OPI July/August 2014 by OPI

Office Products International ISSUE NO.241

The word in office.

magazine

Big Interview Bob Geens, CEO, Advantia Business Solutions p18 July/August 2014

JULY/AUGUST 2014 WWW.OPI.NET

p14 New US dealer service model Evolution of the mobile worker p32

p28 The (Amazon) Kraken wakes

Contents July/August 2014

www.opi.net

News

35 ABC/NAOPA

All the news from the ABC and the winners of this year’s NAOPA

6 Round-up

Digital dealer dilemma; United acquires e-tailer; Armor rejigs

41 OPI European Forum

Lively debates and top-level networking – coming to Amsterdam

10 Beyond OP

Jan/san boosts for AAA, SPR and Banner; Acme acquires First Aid Only; Officeworks gets arty

43 EPIC Preview

TriMega and IS are thinking BIG for the second EPIC event in September

12 Analysis

Category Analysis

New Spicers CEO addresses dealers; Toy Fair organiser launches stationery show; new dealer services model sets up in the US

Features

18 Having good Geens

44 Furniture

Versatility and flexibility – the core prerequisites for today’s office

48 MRO & Safety

Bob Geens explains why Advantia’s Truline model is ready to grow and urges dealer groups to work together for the common good of the industry

Those that have ventured down this adjacent category are beginning to reap the benefits

Regulars 5 Editor’s comment

28 The Kraken wakes

From the growing threat of AmazonSupply in the US to an increasing tendency to bypass some channel partners, Amazon is becoming an almighty animal

51 On the move 52 5 minutes with... Betsy Hughes

53 What’s on?

Key dates for your calendar

32 The mobile evolution Mobilegear looks at the mobile worker of today – and what that means for OP resellers

54 Final word Jennifer Huckeba

“When AmazonSupply gets cranked up and goes after the dealers’ commercial B2B business, leveraging all that customer data it now owns (thanks to third-party sellers), the short-term profits some made selling on Amazon may all of a sudden seem inadequate”... For the full story, turn to page 28 This month’s cover is supplied by Shiny

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Editorial Editor Andy Braithwaite +33 4 32 62 71 07 andy.braithwaite@opi.net

Features & Production Editor Heike Dieckmann

Editor’s comment

+44 (0)20 7841 2950 heike.dieckmann@opi.net

News Editor Michelle Sturman +44 (0)20 7841 2942 michelle.sturman@opi.net

Sales and Marketing VP – Continental Europe, Middle East and Africa Ewan Dickson +44 (0)20 7841 2954 ewan.dickson@opi.net

VP – North America and UK Chris Turness +44 (0)20 7841 2953 chris.turness@opi.net

Digital Manager India Pride +44 (0)20 7841 2959 india.pride@opi.net

Sales Executive Fergus Cox +44 (0)20 7841 2952 fergus.cox@opi.net

Events Events Manager Lisa Haywood +44 (0)20 7841 2945 lisa.haywood@opi.net

Production and Finance Operations Manager Nicky Coulson Designer Charlotte Gerhardt +44 (0)20 7841 2943 charlotte.gerhardt@opi.net

Production Assistant Jack Francis +44 (0)20 7841 2950 jack.francis@opi.net

Accountant Dotun Olaniyan +44 (0)20 7841 2956 dotun.olaniyan@opi.net

Publishers CEO Steve Hilleard +44 (0)20 7841 2940 steve.hilleard@opi.net

Director Janet Bell +44 (0)20 7841 2941 janet.bell@opi.net OPI is printed in the UK by

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No part of this magazine may be reproduced, copied, stored in an electronic retrieval system or transmitted save with written permission or in accordance with provision of the copyright designs and patents act of 1988. Stringent efforts have been made by Office Products International to ensure accuracy. However, due principally to the fact that data cannot always be verified, it is possible that some errors or omissions may occur. Office Products International cannot accept responsibility for such errors or omissions. Office Products International accepts no responsibility for comments made by contributing authors or interviewees that may offend. Office Products International Ltd (OPI), Diamond House, 36-38 Hatton Garden, London EC1N 8EB, UK

Playing with fire I’m not sure if my extended recovery time from SP Richards’ ABC show was due to excessive jet lag or the after effects of a close encounter with a Kentucky speciality called Fireball, but it was certainly a memorable few days in Nashville, even if the OPI crew (with the exception of Heike) had to endure the disappointment of England’s World Cup defeat by Italy while we were there. We had two truly outstanding and deserving winners of the dealer awards at the North American Office Products Awards in the form of Kasie Morley and Bud Mundt (see page 39), and well done to all those from SP Richards who were involved We had two truly outstanding and in putting on such a deserving winners of the dealer great event. awards at the North American Hopefully, most Office Products Awards OPI readers will have noticed by now that we upgraded our website recently, and it’s now optimised for smartphone and tablet users – with a new app coming soon, too. This is something our Digital Manager India Pride and her team have been working on virtually day and night for the past several months and I hope you like the result. Content is organised by category and it should now be easier for you to find the news, features and articles that you are specifically interested in. One new feature is a directory for products, vendors and resellers that includes a free (yes, really!) listing, so why not scan the QR code on this page and improve your visibility on opi.net? Andy Braithwaite, Editor

Tel: +44 (0)20 7841 2950 Fax: +44 (0)20 7841 2951

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@opinews

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News from opi.net Armor rejigs cartridge business Aftermarket supplies manufacturer Armor is reorganising its Office Printing division in a bid to become Europe’s leader in compatible printer cartridges. The announcement came weeks after a senior management buyout and is clearly part of the company’s ambitious strategy moving forward. Armor is investing in sites all over Europe, with the aim of improving logistics across the continent. Its inkjet cartridge production facilities are being reorganised, with the manufacturing of reconditioned inkjet cartridges moving from Písek in the Czech Republic to Prudnik in Poland. The Písek site will now specialise in sorting cartridges for recycling. Armor’s laser cartridge business is being restructured to implement on-demand packaging and improved shipping times.

Gentile evokes “digital destiny dilemma” for dealers Independent Stationers (IS) CEO Mike Gentile has said dealers must have greater control and influence over what products they are able to go to market with and sell. Speaking to OPI, Gentile referred to what he called the channel’s “digital destiny dilemma”, alluding to the e-content and SKU-availability gap between what the e-tailers and big boxes sells on their .com websites and what dealers are able to sell. “We have a situation where a dealer’s product range is essentially dependent on the Mike Gentile wholesalers’ content and the 3PVs’ search functionality,” he stated. “Wholesalers are basically saying: ‘We want dealers to buy the products that we want to sell to them’, whereas a dealer’s product offering should be more end-user driven.” Gentile said he had come across cases where dealers could not get hold of products because they were not stocked, supported or merchandised electronically by one of the major wholesalers in the US. “The wholesalers are not against this principle,” he added, “but it needs someone to take a leadership role in what I believe is a major strategic issue negatively affecting the independent dealer channel.”

TriMega launches Supplier Advisory Council

Mercateo blames Google for slower growth

US dealer group TriMega has created a Supplier Advisory Council, inviting suppliers to join a mission of working together for the good of the independent dealer community. The group aims to use the council as a forum to open dialogue for developing “honest and timely” feedback, not only with its own initiatives, but – more importantly – with the wider issues facing independent dealers. TriMega President Mike Maggio said: “Only through trust, forward thinking and working together, can we effectively drive the success of both our dealers and our supplier partners in the independent dealer community now and in Mike Maggio the future.”

Germany-based online trading platform Mercateo has reported sales growth of 4% to J135 million ($184 million) for 2013. This is a marked slowdown from the double-digit growth rates the firm has been used to. The company said this was caused by changes Google made in 2013 when it replaced its previously free Google Product Search with paid Google Product Listing Ads – something that has proved expensive for e-commerce players. Despite this, Mercateo pointed to a number of positive developments, including a sharp increase in the number of products available – to 10.7 million in Germany – expansion into five new international markets and strong growth with existing customers.

OPI Magazine | July/August 2014

United Stationers has acquired tools and equipment e-tailer CPO Commerce in a $40 million deal. Founded in 2004, California-based CPO is a leading online reseller of tools and equipment to the home improvement and DIY trade and reported 2013 sales of about $78 million. United is paying $30 million in cash for the business, with up to an additional $10 million to be paid in three years, based on performance. The wholesaler said that CPO’s expertise will strengthen its ability to deliver such features as improved product content, real-time access to inventory and pricing, and digital marketing and merchandising. CPO will also provide an enhanced digital platform to support United’s manufacturing partners. Speaking to OPI, United’s VP of Marketing Diane Hund confirmed that United had made this acquisition in order to develop its own digital capabilities for the benefit of its independent dealer customers. “We have no intention of competing with our own OP dealers,” she said, adding that United had purposely picked an e-tailer outside the OP space, preferring to acquire expertise rather than build up capabilities from within – something that would have taken time.

Virtualstock and wnDirect simplify global supply chain UK software provider Virtualstock (VS) and logistics specialists wnDirect have created an e-commerce platform that delivers control and visibility into the global shipments supply chain. The software platform, wnOptimise, ensures that goods anywhere in the supply chain are shipped via a more efficient, cost-effective and logical route, avoiding the ‘ping-pong’ effect that can sometimes take place. The software also transforms stock control and optimises shipping orders by providing a single view of all inventory in all locations.

Cartridge World ECi sees new system uplift betting on new model Cartridge World CEO Bill Swanson says the future of the brand lies in a new business model introduced last year. The franchise chain’s new model is based on a mix of selling high-efficiency printers that use high-yield printer cartridges, and providing services and solutions for business owners, such as automatic ink replenishment, printer repairs, and recycling and shredding services. “We introduced the new business concept to our franchise system about a year ago, and what began as a window of opportunity is now becoming the future of our brand,” said Swanson. Cartridge World has about 600 stores in North America and says there is a greater sales opportunity for its franchisees as Staples and Office Depot|Max downsize their store networks.

ECi President Office Products Andrew Morgan has told OPI that dealers are seeing measurable benefits from its new ECinteractivePLUS system, with an increase of online sales of between 8-10% versus similar profile dealers that hadn’t yet Andrew Morgan made the switch. One key area of functionality that Morgan highlighted is ‘subs’ – or substitute products – where higher margin alternative products are offered on the shopping page. Morgan said that subs used to be limited to OEM vs remanufactured ink and toner products, but that this has evolved to provide more sophisticated alternatives. “It’s about increasing basket size for dealers and selling the right items for the right margins,” he said. “It’s not just about throwing a whole lot of new SKUs at the problem.” He added that educating dealers on the capabilities of the new system would be a priority. “I don’t think that dealers always utilise all the technology that’s available to them in the systems they have,” he stated. “That’s not being critical of the dealers, but it’s an issue that the industry as a whole needs to address as more and more people have their hands in the technology sector.”

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News n Round-up

United acquires e-tailer

Highly respected office products executive Gordon Scott is to retire at the end of July. Scott joined Newell Rubbermaid in 2002 as General Manager for Office Products in the UK after spending nine years serving one of the company’s most iconic brands, Parker. Over the past 12 years, Scott has been instrumental in expanding the business in EMEA. He began by developing Lee Mellor international key accounts while supporting pan-regional marketing efforts before managing office products sales across the

region. He leaves the company as SVP and General Manager of EMEA. Lee Mellor, current Newell Rubbermaid VP of Consumer Sales EMEA, will replace Scott as the company’s representative for the office products industry in the region. Mellor said: “Gordon’s strong sales experience and excellent knowledge of EMEA has been invaluable, particularly over the past two years as we’ve transformed the organisation and driven our Growth Game Plan into action in the region.” He added: “I would like to thank him for his leadership, dedication and many contributions to our brands over his career and I wish him and his family all the best in a very well-deserved retirement.”

News n Round-up

Industry veteran Gordon Scott to retire Gordon Scott

Strong turnout at BOSS event

More than 100 CEOs and senior industry figures attended the BOSS Federation Members’ Day at the beginning of June in the historic setting of Stationers’ Hall in central London. Happening just days after the departure of Spicers CEO Alan Ball, the future of the wholesaler was certainly the main topic of discussion as attendees gathered for registration and pre-conference coffee and biscuits. There was even some speculation as to whether Ball – in his capacity as Chairman of BOSS – would actually put in an appearance. He didn’t attend, of course; perhaps more surprisingly, there wasn’t anyone at all from Spicers, leaving VOW – which had also sponsored the day’s event – as the sole wholesaler representative. The day kicked off with an invitation-only CEO conference, with guest speaker Steve Turner, a former Olympic rower who now runs a corporate team development activity centre. Turner’s talk centred on the teachings of leadership consultant, organisational health advisor and author Patrick Lencioni, in particular his book The Five Dysfunctions of a Team.

