Traditional Office products
• The traditional areas of Paper / IT consumables/ Stationery Last 2 years continue to decline:-
Paper - 2 to 5% decline EOS -3% (switching to MPS) Stationery - 3 to 7% decline
Paper 15-20% of sales
EOS 20 - 40% of sales
Filing 5-10% of sales
Areas that are commoditised and suffering decline /change of purchase
• 2013 GDP stagnant• 2014 across 28 countries = 1.4%• Euro markets € = 1.1%• Fastest growth 3 Baltic countries
4.4%• German growth 1.7%• Modest growth in Spain / Italy <1%• Non Euro markets:-
– Sweden 2.8%– UK 2.2%
• Unemployment expected to stay @ 12.2% in Eurozone . In Europe as a whole dip from 11.1% to 11.0%
Market trends – GDP
The last 5 years has seen major change:-• Big box players
– Staples focus on Direct delivery and E Commerce (not stores), expanding range 1m sku’s
– OD/OMax merge – Antalis & Xerox
– Lyreco expanding non - traditional products model
– Wholesale - creation of Adveo
– New entrants web players Amazon / Shoplet $100m online with huge ranges 250,000 sku’s
Consolidation and diversification
•Retail model is challenged within Europe.
•New partnerships being made.
•Manufacturers will continue to consolidate
•Convergence of traditional channels–(web is a driving force)
Manufacturer > Wholesaler > Reseller > User Manufacturer Reseller
Wholesaler User
Consolidation and diversification
Margin pressure
• Margins have dropped with the commoditisation of volume products and fast web pricing awareness.
• Web entrants have made it more visible and price sensitive particularly in the SME sector.
• Customers are more aware of the market due to web / smart phones.
• Key in office supplies in Google – 104m results
• Its been difficult to pass on increases with low inflation.
Change is here and inevitable
Are you selling office supplies ?
Or
Supplies/Services to the office ?
Selling only office supplies will mean a dealer contraction as the web has commoditised this.
Category development (Adjacencies)
• Trends are moving from office supplies companies to Business Service Providers & have been happening for the last 5 years.
• Europe has been slow to react.
Main areas of development:-
JanSan – Janitorial and disposables
Coffee & Break room – Coffee solutions /catering items
MPS – Managed Print Services – major profit provider
Promotional products – Overprinted /Marketing
Category development (Adjacencies)
Coffee & Break room services
- Office coffee market growing at 15-20% p.a - Disposable coffee consumables . - Full line service/ support offer- Coffee is a growth market
- Sometimes more important than paper choice
- Other break room products
- Adds value to the AOV
Category development (Adjacencies)
MPS – Manage Print Services
•Being offered in SME
•Complete service machines / toners and paper
•Growth market and good margin generator
•Single software option to branded manufacturer
Like a Rubiks cube…………………
Connecting with the customer – Success is profiling
Data & mining
Age profileGen X / Baby boomersMillenials
Contact type Web/direct /retail
Categoryoffering
Customer type Large / SME
Logistics offeringTechnology
Your touch point marketing strategy
Success is 3 dimensional
Speed of change is crucial
Albert Einstein said: “To keep doing the same thing and expecting a different result is the definition of madness”
Office product companies need to evolve