Paperworld in 2014. You have to acknowledge that the innovation cycles of OP manufacturers are not as frequent as they used to be anymore and to exhibit at large and costly events as

Paperworld on a yearly basis might not be feasible going forward.”Horst Bubenzer, Senior Marketing Advisor, Durable

Paperworld time-wrestling: Yearly or biennial?

revert to a biennial attendance. Our intent is always that, if we’ve got an interesting message for the trade community and if we’ve got something exciting product-wise to talk about, then we will attend. As a new product development business, for us Paperworld is a very important launch pylon. The pitching season starts in January so it’s the time where we aim to raise awareness.

“If you want to get listed at an Office Depot, a Staples or a Lyreco – although we have very tight one-to-one relationships with those kinds of companies already – it’s the place where you can start to show the world what you’ve got. Also, of course, it may be different when

you’re dealing with one of the big boxes. But if you’re looking for a new

distributor in Russia or India, you need some initial contact; you need someone to see what your brand is all about, its importance and power in the industry, etc. And that’s one thing

that Paperworld can do really well. We also don’t have all of the major

distributors all the time, so there’s always a chance that someone from Depot will walk on the stand, saying ‘come on, let’s start talking’. That’s really paying for the stand that year, isn’t it, if we get that contract?”

Improvements neededAnd while Darcy admits that he even attends during Fellowes’ non-exhibiting years because it’s simply a good place to meet everyone, he also has plenty of ideas for improvements – echoed by many of his peers, from the reseller as well as manufacturing community.

Timing for a start could be much better. Many of the international visitors arrive on the Monday – historically also the day when the European Office Products Awards dinner was held (now held as part of the OPI Partnership event, see opi.net/EOPA2014), showing a lack of commitment towards the event.

But most of all, Darcy believes that Paperworld needs another powerful

Hugh Darcy

“If you’re looking for a new distributor in Russia or India, you need initial contact; you need someone to

see your brand, its importance and power”


Paperworld | Hot Topic

Paperworld in the past has always vehemently defended the annual aspect of the event. When OPI spoke to new Director of Consumer Goods at Messe Frankfurt, Cordelia von Gymnich, she said: “Paperworld will not take place every two years. We have conducted large-scale visitor and exhibitor polls which confirm that once a year in January is the right time to hold the fair. This timing is particularly advantageous for international visitors. Moreover, the stationery segment is especially innovation and trend-orientated. This means that both the trade and industry need a Paperworld that is held annually.”

That said, recently there has been somewhat of a mini u-turn on this ‘policy’. In a press release issued on 27 November, Messe Frankfurt reiterated that “to maintain its position as a new-products show, as well as a source of inspiration and an economic driving force, Messe Frankfurt will continue to hold Paperworld annually”. The u-turn comes as regards manufacturers from two German manufacturers’ associations – the Altenaer Kreis and PBS-Industrieverband – whereby Paperworld organisers confirmed “an attractive exhibition area where [members of these two associations] can present their product innovations every two years from 2015”.

The decision was the result of consultations between representatives of the two associations and Messe Frankfurt. It’s interesting that many of the companies that have recently withdrawn their support for 2014 – Faber-Castell, Durable, Staedtler, edding, Schneider – are within those groups, as are many others.

Chairman of PBS Industrieverband Horst-Werner Maier-Hunke says: “The majority of the member companies of our two associations have voted in favour of presenting their new products every two years at Paperworld from 2015.”

For the time being, a working group has been set up that will discuss the specifics of this new arrangement in a meeting in early January, the idea being that a formal announcement will be made at Paperworld itself.

Is this real progress some may ask? It’s early days, but it’s an encouraging sign that the concerns of (some of) the manufacturers that ultimately finance Paperworld are being taken into account. It of course also throws up the question that if all – or most – of these German brand manufacturers opt for a two-year cycle, what’s going to happen to Hall 3 on an annual basis, since so many of them are based in that space? More questions than answers at the moment.

Paperworld time-wrestling: Yearly or biennial?

raison d’être to keep attracting both exhibitors and visitors. Yes, there is a plethora of ‘side shows’ in the form of lectures, competitions, award ceremonies, even full-on mini exhibitions like the Office Gold Club Procurement where companies that don’t necessarily have big exhibition stands (most don’t now in fact) have small booths in an adjacent hall and discuss strategy, products and so on with commercial end users. And all these are undoubtedly valuable, but they don’t give that bigger picture and they are by and large small scale and national (though often translated into English).

Says Darcy: “I was at CES in Las Vegas a couple of years ago. The organisers run a really intensive conference programme where you can see industry leaders talking on stage, answering questions, etc. There are different streams you can subscribe to – and pay for – but those I saw were absolutely packed.

This would translate fantastically into a potential Paperworld

concept, he adds. “So there could be a technology stream, a facilities management stream, etc. It would be a golden opportunity to discuss, say, the electronic office. As for big name speakers, I would really like to see what Eric Bigeard makes of the world today; I want to see Jamie Fellowes up on stage talking with the head of ACCO. Those encounters are worth paying for and you can say to your boss, ‘I need to go to that because I’m going to learn something’.”

OTTO Office’s Langvad agrees, also highlighting the need for more networking opportunities. “I mentioned this to the organisers some time ago and was told that there had been a big party for exhibitors. Why don’t they do that for the visitors as well because this is a chance where people really can meet and chat together? The days of actually placing orders at a fair are long gone. The function of an

event like Paperworld is to speak to each other, to network, to get a feeling for trends and what’s next – that’s certainly why the buyers from our company used to go.”

Turnaround?Can Messe Frankfurt and the Paperworld organisers become thought leaders, return the fair to its former glory and make it the

compulsory trip of the year again, even in times when money is short and time precious? A potential future change to a biennial event

also needn’t ring the death knell. Other shows like Orgatec or Photokina prove that every other year doesn’t have to mean the end.

Despite all the criticism, there’s a resounding feeling that manufacturers and visitors alike

are willing the organisers on to give it their very best shot.

Look out for our Q&A with Paperworld organisers Michael Reichhold and Cordelia von Gymnich in the European Annual Review.

opportunities. “I mentioned this to the organisers some time ago

its former glory and make it the

also needn’t ring the death knell. Other shows like Orgatec or Photokina prove that every other year doesn’t have to mean the end.


Dealer Spotlight | Universal O� ce Products


Universal successUniversal is a company of the noughties and that youthfulness – combined with a good dollop of experience - undoubtedly contributes to its fresh approach towards all things OP

MUCH is said about the plight of dealers – 35%

of them are in financial difficulty is the latest figure being bandied about in the UK. On the flipside, that leaves a healthy 65% which are doing reasonably well and Universal Office Products by all accounts is one of them.

It’s a young company, having been founded just 11 years ago; it’s fiercely independent – there’s not even a dealer group affiliation; and it’s run by directors Steve Manley and Mark Broadbent who cut their teeth at what was then Corporate Express, amassing between them 20 years of contract stationer experience before Universal.