Delegates were then treated to a refreshing account of how a young British entrepreneur started her business from scratch. Jules Quinn had spoken at the BOSS Young Managers’ Conference in April, but was invited to the Members’ Day to describe the trials and tribulations of how she started and developed The TeaShed, a fashionable new tea brand which is growing in popularity in the UK. Lunch was held in the magnificent Livery Hall and the guest of honour was Geoff Betts, Managing Director of vendor Stewart Superior. Betts, the 2013 winner of the BOSS Outstanding Achievement award, amused guests with industry anecdotes and then got out his guitar to play his own OP-inspired version of Don McLean’s American Pie – something that will surely stay long in the memory of all those present. Following lunch, BOSS held its AGM during which Durable’s Sean Starkey Sean Starkey was elected as the new Chairman of the association, a role which he said he was proud to accept. Speaking to OPI at the end of the day, BOSS CEO Michael Gardner said he was “delighted” Geoff Betts with the strong turnout which underlined the importance of the association in the UK business supplies space. w w w.opi.net | OPI Magazine

News ■ Beyond OP

AAA aims for jan/san boost Leading California dealer AAA Business Supplies and Interiors is targeting jan/san as a strategic growth category. Speaking to OPI at the recent SP Richards ABC show in Nashville, AAA President Steve Danziger revealed that the $30 million dealership was making a major push into jan/san products after seeing impressive results over the past few years from its move into coffee and breakroom. After doing what Danziger describes as “convenience jan/san” for several years, he Steve Danziger is now hoping

Acme acquires First Aid Only Acme United has acquired the assets of safety products supplier First Aid Only for $13.8 million in cash. Canada-based First Aid Only is a supplier of Smart Compliance first aid kits, refills and safety products, and will now join Acme’s existing PhysiciansCare and Pac-Kit brands in the safety and first aid categories. First Aid Only – which has about 100 employees – posted revenues of $17.3 million in 2013 and is expected to be accretive to Acme’s earnings this year. Acme CEO Walter Johnsen said that changing safety regulations and the increasing willingness of its traditional OP customers to embrace sales of first aid and safety products are contributing to the significant growth of this category for Acme; the vendor is expecting to hit revenues of $40 million this year for its combined first aid, safety and over-the-counter medication products (see also ‘Safety first’, page 49).

to replicate the success of coffee and breakroom, and has recently hired a jan/san business development manager/ category specialist who will both talk directly with existing accounts and train AAA’s sales reps. Danziger underlined the need to invest in specialist jan/ san (and MRO) knowledge in order to have expertise in the breadth of products available and in areas such as product chemicals, regulations, etc. AAA has largely a buy-direct model, so Danziger was at the ABC specifically to meet with jan/san suppliers. Interestingly, he said that previous discussions with certain jan/san manufacturers had not led to any business arrangements as some vendors were keen to protect their existing relationships with specialist jan/san distributors. Others, he noted, are more than keen to speak with dealers such as AAA, viewing the office supplies channel as “the future” of jan/san distribution.

Bunzl continues acquisitions Bunzl is furthering its reach in Europe and South America with two more acquisitions. The company has acquired Allshoes Benelux in the Netherlands and JPLUS Comércio e Distribuição in Brazil. Based in Alkmaar, Allshoes is a distributor of both branded and own label safety and work shoes, serving wholesalers and retailers in the Netherlands and Belgium. Revenue in the year ended 31 December 2013 was 119.9 million ($27 million). JPLUS distributes cleaning and hygiene supplies and disposable products, primarily to the contract cleaning and healthcare sectors. Based in Minas Gerais, the company’s revenue for the year ended 31 December 2013 was R$39.3 million ($17.7 million). Including the two acquisitions of Allshoes and JPLUS, Bunzl’s year-to-date acquisition spend is about £95 million ($161 million).

Richards Officeworks gets arty SP makes an impact Australian reseller Officeworks has diversified its product offering with a new extended range of art supplies. Available in selected Officeworks stores and online, the new collection of artist-quality products features more than 1,500 SKUs including pastels, pencils, modelling clay, charcoals, paints, easels and colour charts. According to Officeworks Business Manager Office Supplies Jim Berndelis, the company aims to become a one-stop shop for art students and DIY enthusiasts.

OPI Magazine | July/August 2014

SP Richards (SPR) has agreed to acquire facilities, janitorial and safety supplies company Impact Products from private equity group Pritzker. Founded in 1963, Impact is a manufacturer and supplier of a wide range of facilities products and serves customers across North America from distribution centres in Toledo, Ohio – where the firm is based – and Walnut, California. The acquisition was set to close on 1 July and SPR expects Impact to add about $85 million in annual sales. This latest deal comes just a few months after SPR acquired $35 million food service and jan/san wholesaler Garland C Norris.

UK reseller Banner Business Services has expanded its facilities supplies category to over 14,000 products. The range now covers everything from catering to front of house, and washroom to premises management, with availability online as well as a via catalogue. Managing Director of Banner Business Services, Richard Costin, said: “We have been expanding our product range in direct response Richard Costin to our customers’ needs, as they’re increasingly looking to purchase from a single source and supply across the UK and Ireland on a next-day delivery basis.

PPS steps into FM category Field marketing agency Product Promotion Services (PPS) has been appointed by FM distributor Robinson Young to provide field sales representation in the UK. Recognising that facilities management categories such as catering and janitorial represent a new product sector for many dealers, Robinson Young Sales Director Kevin Sperling said that appointing PPS allows the company to seek a wider audience and provide dealers with the necessary information and support to take advantage of a growing sales opportunity. The deal, through which PPS will promote the entire Robinson Young product range, will also see the agency provide sales tools and offer assistance with end-user sales presentations.

Jan/san Special – see next issue

News ■ Beyond OP

Banner boosts facilities supplies range

News n Analysis

No false dawns, says new Spicers CEO Greg Michael addresses dealers and suppliers at Superstat conference

into its RDCs instead of via the central distribution centre. And stock ordering and shipment levels are slowly approaching satisfactory levels. With “liquidity stable” and further funding issues being addressed, Michael stated that the company is no longer on credit hold with any vendors. However, he added that the time it takes to rebuild inventory levels, particularly for the company’s 5 Star private label SKUs which are predominantly manufactured in Asia, should not be underestimated.

Longer term

Greg Michael

SpicerS’

new CEO Greg Michael made his first public presentation to the industry at dealer group Superstat’s 21st annual conference in mid-June. Michael’s appearance – less than three weeks into his role – was keenly anticipated given the wholesaler’s recent and well-documented supply chain issues, and even more so given the tight strategic relationship that it cemented with Superstat before the difficulties surfaced. Michael was appointed following the sudden departure of Alan Ball at the end of May. Spicers owner Better Capital finally called time on Ball’s tenure after four and a half years in the job as the supply issues dragged on and began to have a significant impact on the wholesaler’s financial performance (for reaction to Ball’s departure, see And Finally…, page17).

Apology Presenting at the Superstat conference with no visual aids or notes, Michael started by offering a genuine apology for his company’s recent performance issues before speaking frankly about the challenges Spicers is working hard to address. “I will not try and defend the indefensible,” he explained to the assembled dealers and suppliers, “but there will be no false promises or dawns either.”

OPI Magazine | July/August 2014

While the management team is “laser-focused” on addressing two fundamentals – systems and the configuration and scalability of the Smethwick track that has caused many of the service shortfalls – Michael, probably wisely, declined to share the company’s timetable and plans to get back to full operational capability. However, he did offer the reassurance that once the team has identified “a clear route map”, there would be no rolling back when that is shared with the dealer and vendor communities. For the dealers in the room it was no surprise to hear that the Smethwick distribution centre continues to suffer intermittent failures and, while Michael focuses on further strengthening warehouse and logistics expertise, some portions of Spicers’ business will continue to be diverted out to one of the regional distribution centres (RDCs). Stock availability has been a core issue for dealers struggling to fulfil customer orders on time – and profitably – and this was addressed head-on by the new CEO. While industry veteran and board director Ray Peck leads Spicers’ efforts to get its arms around the issue, Michael told the audience that the company had begun shipping stock directly

Before the supply issues occurred, many industry observers – including OPI – had expected Better Capital to be looking to exit its Spicers investment at the end of 2014. Michael moved to play down any suggestions that Better Capital had appointed the experienced turnaround executive to do ‘a quick fix’ and dispose of the business as soon as possible and the owner now appears to have a longer-term strategy for the wholesaler. Overall, it was a polished and appropriate – some may even say brave – appearance by Michael which seemed to hit the right tone. The dealers OPI spoke with as the new Spicers CEO left the stage to a big round of applause were grateful he found the time so early in his tenure, especially against the backdrop of the well-publicised service issues. They also agreed with his observation that Spicers has a limited window of opportunity to restore credibility and all suggested they would remain supportive, provided a promise of a weekly update was forthcoming. It has always been our view at OPI that the UK needs two strong full-line wholesalers. Based on what we saw and heard, we are cautiously confident that Spicers will bounce back, provided there are no more catastrophes and that its incredibly loyal dealers hang in there just a little longer.

editor’s note: Greg Michael has kindly allowed OPI to publish this report despite an initial request that his remarks were off the record and covered by Chatham House rules. We appreciate that permission.

the recent woes of Messe Frankfurt’s Paperworld show, held at the end of January. However, Insights-X is another addition to an already packed calendar of events, as Durable’s Senior Marketing Advisor Horst Bubenzer pointed out: “We are facing a situation where our annual marketing calendar is full of fairs, exhibitions, roadshows and customer events, and while the Paperworld date is not ideal for some resellers, there are already autumn events such as ADVEO World and the GVS fair.” The cost of exhibiting and attending two major shows may also be more than the industry can handle although Insights-X, as a smaller fair hosted in Nuremberg, might offer cost savings for both exhibitors and visitors over the larger Frankfurt-based Paperworld

Does the announcement of a new stationery show in Nuremberg pose a threat to Paperworld?

May, Spielwarenmesse, organiser of the Nuremberg Toy Fair in Germany, announced the launch of Insights-X, an office supplies and stationery fair to be held for the first time in October 2015. Spielwarenmesse CEO Ernst Kick told OPI that well-known representatives from the OP industry had asked to jointly develop the show, applying Spielwarenmesse’s trade fair expertise to the stationery sector.

Perfect timing? The autumn timing has struck a chord with some in the industry who see this as a better fit than Paperworld for marketing schedules and product launches and was one of the main reasons for launching the event. “It is perfect timing as it allows us to introduce new product and marketing concepts to a national and international clientele,” commented Staedtler CEO Axel Marx. OTTO Office Director of Product Management & Business Development Christian Langvad agreed, saying autumn is the time the company is in the final throes of the following year’s preparation and believes it’s the same for the majority of the industry. Indeed, timing seems to be crucial and is seen as one of the reasons for Ernst Kick

attraction remains to be seen, but it does up the ante for Paperworld to provide compelling reasons for the international stationery and OP community to continue to travel to Frankfurt in January. A comprehensive programme of thought leadership and big industry names is regarded as a major draw card for attending a show (see Hot Topic, OPI Dec/Jan 2014, page 28). With that in mind, it will be interesting to see what value-added programme Messe Frankfurt comes up with as part of its Paperworld Plaza initiative in 2015, when two German trade associations will exhibit in Hall 3.1. And of course, it’s not necessarily a case of vendors – or resellers – choosing between Nuremberg and Frankfurt. Staedtler, among others, has already said it will exhibit at Paperworld every other year. “In 2015, we will be present at both fairs in Frankfurt and Nuremberg,” confirmed Marx. “Both shows are attractive, each with their own benefits. Paperworld is well known worldwide and is still the international fair for stationery products whereas Insights-X offers new opportunities at a perfect time and place.”

“It is perfect timing as it allows us to introduce new product and marketing concepts to a national and international clientele” (comment was unobtainable from Messe Frankfurt at the time of going to press). Marx commented: “We are convinced that Insights-X will provide an excellent value-for-money experience for the industry, particularly with regards to Nuremberg’s infrastructure.” At first glance, Insights-X would appear to be aimed at the German retail sector, but Kick did not rule out a greater international focus in the future, although he pointed out that the show will be open to international exhibitors and trade visitors. Staedtler’s Marx added that the show is expected to intially attract customers from Germany, Austria and Switzerland, but is confident that, as it grows, other international buyers will follow within the next few years. Whether Insights-X will develop as an international

Solid backing With leading German stationery manufacturers such as Faber-Castell, Staedtler and Stabilo backing the show from the get-go, Insights-X already has a solid foundation. And while not appearing to be looking to compete directly with Paperworld’s international focus, it will no doubt bring up again that old chestnut of whether Paperworld should move to a two-year schedule – in line with the biennial Paperworld Plaza concept that begins next January. w w w.opi.net | OPI Magazine

news n Analysis

From Frankfurt to Nuremberg

Axel Marx

News n Analysis

Going after Goliath A new dealer services model is set to be rolled out in North America early next year

The

rise of dealer services initiatives in the UK, such as nectere, Cadabra, Office Power and Pi has been well documented in the pages of OPI (see, for example, Hot Topic, OPI November 2013, page 32), but – with the possible exception of Florida-based America’s Office Source – the concept has found little traction in North America. That may be about to change following the announcement at SP Richards’ (SPR) recent ABC event of a dealer services programme called Next Major. One of the main messages at ABC (see Event Review, page 35) was that dealers should be seriously looking at the structure and organisation of their businesses, weeding out bits that don’t add value and looking to outsource areas that someone else can do better and in a more cost-effective way (see also Final Word, page 54).

