Keywords: big, boxes, dealers, wholesalers, office, products, 2011

Forward thinking

Questions, questions

Looking at our predictions in last year’s US Office Products Industry Annual Review, it would be easy to write a very similar article. Rumours do continue to abound about a possible big box merger, retail might become an even smaller part of the industry, and independent dealers may well continue to make inroads into the national accounts arena.

But there are some noticeable rumours and suspicions new to this year that are worth a mention. While a Depot/’Max merger is still on the cards – or will Staples get involved? – another possibility could be a merger of just parts of the business. Both Office Depot and OfficeMax’s models are built around having a dual route to market, both retail and delivery, so could there be a merger of just one of these parts? 

The big boxes probably also need to address Walmart’s apparent success with its new Express stores. With leases coming up for renewal, it’ll be interesting to see how the number and sizes of stores vary in the coming year. 

But taking another tack, considering the growth of other office supplies rivals such as Best Buy and Amazon, could a big box bankruptcy be looming around the corner? Really, anything could happen. With all these options it seems that the power channel is on something of a knife-edge.

On the dealer group side, how long will TriMega continue with Point Nationwide? As a competitor to Independent Stationers’ national accounts programme, what will happen if IS continues to make the progress Mike Gentile predicts? 

Similarly, Dave Guernsey’s Pinnacle group could achieve national coverage soon, which would open up possibilities for it to have its own national accounts business. This would put pressure on AOPD and raise question marks over Pinnacle’s existing relationship with IS.

We haven’t said much about giant independent dealers such as WB Mason in this publication, but we haven’t forgotten them. Though just missing its billion dollar mark this year, WB Mason CEO Leo Meehan isn’t far off his target, so where from there? Is the dealer looking to expand west? Perhaps.

As usual, we can predict that there will be a fair amount of dealer consolidation in 2012. With a market this unsteady and a high unemployment figure this seems inevitable. It is a safe assumption that MyOfficeProducts will make more acquisitions in the coming year, expanding its reach even further. 

Consolidation could also be present on the vendor side. Rumours last June circulated regarding Avery Dennison possibly selling of its office division, but we have heard nothing since. Could 2012 be the year? 

So, as usual, there are a lot of question marks. As the year progresses some will be answered, although it may be that a slow-moving economy will put off some changes until 2013. But it’ll certainly be an interesting year and we look forward to seeing what happens.