Being so young a company has meant that major milestones are thin on the ground, although Manley points to the acquisition of a couple of major accounts as one of them. As a general statement, however, he adds that Universal’s success has been due to its ability to diversify. He says: “Particularly in the past couple of years,

where we’ve seen major growth is the diversification into segments like MPS, office fit-outs, furniture, promotional products and all print-related bespoke point-of-sale material.”

MPS growthSimilar to November’s Dealer Spotlight with Austria-based Tekaef (see ‘Office Partners’, OPI November, page 40), MPS is indeed the firm’s key growth driver. Started about two years ago, it began very much at a reactive level, typically because customers would say that they had a better deal on their toner purchases because of pence-per-click offers. “So we had to do something about it,” says Manley. “We found our current partner and started converting our customers from traditional toner purchases to an MPS package.

“Now we’re very proactive, but mostly through targeting customers that are already in an MPS deal and

showing them how they can make further savings,” he adds.

A big bonus of its diversification efforts has been the fact that it has allowed Universal to significantly increase its business with existing customers to what’s now a £8.1 million ($13.1 million) company. 2012 was a great year, says Manley, but 2013 has further exceeded his expectations in terms of gross and net profit.

He explains: “Yes, the number of our customers has increased over the years, but probably only by about 20% per year; it’s really been the growth from our existing customer base that has contributed to our growth. For example, we had an account with 80 office staff that was spending £20,000 a year with us. That’s about £250 per head – the industry average. We’ve turned that and other accounts into £50,000-a-year customers, not with more pens and pencils, but by selling them different and additional products and services.”

Mark Broadbent and Steve Manley celebrate ten years of Universal Offi ce Products


Universal O� ce Products | Dealer Spotlight

Universal fact box: Founded: 2002

HQ: Wakefield, UK

Owners/Directors: Steve Manley & Mark Broadbent

Sales: £8.1 million ($13.1 million)

Employees: 21

Business model: B2B, B2C

Logistics: VOW

Geographical coverage: UK

A side effect of that development has been that instead of seeing one person now at a specific customer, Universal’s salespeople may typically see four people within that account, making for an all-round more comprehensive customer experience, in the process getting a better insight into that client as well as gaining its trust, particularly as regards contractual services like MPS.

Universal is first and foremost a B2B operator – more than 90% of its revenues

come from the business end of the OP spectrum. It’s essentially a nationwide operator with the majority of its clients in the wider vicinity of its headquarters in West Yorkshire, UK.

But, parallel to the need to explore new avenues, the B2C segment has also been very high on Universal’s list of priorities over the past couple of years.

The majority of the company’s B2C revenues – about £750,000 – are generated from online businesses through various platforms. And the growth opportunities here are excellent, says Manley: “By the end of 2014, we would like to double our current sales in that channel.”

By the same token, he adds, e-tailers that have traditionally targeted primarily the B2C/SOHO market are now also going even further down the B2B route. “If you spoke to any of the major UK e-tailers they wouldn’t say ‘oh no, we can’t serve you, we only deal in the B2C market’. And I hear my customers say to me: ‘I’ve checked – I can get these five non-core items cheaper online; match that price’. The internet is certainly driving

margins down. I’m not saying that’s a bad thing – you just have to play both sides and understand your buyer.”

On a shoestringAnd that is done very much on a shoestring. Universal’s staff number of 21 is small, compared with its overall sales figure. It’s due to a lean operation, but also partly a result of the company’s close and longstanding relationship with its first call wholesaler VOW.

Universal doesn’t carry any stock and has no warehouse. About 60% of its distribution goes completely via VOW’s nearby Normanton distribution centre, with the final mile done by UPS. The remaining 40% are delivered through its own small fleet. Essentially, Universal’s drivers – three of them – turn up at the wholesaler in Universal vehicles every morning at 6am, where all the orders are already picked, wrapped and labelled and put into van route order.

The temptation to go one step further and hand over all of its distribution has

clearly occurred to Manley, but for its core customer base in a radius of 70 square miles, he is keen to retain that specific level of personal ownership.

This ownership forms part of Universal’s USP, as Manley explains. “We want to take the best bits of a large corporate stationer and marry them with the best bits of the independents – that’s been the cornerstone of our success.”

“Where the big operators like Office Depot, Lyreco and Staples let themselves down is the dedicated local customer care. That includes dedicated telesales, a dedicated account manager, as well as a dedicated delivery driver who takes the copier paper to the third floor.”

It’s a combination that works and with their joint background at Corporate Express, Manley and Broadbent continue to complement each other. “We’re both very hands-on,” says Manley. “I’m more externally based, so my role involves overseeing

the external sales of new business acquisition and account management. Mark on the other hand oversees the business operations, ie internal sales, customer service, accounts, admin, etc. We’ve almost fallen back into our natural roles from our Corporate Express days.”

The future looks bright and worrying in equal measure, Manley believes. Consolidation among the dealer community in particular will continue, with the weak – and weak unfortunately often equals small – getting weaker (though somewhat helped by the current plethora of dealer group programmes), and the strong, especially those crossing boundaries, getting stronger.

And there are still more diversification opportunities that haven’t been explored to the full yet. Facilities management is one of them, says Manley. “It’s a product segment that we’ve really been trying to attack, but we haven’t been as successful as we would have liked. The reason, I believe, is that the wholesalers haven’t got it quite right yet, in terms of product as well as pricing. For them to get really serious about it, they would have to buy an FM specialist business.

“If you’d asked me 12 or 18 months ago where I thought the growth would come from, I would have said jan/san or breakroom. I wouldn’t have said MPS or all the other sectors previously mentioned. Yet that’s what happened, so there’s a long way to go here.”

For a more in-depth look at the topic of FM, turn to page 43.

as well as a dedicated delivery

“For the wholesalers to get really serious about FM, they would have to buy an FM specialist business”

Universal’s HQ in Wakefi eld, UK


Sponsored Article | Spicers


Spicers | Sponsored Article


ED Expo & CAMEX | Show Preview

THE National School Supply and Equipment Association

(NSSEA) and the National Association of College Stores (NACS) will be co-locating their Ed Expo and CAMEX events beginning with the 2014 show in Dallas, Texas from 9-11 March. The combination event will form the largest educational products tradeshow in the world, with over 1,000 exhibitors showcasing the latest products for students, from pre-school to college.

Education is certainly one of those ‘adjacent’ categories that office products resellers are eyeing as they look to offset declines in traditional categories and there would appear to be a lot of upside in the category, both in terms of acting as a supplier to educational establishments and by developing sales around the back-to-school and back-to-college seasons. Education, more specifically early education, is one of the verticals that Staples has targeted for its ‘beyond office supplies’ strategy and it has added thousands of products in the past few months. In the independent dealer community, Independent Stationers was recently awarded the new US Communities school supplies contract, securing a supply agreement with Educators’ Resource in the process, and this is bound to lead to an evolution in educational products expertise amongst its members.