Full services model Wrapped up in all that – and something that will be defined more clearly when SPR officially introduces a ‘full services’ model early next year – is the idea of shared services, which is where Next Major comes in. Just to be clear, Next Major is not an SPR company nor does the wholesaler have an equity stake in it. The venture is owned by former TOPS President Matt Gresge and technology specialist Jennifer Stagner. SPR, however, has been designated as a ‘preferred partner’. There certainly appear to be similarities between Next Major and initiatives in the UK such as nectere, and Gresge admitted that his model was inspired by some of nectere’s broad concepts including improving the competitiveness and profitability of independent dealers and injecting new efficiencies into the independent channel. Nectere’s Managing Director Paul Musgrove told OPI that he believed the number of potential entrants to the dealer aggregation market

OPI Magazine | July/August 2014

Matt Gresge and Jim O’Brien at the ‘Transform your dealership’ session at the ABC both in the UK and the US, “in which nectere was the first”, was good for the independent industry. “The Next Major model is not the same as the nectere model,” he said. “I believe there is potential for our model in the American market and would certainly be interested in initiating discussions.” Gresge – in tandem with SPR’s SVP Marketing Jim O’Brien – presented Next Major at an eagerly anticipated and well-attended session on the Saturday morning of the ABC that was billed as ‘Eliminating Goliath’s

Gresge explained to OPI after the ABC show, adding that two other important pieces were a VOIP phone system to connect with dealers and a sales tax part for US dealers, whereby the ERP system is integrated with the Avalara sales tax compliance software. In terms of making dealers more profitable, Gresge pointed to two broad areas where he believes Next Major will make a difference. The first is actually helping dealers to grow their top lines. “Revenue growth is possible because we start to give time back to the dealer principal and the sales management of their dealership,” he argued. “We are taking away some of the administrative tasks, so dealers spend more time on selling, customer relationships and prospecting. Then there are three things we do on the analytics side of things – lead generation, share of wallet and customer retention – that have a direct positive impact on sales.”

Profitability The second area is profitability. Again, analytics play a part in this with pricing tools that will help dealers to potentially achieve better gross margins. Then there is the question of staffing levels and the potential for dealers to reduce employee overheads – although this is obviously an emotive subject for some dealers. “It’s possible for the same amount of work to be done with fewer people,” stated Gresge. “Some dealers may choose not to let go of staff – they may choose to redeploy those

“Revenue growth is possible because we start to give time back to the dealer principal and the sales management of their dealership” Advantage’, a reference to the ability of Next Major to provide dealers with world-class systems, analytics and e-commerce tools. “There are four main components to the Next Major platform: ERP, e-commerce, marketing and analytics,”

staff in other activities – but we have given them that option.” Next Major is certainly not a carbon copy of nectere, although it does run on the same ECi Progress ERP platform and uses ECi’s EasyOrder e-commerce tool. Two of the main differences are

e-commerce system is based on an SPR catalogue and it is envisaged that the majority of the wholesale spend will flow through SPR. The Next Major analytics tool also uses SPR’s MyAnalystPro – as well as other industry sources such as Acsellerate – and SPR is currently looking at costing options for this, though it will be part of the Next Major service. “We would really like to push the efficiencies of a relationship with one large wholesaler – it’s more efficient

“We would really like to push the efficiencies of a relationship with one large wholesaler” delivery vehicles. Again, this is not something that is baked into the Next Major model, but which Gresge didn’t rule out as a possibility in the future. In terms of the ‘preferred partner’ status with SPR, the Next Major

to consolidate spend and effort,” noted Gresge, although he added that Next Major was open to all dealers, not just SPR first-call customers. Next Major is currently in an initial implementation phase with four

SPR ‘beta’ dealers. “We’ve had great feedback from these dealers which has helped us to make adjustments in order to meet their needs,” said Gresge. “We’re in the early stages and there is a lot of detailed system work that needs to be worked through.”

Testing times This initial phase is likely to continue for the next three or four months before a second wave of test dealers comes on board, with a full introduction into the market pencilled in for the first quarter of 2015. Dealers that OPI spoke to after the ABC presentation certainly saw the sense in the concept, and many were keen to find out more. How many then take that leap of faith, of course, remains to be seen.

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News n Analysis

that Next Major does not require a dealer to rebrand its business, nor does it get involved in collecting receivables or paying suppliers. Gresge said that Next Major has the ability to “get in the middle of cash” but that the resounding message from dealers during testing was “Don’t touch my cash!”. That may change at some point, admitted Gresge, but for the time being it will be the status quo from a cash standpoint. Nectere has also enjoyed success with its ‘hub’ model, whereby dealers in the same or neighbouring markets consolidate distribution facilities and

Comment

4,859,0 0 0 Alan Ball’s sudden departure as CEO of Spicers has been a major talking point in the UK market these past few weeks. Here’s what some senior executives in the UK thought about Ball’s four-and-a-half-year tenure: Chris Collinson, Managing Director, Superstat Alan’s time at Spicers was very different to what we had become used to from a wholesaler CEO. He was sometimes controversial, often daring and always determined in his efforts to turn Spicers into the business he believed it could and should be. Here at Superstat we didn’t always agree with the decisions Alan made, but we backed his drive and overall direction – he was a breath of fresh air when it came to new ideas and ways to improve. He never shirked the difficult or unpopular decisions and overall he was definitely heading in the right direction.

News ■ And finally...

TWEET CHAT

The number of bottles that have been recycled to make Pilot’s B2P pens (as of 6 June)

240,000 Number of apps and games available in the Amazon Appstore

@Prima Software Had a brilliant tour around Spicers DDC yesterday. The investment is clear to see and will benefit all OP dealers using the facility! @geoffreybetts £10,000 raised for Benevolent Fund at Bengolf today!! Stewart Superior team focused but not always in the right direction. @OPInews #ABC2014Nashville The biggest office products selfie in the world.

75%

The percentage of workers that would like more flexitime

SNAP SHOT

Steve Harrop, Managing Director, Office Friendly Alan tried to introduce some change to the industry, but I think he got it wrong. He was wrong because, in my opinion, he didn’t understand dealers or he didn’t want too. He had a vision and that vision, while forward-thinking, forgot about the real roots of a proud and established industry. At the same time, he used the industry’s tools and forums to attempt to get his message across. So why did he fail? Overconfidence, perhaps, and a lack of understanding of the dealer channel. In my opinion, he lacked the conviction to support, as wholesalers, the mid-market channel. Then he could not deliver on his new strategy because his team didn’t respond to the challenge. Jeff Whiteway, CEO, OfficeTeam Alan introduced much needed change to Spicers and should be commended for undertaking that difficult task. Spicers has been a pivotal part of the office products industry for decades, but has consistently underperformed in terms of profitability. Under DS Smith, the lack of investment and interest from its owners was clear to see and without doubt hampered its development. Alan, with Better Capital’s backing, addressed many of the historic issues, but unfortunately the way he went about the necessary changes alienated customers, vendors and staff in the process. Change within Spicers was necessary, but no company or individual can successfully maximise potential while upsetting its supply chain – upstream, downstream and internally.

Adding a twist to its Make More Happen campaign, Staples has teamed up with pop star Katy Perry to ‘make roar happen’, sponsoring the North American leg of the singer’s 2014 world tour and supporting teachers at the same time. The reseller has already donated $1 million to DonorsChoose.org in support of teachers’ projects.

opi.net poll results Which of these will represent your biggest investment over the next six months?

35% Acquisitions 16% Hiring Restructuring 13% new staff 26% None of the above 10%

IT/ e-commerce

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Big Interview | Bob Geens

Having good Geens Advantia CEO Bob Geens says the “proven” Truline model is now ready to grow

by Andy Braithwaite andy.braithwaite@opi.net

WHEN

UK dealer group Advantia Business Solutions announced in 2011 that it was ending its wholesaling relationship with Spicers and moving to a new sourcing and delivery model run by office2office’s (o2o) Banner and its logistics arm Truline, there were plenty of sceptics who thought it would never work. Two and a half years after the switchover, those naysayers are eating humble pie as Advantia’s members prosper under their new, lower-cost business model; a model which has undoubtedly encouraged other market players to tackle the issue of removing duplicate costs from the supply chain. Advantia’s courageous decision to adopt the Truline model was recognised by the industry when it won the Dealer Group of the Year prize at the 2014 European Office Products Awards, so it seemed like the ideal time for OPI to catch up with group CEO Bob Geens. OPI: Perhaps we can start with a quick overview of your career. Bob Geens: I’ve been in the industry 40 years – 16 with Advantia (or COSTS as it was called when I joined), 16 with ACCO and then before it was with manufacturers and furniture resellers. So, apart from being a wholesaler, I’ve been involved in pretty much all aspects of the industry. OPI: I know you’ve made a lot of changes at Advantia over the years, but I’d really like to focus on the Truline initiative for this interview. BG: Well, what kicked it off was when the news came out in 2009 that VOW was in

OPI Magazine | July/August 2014

serious trouble. The Spicers Managing Director at the time told me that if anything happened to VOW, then Spicers would implode too, so we had a board meeting just after that to look at finding a delivery solution if ‘Armageddon’ happened. I brought in some logistics people to advise us and one of their observations was: “Your industry is mad! You’re handling the goods far too many times. You should be looking at this from packing and storing centrally, picking and packing once, distributing to local hubs and then delivering straight to the consumer.” While this was going on, we were approached by o2o. OPI: So they approached you? BG: Yes, they’d made a decision to get into the mid-market sector; they’d bought Accord, our largest member, and two other dealers. Then I got a phone call saying: “Can we have a chat to you about the SME market?” You never miss that kind of opportunity to talk to somebody, so I went and met them, and we had a very honest and open chat about the market and how we worked. Then a few months later they came back to me and said: “We’d like to work with you.” And I said: “OK, let’s sign confidentiality agreements and we’ll share all of our information with you.” Well, frankly, I had nothing to lose and credit to Simon Moate and his team – they were totally transparent. Obviously we have a non-executive Chairman called Graham Cundick and what Graham doesn’t know about purchasing isn’t worth knowing. He looked at it and said: “This is for real; they are being totally transparent with us.” We started the serious talking in June 2010 and the following May we presented, in effect, two options to our members. Our deal with Spicers was coming up for renewal and I’d got offers from Truline and VOW.

“I always knew it was a gamble and we’d lose some members, but I absolutely believed it was the right thing to do”

Advantia Business Solutions | Big Interview

OPI: So the Spicers deal ending gave you a cut-off point? BG: Yes, so I went to VOW and Spicers and told them I wanted another three-year contract, but that I wanted to look at an open book, a true cost-to-serve and last-mile service model. VOW said it would give it a shot, but Spicers and the now-departed Mr Ball said that unless we gave them another contract, they wouldnâ&#x20AC;&#x2122;t even look at it. I donâ&#x20AC;&#x2122;t think they even looked at the tender documents, so it became a two-horse race. OPI: Were your members on board with the plan at this time? BG: Iâ&#x20AC;&#x2122;d obviously taken it to the board first and got their approval and then done a lot of sounding out with the members. They all knew that the Spicers contract was up for renewal and that there could potentially be a change. We called them to a meeting and just presented the facts of the market in terms of product mix change, margin change, rising costs, etc.

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Big Interview | Bob Geens I always knew it was a gamble and we’d lose some members, but I absolutely believed it was the right thing to do. We had 54 members at the time and we retained 46. Six of those that left, it was absolutely the right thing for them to do because the savings I was proposing in terms of the logistics and all the other costs didn’t apply to them. For the other two, it was just the pure emotion of not wanting to deal with a contract stationer, so they left. OPI: At the time we talked about Banner being a competitor of your dealers. BG: But it’s really not. Banner’s strength is in central government and very large corporate accounts. I can count on one hand the number of competition issues we’ve had, and in all but one of them Banner has backed out – and the only reason it didn’t back out of the one was because it was linked to a public-funded contract. In fact, they actually give us more business – leads they get that are not in their market sector and which they pass over to us. OPI: VOW got the bad end of the deal, didn’t it, in terms of supplying the tail? BG: Well, yes and no. They were obviously disappointed not to get the business, but credit to Robert Baldrey – he said our model was to be applauded and they’d support it. And they have ever since. OPI: How many SKUs do you have going through Truline? BG: About 8,000 through Truline and then the balance we get through VOW. We have a good, open relationship with VOW because our views on the market are very similar. Sometimes we look at each other and say: “Well, we shouldn’t really be friends because in theory you’ll take a dealer off me and I could take a dealer off you.” But that’s part of what goes on, and probably for the good of the industry going forward it’s better to stay friends and I appreciate what they do for us. Spicers, we just have no relationship with them at all at the moment. I can’t say I was surprised at the news of Alan Ball’s departure and they’ve got a huge rebuilding job to do there. OPI: How important is it to have a healthy Spicers operating in the market? BG: Very important. We need an alternative and I think the market needs an alternative. OPI: An alternative might come from somewhere else; it might be a Gem or...

