OPI and specialist office products market research firm Martin Wilde Associates (MWA) have published a special update to their annual The View From The Top: The State Of The OP Industry 2019-20 report which quantifies the impact of the COVID-19 pandemic on the business supplies indusrty.
With COVID-19 causing fundamental shifts in working habits and product demand worldwide, MWA and OPI have recently revisited the senior industry executives in Australia, Benelux, Canada, France, Germany, the UK and the USA who had originally participated in the State Of The OP Industry survey in early 2020 and asked them to revise their forecasts concerning:
- the value of the OP market in their country in 2020
- their estimated sales in 2020
- distributor gross margin trends in 2020
- the key product categories that will grow and decline in 2020
- the key distribution channels that will grow and decline in 2020
Overall, the research unearthed some fascinating new findings across the seven countries. These include:
- Overall, the expected rate of decline in demand for core OP in 2020 has now accelerated significantly: 94% of all respondents now expect a core OP market decline in 2020, compared to 85% earlier in the year – and the anticipated rate of that decline is now also much deeper.
The report explains the reasons given for the decline in each country and shows that there are some countries where a few respondents are still expecting some value growth in demand for core OP in 2020.
- Overall, distributor respondents are now generally slightly less positive about margin trends in 2020: while a few respondents are now more likely to expect their margins to increase in 2020, there has been a larger increase in those who believe that they will decline this year.
The report details the average gross margin trends expected by respondents in each country in 2020 and gives reasons for any possible margin changes.
- The product categories that are most widely expected to be growing in 2020 have substantially changed, with cleaning/janitorial, PPE and technology products now heading the list.
The report also shows that, whereas catering/breakroom supplies and office furniture were previously amongst the categories that were most widely expected to grow in 2020, these are now rarely mentioned as being growth categories.
- The product category that is most widely expected to be declining in 2020 continues to be traditional stationery products, but other core OP categories, such as cut office paper and printer/IT consumables, are now less likely to be mentioned.
The report shows that there are also some other categories that are now being widely forecast to decline in 2020.
- The supply channels that are most widely expected to be taking share in 2020 continue to be Amazon/Amazon Business and – to a lesser extent – other internet-only OP resellers.
The report shows that online players in general – including, for the first time, eBay – are the most widely believed to be benefiting from the COVID-19 crisis, as have the facilities supplies specialists.
- The channels that are most widely believed to be losing share in 2020 continue to be the national contract stationers, small independent OP dealers and OP wholesalers.
The report shows that there are some product specialists, such as paper merchants and furniture distributors, that are now more widely expected to be in decline in 2020.
The full update report – including the original survey published in April that reports on OP market trends in 2019 – is now available here.