“We are thrilled to be joining forces with CAMEX to bring new opportunities for expansion and growth to the community of international office products dealers,” said NSSEA CEO Jim McGarry. “The combined exhibit hall will be an exciting display of product that will help the office products industry serve an expanding customer base, while providing exhibitors

with the opportunity to see over 3,000 potential buyers. In addition, office products dealers will find money-saving specials throughout the exhibit floor that will more than pay for their trip to Dallas.”

CAMEX and Ed Expo will occupy adjacent but separate sections of the Dallas Convention Center, with dealer

attendees having access to both shows by registering for either event. The education programme for Ed Expo will be held on Saturday 8 March and for CAMEX on Friday and Saturday 7-8 March. Both exhibit halls are open on Sunday and Monday from 9.00 am to 5.30

pm and on Tuesday from 9.00 am to 3.00 pm, with unlimited access to the tradeshow floor for all show attendees.

“This combination of two excellent tradeshows will provide both organisations’ members with unrivalled access to products and services that will help them

differentiate themselves from competitors,” said NACS CEO Brian Cartier. “Traditional office product resellers will find unique products that can position their companies for success in the education space.”

The Ed Expo exhibit floor showcases the latest products for every facet of the $6.2 billion pre-K-12 learning environment from instructional materials and teaching aids to technology products, educational games and toys, and supplies. Attendees include stores selling educational materials to teachers and parents, office products dealers that sell to school districts, and independent toy and game retailers.

CAMEX is the $10 billion higher education retailing industry’s largest tradeshow and educational event, featuring the newest innovations in more than 100 product categories targeted at 18-24 year-olds.

“If you sell to the education market — or are looking to expand your traditional office product mix — you can’t afford to miss CAMEX and Ed Expo, the premier showcase for the educational products marketplace,” concluded McGarry.

Ed Expo and CAMEX co-locate for mega educational show

OPI named international media sponsor

OPI is delighted to be the international media sponsor of both the overall event and the International Members Reception taking place from 5.30-7.00 pm on Sunday 9 March. At this exclusive reception, all international members are invited to mix, mingle and unwind with friends from near and far and to develop their business networks. OPI is also pleased to offer readers a complimentary tradeshow-only registration. Simply visit www.camex-edexpo.com and enter the promotional code: 2GreatShows14

Special Ed Expo & CAMEX offer for OPI readers

products in the past few months. In

Saturday 8 March and for CAMEX on Friday and Saturday 7-8 March. Both exhibit halls are open on Sunday and Monday from 9.00 am to 5.30

to both shows by registering for either event. The education programme for Ed Expo will be held on Saturday 8 March and Saturday 8 March and for CAMEX on Friday and Saturday 7-8


THE 2013 Climb of Life (COL) set another record this

year, raising more than £81,000 ($110,000) for the Institute of Cancer Research (ICR).

11 teams comprising 120 members of the UK office products industry – including Janet Bell, India Pride, Chris Turness and Fergus Cox from OPI – braved the wintry November conditions in the north of England to scale some of the tallest peaks in the Lake District.

COL organiser Graeme Chapman said: “We pipped last year’s amount by £1,000 and, when I announced the total, the noise from the trekkers almost took the roof off.”

COL has raised £480,000 for the ICR over the past seven years, while the total amount raised through Chapman’s efforts for a variety of charities over the past 26 years is a staggering £1.1 million.

“When I started this event 26 years ago, I had no idea of the impact it

would have on the OP industry. To reach over £81,000 and beat the

previous amazing year left me almost speechless,”

added Chapman. “What

Climb of Life breaks fundraising recordMore than £81,000 raised for cancer research

impresses me, apart from the huge contribution to cancer research, is the dedication, year after year, from so many friends and industry stalwarts to our Climb of Life.”

The top corporate fundraiser this year was Vasanta, which brought its entire board for the second time to support the event and raised £21,000. OPI raised more than £15,000 and we would sincerely like to thank our generous sponsors for their support.

“Thanks to the phenomenal support from so many individuals and groups like OPI and Vasanta, the COL event goes from strength to strength,” stated Chapman.

“I would like to give a special mention to OPI, which really raised the bar with its impressive fundraising that started four years ago and has helped the COL team to go on and beat £80,000 for the past two years,” he added.

Nowhere is the COL team spirit more evident than at the now-traditional post-COL celebration at the Swan Hotel in Grasmere, the location of the COL ‘base camp’ for the past 21 years. Joining the trekkers this year were Professor Paul Workman, Deputy CEO

of the ICR, and Britain’s ‘Greatest Ever Mountaineer’ Alan Hinkes – the only Briton to have scaled the 14 highest mountain peaks in the world.

“It was inspiring to spend time with you and your amazing group of fundraisers, including cancer survivors, patients, family and friends,” said Professor Workman. “It is truly fantastic to have the Climb of Life team raising funds for this vital research.”

The ICR continues to be one of the most important scientific research centres for cancer in the world, bringing more drugs to market in recent times than any other. On a more poignant note, three people connected with COL have been diagnosed with cancer in recent months and it is just over a year since we at OPI lost our own Adam Morris, aged just 32, to the disease. It’s something that touches all of us to varying degrees, and we are just proud to be able to play a small part in the wonderful efforts of COL in the UK and City of Hope in the US.

The next Climb of Life will take place on 7 November 2014.

Janet Bell, Graeme Chapman and India Pride with (far right) Britain’s ‘Greatest Ever Mountaineer’ Alan Hinkes enjoying a well-earned drink at the 2013 Climb of Life celebration

Climb of Life 2013 | Special Feature

OPI’s Chris Turness, Janet Bell and Fergus Cox with Offi ce Product Network’s Danny and Vivian Ayriss and walk guide Jane Pye and Roxy the dog


OPI Global Forum 2013 | Review

It was perhaps the words of Staples CEO Ron Sargent prior to his Big Interview that

most aptly summed up the value of the OPI Global Forum, the latest of which took place in Chicago at the beginning of November.

Sargent called OPI the “glue” that sticks the industry together and it is difficult to recall another event which brings together such an international representation of independent dealers, big box players, resellers, vendors, wholesalers and service providers under one roof. About 90 senior executives from North America, Latin America, Europe, Australasia and Asia gathered at Chicago’s brand spanking new Langham Hotel to get to grips with the key issues affecting our industry today and those likely to shape its future.

Sargent’s 60-minute Big Interview with OPI Editor Andy Braithwaite brought to a close an intensive two days of seminars, presentations, roundtables and networking sessions. The Staples CEO gave his views on a number of topics, such as the state of the industry, the re-invention of Staples – including its ‘beyond office supplies’ and online strategies – and the future of retail for office suppliers.

Chatham House rules mean that we are unable to provide any specifics for this article, but it was certainly interesting to see how the world’s largest OP reseller is getting to grips with the almost perfect storm of digitisation, economic austerity, e-commerce, Amazon and younger generations entering the workforce.