OPI Magazine | July/August 2014

BG: It could be, who knows? But I don’t know enough about Spicers’ situation, whether they will need a white knight or not... OPI: Your Chairman has been mentioned in the same breath as Spicers in the past few months. BG: I’m glad you brought that up because I can finally lay that one to rest. Officially, I can tell you there is absolutely no way Mr Cundick would want to get involved in any sort of Spicers acquisition or with any other PLC for that matter. He loves what he’s doing with Virtualstock and with the dealer community with us. He’s like me: we’ve lived the corporate life and wild horses wouldn’t drag us back there. OPI: So, the switchover to Truline happened in January 2012. Things didn’t go smoothly at the start, did they? BG: The first two months were absolute hell for everybody. Ideally, we’d have phased things in over the last three months of 2011 and the first three months of 2012. But that was out of our hands and it ended up being a ‘big bang’ on 2 January. And on top of everything else, that January was an exceptionally strong month in terms of sales, which compounded the situation. So I had lots of sleepless nights thinking: “What have I done to these dealers’ businesses?” Because, by then, all their drivers had been transferred across and they’d got rid of their vehicles. It really highlighted to us the speed of service in the dealer community versus the contract players, but I cannot fault what the operational team of Truline did to

“Officially, I can tell you there is absolutely no way Mr Cundick would want to get involved in any sort of Spicers acquisition”

Big Interview | Bob Geens crank up the service – they got in more stock, put in some additional resources, built a much better portal of information and by June everything was great. Now service levels are so good that nobody ever talks about it. Operationally, it is now so smooth that at our last board meeting – which is seven dealers of all sizes – they said Truline now gives a service that is better than they could ever manage themselves. OPI: What impact has it made on the dealers’ businesses? BG: Obviously, it took a lot of fixed costs out in terms of warehouses and drivers. We also saw improvements in product margins because the buying was better. It varied because of mix, but it could be anything between 2-6% in gross margin improvement. But the thing dealers talk about more than anything is the ‘noise’. The thing that’s in the front of their mind is how much noise has been taken out and how much time they’ve got to focus on selling and on the market. Dealers think they’re good at logistics, at buying and at IT, but they’re not; they’re excellent at selling and looking after the customer. Our members didn’t realise how much time and noise logistics, buying and IT took up in their businesses. OPI: So, you are two and a half years into a four-year contract? BG: That’s right and, yes, we have to start reviewing it and we’ve already started the

OPI Magazine | July/August 2014

discussions; the ‘what ifs’ and what the options are. OPI: Any sense that you’re tied to o2o regardless? BG: When we first started, that was probably the case. I think what we will see emerging in the next 18 months to two years are viable alternatives that will give us other options. OPI: From the wholesalers? BG: Potentially, yes. I can’t speak about Spicers, but certainly from what Vasanta announced with its bokz programme and last-mile delivery package, it could potentially become a viable alternative. OPI: o2o has had share price issues and there seems to be constant takeover chatter. Does that make you nervous? BG: I think the way to look at it is that ten years ago we had this very stable market with the wholesalers. The reality now is that our supply chain is not stable; Spicers and VOW are run by venture capitalists and so you have to make a decision based on where you are now and minimise the risk. So yes, there is some risk with o2o. The good thing is that Simon Moate has kept us fully informed – as much as he can – on what’s been happening and why, and everything he said has come to fruition. I can’t ask any more than that and certainly we’ve had a lot more stability than Spicers dealers in the past two years.

“Dealers think they’re good at logistics, at buying and at IT, but they’re not”

Big Interview | Bob Geens OPI: So what’s your current membership number? BG: It’s 47. I knew that once we launched the new model we had to prove it. At the start we had some problems and it wasn’t the time to go out and recruit – so we didn’t. We concentrated on refining things so we knew we’d got an absolutely-rock solid model, and now it is proven. I’ve got back-up in terms of dealer performance stats and things like that. Whatever the size and profile of the dealer, I’ve got the numbers to show someone. The openness we get from Truline in terms of the data on how everyone’s performing is fantastic. Every month the dealers see their complete activity and where all the issues are – if it’s a customer fault, the dealer’s fault, a warehouse or driver fault – and they get a benchmark. They can measure themselves against the group and they really appreciate that. OPI: And now you’ll look to grow the membership? BG: We’re now coming into what I call the ‘mating season’ when people start to think about catalogues and decisions for the next year, so you’ll see our activity step up. We probably have a prospect list of about 12 dealers; not that big by other groups’ standards, but they’re good ones. I’m not looking for hundreds of members, but I’m

10-15% and others that have grown by that amount and more. In terms of financial performance, all of them have seen the bottom line improve because of the cost savings. But if you look at it on a like-for-like basis, it’s starting to show real growth now this year because the members are starting to win business. OPI: Dealers declining in the high single digits or even more – that’s not sustainable for any business, is it? BG: I’m sure it’s the same message in every interview you do, but part of the strategy is to get everybody into new market categories – water, shredding, catering supplies, etc. Actually, I’m finding that the successful dealers are winning new business not in stationery, but in other market sectors and then they go back in with office supplies. One dealer won some business in promotional goods and health and safety and then went back to the customer six months later and won its stationery business. They grew stationery sales by 12% and put two points on the gross profit. If they’d tried to do it the other way around they’d either have not got the stationery business in the first place or they’d have had to buy their way in. But going in the other way round, winning other categories and getting yourself so embedded in that customer – and then getting the stationery – is a better strategy.

“If all [potential members] are interested in is the price of goods, I just walk away” looking to grow membership very steadily over the next 2-3 years. It will also be dealers that ‘get it’, because I don’t want dealers where the first question they ask is: “How much is your paper?” If all they’re interested in is the price of goods, I just walk away. I spoke to one quite substantial dealer a couple of weeks ago, and during the three-hour meeting we never once talked about the price of goods. It was all about how this model could help them grow their business and service their existing customers. OPI: Looking at aggregate sales, I think you did about £27 million ($46 million) with Truline last year. BG: Yes. The first year it dipped, but then it started to grow steadily from the second half of last year. The growth is continuing because of the new members and the existing members are growing as well now. We have some dealers that have gone backwards

OPI Magazine | July/August 2014

We had one instance last year using Truline where a member used the Truline model to help an organisation that had an internal distribution problem across five sites. He’d been trying to win that stationery account for three years but couldn’t get it from a contract stationer. But after he signed the logistics deal, they said to him – almost in passing – “By the way, do you want the stationery contract – £80,000?” Provided he now keeps servicing it right on the logistics side, how easy is it going to be for somebody to come in and take that stationery contract away? There are so many opportunities in new product areas. We beat ourselves up at times, thinking perhaps we’re not as smart and as efficient as incumbent suppliers, but actually if you look at our IT and our logistics, we are really quite good at it. I recently spent a few hours with a large organisation in the catering category and they couldn’t get their head round how sleek

Big Interview | Bob Geens we were in terms of EDI ordering by 4pm and having the products the next morning. OPI: You mentioned Vasanta’s bokz. What do you think of some of these other dealer initiatives that have cropped up over the past couple of years? BG: I think they’re great because anything that helps bring about change is good as it forces dealers to think about it and face up to the reality that the world is changing. So all these initiatives that are coming along with their various options – whether it’s a back-office solution, a marketing solution or whatever it is – they’re a breath of fresh air. OPI: But they’re competing with Truline. BG: They’re all different in a way and I think they’ve all got their USPs. For us, our real USP is our last-mile delivery; none of them really have that very clean, straightforward, totally managed and controlled last-mile delivery. That’s the big difference. We’ve looked at some of the other solutions and it’s not there. OPI: So, how do you see the channel developing? BG: My area of knowledge is really dealers and my personal view is that there will be dealer consolidation. There needs to be. There’s reported to be about 3,200 dealers in the UK and that number needs to come down. It will be horrible for those that go, but it needs to slim down to 2,250-2,500 dealers that are more efficient and more switched on in terms of use of technology and how they’re going to operate. In terms of what the dealer model is going to look like, for me the only model that’s going to survive is completely stockless. The dealer does the sales and marketing and someone else does the logistics. So it could either be a Truline-like model or a variation on that. I think that’s where others will go; certainly in discussions I’ve had with people like VOW, they have quite a similar view on the market so that’s where I see it going. OPI: You said you think there are too many dealers. Do you think there are too many dealer groups? BG: Yes, there needs to be some consolidation there as well. I think one goes with the other, but can I see it happening? In the short to medium term, no. OPI: Are there any natural fits in the dealer group community? BG: I suppose the only two that are very similar in structure are ourselves and Nemo

OPI Magazine | July/August 2014

because we’re owned by the members, whereas the others are owned by individuals, so it’s very difficult to see. For me, the Achilles heel we’ve got to address is IT and data; I think that’s the next big challenge for the dealer community. And I think a great service that dealer groups could do for all their dealers would be to try and work together on IT and data because there’s a huge duplication of costs there. We did a lot of good when we worked together as Europa a few years ago and I just think we could work together on IT and data without compromising our current positions. Whether that will happen or not, I don’t know. OPI: Is that likely to be controversial? BG: No doubt it will upset people, but I think that unfortunately there are too many individuals with egos – and also fear – who won’t sit down and have a sensible discussion about this as something we need to do. It will end up being forced on us, but if we were actually to all sit down and say it would be in all our interests, and if we could work together to come up with the complete package – front and back end – on IT, that would be utopia. The reality is I don’t think some of the individuals would be up for it. OPI: Finally, what are your own plans? BG: Well, I’m 60 now, so my goal is to make sure the logistics model is absolutely solid and then put in place a new five-year plan. We’ve pretty much got the marketing, but then it’s the IT and the systems that will enable dealers to compete. We’ll do that and then they can put me in my little chair and wheel me off to the old people’s home. Simple as.

“A great service that dealer groups could do for all their dealers would be to try and work together on IT and data”

Hot Topic | Amazon

The Kraken Not exactly a giant monster about to usurp all around it, Amazon has nonetheless become a threat – not to mention a formidable competitor and often a real oppportunity too – to the OP industry. But how far-reaching are its tentacles?

by Heike Dieckmann heike.dieckmann@opi.net

SOME

products and concepts start with a bang and are instant successes – the launch of the first iPhone in 2007 put Apple very firmly back on the business map – while others, including the iPad in fact, are slow burners that take a little more time to mature.

The fact that Amazon has its tentacles around so many concepts – and some, like the recently announced delivery drones, may seem just too outlandish to cause an instant panic – makes it hard to decide which ones to really monitor. But, says Rick Marlette, co-owner of OPSoftware, with 2.5 million products advertised, AmazonSupply is the sleeping giant that many in the industry have so far chosen to ignore – at their peril. “Amazon is after a cut of

“When AmazonSupply gets cranked up and goes after the dealers’ commercial B2B business, [...] the short-term profits may [...] seem inadequate” AmazonSupply is one of these smouldering slow burners. The B2B spin-off that was launched in the US in April 2012 has been largely under the radar – deliberately so from an Amazon PR point of view, presumably – for the past two years. But that appears to be changing. Some of the most notable US publications – Forbes and The Wall Street Journal to name but two – have recently been giving the site and the threat it poses to the wholesale and distribution world plenty of column inches.

OPI Magazine | July/August 2014

everything and it doesn’t care where or who that cut comes from,” he says. “When AmazonSupply gets cranked up and goes after the dealers’ commercial B2B business, leveraging all that customer data it now owns (thanks to third-party sellers), the short-term profits some made selling on Amazon may all of a sudden seem inadequate. I would be amazingly cautious in dealing with Amazon. It has already proven that it will convert to its own use what sellers so willingly hand over.”

Greg Welchans, President of Supplies Network, agrees: “I believe that AmazonSupply is a major threat to the independent dealer community and also to the branded manufacturer. As Amazon collects valuable data on both products and the customers, it will market to the consumer in ways the independent dealer cannot match.”

Beyond the big boxes When AmazonSupply was first announced, the consensus was that it would add strong competition for the likes of Staples, Office Depot and Costco. Staples in particular has responded and massively ramped up its overall product offering, opened a new development centre that will focus on enhancing the company’s e-commerce initiatives and very recently announced that in the forthcoming back-to-school (BTS) season it will price-match items sold and shipped by Amazon.com (rather than AmazonSupply) or by any retailer that sells products in both stores and online under the same brand. In its current fight against Amazon, Staples is resorting to price to win market share, no mean feat

Amazon | Hot Topic in the cut-throat BTS season where large retailers such as Walmart and Target have the clout to compete on price too. Independent dealers – Amazon Marketplace sellers aside (note that AmazonSupply does not have a marketplace) – are for now still a little more on the periphery: on the plus side, they still draw on and capitalise from ‘Buy Local’ strategies as well as a unique personalised service, while on the minus side many have arguably never been real contenders in the online game for a whole number of reasons. But far from the initial threat to predominantly the big boxes, wholesalers and manufacturers too are privately worried about AmazonSupply and with good reason, adds Marlette. “It’s clear by Amazon’s own statements that it wants to sell everything to everybody, controlling the flow of as many products as possible from manufacturer to consumer. If this did happen, it would be really bad news for the wholesalers and manufacturers.” Given that Amazon has built up an enviable logistics and data powerhouse in the US (though by no means exclusively there) and is intent on servicing as many markets directly as it can from its 40+ fulfilment centres, the wholesale and distribution world across many industries comes under threat and OP is no exception. So what does that mean for United Stationers, for example, Amazon’s (officially unconfirmed) OP partner in the US? United declined OPI’s offer to comment, while others have been more forthcoming. Welchans says: “Logic would dictate that as Amazon develops

Back to basics Did you know Amazon sold its own range of shredders, laminating machines (plus consumables) and remanufactured toner cartridges? It’s yet another of the e-tailer’s many avenues it’s ventured down. Under the overall banner of AmazonBasics, the company launched this private label collection of basic consumer electronics products – also including batteries, blank DVD media, USB cables and accessories – about five years ago, initially in the US, but now available in many other countries too. It’s a modest range and like with the Kindle, Amazon’s own brand products aren’t necessarily revolutionary and they also aren’t the first to the table. But like with the brand new Amazon smartphone, Amazon Fire, it’s a well thought-out concept and another route to the customer that has the potential to do really well – even if it ultimately doesn’t (Pinzon, its own brand of sheets and towels, hasn’t set the world alight, while the Kindle clearly has with the Kindle Fire!). It’s all about perception and loyalty. Just take the smartphone – it’s not expected to pose a real threat to Apple or Samsung devices, but it’s to reinforce the perception that life with Amazon is easier – it’s convenient and it supposedly makes shopping from Amazon even easier. Amazon is the master of reeling in the customer and creating loyalty that is hard to displace. So what’s stopping it from creating the new Amazon-branded lever arch file – the new Leitz? Or a broader range of computer consumables? Or anything in the thousands of other categories that it sells? The sky’s the limit – or is that perhaps just Amazon Web Services?

“We at Supplies Network made a decision long ago not to pursue Amazon’s business as it would hurt a large part of our customer base.”

