Research: State of the Industry 2020-2021 findings

Measuring change.

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It’s out – the State of the Industry 2020-21 report, the eighth edition of the annual market research study by Martin Wilde Associates (MWA) and OPI. And it’s more pertinent than ever, as 2020 was such an unparalleled year for the global OP industry and 2021 is likely to be just as unpredictable.

With offices and indeed entire economies practically shut down, the OP demand that remained switched rapidly away from products that were driven by ‘normal’ office working towards categories that were either suited to homeworking or protected workers and their customers from coronavirus.

During such periods of upheaval, it’s vital for senior industry executives to have a firm perspective on what is happening – and will continue to happen – in the sector. What has been the effect on core OP demand? Where is the market going in terms of products and distribution? What are the underlying trends and which new factors are coming into play? Most of all, where is the industry headed as life gets back to something resembling normal?

Fascinating findings

It is these types of questions the study aims to answer. This authoritative sourcebook for the OP industry is the result of 55 in-depth interviews with senior executives in Australia, Benelux, Canada, France, Germany, the UK and the US.

Overall, the research unearthed some fascinating findings across these seven countries:

The historic rate of decline in core OP demand rapidly deepened in 2020.

As many as 86% of respondents reported a core OP market decrease in 2020, with 57% stating that the value decline was more than 10%. The full report elaborates on expectations for 2021.

During such periods of upheaval, it’s vital for senior industry executives to have a firm perspective on what is happening – and will continue to happen – in the sector

While survey respondents’ overall sales also diminished on balance in 2020, they still outperformed the core OP market.

56% reported a decline in sales in 2020, but for 41%, revenues actually grew. The study explains how respondents in each country achieved increases in 2020 and provides estimates for expected growth in 2021.

Distributor respondents were more likely to report margin increases in 2020.

As many as 46% confirmed a rise in margins, while only 26% claimed they had decreased. More details on average gross margins achieved and expected figures for 2021 – and the reason for them – are revealed in the report.

The product categories that were most widely referred to as growing in 2020 were, somewhat unsurprisingly, PPE/workwear/signage products, cleaning and janitorial supplies, and COVID protection screens.

Declining segments, meanwhile, continued to be traditional stationery products and cut office paper. In addition, business gifts and catering/breakroom supplies were on a downward trajectory. The study sheds further light on the categories likely to be in decline in 2021 on a country-by-country basis.

Amazon (Business) and other internet-only OP resellers headed the list of channels that took the most share during 2020.

Mass market retailers have also benefitted from global lockdowns. Conversely, national contract stationers, small dealers and OP wholesalers were at the top of the ‘losing share’ table in 2020. Predictions for the key growth channels for each country in 2021 are included in the study.

Where will sales come from?

Other highlights from the survey include details on the share of distributors’ sales accounted for by MPS, jan/san and breakroom items – all of which are projected to increase again in 2021. Workwear, PPE and signage, meanwhile, are expected to fall back from the boom experienced last year.

Finally, the State of the Industry 2020-21 report offers insight into respondents looking to acquire or partner with another business in 2021.

The State of the Industry 2020-21 is now available. To order your copy, visit www.opi.net/SOTI2021