ABC4Office

 

Bridging the Gulf

 

Jordanian conglomerate looks to create the region’s leading OP B2B player

With traditional markets taking a bit of a hit during the economic slump and question marks hanging over growth prospects for new ventures in Asia, eyes are turning towards the largely untapped Middle East region as a potential driver of sales and profits for OP resellers.

Following on from the recent announcements that Office Depot is to enter the region and that Office 1 is expanding its presence there, Jordanian group Nuqul has now launched a new B2B office supplies subsidiary that it plans to develop into the number one player in the MENA region.

 

The new venture – ABC4Office – was officially launched in its home market of Jordan on 1 February, supported by a massive $750,000 advertising and marketing campaign which includes national press, radio, outdoor posters and a launch event for top CEOs in Jordan’s business community.

 

Initially, ABC4Office is targeting large and medium-sized businesses with a single-source and next-day delivery model that is the first of its kind in the local market. Other aspects of the proposition which are new for Jordan include a dual Arabic/English catalogue supported by an internet catalogue and webstore for both account and payment card customers – one of the first trading websites to be operated by a Jordanian company. Both the traditional catalogue and internet catalogue have been designed in the UK by specialist agency The OfficeSpa.

 

"Although economic growth remains strong in Jordan, our market research indicated that developments in the supply chain for office products were not keeping pace with the increasingly sophisticated requirements of corporate customers," explained Rami Kawar, ABC4Office’s General Manager.

 

Nuqul is already a leading player in Jordan as a paper converter and distributor of office paper, notebooks and pads under its ABC brand, hence the name ABC4Office which will already have a familiar ring to it for Jordanian customers. Nuqul has also been able to integrate its own Fine brand of tissue paper and hygiene products into ABC4Office’s janitorial product range.

 

The rest of the product range is largely built around well-known office supplies brands and comprises an "adequate but limited" range of items that will be kept in stock in order to fulfil ABC’s 24-hour delivery promise and 98 percent first-time fill target.

 

Warehousing, distribution and delivery is being handled by leading Middle East logistics provider Aramex.In most cases, products are being sourced direct from manufacturers, but some local distributors – for example HP and Canon – who carry sufficient stock are also being used.

 

"The first signs are very encouraging," says Martin Eames of consultants Supplies4Office which has been managing the project to set up the new business over the last 18 months. "A targeted e-mail shot drew a 5 percent response and follow-up calls have already resulted in a healthy number of appointments for our sales team, including with the US Embassy in Amman."

 

ABC is looking at a two-year time frame to secure a leading position in Jordan – where the market for office supplies is estimated at around JD100 million ($140 million) – before looking to expand beyond its home borders.

 

"Subsequently our plans are to scale our business model across the Gulf and MENA region and become the leading player in the office supplies market estimated at $3 billion and projected to grow to $4 billion by 2012," said Nuqul CEO Nidal Eses.

 

Regional interest

 

This will undoubtedly be of interest to other players in the region and to those who have yet to make their entrance into what is still a largely fragmented marketplace.

 

To date Office 1 is really the only international reseller to have made a foray into the region with stores in Saudi Arabia and Qatar, and the first Jordanian store set to open next month. CEO Mark Baccash was not unduly worried about the emergence of Nuqul in the Jordanian market.

 

"Our concept is different in that the business is based on retail stores, some under franchise, backed by a B2B business," he told OPI. "I think there is enough market for all and do not anticipate much butting of heads."

 

Similarly, Office Depot’s imminent arrival in partnership with leading Kuwaiti group Alshaya looks set to be a retail-only operation, at least to begin with, and Saudi-based resellers such as Hoshan and Jarir are better know as a distributor and retailer respectively.

 

The only real B2B player on the radar screen is Lyreco’s strategic partner in Egypt, SpeedSend, which is still a fledgling business with annual sales at around the $6 million mark. One consequence of Nuqul’s arrival could be increased Lyreco investment in SpeedSend to expand the operation before the Jordanian gets a stronger foothold in the region.

 

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