The price point The power to determine and drive down prices is another bone of contention that virtually all supply chain partners have to contend with (although it could be argued that Amazon is no longer the low price competitor that it once was). In fact, several people OPI spoke to named Hewlett-Packard’s (HP) reseller authorisation programme (see also

“We at Supplies Network made a decision long ago not to pursue Amazon business as it would hurt a large part of our customer base” more distribution capabilities that its current partners would see a decrease of business over time. If United is a major supplier to Amazon it could adversely affect its business.

OPI November 2013, page 28 and OPI April 2014, page 30 for an in-depth look at this programme) as a means to address that threat. Says Welchans: “Absolutely Amazon is driving

down the price of goods. HP’s new authorisation programme is designed to help keep pricing and product integrity offered through companies such as Amazon.” And HP is not alone in trying to control Amazon. Marlette adds: “Most OP manufacturers used to provide a Manufacturer Suggested Retail Price as the maximum price for their products. Now more manufacturers are creating a Minimum Advertised Price (MAP) to keep resellers from driving prices too low. When you see ‘add to cart for price’ on a website, that’s MAP in action. On the AmazonSupply site, they do have a few items with MAP pricing, but from the disclaimer they place next to the ‘add’ button, you can clearly tell they are not happy with the manufacturers that impose this restriction.” Although AmazonSupply delivers to, as the website says, 50+ countries, the B2B site itself is not actually hosted anywhere else but the US at the moment. As such, the threat to resellers – and wholesalers – selling to the B2B space is perhaps not as acute as it is w w w.opi.net | OPI Magazine

Hot Topic | Amazon same conditions, rendering any dealer promotion almost redundant. “I am told that the only way around this is to synchronise the reseller promotions with a similar promotion on Amazon or risk being delisted,” says Howarth. “Because the promotions are time-limited and are not permanently sustainable, this can have significant adverse

to those in the US. That said, it’s not to be underestimated either. One UK dealer that prefers to be unnamed and that has been doing a considerable amount of business on Amazon as a Marketplace reseller, says: “Amazon is already a clear threat in the B2B marketplace and I can categorically state that fact due to the orders that we receive from large companies (via Amazon marketplace) that we otherwise do not deal with.” What is increasingly happening in the UK too – much to the discontent of resellers that willingly and knowingly hand over so much data to Amazon in order to be part of the Marketplace – is that, once established, the e-tailer happily bypasses its resellers and heads straight to the manufacturers (and wholesalers) for certain categories. Adds the UK dealer: “We have noticed that Amazon is reducing the number of resellers on certain lines and while this hasn’t affected us yet, it is something that we are aware of and something that we would be totally powerless to control.” It is that feeling of powerlessness, perhaps, that is hard to stomach. And there’s something else that affects both dealers and manufacturers, says Iain Howarth, Managing Director of Open Range, a UK-based e-content provider across a range of categories, including OP. As manufacturers foster close relationships with OP resellers, working with them on special promotions that are run at different times throughout the year, Amazon – aware of those favourable conditions – squeeze manufacturers for the

OPI Magazine | July/August 2014

this debate, other than taking their custom elsewhere, but it’s not too far-fetched to assume that Alan Ball’s downfall can be in part attributed to his “lack of understanding of dealers” (see also And finally..., page 17). Over in Germany, business supplies wholesaler soft-carrier made the same decision as Supplies Network in the US, inasmuch as a working relationship with Amazon is concerned.

“I don’t think some OP manufacturers are aware of what’s happening with their brands in the online business” implications on profitability for the manufacturer and the reseller.” As Howarth adds, marketplaces such as Amazon – and eBay for that matter – can be useful marketing tools in attracting customers to your own company through initial purchases via Amazon and eBay stores. “It’s all about managing what you choose to sell on Amazon and eBay and at what price, and never losing sight of the fact that from a reseller perspective it’s part of the marketing mix rather than a replacement for your own, direct and online relationship with your customers. “It’s about choosing what works for your company and customers and avoiding what doesn’t.”

Sleeping with the enemy And indeed, the same applies to the wholesalers. Like in the US, in the UK – and continental Europe – the debate rages as to whether wholesalers should be fulfilment partners for the likes of Amazon. Spicers has long had a tetchy relationship with parts of the OP reseller community because of its staunch stance on supplying companies like Amazon and Tesco (not to mention its brief foray as a – nominally – direct reseller on Amazon with Ernie’s Office Supplies. Dealers haven’t really had any real leverage in

Says Managing Director Thomas Veit: “Soft-carrier does not cooperate with Amazon, either in Germany or in France. We’ve been approached repeatedly in both countries by the e-tailer to carry out order fulfilment, and it’s interesting to note that when this happened in France recently, we were told that they were amenable to certain concessions in terms of conditions. It hasn’t changed our policy of keeping this potential ‘customer’ Amazon at bay for now.” That said, the Amazon Kraken in Germany remains a very different animal for now and could almost be viewed as where the UK and US were several years ago. Always regarded as a country that is deeply traditional and resistant to change while at the same time embracing technology with super efficiency, Amazon is already a colossal competitor in the B2C space (though not without a good dollop of controversy,

Amazon | Hot Topic particularly as regards working and pay conditions of seasonal workers in its distribution centres), but in B2B terms, the threat remains negligible, with many resellers seeing only a minor impact. For now that is and it’s a very big ‘for now’. Says Christian Langvad, Director of Product Management & Business Development of OTTO Office, part of the OTTO Group, which is also a huge contender in the B2C online space: “At the moment Amazon is not a a real option for B2B OP customers in my opinion. The requirements to address the shopping needs of B2B customers are very different compared to B2C, and OP specialists that are active in e-commerce provide a considerably more attractive and competitive package than Amazon.”

Manufacturer naivity But that’s changing and it’s a path well trodden. What is very different to, say, the UK, where the e-tailer is already clamping down on manufacturers, making demands and changing conditions, is the way in which a good part of German OP manufacturers are really embracing the ‘Amazon opportunity’. There’s much talk of how easy it is to deal with Amazon, how the company is uncomplicated and doesn’t ask for special prices, programmes or conditions… “It’s exactly the same tactics that Amazon has employed in other industries,” says an OPI source. “The first step when it enters a new product area is to open its marketplace to companies in that space. It happened in books, it happened in clothing, it happened in office products. And it makes sense for many small office products dealers in Germany as a way of getting a small slice of the online cake. They don’t know how to get into the online world and they see an easy opportunity by placing their products and selling them via the Amazon Marketplace. “But Amazon now has access to all that valuable customer data and sales data,” the source adds. “The second step is that it takes a close look at that data and where it sees

some business potential, it smoothly begins to offer the products themselves by going directly to the manufacturers while the dealer on the Amazon Marketplace becomes somewhat redundant.” And after the small dealers – and before the manufacturers – come the wholesalers – adds Veit. After initially going for the small dealer, now it’s the turn of the wholesale channel, with its broad logistics competencies, to be targeted. Having gained a good understanding of the workings of the industry and having all that valuable data, the manufacturers will be next, he predicts, and history in the more mature online markets would certainly suggest he’s right. It’s nothing new and shouldn’t come as a great surprise, but manufacturers – and resellers too – are not paying enough attention to their overall brand proposition, says Langvad. He says: “I don’t think some OP manufactures are aware of what’s happening with their brands

in the online business. They don’t see that a broad presence of their products online will not necessarily bring any value to their brands or generate additional market share. In fact, it could lead to the opposite – making them comparable to product alternatives, where price-sensitive online customers increasingly will not be willing to pay extra for a brand. I am sorry to remind them, but we sell low-interest products...”

Beware the Kraken There’s plenty to admire about the global phenomenon that is Amazon – nobody arguably does data analytics better, for starters – but putting all your eggs in the Amazon basket is not a good idea because the hatchlings could clearly be monstrous and all-usurping.

Sticking with the nautical theme, Swimming with Piranha is a research study that takes an in-depth look at what Amazon means now and potentially could mean for the global OP industry in the future. Published by OPI and researched jointly with Martin Wilde Associates, the study aims to help office products leaders understand and plan for the dynamic changes sweeping through the industry. Already, as illustrated in this article and from speaking to a variety of people across the supply chain, there is no doubt that Amazon – as well as other broadline e-commerce specialists such as eBay – will be a major factor in the future of the OP industry. However, little is known about their current and potential B2B customer base for office products. Swimming with Piranha investigates the world’s largest e-tailer and addresses the following questions: • • • • • • • • •

What kinds of products – and what share of end-users’ total OP purchases – are currently being purchased via Amazon? What are the perceived benefits and disbenefits of buying OP from Amazon? What are the perceptions of service from Amazon, compared to other major national OP resellers? What are the perceptions of the AmazonBasics brand? To what extent is Amazon used for making price comparisons with offline resellers? Which OP supply channels have lost out to Amazon? Do customers navigate directly to Amazon or do they just search for products online and find themselves at Amazon? Once at the Amazon site, do customers prefer to buy from Amazon or from an Amazon Marketplace seller? How will OP sourcing from Amazon change in future? For more information, visit www.opi.net/piranha

w w w.opi.net | OPI Magazine

Research | Mobilegear

Evolution of

the mobile worker… In the home 1990s to 2010 On the road 1960s to 1980s

‘Mobile’ is the current buzzword, but to really target this ‘new’ customer in the mobile workplace, we need to first know who and what exactly makes and defines that individual. Mobilegear.com has been doing some research…

today’s US workforce, over 30% of employees no longer work in a traditional 9-to-5 office environment. A recent online study, entitled Mobile Worker Report, conducted by Mobilegear.com, a niche OP website targeting the mobile workforce (see Dealer Spotlight, OPI February 2014, page 37), found that today’s mobile worker represents a much larger and more diverse population than what the company’s President/CEO Douglas Nash calls ‘road warriors’. “Road warriors have been a part of today’s business workforce for a long time, dating back to travelling salesmen. They know how to work in multiple environments because it’s always been their job to figure it out,” he states. These original road warriors were mainly men who worked in the sales departments of very large corporations. In this study, the majority of mobile workers were still men, but only 27% worked for large corporations and most – 52% – worked for themselves or small companies (fewer than 100 employees).

OPI Magazine | July/August 2014

Work anywhere 2010 & beyond Only 20% of them described themselves as being in ‘sales’ while 50% indicated that they were a business owner, consultant or ‘other’, indicating that mobile workers now come from a wide variety of companies and represent a diverse skill set.

Still strong office base Historically, road warriors spent nearly 40 hours or more on the road and out of the traditional office while only 16% of today’s mobile workers indicated they were on the road for that period of time. In fact, 57% spent between 10-40 hours out of a traditional office. In addition, when asked: “Why do you

Other 4%

Purses 11%

Messenger/Totes 48%

Backpacks 23% Briefcases 15%

What do mobile workers use to carry their supplies?

Mobilegear | Research work remotely”, only 28% indicated that their “job required it” and cited work/life/family balance and other obligations as the main reasons for working outside a traditional office. Lastly, mobile workers were found to be highly educated with 76% of them holding college and/or postgraduate degrees. Nash summarises: “Today’s mobile workers aren’t on the road as much, but they are working in multiple locations – home office, cafés, co-working spaces, their cars... Therefore, they are seeking to find products and services that empower them to work anywhere more effectively. It’s a matter of lifestyle/workstyle choice rather than job description.” Historically, large companies that employed road warriors bought the required mobile office supplies for their staff, but only 16% of today’s mobile workers rely on an employer to select and purchase supplies on their behalf. Instead, 35% claim purchases on expenses, with 45% buying their own mobile office supplies. More than half – 52% – stated they spent over $50 a month on office supplies. “We know that in today’s mobile workforce, the person buying OP and tech accessories is no longer in ‘purchasing’ or ‘admin’. It is a person, a business consumer,” Nash says. “This fundamentally changes the way we need to sell and market these products.” What may be surprising in today’s technology-driven business environment is that mobile workers still use more traditional

$ $ $ $$ $ How do you purchase mobile office supplies? Selected by me and bought through my employer (via specified catalogues, retailers, etc)

10%

Selected and paid for by my employer

16%

Included in a lump sum budget provided by my employer

Individually reimbursed business expenses

35%

Personal expense

45% Other

Why do you work remotely?

28%

20%

“My company/job requires it”

“I am self-employed”

16%

“To balance my work/ family schedule” <10% Other, including: “To balance other personal interests” “I like to be out of the office” “I live in a different geographical location than my employer” “I am more productive when I am not in the office” “I want to avoid the commute” office supplies on a daily basis than tech tools. Almost all mobile workers (96%) use writing instruments daily, compared to 68% using wireless mice/keyboards or 16% using a stylus for tablets/smartphones.

Device protection Because mobile workers are working and meeting in many different environments, device protection and power is essential. The survey found that 79% use protective cases and 76% use power adaptors on a daily basis. However, mobile workers, it seems, aren’t too concerned with the brand, style or design of traditional business supplies, with the exception of writing tools and bags – both often considered more personal purchases and status symbols. Only 15% of mobile workers favour a briefcase these days, with 48% preferring a messenger/tote bag, followed by a backpack (23%). Conversely, brand and style is important for technology tools that are in daily use such as power adaptors, headphones, wireless mice and protective cases. “These tech accessories say a lot about who a person is, so brand and style matter,” indicates Nash. All in all, when compared to the historical road warriors, today’s mobile workers represent a very diverse group of people, motivated by both business and personal reasons to work in non-traditional environments. Both technology advancements and evolving corporate cultures are the momentum beneath this growing trend and dramatic change in today’s workforce. Chicago-based entrepreneur Douglas Nash founded Mobilegear.com in April 2013. The website targets the mobile workforce with over 3,000 mobile-oriented products.

