On Friday, Corporate Express (CE) announced that it has entered into a partnership with Daily Service, based in Vilnius, Lithuania, effective from 1 January 2006.
Daily Service is the market leader in Lithuania and is the only B2B contract stationer offering coverage of the entire Baltic region. Its presence in Lithuania, Latvia and Estonia is a distinct advantage given that the three countries have very different languages, cultures and dynamics.
Daily Service’s revenue for 2005 is expected to be in excess of €18 million ($21.6 million) and is pegged to grow rapidly over the next three years.
Peter van der Vlis, VP of international accounts for CE Europe, said in a statement: "This partnership with Daily Service is an important further step in Corporate Express’ strategy to offer our international customers a reliable solution for their office needs in all European markets. Our customers expect that we are where they are."
Valentinas Milaknis, president of Daily Service, added: "We are confident that our partnership with Corporate Express will facilitate providing further value-added for our customers in the Baltic states and will create a strong competitive advantage…Corporate Express’ approach fits very well with Daily Service’s strategy: focus on B2B contract stationery, international presence, nationwide coverage, ecommerce solutions, dedicated team, good reputation and honest business practices."
The announcement came just six weeks after CE entered into an exclusive agreement with Fesa, a Mexico City-based OP and services company, and voiced plans to continue expanding south into other Latin American markets.
But despite this recent push into emerging markets, CE says that this is not where its priorities lie. Instead, it claims it is more concerned about improving its services in more developed markets where its portfolio of multinational customers have a greater presence.
Expanding into less developed markets such as the Baltic states will remain somewhat of a sideline for the time being.
Head of corporate communications Gerard Wichers told OPI+: "We are looking at other deals that are not in the Baltics but in more pressing areas such as Spain, Switzerland and Scandinavia. We have a strong presence in Europe [25 countries at last count] but in some countries we do not have a real presence, and these countries are our most obvious whitespots and the ones that we plan to fill."
Wichers says CE’s plan of entry into these markets will be through small acquisitions and says the company is currently researching targets. "Our large strategic accounts work on a pan-European scale and they like our private brand products, so it will be useful to us to buy small companies. This will also enable us to implement private label more easily…We just need a foothold in these markets."
But CE maintains it will continue to hunt out partnerships – rather than acquisitions – in smaller markets, such as the Baltics and Latin America, because they are all part of what Wichers describes as CE’s "larger strategy".
