OPI: Do you have plans to venture into any of the growing categories that office products resellers and of course your wholesale competitors are now increasingly offering?
Raj Advani: We always look at new products to see if we can do a good job and add value to the market. The facilities category in particular is under review at the moment, but we have no immediate plans to make a move into it. We’ve still got a way to go to get the core office products SKU count and range right and we don’t want to run before we can walk.
OPI: A subject that’s come up quite a bit recently is the value of the catalogue in this Amazon/e-commerce world. What’s your current offering in terms of marketing, catalogue support, etc?
RA: As I mentioned before, we don’t see ourselves as a value-add wholesaler, so we don’t have a big catalogue. I do believe, however, that there is a lot of duplication of cost in our industry whereby the vendors are giving money to the wholesalers and to the dealer groups, while also doing some marketing themselves of course. They don’t really have much control over where all this money is being spent, what it’s being spent on, and whether it’s in fact driving sales.
Our approach with the vendors we work with is that we want to make money out of selling their goods, not out of charging them for having pages in catalogues that may or may not deliver any results to them. We sell the products, then we’ll get paid.
We do have one publication called Office Vibes, but that’s put together in collaboration with the vendors and they pay directly to the marketing company that prints it. We facilitate distribution to the customers, but the vendors have full control of their spend, the product range and the message they want to send out. In this way we are aggregating the marketing spend and are able to offer a better-quality publication that can actually drive awareness and sales of brands.
OPI: We can’t have a conversation about cost without talking about Brexit and the uncertainty it brings. You’re planning on holding your prices again until next year I believe – quite a bold move.
RA: We’re holding prices until the end of this calendar year and we’re giving dealers the option, if they meet certain criteria, to have them held until the end of June next year.
Independent dealers face a lot of challenges right now with regards to profitability. We want to help them grow, maintain and extend their market share and give them some stability and insulation from the wider political and economic scene.
Being part of a large and multinational organisation we’re positioned well to cope with instability – Brexit is just one challenge. What will the effects be? Well, one immediate effect was the weakening of the pound and we’re starting to see some inflation. So perhaps for Exertis, Brexit is not a huge deal, but to a small independent dealer it can be very important, especially the devaluation of the pound which meant a lot of price increases straight after the referendum.
OPI: You mention the multinational outlook of your parent. Do you foresee taking the Exertis Supplies model into other neighbouring European countries?
RA: Yes, that would be nice. We have Exertis businesses in many European countries. But none of them at the moment sell office products, so there’s an opportunity to maybe work with them to introduce a range or alternatively go via the acquisition route. DCC is most definitely an acquisitive organisation. But let’s get where we want to be in the UK first before we expand across Europe.
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