HISTORICAL ROAD WARRIOR • Small, narrow population • Technology irrelevant • Most hours ‘out of office’ • Mostly male • Mostly sales industries • Middle income • Average education • Part of job requirement • Company purchased supplies • Briefcase culture

• Large diverse population • Technology essential • Varied hours ‘out of office’ • Male/female split • All industries • All income ranges • Higher education • Personal flexibility • Person purchased supplies • Diverse attire culture

TODAY’S MOBILE WORKER

w w w.opi.net | OPI Magazine

ABC 2014 | Event Review

All Right NOW!

SP Richards highlights the need to embrace change – right now

NORTH

American wholesaler SP Richards (SPR) held its annual Advantage Business Conference (ABC) in mid-June at the impressive Gaylord Opryland complex just outside Nashville, Tennessee. The theme of the event was ‘Right Now’ and the opening general session featured a light-hearted – but professionally put together – video of SPR’s senior management team performing the Van Halen song of the same name, drawing much laughter from the audience that included representatives from about 800 dealerships. On a more serious note, SVP of Marketing Jim O’Brien underlined the sense of urgency (the ‘right now’) that dealers need to show in this transformational moment in our industry. One of his key messages was the need for dealers to take advantage of all the e-commerce and data analytics tools that are available to them, in particular the SPR MyAnalystPro tool. According to figures from a pool of test dealers, those using MyAnalystPro were able to improve their gross margins by 115 basis points and grow sales by 2.5%.

– experts in their field, certainly if they want to successfully expand into new, adjacent categories. And that increasingly means recruiting outside expertise. Indeed, hiring expertise and outsourcing were two of the key themes of the conference,

a record number of exhibitors, with a noticeable presence of growing categories Jim O’Brien such as jan/san, breakroom, facilities supplies and education. “The expo was fantastic and it was great having the different lines of business being represented so well at the show,” commented Jeremy Bourret, VP at Connecticut-based dealer Suburban Stationers. “It will definitely help us open up opportunities and expand more into jan/san, cleaning and breakroom, coffee, food and beverage, and furniture.”

“The expo was fantastic and it was great having the different lines of business being represented so well at the show”

Sharing data “Failure is not an option,” said O’Brien, quoting a line from the Apollo 13 film, “but failure can be an option for some,” as he urged dealers to be more open about sharing data. He also emphasised the need for dealers to remain – or even become

underlined by the presence of partners such as R2 and Business Performance Group (for more on the topic of outsourcing, see also Final Word, page 54). Delegates were also treated to two inspirational keynote addresses. On the first morning, bestselling author and entrepreneur Seth Godin wowed the audience with a whirlwind of ideas and impressions. “Independent dealers,” he said, “have the ability to treat different people differently and that’s something the mass market operators can never do.” Thinking ahead – and doing it now, not next week, month or year – was also the theme of Peter Sheahan’s keynote on the second day of the ABC. As a leading business thinker with a truly enviable stage presence, Sheahan urged delegates to think about changing their companies and preparing them for the future when they’re still on an upward trajectory, not when business is bad already, when margins are squeezed and revenues down. A well-attended vendor expo that took place on the first day of the show featured

Educational sessions Bourret was one of the speakers at a best practice sharing session called Ideas@Work, part of the information and training seminar programme that included a special track for SPR’s Your Business Source dealers and a more general business development track. There was also an optional – and well-attended – session for dealers revealing a new shared services model called Next Major that SPR is supporting and which has been inspired by successes in Europe such as nectere (see News Analysis, page 14). Concluded O’Brien: “It was another great event and the feedback we’ve received from attendees and exhibitors has been extremely positive.”

The 2015 ABC will be held from 21-25 June at the MGM Grand Hotel in Las Vegas, Nevada.

w w w.opi.net | OPI Magazine

NAOPA 2014 | Awards Review

And the

winners are... The North American Office Products Awards have now become an integral part of SP Richards’ ABC event, and this year proved again that innovation is alive and well

Core Office Product MooreCo: Sharewall Full Wall Magnetic Whiteboard It’s interesting that the winner of the Core Office Product award was nominated for two categories, showing the increasing blurring of categories. And while the Sharewall Full Wall Magnetic Whiteboard scooped the Core Office Products award, MooreCo scored again in Furniture (see next page). The judges loved this easy-to-install magnetic whiteboard that can quickly turn any space into a creative environment. Fitting on almost any surface, including curved walls, wood and textured materials, it can transform any office or workspace. MooreCo’s President/COO Mikel Briggs (pictured, second from right) said that customers particularly like the product for its flexibility: “Users really like the flexibility of what the whiteboard can do to an entire wall. The product also shows very well that there is still a place for non-digital products in this category.”

Technology Logitech: Bluetooth Illuminated Keyboard K810 The judges were hugely impressed with this new product from Logitech. It enables users to switch easily between PC, tablet and smartphone, yet still have the convenience of a keyboard. With workers these days often owning multiple devices, something that can work efficiently across all platforms will certainly be an attractive selling proposition for dealers. Indeed, Mary Meator, National Account Manager for Business Markets at Logitech (pictured above), said: “The most important characteristic of the Bluetooth Illuminated Keyboard is that it is able to talk to a number of different devices without any problems. It makes work processes completely seamless and I believe that’s what customers really like about it.” With the additional feature of backlit keys and full rechargeability, the judges can see this product doing very well in terms of future sales opportunities.

Cleaning & Breakroom 3M: LED Advanced Light LED lighting is still a fairly nascent addition to the lighting category, but it’s one that is set to really take off over the next few years. The LED Advanced Light has a sleek design, excellent energy efficiency and bulbs offer an incredible amount of light output that is bright from the minute you turn them on. Importantly, 3M has gone a step further and made it affordable, through a specific finance package, for businesses to convert their lighting systems to incorporate LED. An excellent product that dealers can’t wait to get out there – that was the judges verdict. And Mark Wollner, Business Development Manager at 3M (left, above), was delighted about winning the award. He said: “This is an honour for us. The LED Advanced Light is a great product and offers businesses affordable energy-saving lighting systems. It’s a real ‘green’ product, that’s what I like most about it.” w w w.opi.net | OPI Magazine

Awards Review | NAOPA 2014

Innovation of the Year Fellowes: AutoMax 500C Auto-Feed Shredder

Furniture MooreCo: Shapes Desk Configurable Desking System

Shredders are certainly not a new category in the OP environment, but with security becoming ever more important, their priority has increased rather than decreased over time. The judges were impressed with this ‘walk away’ shredder and liked the convenience of the new ‘SureFeed Technology’ which enables the shredder to do the work for you, so that you can focus on other priorities. Simply load the drawer, push the button and walk away. There is no preparation involved and the AutoMax 500C will comfortably shred crumpled paper, multiple sheets with paper clips and/or staples, double-sided colour paper, glossy paper and junk mail. A great new time-saving innovation for the office and one that the judges felt will do well in the market. Abbie Ferguson, National Account Manager for Fellowes (second from right, above), was very pleased as well: “Winning this award is incredibly exciting for us. We’ve worked very hard on the concept. I believe the real differentiating factor is that users can just walk away from the shredder once they’ve thrown all their papers in the drawer. There’s no interaction after you close the drawer – it’s just like magic.”

This flexible and affordable desking solution, aimed at the education and training market – rather than squarely at OP businesses – was a surprise winner in this category and demonstrates how important adjacent categories are becoming for dealers. There are few systems out there that offer truly configurable options. MooreCo’s new Shapes Desk Configurable Desking System has a clever and functional design that enables a variety of set-ups with an efficient use of space to suit the needs of any classroom or study setting. With left and right-hand desking, adjustable heights and several colour options, it has been well received and the judges expect it to do very well in the market. Winning a second NAOPA, Mikel Briggs, President/COO at MooreCo (second from right, above), was delighted to be recognised once again. He commented: “There is a very clever design behind the product. Being able to reconfigure classroom desking systems gives teachers tremendous flexibility in how they teach and allows kids to interact and collaborate much better.”

People’s Choice Deflecto: Lit Loc Interlocking Literature Displays After weeks of counting votes – not cast by a judging panel, but online by OPI readers and delegates of SP Richards’ ABC event in mid-June – the winner of the popular People’s Choice award was the last one revealed as the Office Products Expo drew to a close on the first day of the ABC. It was a close call in the end, but the clear winner ultimately was Deflecto for its Lit Loc Interlocking Literature Displays. Having come up against some very stiff competition, Danielle Rodgers, Product Manager at Deflecto (pictured, third from right), was delighted with the award and said: “We put together some good marketing material across various media and it really paid off for us.” But the credit ultimately goes to the innovative thinking behind the interlocking display system, she added: “It’s a very versatile product. Instead of being a fully assembled unit, we’ve created something that links together for a truly customised display.”

OPI Magazine | July/August 2014

NAOPA 2014 | Awards Review

Winner Kasie Morley with Mike Maggio who presented the award

Professional of the Year Kasie Morley

Bud Mundt receives the award from his son, Bud Mundt Jr

Industry Achievement Bud Mundt

In an industry so often devoid of female senior executives, Any award given from son to father is going to be it was fantastic to see another woman (last year it was emotional, and a clearly touched Bud Mundt collecting Wendy Pike) pick up the Professional of the Year award. the Industry Achievement award from Bud Mundt Jr was Kasie Morley, President of Baltimore-based dealer Jacobs a fitting culmination to another successful SP Richards Gardner/Penny Wise, was warmly introduced by TriMega ABC event and NAOPA ceremony. President Mike Maggio and praised for her close working With a longstanding OP career spanning over 45 years, relationships with manufacturers, her marketing talent Mundt Sr has accumulated huge experience in all OP and collaborative spirit within dealer circles as well as distribution channels and is known as a fierce advocate her educational work in her local community. of the independent dealer cause, to the extent Morley herself pointed to the willingness of postponing his retirement ten years ago to of dealers to work together and share join dealer network organisation AOPD which ia et/med experiences as something she loved about the he has led for the past ten years. But as he said: Visit opi.n e winners’ th h tc a to w OP industry. Her advice to fellow dealers is this: “The OP industry has changed tremendously videos “Believe in yourself and in the ideas that you have. over the years, but its values, from where I am Perseverance goes a long way in this industry.” standing, have not.”

European Forum 2014 | event Preview

Rising to

the challenge Can your business afford not to attend the 2014 OPI European Forum?

all know that the business supplies sector is a challenging arena. However, the best operators are doing well and there are still plenty of opportunities if you know where to look and have the confidence to act. The OPI European Forum provides senior level executives with the opportunity to meet with the leading players and learn more about the future of the sector in a unique, high-level setting. Established in 2009, the first OPI European Forum took place in London, UK. Following its success, the event now takes place every 18 months, offering a real highlight in the calendar. The forums are invitation-only events and provide a unique opportunity for C-level executives to mix and discuss the challenges of the day. As OPI CEO Steve Hilleard says: “Industry leaders face many similar obstacles to growth, but they have very few opportunities to discuss their challenges in a non-competitive environment. By providing a neutral forum with high-level debate and exclusive networking, OPI believes that these leaders can learn from each other and drive the sector forward. “The addition of Chatham House rules makes it all off the record and provides a private arena for genuine debate. This means no press reports – even from OPI!”

Going Dutch The 2014 OPI European Forum takes place from 22-24 September at the Huis ter Duin hotel near Amsterdam, Netherlands. Its central European location – just 25 minutes from Schiphol airport – means it is easy to get to from across the continent, enabling a fantastic crowd of senior leaders to attend. The sessions will be moderated by Roy Sheppard, a journalist, author and specialist conference moderator. OPI Director Janet Bell notes: “Having a professional

moderator ensures the best outcome from an event at this senior level. We want the best information to be generated for all attendees and Roy will help us achieve this goal.” She continues: “We also have an outstanding range of speakers who will bring important information to the table. That said, we always ensure the programme is not overloaded, so there is time to discuss topics in great detail. And there is plenty of time for networking too, of course. In our industry, personal relations are what really matter and the European Forum event will give delegates the chance to meet new people as well as reconnect with old friends. It certainly is an event not to be missed.”

Lively debates Speakers include Kimberly Lear, a leading expert on multigeneration workforces and the challenges they bring. Brother’s Phil Jones brings his unique insights into our digital future – tailored especially for the OP sector. President International at Office Depot, Steve Schmidt, will be our Big Interviewee while VirtualStock’s Ed Bradley will be looking at the new challenge of big data. Other topics include discussions on multichannel strategies, innovation, category growth, mobile marketing, social networking developments and rebranding, to name but a few. The full programme can be viewed or downloaded at www.opi.net/ ef2014

“...an outstanding line-up of speakers and the chance to network with industry leaders. It’s an excellent way to assess market trends and our position within the industry” James Fellowes, Chairman, Fellowes

Want to know more? You can find more information about the 2014 OPI European Forum at www.opi.net/ef2014. If you would like an invitation to attend, please email OPI’s CEO Steve Hilleard on steve.hilleard@opi.net

w w w.opi.net | OPI Magazine

EPIC 2014 | Event Preview

Thinking

BIG

A merger of the two groups might be off for the moment, but Independent Stationers and TriMega are once again coming together for an EPIC event in September

MODERN

working life time pressures and cost issues make it hard to attend the myriad industry events and conferences on the calendar, so anything that might ease that burden is something the industry should welcome with open arms. Perhaps that’s what made last year’s inaugural EPIC show such a success, as leading US dealer groups Independent Stationers (IS) and TriMega joined forces to stage a combined event, with over 1,300 individuals registering for the 2013 conference. It’s no surprise then that the two organisations have decided to work together again. Operating once more under the banner ‘Where BIG Happens’, the two groups’ national conventions will take place at the Westin Diplomat Resort and Spa in Hollywood, Florida, on 17-19 September 2014.