OptimismGiven all these challenges, it would have been understandable if a sense of gloom and doom had prevailed at the Global Forum, but this was far from the case. In fact, it is fair to say that delegates went away with a renewed sense of optimism about future opportunities. Products have come and gone in the past, it was pointed out – remember VHS tape and diskettes? – and the OP industry has such a sophisticated

OPI’s fourth Global Forum was regarded as the best everdistribution and logistics model that it is in a strong position to take advantage of areas such as category expansion and end user supplier consolidation. We’ve faced periods of radical change before and come out the other side – perhaps looking a bit different, but still with that same entrepreneurial and pragmatic approach to business.

CooperationOne interesting concept that came out of the event was that of ‘cooperatition’ (cooperation + competition) – competitors working together for the greater good of the industry.

We’ve seen aspects of that recently with, for example, the Independent Stationers/TriMega EPIC event, but what if that was taken a step further and the power channel and independents developed closer ties? Product data would be an obvious example, but how about other areas such as shared sales data, product sourcing and the supply chain? There has been an undercurrent for some time that independents should cooperate more in their battle against the big boxes, but perhaps the real ‘enemies’ are the likes of Amazon and Walmart.

A special mention must go to event moderator Chris Westfall who stepped in virtually at the last minute in place of Jeffrey Hayzlett. Westfall’s energy, his quick grasp of the key industry issues and his presentation and interviewing skills certainly played a major part in the overall success of an event which was regarded by Global Forum ‘veterans’ as the best one yet.

OPI’s next Global Forum will take place in 2015, but why wait until then? The OPI European Forum is due to take place in mid-2014. Look out for more details soon on the opi.net website.

Bringing the industry together

Delegates went away

with a renewed sense

of optimism about future opportunities

Event moderator Chris Westfall

The Forum closed with a Big Interview with Staples CEO Ron Sargent

Special Feature | FM Report

Visitor numbers up 20% at Italy’s largest o� ce products event

THE 18th Big Buyer trade show in Italy – which took place

from 20-22 November in Bologna – was marked by a strong increase in visitor numbers. Official figures released by organiser Edinova show that 7,030 visitors attended the 2013 event, a jump of more than 20% on 2012.

Edinova owner Mariella Nasi Pfeiffer attributed the stronger interest in this year’s event to a comprehensive and relevant seminar and training programme that was spread over the three days of the exhibition. Seminar topics included back-to-school, retailing, e-commerce, contract stationery, wholesaling and green products.

There was also a special training programme for independent sales reps – who are still the main route to market for vendors and resellers in the Italian market – that took place on the third day of Big Buyer.

Pfeiffer pointed to the growing number of international delegates at the show – 860 foreign visitors represented about 12% of the total. Edinova has been taking steps to attract more global participation and this year included buying delegations from countries such as Poland.

Italian trade association AIFU also invited BPGI CEO Barrie Hayes

to provide a global perspective on the state of the office supplies industry and he gave a clear message to a packed audience of about 120 delegates: “Change is here and if you don’t accept that you are in denial,” he stated. “You must evolve or you will go out of business.”

ResilienceAdriano Alessio, AIFU President and Managing Director of the In Ufficio dealer group, presented some encouraging market data, revealing that sales in the B2B channel had fallen about 4% in the first nine months of 2013, a resilient performance given the softness in the Italian economy.

However, other attendees at the show pointed to double-digit declines and there was talk of market “turmoil” in some quarters, especially given the uncertain political situation and steep public sector spending cuts.

One strategy that some vendors are taking to try to offset soft or declining sales is to broaden their product portfolios.

Fellowes Italy used Big Buyer to launch a range of environmentally friendly office accessories called Green2Desk. These products are made by Fellowes’ Italian partner Leonardi and will be distributed across Europe under the Fellowes brand.

Filing and archiving specialist Jalema meanwhile has teamed up with Italian manufacturer Natural File and is now the exclusive distributor in the Italian office channel for Natural File’s patented filing products. Durable’s focus this year was on its Colour Your Office range of accessories as it looks to offer something different for end users.

Other international vendors attended Big Buyer to provide a boost or fresh

direction to their Italian operations. HSM’s experienced Head of Global Key Accounts Karlheinz Haigis was put in charge of both Italy and Spain a few months ago following a divisional reshuffle. He was at Big Buyer with Fabrizio D’Urso, HSM’s new Sales Manager Italy, as the shredder manufacturer steps up its efforts to raise its brand awareness in the Italian market.

Communication toolSenior executives from Avery Europe Mark Cooper and Jonathan Smith flew to Bologna as the manufacturer looks to re-energise itself following the acquisition by CCL earlier this year. They joined up with the local Italian team at Big Buyer to meet with the manufacturer’s sales agents and reseller partners in order to communicate the company’s strategy and outline the benefits – including product assortment expansion – that being in the CCL fold will bring.

German writing instruments manufacturer Schneider is hoping for more inroads into the Italian market after recently signing a distribution agreement with Caimi Luigi.

Schneider’s Export Director Klaus Baumgärtner told OPI he is hoping that Caimi Luigi’s reputation and wide network will provide the Schneider brand with a fresh impetus in Italy.

by Andy [email protected]

FM Report

Visitor numbers up 20% at Italy’s largest o� ce products eventto provide a global perspective

Special Feature | FM Report

Strong turnout at Big Buyer

Mariella Nasi Pfeiffer, owner of Big Buyer organiser Edinova

BPGI CEO Barrie Hayes warned delegates that they must evolve


FACILITIES management (FM) products are often hailed as one of the potential saviours of OP resellers, going some way towards minimising the impact that the decline of traditional supplies is having on their general well-being.

And it’s true, for some resellers the category has indeed been a real growth driver. United Stationers CEO Cody Phipps said in November’s Big Interview (See ‘Focusing on the essentials’, OPI November, page 18) that some resellers have seen growth of more than 20% with FM products. The average is somewhat lower

The FM category is no doubt on the up for OP resellers, but there’s more to it than just adding these products to the overall basket

however, ranging anywhere between 7%-15%, according to research report Mountain or Molehill published in June by OPI in association with Martin Wilde Associates (see also page 44).

But that growth is by no means seen across the board. As Universal Office Products Director Steve Manley points out in this month’s Dealer Spotlight on page 30, FM hasn’t been the success category that has been predicted for his company. Not yet anyway, and the reasons are multifold.

Wholesaler focusMuch of the onus to deliver FM products to the reseller community, certainly independent dealers, is on the OP wholesalers in the absence of direct relationships with the manufacturers. Indeed, even some of the wholesalers – SP Richards in the US and VOW in the UK to name but two – work with distributors like the mighty Bunzl.

Does that mean that prices are not always competitive enough to enable dealers in particular to offer their customers not only the much sought after one-stop shop, but a competitive one-stop shop? That’s certainly a criticism frequently voiced by dealers. The lack of a comprehensive range is another point of discussion.

That said, several OP wholesalers have considerably upped their game in the FM stakes over the past couple of years. VOW’s range in the UK, for

example, now encompasses 5,000 lines, allowing it to offer complete B2B ranges from suppliers like Nestlé, Mondelez, Diversey, Deb, Gojo, Proctor & Gamble, Kimberly- Clark and SCA.

