A sales growth of 60 per cent year-on-year – compared to 35 per cent last year – is no mean feat for a national company in an industry squeezed by international power players and an increasingly demanding clientele.
But by seizing opportunities, continuing to "think big" and building an exceptional team, George Karibian, Euroffice’s managing director and co-founder believes the almost-unachievable is possible.
Known for setting exceptionally high targets, Karibian aimed to bump up last year’s 35 per cent sales growth rate to reach 100 per cent within the financial year. At a cumulative 77 per cent, the figure is not far off. "We knew it was a high target and we worked pretty hard," Karibian told OPI+. "We fell short of it but I’m pretty happy with it."
To meet his famously-high goals, Karibian has always placed a mammoth importance on both his team and what he describes as "keeping the energy going". He said: "We have an exceptional group of people without which we couldn’t do any of this. And we take time out to do the big thinking and keep that innovative edge, which is one of the most difficult things to do when you’re comfortable. As the company’s managing director and founder, this is my biggest challenge."
Karibian gets his new ideas from all manner of sources – other companies, conferences, books – one of his favourites being Malcolm Gladwell’s The Tipping Point: How little things can make a big difference. It is then a question of consulting an expert, sharing ideas with the team – usually in a salubrious countryside location – and then motivating the workforce to implement the changes.
One of the biggest things to evolve from this heady mix of ideas, talent and innovation is Eurwholesale.co.uk, which was launched in January. The nature of the operation, based on Sam’s Wholesale in the US, is to target medium-sized companies of 20-25 people by offering the lowest prices in the market in exchange for a subscription fee and raised minimum order quantities. The site features 3,000 products as opposed to Euroffice’s 20,000 products.
So six months in, is Eurwholesale showing signs of tipping? "It’s going well but it’s still too early to tell whether it will take over Euroffice, although I have a gut feeling that it will do," said Karibian. But he admits that current growth levels aren’t good enough and that the site needs total attention. To this end, he devised an innovative solution. "I asked for a volunteer to play a Mr Wolf [Harvey Keitel’s role in Pulp Fiction]. This person would have the ultimate power to chose one person from each department and have these people totally under his leadership. I gave them 21 days to take Eurwholesale to the next level."
The deadline is currently drawing to a close and the experiment has been successful. Among other things the site’s landing page has been changed, the design has been updated and the team have adopted new approaches to marketing. "We are making five to ten changes a day to the Eurwholesale site," he said. "We can try out new things and be more aggressive with this site because it is new."
Of course being a successful online player in today’s market, Euroffice is well-placed for growth. But Karibian admits there is a constant challenge to stay ahead. At present in the UK, the company comes a close third to Staples and Viking with 15,000-20,000 visitors a day, but as pure online players go, it is number one. Karibian is well-aware of the precarious nature of online, which he admits can lose him sleep at night. "There will only be two or three winners in online," he said. "Think of any industry – books, airline tickets, there is only room for two main players, three at the most."
The secret of online success is to have design patterns that both differentiate you from your competitors and are familiar for your customers. Together Euroffice staff and external consultants have spent no end of time and money on design patterns – and continue to do so – to achieve that they believe to be a winning formula. Unfortunately, so do plenty of others. "One of the increasing problems for us is smaller sites in the OP industry copying our site design and duplicating," he said. "This won’t get them anywhere but it hurts our business as it makes our site look less unique. We have just signed up a law firm in the city to chase these guys."
Looking towards 2007, the company plans to replicate either Euroffice or Eurwholesale in Europe a la Spicers. The priority countries are, predictably, France (fastest growing online, poor service), Germany (the biggest market) and Spain (high margins, room in the market to be competitive). To finance the move, Euroffice is planning an AIM flotation next year.
But whether it is Euroffice or Eurwholesale that goes continental remains unsure. Harsh as ever with his targets, Karibian says Eurwholesale needs to "prove itself by the end of the year or die". But he is quietly confident it will work – in which case the goal further down the line is to merge the two sites, OPI+ can reveal.
One thing looks certain – Euroffice’s business formula will continue to adapt to market. By looking after its loyal SME base and acting as a second source supplier to many corporates, Karibian hopes to increase its current £1.5 million ($2.8 million) in sales a month to top the £20 million for the first time ever by the end of its financial year next March.