Networking start The event kicks off on Wednesday, 17 September with the annual golf tournament, giving those inclined a chance to practice their swing among the banyans and royal palm trees of the Westin’s 6,500-yard championship golf course. And, of course, it will also give them the chance for some all-important networking. On 18 September, business starts in earnest. Following the Opening Session which, the organisers promise, will feature some BIG thinking and BIG ideas, attendees will have access to an exhibition hall featuring about 200 booths showcasing the latest innovations in every area of the industry, from office products, furniture and school

supplies to facilities management, MPS and ground-breaking new technologies. There will also be a number of different show specials, allowing delegates to make big savings by ordering a variety of products on the show floor. The final day, Friday 19 September, comprises a full programme of educational seminars and discussion groups. While many sessions will be available to all attendees, there will also be some that are specific to members of Independent Stationers or TriMega. These sessions have been tailored specifically to focus on helping members grow their businesses and include topics under the banner of Dealer Best Practices, Never Get Out-Negotiated and the enticingly named The Naked Office Supply Salesperson. So confident that attendees are going to benefit from this second joint dealer group event, both IS and TriMega are offering a ‘Time Well Spent Guarantee’. This means that if a delegate leaves the show without gaining “at least one BIG business-boosting best-practice learned, new business connection, brand new profit-producing product opportunity, or EPIC-inspired idea”, they will refund any out-of-pocket expenses that they incur. You can’t say fairer than that.

Sessions have been tailored specifically to focus on helping members grow their businesses

w w w.opi.net | OPI Magazine

Category Analysis | Furniture

figure

As the way we work changes, the office environment needs to constantly adapt and furniture companies are seeing exciting opportunities in this sector

by David Holes

THE

workspace and the way we interact with it has altered considerably over the last decade, and the pace of change continues to accelerate. The need for a flexible, adaptable office environment has indeed thrown down a challenge to the office furniture sector, but it’s stepped up to the plate with manufacturers delivering some innovative solutions. Improvements in the global economy also mean that many companies are now spending more in this sector, with most manufacturers and resellers OPI spoke to reporting strong upswings in sales. Martin Weedall, National Sales Director at UK wholesaler VOW, is in no doubt: “The figures speak for themselves. In 2014 we’ve already seen a 25% increase in furniture sales to our VOW+ partners.” Brian Banks, VOW’s Furniture Business Development Manager (South), agrees: “SMEs in particular are now ordering in the way they were before the economic downturn, with customers upgrading their offices to reflect new ways of working and to attract the best people.”

OPI Magazine | July/August 2014

The story is similar in the US. Dennis Arnold, VP Furniture at SP Richards, reports: “We’ve seen a nice mid single digit percentage rise in sales this year, despite the slow start caused by the awful weather. We anticipate momentum will continue as the year progresses.”

The versatile office The need to configure the office space to suit multiple needs is a key driver of furniture design. An excellent example of this is the recent winner of the North American Office Product Award (NAOPA) for furniture. The MooreCo Shapes Desk Configurable Desking System, aimed predominantly at the education market, demonstrates a clever, multifunctional design that enables a huge variety of set-ups for efficient use of space (for a full review of the NAOPA and MooreCo’s award, see page 37). MooreCo’s CEO Greg Moore sees the development of “products allowing flexibility to meet the needs of multiple end users in the constantly changing work environment” as the key to success. And he’s adamant that the workspace must accommodate rapidly changing needs. “Common rooms set up with flexible furniture to enable multiple uses are not just best practice, but are key to long-term survival. Manufacturers and distributors that can fulfil these needs are becoming the new leaders”, he says.

Furniture | Category Analysis This requirement to produce furniture that fits in with new work practices is a central theme. Nat Porter, VP of LDI Spaces and General Manager at its subsidiary Safco, says: “Current drivers are the changes in both how and where people are working, and we also see potential in products that help people stay healthy. Our fastest growing product lines stem from people working in smaller, more informal spaces which has spurred our product development.” Safco launched a new furniture line at NeoCon this year called the

Matt Allanby, VOW’s Furniture Business Development Manger (North), notes: “Changes in computing devices, increase in BYOD, mobile working and the expectations of Generation Y

“Work areas need to change to respond to the demands of the millennials” Kalyde Collection. It supports ‘third’ or ‘in-between’ spaces and transforms unused areas into collaboration zones that invite people to work, meet or have a casual conversation (see also ‘NeoCon nuggets’ box).

are all having a significant impact on furniture design. “Furniture is becoming more colourful, coordinated and streamlined and personalisation is key,” he adds.

Levent Çaglar, Chief Ergonomist at the Furniture Industry Research Association (FIRA) in the UK, echoes this: “Work areas need to change to respond to the demands of the millennials. A new ergonomics approach is needed to allow people to collaborate in a softer, more home-like environment”. He sees settings that encourage socialisation, collaboration and learning as vital, with spaces that encourage a variety of postures – standing, sitting, perching, walking and relaxing – as important for well-being. Zones that support quiet concentration and

Flexibility is key OPI talks to Sandi Jacobs, President of SideMark & board member of the Independent Office Products & Furniture Dealers Association (IOPFDA) in the US OPI: What currently fuels the demand for office furniture and what are the key trends? Sandi Jacobs: I was once told that there are no trends in office furniture, just trends in how we work and I believe that’s still the case. Today it’s all about creating an employee experience, with companies using office furnishings to help create a strong brand and deliver a sense of who they are and what they represent. Companies only used to buy new furniture when they moved premises, but now they buy whenever they want to reinvent themselves and that represents a huge opportunity for our industry. OPI: What else motivates companies to refurnish their offices? SJ: There’s fierce competition for attracting the best talent. Companies can actually use their work environment as a recruitment and retention tool for bringing in and keeping the best people. Plus these days, when people can work remotely from virtually anywhere, you need to give them a reason to actually come into the office and a well-furnished workplace can help achieve that. OPI: What impact does the way we work have on how office furniture is used? SJ: Today it’s all about flexibility, mobility and creating a workspace in areas that also have other uses. Companies are using libraries, lounge areas, outdoor patio areas and cafés as temporary

workspaces, and furniture needs to be able to adapt to these multiple uses, injecting a real sense of energy and dynamism across the entire office space. OPI: How is technological change affecting furniture design and how do you see this developing in the future? SJ: The trend for employees to bring in their own technology devices from home is obviously key, but it’s already possible to embed that technology within the furniture itself. At the moment it’s not really cost-effective, but within a 3-5 year time period that will change and we will see technology as an integral part of the design, with furniture that adapts itself to the current needs of the user. For example, a glass panel will sense when a tablet is placed nearby and turn itself into a fully interactive screen. OPI: You sound optimistic about the future, but how are things currently looking? SJ: This sector has been on the up for the last 18 months and things are looking great for 2014 and beyond. Based in California, I feel that we’re at the cutting edge of the furniture industry, but these positive trends are things that I’m noticing worldwide. OPI: What are the main challenges now; what do companies need to focus on? SJ: This business is more competitive than it has ever been. Commoditisation is still a challenge and companies need to show that they really value their customers and the end users of their products. Focusing on creating a lean business model, while delivering a high-quality service is paramount and those that can achieve this will prosper.

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Furniture | Category Analysis convey a sense that employees are valued, can also engender a much happier workforce. The importance of wellness is also picked up by SP Richards’ Arnold. “The trend for adjustable height work surfaces is increasing, particularly now the American Medical Association recommends changing positions throughout the day. Electric height sit-stand work surfaces are very popular, as is integrating adjustability into a worker’s current desk configuration.”

Technological innovation The impact of technological changes has also had an effect on the way office furniture is used, but the rapid rate of change presents its very own problems. “Technology changes faster than people buy new furniture”, says Safco’s Porter, “so integrating it within products is tricky. The biggest impact it has is creating the freedom to roam, producing new requirements for furniture used in open areas”. Arnold concurs, saying that “you are no longer tied to your desk and the need for large storage cabinets and filing has changed significantly”. He adds: “New storage is [often] designed for personal items requiring additional security. We don’t see much technology integrated into the actual design yet, but we do see furniture designed to facilitate the use of technology.” Moore regards technology no longer as just a tool, but as part of the human experience. “Rapid technological advances mean products built for today’s technology will be obsolete within two years. As such furniture designed today must be able to accommodate the swift and unpredictable changes of the future.” Vow’s Banks believes that younger employees used to working in pod-like

NeoCon nuggets Making the move to a healthy, more flexible workplace NeoCon 2014 took centre stage at the Merchandise Mart in Chicago, Illinois, in the middle of June, with attendance up an impressive 20%, bringing overall visitor numbers to about 50,000. Despite the dismal weather, spirits were high among the crowds. And there were some clear trends in terms of office furniturre design: flexible seating, height-adjustable desks, moveable walls, lightweight partitions that link magnetically and innovative, plug-and-play pods designed to maximise space were all on show, emphasising the move towards an adaptable workspace supporting multiple uses. Another growing trend was products offering an alternative to open plan work layouts. Steelcase showcased applications for its Vertical Intelligent Architecture (VIA) soundproof wall system that can be used to carve out private spaces in open plan offices. Chris Congdon, Global Director of Research Communications at Steelcase, comments: “While the open office continues to be the dominant form of design, there has been a backlash towards offices that only offer open spaces, without adequately supporting people’s need for privacy at times. We expect wall products to become even more important, especially ones like VIA that not only offer superior acoustic control, but also seamlessly integrate technology. We drive to work in cars that are ‘smart’ and then go into offices that are often ‘dumb’ – that doesn’t make sense. We see the opportunity for work environments to integrate technology that can help augment the ways people work today.” Health and wellness is another key area where companies are investing to attract and retain staff. The furniture industry is gearing up to support this by launching products with green, ergonomic designs to aid wellness and this was seen aplenty at NeoCon. Products such as sit-stand desks and ergonomic seating highlighted this health theme. The Freedman chair, launched by UK osteopath Simon Freedman, is a good example – its design forces users to adopt the correct sitting posture. Design principles that support a healthy lifestyle by encouraging people to get up and move around were also on display. For example, the Stir Kinetic Desk is a hi-tech, height-adjustable desk with an intriguing mechanism that periodically moves the top slightly to remind the user to keep moving about. As mobility within the office increases, so does the demand for collaborative workspaces with built-in charging stations and storage for technology. Technology is definitely having an impact on furniture design, but NeoCon 2014 showed that trend – as of today at least – is not necessarily about incorporating technology, but responding to how we use it Steelcase’s Vertical Intelligent Architecture (VIA) soundproof wall system within the workplace. environments at universities increasingly expect to see something similar in the workplace. “Pod systems mix flexibility with privacy and are quick to install or relocate. Many are acoustically insulated and contain touchscreen technology for beaming images and presentations from wireless devices.” FIRA’s Çaglar goes further. “With the technology now available we can truly work anywhere, anytime. Soon we may not need offices at all,” he says.

Technology is having an impact on the way furniture is marketed too. Many products are launched on social media, with new designs often showcased on Facebook and Twitter. Safco’s Porter has also noticed a “significant sales spike” whenever products are reviewed on blogs. Moore concludes: “Social media has seen growth in every area we use and YouTube is a very successful tool for understanding product functionality.” w w w.opi.net | OPI Magazine

Category Analysis | MRO & Safety

The MRO & Safety net The MRO & Safety market has provided an opportunity for diversification that some resellers have been quick to exploit and it’s looking like their foresight may be paying off

by David Holes

traditional OP suppliers look to broaden their scope and diversify into new markets, the maintenance, repair and operations (MRO) and safety sectors have caught the eye of many, particularly with businesses now increasingly looking to buy a complete range of products from one supplier.

Banner, the contract stationery arm of UK-based office2office, is a prime example and has been expanding its MRO & Safety portfolio over the last two years. Richard Costin, Managing Director of Banner Business Services, says: “We’re no longer an office supplier, we’re a workplace provider, with our range extending far beyond traditional office stationery – it now includes everything needed to run business premises, from office, warehouse and kitchen to washroom, mailroom and canteen.”

He adds that this is in direct response to customer needs: “They told us they wanted to be able to buy everything from one place and we’ve been quick to respond to that.” In the antipodes, Australian reseller Officeworks also spotted the opportunity and has expanded its business in this direction. Scott Clarke, Officeworks’ Buyer for Safety, says: “We’ve worked hard to develop our safety category as a direct result of legislative workplace changes and the increasing costs of workplace injury. A key focus is assisting our

Batteries included Batteries form a crucial part of the MRO market. Any portable electrical device needs a battery, plus they’re also used for temporary power back-up in case of mains failure. Duracell is the market leader for batteries, with around 37% market share by value and it’s seeing steady global growth of 2-3% per year. Kenyatte Nelson, EMEA External Relations at Procter & Gamble (manufacturers of the Duracell brand), sees the latest Duracell Ultra battery and Power Mat, a wireless mobile phone charging system recently launched in the US, as key innovations driving sales in this sector. Despite increasing awareness of green issues, alkaline disposable batteries still represent around 85% of sales in Europe. However, improvements in technology mean rechargeables are more and more seen as a viable option. “Previously batteries would take hours to charge and if you stored them, they’d be flat again when you wanted to use them,” says Nelson. “StayCharged technology means they’ll retain their charge for six months and fast charging means

OPI Magazine | July/August 2014

batteries can now be recharged in the time it takes to have a shower. This makes them so much more convenient.” Rival manufacturer Rayovac is also seeing sales growth and has recently introduced a range of Portable Power chargers for recharging products such as mobiles and tablets on the go when no mains power is available. Jessica Yurchich, Rayovac Assistant Product Manager, believes this is an important new sales area: “With increased use of portable technology and the need to have devices constantly charged, we expect to see this market growing rapidly as users become aware of these technological advances.” Yurchich has also spotted a growing clamour for batteries and battery-powered products from OP resellers: “They’re demanding batteries and torches more and more. As they look to emerging categories such as MRO & Safety for growth, they are capitalising on the new business these channels bring them.” She adds: “Many leaders in the industry see OP dealers as a threat. They are poised with the salesforce, infrastructure and products that make them extremely attractive to all end users.” Duracell’s Nelson agrees: “Our products are sold across a variety of retail and B2B channels and OP resellers are an important sales outlet. With our partners in the office supplies sector we’ve been able to develop the business model and create new sources of income for our customers.”