As far as pricing issues are concerned, Debbie Nice, Facilities Supplies Category Head at the wholesaler, says: “Dealers that focus on the solution-sell are performing very well and can compete. We find that OP resellers that are trying to compete with cash-and-carry pricing and offer a delivered next-day service will struggle to always beat every price.”

She adds: “FM is no different to traditional products and technology. You need to have a very clear message with the end user about your service offering and not focus purely on beating every price out there.”

US-based vendor Office Snax concurs with that view, with owner/CEO Bill Baker saying: “Our growth comes from those dealers that are saying ‘what else can I sell my customers’? It’s a convenience sale, in other words asking customers ‘can I bring some cookies or can I bring some coffee along with the stuff that I’m already selling you’? Most consumers are happy to have that service. Of course, price is important, but it’s much less of a consideration when breakroom is presented as a convenience.”

And FM is a broad product segment, so tarring every sub category with

Growing facilities



Facilities Management | Category Analysis

the same brush would be wrong. Germany-based adhesive products manufacturer tesa traditionally comes more from the DIY sector, but is now very visible in the OP channel as well.

Falk Butterwegge, Head of Office Supply, Stationery & Online and International Sales Consumer & Craftsmen, says: “Initially, FM business in the OP channel was mainly driven by e-commerce players, because the internet can give added value information to guide the customer.

This is often required as some FM products are not that self-explanatory. Now B2B players, mail order operators and wholesalers follow this trend as they see opportunities to drive sales.”

Need for trainingBut, he adds, it is mandatory that salespeople are trained properly and that resellers have the correct information to inform and lead their customers. Such tools may include anything from information leaflets over application images to videos.

Nice concurs with the view that more visibility and information is needed. She singles out the cleaning category as being particularly important: “All areas of FM are growing, but there is a requirement for more training and product knowledge in cleaning. But

now that we have relationships with the key manufacturers we are able to work with them on training and awareness programmes.”

And the results can be very tangible, adds Vince Phelan, Director of Trade Marketing at United, saying that early returns of its new Fresh programme are positive, with dealers that have

gone through its jan/san boot camp having seen a 6.8% sales lift over those that have not participated. SPR meanwhile referred to its Business Development Managers’ one-on-one training programmes as “wildly successful in educating our dealers’ salesforce on the more complicated and complex products in CBS”.

Lies Marijnissen, Product & Brand Marketeer at European vendor Ecover, reports that sales towards the OP distribution segment have

risen by over 20% in the first nine months of 2013. That said, she adds that “we notice a higher demand for non-service and non-training demanding products; those easy to sell and easy to use”.

In the breakroom area, meanwhile, this need for training is less prevalent, says Baker: “Foodstuff is comparatively easy because you just say ‘would you like to try this candy?’ And if the consumer doesn’t like it, try another one. You don’t really need to know anything to sell these items, but you do need to know something to sell window cleaner or floor polish.”

What’s important in this specific product segment is freshness and that’s part of the reason why Office Snax sells 80% of all its products

For more on the opportunities in FM and/or to order a copy of OPI’s Mountain or Molehill report, please visit OPI’s website www.opi.net/mole

through the wholesale channel. Baker says: “We are strongly wholesale-focused and that is because we want to sell a broad selection of products and if we sell that selection through the wholesalers it’s easier for us to keep it fresh rather than having lots of dealers buying direct. The consumer will never buy a stale product twice.”

End consumer wants and needs are also what has driven Unilever Food Solutions, the division that includes tea brand PG Tips, to make a more concerted effort in the OP channel. National Account Manager Jeff Davison says: “PG Tips is the UK’s biggest tea brand, but its introduction into the office channel is relatively recent.”

This is partly because, away from home, coffee has the biggest share of beverage consumption. Whether that is changing is unclear, but Unilever is now penetrating OP in a more focused way, for example with differently-sized tea bag packs.

Evolving categoryWhat all these FM sub categories have in common is that they evolve, along with general trends in the business world. For tesa, non-permanent adhesive solutions have become more important in the office sector because many offices are rented and drilling or nailing is not permitted. Says Butterwegge: “Strong double-sided applications are of interest for the OP industry as you can easily stick your whiteboard in the office, for example, without harming the wall. Also, especially the female target group appreciates alternative solutions to the classical drilling method.”

Office Snax is seeing good growth in healthy snacks and, bizarrely, dog biscuits, while VOW is putting great emphasis on environmentally friendly products in its FM range, for example with its 2Work Eco range.

All in all, FM is a category with huge potential, but a ‘dive in and see what happens’ attitude is unlikely to get satisfactory and long-lasting results.

Chris Whiting, VP of Cleaning and Breakroom Supplies at SP Richards, has three tips for dealers that want to invest and make a concerted effort in the FM category:

1. Develop your salesforce comfort level in “off carpet” selling. Offer hands on, one-on-one training to provide knowledge and guidance on these categories. When you create a confidence in your team to move past just the office manager, you open the door to these very profitable items.2. Recruit a jan/san specialist from a local jan/san distributor. Having a specialist in this seemingly difficult category provides additional resources to your team. They know exactly who to contact as their expert in jan/san.3. Identify and target local jan/san distributors to potentially acquire. You not only bring on new experts in this growing and profitable category, you eliminate some of your competition.

Become an FM expert

“Foodstuff is comparatively easy because you just say ‘would you like to try this candy?’”


Category Analysis | Facilities Management

PRINT is dead and the paperless office is just

around the corner. Millennials would rather look at an iPad than a printed sheet of paper and, as a result, that device in the corner that shoots ink onto mashed up trees will soon become a relic of a bygone age.

But is this dystopian vision set to become a reality? In truth, the demand for office machines – from printers and copiers to laminators and shredders – is mixed, but it is far from a car crash. And many manufacturers and resellers are adapting to the

challenges of the modern office and, indeed, working environment.

Let’s consider a few facts. In November, HP shipped its 200 millionth LaserJet printer and its results later in the month showed hardware unit shipments up 6%, driven by a rise of 9% in volume sales to offices.

Earlier this year, Canon Europe commissioned an independent report into the value of office equipment to office workers. The company’s European and UK Marketing Manager

Francis Thornhill says that the Office Insights 2013 report, which surveyed 1,671 employees across Europe, found – unsurprisingly – that traditional office devices such as printers, scanners, copiers and shredders are still integral to the running of a business.

Of those surveyed in the report, a third said they could not do their jobs without them and 98% said that printing and copying is important to their organisation.

Thornhill comments: “Every office processes a staggering amount of information each day, either electronically or paper-based. And it’s important to remember that paper-based documents are

still crucial to almost all organisations. I don’t expect this to change

anytime soon.”He adds: “One third

of printed documents are actively shared with

clients and almost half of end users agree that

producing high-quality documents is crucial to the success of

their organisation.” Figures from US research

firm NPD Group seem to back this move to quality with inkjet sales declining and laserjet growing. In the 12 months to September

2012, value sales of inkjet printers fell 11.2%, while laserjet sales rose slightly at 0.4%. The following year, sales between October 2012 and September 2013 show inkjet down 0.7% and laserjet sales up 2.2%.

NPD VP of Industry Analysis Stephen Baker says: “Printer markets remain challenged no matter the channels.

In corporate channels unit volumes are a bit stronger but certainly not robust. Replacement volume continues apace as printers remain a tool necessary in the workplace, but one that gets less attention today than it has in years past.”The UK market,

though, is in steeper decline. According to research firm GfK, UK value sales of printers in the business channel dropped 16% year on year for the 12 months between November 2012 and November 2013. The only bright spot was for multifunction devices (MFDs), which experienced a sales uplift of 6% by value.

Opportunity knocks But Monte White, VP Product Marketing at US office technology wholesaler Supplies Network, which supplies more than 8,000 products including printing and imaging hardware, copier and fax supplies, data storage media products and computer accessories, paints a brighter picture. “Most of the data we’ve seen from industry sources and vendors show sales either

“It’s important to remember that paper-based documents are still crucial to almost all organisations”

by Niall Hunt

Deus ex

comments: “Every office

amount of information each day, either electronically

important to remember that paper-based documents are

In corporate channels unit volumes are

indeed, working environment.Let’s consider a few facts. In

November, HP shipped its 200 millionth LaserJet printer and its results later in the month showed hardware unit shipments up 6%, driven by a rise of 9% in volume

Earlier this year, Canon Europe commissioned an independent report into the value of office

workers. The company’s

I don’t expect this to change anytime soon.”

of printed documents are actively shared with

clients and almost half of end users agree that

producing high-quality documents is crucial to the success of

their organisation.” Figures from US research

firm NPD Group seem to back this move to quality with inkjet sales declining and laserjet growing. In the 12 months to September

The business machines market is changing as the growth of mobile working and the decline in demand for print continues. But where there is change there are also opportunities for resellers that want to rise to the challenge


Business Machines | Category Analysis

flat or in slight decline. Copier sales are experiencing even further declines.

“We’ve no doubt been fortunate in our ability to grow sales, some of it being due to adding internal resources and our MPS programme, but also through leveraging our data to reveal customers most in need of a refresh and then wrapping marketing programmes around that data.”

So while the printer and copier market is changing with MFDs becoming a more cost-effective solution for a lot of offices, what of document disposal?

The end of the shredder? “Shredders suffer from the same secular challenge as printers – the need to print less in a cloud-based electronic age,” says NPD’s Baker. “While security issues remain paramount in consumer and corporate viewpoints, shredders appear much less likely to benefit from that than a more aggressive corporate approach to archiving and off-site storage.”

NPD’s figures show a decline in shredder value sales of 3.2% between October 2011 and September 2012, widening the following year with a fall of 3.6%. GfK’s figures for the UK are no more rosy, with a fall in sales value of 6%.

Mono Machines and Ochimp.com President Kris Colt says: “The economy has really hurt things. Customers either aren’t buying or they’re spending less than they used to. At one point we were growing between 200%-300%, but in 2013 the shredder category is down about 30%-35%.”

Sue Moscatelli, Marketing Manager of UK manufacturer Snopake, says sales of its Swordfish line of shredders “are coming from consumers who have previously had a shredder rather than those buying their first shredder”.

The Office Insights report also highlights this shift in spending, with many companies’ shrinking IT budgets focused on replacement only rather than upgrading.

Thornhill says the growth of mobile technologies is fundamentally changing the business machines market. “In recent years, businesses

across Europe have slowly been recognising the benefits of equipping their employees with

mobile devices to support a more flexible workforce.”

This shift is creating an opportunity for resellers, which can focus on selling the

benefits of wifi and mobile-enabled devices. “We are seeing

an increasing demand for printers and scanners that include mobile, wifi and cloud connectivity,” Thornhill comments.

The shift to mobile working has also meant an uplift in products aimed at the home office.

Moscatelli says: “Retail is proving to be one of the most important channels, especially as our machines are aimed at the SOHO market.”

She adds: “Consumers want higher security (ie cross-cut and even micro-cut) and quieter motors so machines can be used in busy offices and homes without disturbing others.”

Security issues are also highlighted by Canon Europe’s report, which found that 78% of workplaces print sensitive or confidential documents on shared devices. And this has created a growing demand for new products.

As Colt points out: “Obviously, paper will eventually go away. However, the security industry is still growing and digital media will need to be dealt with. It’s the same with paper shredders; there is less paper to shred, yet more hard drives to dispose of.”

And this shift has been recognised by HSM, which launched a range of hard drive shredders in 2010 and sells two models. At $20,000 and $30,000 respectively, it’s a niche market, but HSM Marketing Director Angelika Lange says the cost is usually absorbed within two years.

Canon Europe’s Thornhill adds: “There is a need for a secure environment and employee education to allow new working practices to evolve, which represents a great growth opportunity for vendors to leverage their expertise, skills and solutions to optimise organisations’ document workflows and enable

mobile working without compromising security or control.”

So while there is certainly a decline in print, it is not as sharp as some doom-mongers claim. As Canon Europe’s research suggests, the usage of business machines is changing, but they are still a fundamental part of office life.

Whether the opportunity is MPS, data security,

hard drive shredders or MFDs, there are still areas for growth. And the Supplies Network

example shows that good customer data needs to

underpin your sales strategy.And the growth of mobile

working might not spell the end of offices, but instead create a growing SOHO market. So while the personal device in the office may be declining, the smaller, home office device is becoming more popular. Which raises the question of how well you are selling into the B2C channel.

Security needs are greater than ever, but it is not just about

shredding paper anymore. Here again, a reseller that can offer the correct products at the right place and for the right price can take advantage.

The office technology market is changing fundamentally, no doubt, but the smart, data-driven reseller can still make money.

“Paper will go away, but the security industry is still growing and digital media will need to be dealt with”

important channels, especially as our machines are aimed at the SOHO

She adds: “Consumers want higher security (ie cross-cut

Whether the opportunity is MPS, data security,

hard drive shredders

example shows that good customer data needs to

underpin your sales strategy.And the growth of mobile

working might not spell the end of offices, but instead create a growing SOHO market. So while the personal device in the office may be declining, the smaller, home office device is becoming more popular. Which raises the question of how well you are selling into the B2C channel.

Security needs are greater than ever, but it is not just about

flat or in slight decline. Copier sales are experiencing even further declines.

“We’ve no doubt been fortunate in our ability to grow sales, some of it being due to adding internal resources and our MPS

through leveraging our data to reveal customers

across Europe have slowly been

mobile devices to support a more flexible workforce.”

is creating an


Category Analysis | Business Machines

USAKimberly-Clark Professional has named Tim Feeheley VP for Kimberly-Clark Professional North America.

Feeheley succeeds Richard Thorne, who was recently named to lead Kimberly-Clark Professional’s Asia-Pacific Region.

Feeheley joins Kimberly-Clark Professional from JanPak, a $240 million provider of facilities maintenance and packaging supplies and solutions.

Global OP and cash handling equipment firm Block and Company has named John Cruickshank as VP of Finance and CFO.

Burberry CEO Angela Ahrendts will join Apple next year to run its retail and online stores.

Ahrendts will join Apple in the first quarter of 2014 in a newly created SVP role, reporting to CEO Tim Cook.

She has been CEO of Burberry since 2006 and her background is firmly in fashion retailing, having also held senior positions at Liz Claiborne and Donna Karan International.

Chung-Li Lee, Director of International Supply Chain at Boise has announced his retirement.

Lee has spent the past 20 years at various incarnations and subsidiaries of Boise, including Boise Cascade, Boise Office Solutions, OfficeMax and finally the paper manufacturing spin-off Boise Inc.

US manufacturer rep group The Highlands Group has made two regional business development appointments at its cleaning and breakroom team.

Kevin Bjorkstrom has joined the group as Cleaning & Breakroom

On the moveOP personnel changes from around the globe

We would love to hear from you. Email [email protected], Tweet us @OPInews or you can write to us at OPI, Diamond House, 36-38 Hatton Garden, London, EC1N 8EB, UK

Business Development Director – South. He comes to Highlands with more than 25 years’ experience in various product categories within the cleaning and breakroom segment, most recently with Continental Commercial Products.

Richard Davis, meanwhile, was named Cleaning & Breakroom Business Development Director – Midwest. Davis has more than 25 years’ experience in facility supplies, including 19 years at Saalfeld Redistribution.

Staples has appointed Tom Conophy as EVP/CIO, overseeing all aspects of the company’s global IT organisation.

EuropeMarcel Jacobs, Senior Manager of Environmental Strategy, Quality & Social Compliance at Office Depot Europe, is to leave the firm at the end of December.

Jacobs has been with Office Depot Europe since 2007, joining the office supplier from electronics giant Philips, where he was Sustainability Officer at the group’s lighting division. In addition to implementing Office Depot’s CSR and green strategy in Europe, Jacobs has developed a sustainable product sourcing programme that Depot will roll out at a pan-European level early next year. He has also played a key role in wider sustainability programmes such as the Sustainable Office initiative in the Dutch OP market.

He is leaving Office Depot to rejoin Philips in a new role as Supplier Sustainability Manager.

UK wholesaler VOW has appointed Phil Allen to the new role of Director of Private Brand Strategy

and Development. He also joins the group merchandising team of parent company Vasanta.

Allen previously spent 11 years at Office Depot, most recently as Merchandising and Buying Director Own Brand Europe. His new responsibilities include reviewing Vasanta’s private brands with a view to improving and extending the ranges over the next few years.

Also joining VOW is former Office Friendly Sales and Marketing Director Joe Walker. Walker was with the dealer group for more than six years until 1999 before becoming a Management Training Consultant for On-Track International. His new role at VOW is that of Head of Reseller Training & Development.

Spicers has appointed Peter Haynes as Account Manager for Shoplet’s UK operations.

Haynes has been with Spicers for eight years, most recently serving as Sales Effectiveness Manager.

In his new role – which is dedicated to the Shoplet account – he will work closely with the Shoplet team “to ensure the culture and success driven in the USA transfers across to the UK and beyond”.

Former Jalema and Office Depot executive Wim de Goei has been appointed Managing Director Benelux

at European reseller Schaefer Shop.De Goei left his role as CEO of

Jalema in July and is to lead the Benelux operations of German family-owned Schaefer Shop, part of the Schaefer industrial group.

German stationery vendor Herlitz has confirmed that board member Thomas Radke will leave the firm at the end of December.Radke – who is also in charge of European sales and marketing at Pelikan – had already announced his intention to leave Herlitz/Pelikan by the end of next March to take on the CEO role at household goods manufacturer Leifheit.

InternationalSpicers has named Kim Kaare Jenson as General Manager for its Asia-Pacific operations.

Jenson was General Manager for the wholesaler’s sourcing office in Shanghai, but has relocated to Hong Kong where he will focus on bringing on board new vendors from across the Asia-Pacific region.

Australian dealer group Office Brands has named Norm Sharpe as Business Development Consultant.He is a former long-time member and business development advisor at Australia’s other leading dealer group Office Choice.

USAMike Maggio is to be the new President of TriMega. The US dealer group has been looking for a new President since Charlie Cleary left earlier this year and Maggio is bound to be a popular choice given his commitment to the independent dealer community over the past 30 years.

Since January 2012, Maggio has been General Manager at Frank Parsons, the division of leading independent dealer The Supply Room. He also spent almost five years at regional wholesaler ActionEmco in a number of roles, the last one being President/CEO.

Prior to that Maggio was at SP Richards for 14 years – rising to divisional VP. His OP career began at family run independent dealer Independent Office Products, where he worked for 12 years.

Since January 2012, Maggio has been General Manager at Frank Parsons, the division of leading independent dealer The Supply Room. He also spent almost five years at regional wholesaler ActionEmco in a number of roles, the last one

Prior to that Maggio was at SP Richards for


Your OPI

Your OPI

5 minutes with...Thomas Illi, Managing Director, Lyreco Switzerland

Describe what you do in less than 20 words. Meet people, listen to them, motivate them, give advice to them and infect them with my passion.

If you weren’t doing your present job, what would you like to be doing? I would like to be a mountain guide.

Your greatest strength? Taking clear decisions in changing environments.

Your favourite office product? The Omega Swiss-quality paper clip made by Lüdi Swiss.

The biggest single issue affecting the OP industry over the next five years? Digitisation will change the office environment more than we can imagine.

What do you like best about the OP industry? Every company is a potential customer – every day we talk to different people from all kinds of industries.

Your favourite movie? One Flew Over the Cuckoo’s Nest – an incredible performance by Jack Nicholson.

What keeps you awake at night? Conflicts with people.

Your childhood ambitions? I always wanted to become a priest.

Your first car? A Ford Fiesta… until it was crushed by a tractor!

Your ideal night out? To dance the whole night like crazy.

What sports team do you support? The local rowing club in my home town of Richterswil, where my son is a fanatical and successful team member.

Your favourite holiday destination?

Lofoten, Norway. I like the combination of the mountains and the sea.

What makes you angry? Order-based management instead of target-based management.

If you could change one thing about yourself, what would it be? My planning skills could be improved dramatically.

If you had to sing at a karaoke next weekend, which song would you choose?Everybody Needs Somebody to Love by The Blues Brothers. I love the rhythm and the dance moves.

Do you have any annoying habits? I’m forgetful. I sometimes ask my direct reports the same thing several times, which can be embarrassing.

The best concert you have ever been to? The Saint Petersburg Philharmonic Orchestra playing in Zurich – it was different to what I’m used to listening to, and I could really feel the extraordinary passion of the players.

The best book you’ve read in the past 12 months? The Millennium Trilogy by Stieg Larsson – exciting and thrilling from the first page to the last.

“Digitisation will change the offi ce

environment more than we can imagine”

Have you ever done anything dangerous?

I’ve climbed the famous Piz Badile mountain in Switzerland.

What sports team do you support?The local rowing club in my home town of Richterswil, where my son is a fanatical and successful team member.

Your favourite holiday destination?

Lofoten, Norway. I like the combination of the


CalendarKey dates in your industryIf we are missing an event please let us know. Contact [email protected]

JAN 06-09Hong Kong International Stationery FairHong Kong Convention Centre, Hong Kong

JAN 08-10PSI – Promotional Products FairMesse Düsseldorf, Düsseldorf, Germany

JAN 20-22ADVEO World FranceDisneyland Paris, France

JAN 25-28Paperworld Frankfurt 2014Frankfurt, Germany

FEB 25-27Skrepka Expo powered by PaperworldCrocus Expo, Moscow, Russia

MAR 02-06AOPD Annual Meeting Biltmore Hotel, Coral Gables (FL), USA

MAR 04-06Paperworld Middle EastDubai International Convention and Exhibition Centre, Dubai, UAE

MAR 11-14CeBIT 2014Deutsche Messe, Hanover, Germany

APR 29The Society of Old Friends members’ dinner and AGMLondon, UK

MAY 06-09ISSA/Interclean AmsterdamRAI Convention Centre, Amsterdam, the Netherlands

MAY 21-23 CorwellExpoCorwell HQ,Budapest, Hungary

Do you have an event that you would like to promote in the OPI Calendar?

Please contact Fergus Cox for further information about having an extended entry and pricing. Email: [email protected]: www.opi.net/calendar

MAR 06-07DPCG annual catalogue meetingBiltmore Hotel, Coral Gables (FL), USA

MAR 07 The Society of Old Friends Members Guest Night Stationers Hall, London, UK

JUN 11-15SP Richards Advantage Business ConferenceNashville (TN), USA

JUN 16 BOSS FederationBenGolf DayWyboston Lakes Golf Centre, Bedfordshire

JUL 09-11ISOT 2014Tokyo Big Sight, Tokyo, Japan

JUL 15-16Bob Parker Memorial Golf Outing Kiawah Island Resort, Ocean Course, Kiawah Island (SC), USA

SEPT 17-19EPIC 2014Joint Independent Stationers - TriMega conventionWestin Diplomat, Hollywood (FL), USA

OCT 08 Howard Wolf Golf ClassicCantigny Golf Club, Wheaton (IL), USA

OCT 09Spirit of Life GalaNavy Pier, Chicago (IL), USA

NOV 04-07ISSA/ Interclean Orlando 2014Orange County Convention Center, Orlando (FL), USA

APR 01-02London StationeryShow 2014Business Design Centre, London, UKContact: Chris Leonard-Morgan Email: clm@fi rstevents.comTel: +44 20 8462 0721; Web: www.stationeryshow.co.ukThe only UK exhibition dedicated to stationery products, writing instruments and accessories for the home, school and offi ce. Organiser of National Stationery Week.

MAR 04-06OPI Partnership 2014Amsterdam, the NetherlandsContact: Steve Hilleard Email: [email protected] Assisting European vendor and reseller companies in building long-term strategic relationships.

MAR 05European Offi ce Products Awards 2014Amsterdam, the NetherlandsContact: Lisa Haywood Email: [email protected]: www.opi.net/EOPA2014 We invite entries from any organisation operating in Europe. This year we also ask you to nominate any company or individual you feel deserves to win.

MAR 08-11Ed Expo and CAMEXDallas Convention Center, Dallas (TX), USA The world’s largest trade exhibition for the educational supplies market – from pre-school to college – with over 1,000 exhibitors. OPI is also pleased to offer readers a complimentary tradeshow-only registration. Visit www.camex-edexpo.com and enter the promotional code: 2GreatShows14

OPI Magazine | December 2013/Jaunuary 201452

Your OPI

Final wordYour industry, your opinions

Addison FarrellMarketing Account

Specialist, United Stationers

Get moving with mobile marketingSmartphones have made it possible to shop anytime anywhere, writes United Stationers Marketing Account Specialist Addison Farrell. And the OP industry must embrace mobile or risk losing out

YOUR customers aren’t just shopping at home, they are shopping while waiting in line

at the grocery store; running to a client meeting; stuck in traffic; during lunch; on the train; in a restaurant; waiting for everyone to show during a meeting; working out; and many more places. They are even shopping on their tablets at Gap.com while shopping at the Gap.

See a trend here? It’s all about going mobile with your marketing. If your customers are shopping on the go, then you need to market to them on the go.

This isn’t like the infamous Go-Gurt, it’s much more lucrative and longer lasting than that and it’s a necessity for your business.

If you have a fully functioning website, then good, you are about a third of the way there. Have an interactive, content-rich website that creates a destination for your customers? Now we’re talking – but not there quite yet.

Court Cunningham, a guest blogger for Forbes, says that the number of SMBs with mobile websites will triple this year.

Here’s why: In 2012, mobile grew 180% and there is no expectation for growth to slow. Surprised? Experts aren’t. We can expect to see a 77.1% increase in spend via mobile that will account for more than $7 billion in the next year.

At the very least, your website should display properly on a smartphone and tablet – this is called mobile friendly. If you go a step further, you might have a mobile-optimised site which will reformat itself for a list of handheld or tablet devices.

Finally, the Cadillac of the mobile world is responsive design. Responsive design is a method of developing a site that is completely flexible regardless of device. While more costly, it is the best investment if your customer base has various types of devices.

Mobile websites and marketing offer the possibility of connecting with your consumers on the go and the chance to make sales anywhere, any time. Imagine customers who drop their portfolio on the way to

an interview and buy a briefcase from you on their smartphone a second later as they are about to shake hands with their future boss.

Think of the possibilities. Possibilities and positive results from a touch of a screen on a smartphone is exactly what your business should be working towards.

Once you have the data and believe that you need to take action, what’s the next step? It’s important to first understand what makes a great mobile experience. So I leave you with a quick list of mobile site best practices, according to Google, that are sure to get

you moving in the mobile direction.

1. Keep it quick2. Simple navigation3. Be thumb friendly4. Design for visibility5. Make it accessible6. Make it easy to convert7. Make it local8. Make it seamless9. Use mobile site redirects10. Listen, learn and iterate

Addison Farrell is Marketing Account Specialist for United Stationers and blogger for OPI. She prides herself on offering the best solutions and resources to customers that enable them to succeed.

Want the fi nal word? Email [email protected] or write to OPI, Diamond House, 36-38 Hatton Garden, London, EC1N 8EB, UK

Mobile websites and marketing offer the possibility of connecting with your consumers on the go and the chance to

make sales anywhere, any time

• OPI takes a closer look at the Offi ce Depot/Offi ceMax merger• Big Interview with Büroring’s Ingo Dewitz• Spotlight on all things mobile at mobilegear.com

IN THE NEXT ISSUE

Your OPI


Documents

December january2013 eu