MRO & Safety | Category Analysis customers with the achievement of safety compliance.” Overall, the sector seems buoyant too. Companies specialising in MRO have weathered the economic storm and are posting impressive sales figures. Keeping your workforce safe can never be taken lightly, of course, but now that businesses have more resources at their disposal again, they are refreshing and updating their safety equipment, and companies that can supply these products are benefitting.

Sector bellwether US-based WW Grainger is a massive player in the global distribution of over 900,000 MRO and safety products and must be viewed as an important bellwether for this sector. It reported strong US sales in the first quarter of this year and CEO Jim Ryan said at the time: “We are particularly encouraged by the performance of our US business and online sales in both Japan and the United States continue to be strong. Despite near-term economic headwinds in Canada, we are very optimistic here also.” Banner’s Costin is also pleased: “Site and premises management is a new category we’ve invested in this year and we’re seeing strong sales growth here.” He also views the company’s catering offering as an important new area: “We recognised that every workplace needs catering supplies and equipment; we’ve got everything from kitchen to front-of-house products and initial sales have been really successful. But kitchens can be really hazardous places, so health and safety are vital and that’s an essential part of our new offering.” Safety – as well as MRO – is also an area where German adhesives manufacturer tesa is seeing good results through OP channels with its specialist range of products, particularly marking, security, anti-slip and repair tapes. The opportunities within the MRO & Safety sectors are clearly there for the taking, and those that have made the step already are beginning to see the benefits.

Safety first OPI talks to Walter Johnsen, CEO of Acme United, about the global market for first aid kits – a key component in the safety category – and its recent acquisition of First Aid Only. OPI: How is the first aid market doing and what’s currently fuelling demand? Walter Johnsen: The market is looking great and the main reason for that is concern from businesses for the safety and well-being of their employees. If an accident happens, they want the equipment on hand to deal with it. Also, as the global economy picks up, so does industrial output – more houses get built, petroleum production increases, etc. Sadly, this can mean more people get injured. OPI: How do different working environments affect the type of first aid kits required? WJ: The requirements for first aid in, say, a school vary considerably from those needed on an offshore oil rig. We sell tailored kits for every type of situation. For example, we supply Saudi Airlines with their own kit to deal with airborne accidents, be that burns from spilled coffee or cuts and bruises. But a kit for a restaurant, with the probability of more severe burns and deeper knife injuries, plus the need to quickly clean up blood spills, will be quite different. A first aid kit for a fracking site, meanwhile, will contain specialist equipment that you just wouldn’t need in a standard office environment. OPI: How do regulatory requirements for first aid kits differ around the world? WJ: They vary enormously. The requirements in Germany, for example, will be quite different to those across the border in France. In North America it’s the same – US school kits can contain medication, but in Canada they can’t. Having that specialist knowledge of different regulatory environments worldwide and the ability to tailor the product is key to selling into those different markets. OPI: So how is the market for selling via OP channels changing? WJ: Overall, we’ve seen growth in the sale of first aid kits of about 20%, but it’s substantially higher in office channels. OP suppliers are already in contact with all the industries of the world and they’re diversifying and deepening their range of first aid products, with bespoke kits designed to suit each industry’s requirements. They all need something different. There’s also a tremendous opportunity for supplying refills. For every dollar of kits we sell we see an additional dollar in revenue from refills as items are used, expire or require upgrading due to technological advances. Wound dressings, for example, have improved greatly as they’re now employing advances originally developed for the military. OPI: You recently acquired the assets of First Aid Only (see also Beyond OP, page 10). What were the main reasons behind that purchase? WJ: First Aid Only was the expert at ‘consultative selling’. The company wouldn’t simply sell a first aid product, but would also provide the training on how to use it. We’ve now got access to that expertise and the knowledge to sell tailored ‘smart compliance kits’ that not only meet, but exceed the required regulations – be that kits for the medics in soccer stadiums or those needed for survival in harsh environments. We’ll also be moving more production to First Aid Only’s facilities on the west coast of the US, giving us better access to markets there and across the border in Canada.

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Your OPI

On the move

OP personnel changes from around the globe We would love to hear from you. Email editorial@opi.net, Tweet us @OPInews or you can write to us at OPI, Diamond House, 36-38 Hatton Garden, London, EC1N 8EB, UK

North America

Staples has named Frank Bifulco as EVP of Marketing. In this newly created role designed to Frank Bifulco drive its Make More Happen brand campaign, the former Home Depot CMO will take charge of marketing across the company. He previously held marketing and sales positions at firms such as Coca-Cola, Timberland and Hasbro. Software provider ECi has named Anshul Choudhry as Global VP Anshul Choudhry of its new E-Commerce division. Alongside this move, Andrew Morgan has been named as President of the Office Products division. Morgan joined ECi last year when the company acquired his Red Cheetah firm, with Choudhry joining in 2006 as part of the company’s Britannia acquisition. SP Richards has promoted Paul Gatens to VP of E-Commerce and Marketing Services. In his new role, Gatens will be responsible for print and digital media activities, in addition to overseeing all marketing information data. The company has also promoted Gaius Gough to VP of Sales. In his new role, Gough will work closely with the corporate sales team, helping to maximise sales opportunities and manage national account relationships. Mark Sutton, a 30-year International Paper employee,

has been promoted to President and COO. Moving up from his previous role as SVP for Industrial Packaging, Sutton has now assumed overall responsibility for the company’s operations. Craft retailer Jo-Ann’s has recruited industry veterans Jim Wright and Megan Featherston to bolster its marketing and merchandising divisions. Wright joins as SVP of Marketing and Advertising while Featherston takes on the role of SVP of Merchandising.

Europe

Mikko Helander will resign as CEO of Metsä Board as of 1 December 2014 to join retail Mika Joukio group Kesko as CEO. Mika Joukio will replace Helander as Metsä Board’s CEO, leaving his current position as CEO of Metsä Tissue. Spicers Ireland veteran Martin Everard is now Managing Martin Everard Director Designate. With 23 years in the industry, including the role of Spicers Ireland Sales Director, Everard has taken over from Siobhan O’Connor who has left to join independent dealer Codex. Euroffice’s Office Power has announced Daniel Hill as Business Development Manager for the South of England. He moves to Office Power from VOW Europe where he was a Dealer Account Manager.

North America After spending 31 years in the role of Fellowes CEO, Jamie Fellowes has handed over the reins to son John Fellowes. The handover coincided with Jamie’s 50th anniversary of working in the business and he will remain Chairman of the Board in a non-executive role. A legend in the industry, Jamie has been recognised by the OP industry for numerous awards, including the Industry Achievement at John and Jamie Fellowes the 2014 OPI European Office Products Awards. John joined the family business 13 years ago, starting in the shredder division, a division he later ran. In preparation for the role of CEO, John moved to the UK in 2010 to better understand the European market, from which almost 50% of its sales revenue is derived. John became President of Fellowes in 2012 at which time he began a process of diversifying the company’s product portfolio away from paper dependent categories, and focusing on product innovation, new market development and brand marketing. ExaClair has appointed Graeme Gladwinfield as its National Account Manager. Graeme Joining ExaClair Gladwinfield from Bi-silque, Gladwinfield offers substantial experience in the areas of educational stationery products and solutions for presentation & display, interactive learning and collaborative working as well as planning and organising.

over five years as Steelcase Sales Director Japan and Korea – to take up the new position in Bostjan Ljubic London, UK. Durable UK’s Managing Director Sean Starkey has been named as Chairman of the BOSS Federation. Appointed as Vice Chair last year, Starkey takes over from former Spicers CEO Alan Ball, whose two-year term as BOSS Chairman had come to an end.

Soennecken has hired Oliver Buxel as a Key Account Manager for its Print and Copy Oliver Buxel division. Buxel, who spent 13 years at Ricoh, will be responsible for the acquisition of new members for the German dealer group as well as contract suppliers for software solutions. Bostjan Ljubic has been appointed to head Steelcase’s sales operations in the UK and Ireland as VP of Sales. The 36-year-old recently moved from Tokyo, Japan – where he spent

Nicolas Potier has been named as the new Chairman of French trade association UFIPA. Potier, who is General Manager for JM Bruneau, takes over the role from Marcel Ringeard, President of Pilot Europe, whose three-year tenure has ended. The Confederation of Paper Industries (CPI) has appointed Patrick Willink as its new President. Willink is Group Chief Technology Officer at luxury paper manufacturer James Cropper and will serve as President at the CPI for the next two years.

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Your OPI

5 minutes with... Betsy Hughes, VP of Sales, Friends Business Source

Your first full-time job. Working as a customer service representative at a local office supply dealer. I was looking for a teaching position after graduating college, but have stayed in this crazy industry for 30 years! Your best piece of advice to someone who has just joined the OP industry. Be patient with yourself; it takes time to learn. Don’t fear the competition either! The best moment in your career. Being awarded a contract with the National Healthcare GPO, Premier. The industry figure you most admire. Winnie Ary. I was one of her first trainees. She toughened me up and taught me a lot of what I practise today. What do you think will be the biggest single issue affecting the OP industry over the next five years? Drones delivering office products. Your greatest strength. Honesty and integrity. I never let anyone challenge it.

“Be patient with yourself; it takes time to learn”

Things that make you angry. Lying. Be accountable for your decisions, either wrong or right. What sports team do you support? The Detroit Lions. I am a person that perseveres and I still believe we can win a Super Bowl! What is mankind’s greatest invention? Wine. What keeps you awake at night? I want to be the person in this industry who thinks of that one thing that totally changes the customer experience! The daily task that you like the least. I hate laundry. If you could change one thing about yourself, what would it be? That I would have the ability to take a nap in the middle of the day. How would you like to be remembered? As someone who just loved all and loved life.

What business book would you recommend as essential reading? Borrowing Brilliance by David Kord Murray. Your childhood ambitions. I wanted to be an archaeologist for some reason. I guess I like to discover things that are hidden. Your first car. A 1980 Datsun B210. A brown hatchback with racing stripes. Things you don’t like spending money on. Repairs. Why do things have to break? The best concert you have ever been to. Elvis Presley in April 1977.

Any pets? My Cavalier King Charles, my Cavapoo, and my 12-pound Calico cat. www.opi.net | OPI Magazine

Your OPI

Calendar Key dates in your industry If we are missing an event, please let us know. Contact editorial@opi.net Do you have an event that you would like to promote in the OPI Calendar? Please contact Fergus Cox for further information about having an extended entry and pricing. Email: fergus.cox@opi.net Web: www.opi.net/calendar

SEPT 05-06 The Australian Office Products Expo Melbourne, Australia SEPT 11 Kids in Need Foundation, Education Celebration Gala Minneapolis (MN), USA

SEPT 17-19 EPIC 2014 Joint Independent Stationers/TriMega Convention Westin Diplomat Resort, Hollywood (FL), USA Contact: Cora Lienemann Tel: +1 317 579 1111 Email: cora@ independentstationers. coop Web: www. wherebighappens.com/

SEPT 25-27 ISSA/Interclean Istanbul, Turkey OCT 06-08 Pinnacle Annual Meeting and Vendor Forum 2014 Rosemont (IL), USA OCT 07 Advantia 2014 Conference Warwickshire, UK OCT 08 Howard Wolf Golf Classic Wheaton (IL), USA OCT 09 Spirit of Life Gala Chicago (IL), USA OCT 10-12 Office Brands EXPO Sheraton & Westin Denarau Island, Fiji OCT 20-22 Transform Europe 2014 Prague, Czech Republic OCT 22 BOSS Awards Birmingham, UK

SEPT 22-24 OPI European Forum 2014

Grand Hotel Huis ter Duin, Noordwijk, the Netherlands

Contact: Janet Bell Tel: +44 20 7841 2941 Email: janet.bell@opi.net Web: www.opi.net/EF2014 An invitation-only forum for CEOs and senior executives from the business supplies and associated sectors.

OCT 22-26 BSA & IOPFDA Annual Meetings San Diego (CA), USA

MAR 04 European Office Products Awards 2015

NOV 04-07 ISSA/Interclean Orlando (FL), USA

Hotel Okura, Amsterdam, the Netherlands

NOV 10-12 ECi Connect Conference Las Vegas (NV), USA NOV 10-12 General Program Marketplace 2014 Miami (FL), USA NOV 11-15 Office Partnersâ&#x20AC;&#x2122; Grand Ole Gathering 2014 Nashville (TN), USA

Business Design Centre, London, UK

NOV 26-28 Big Buyer 2014 Bologna, Italy DEC 03-05 ADVEO World Germany Munich, Germany

JAN 25-26 Paper Show 2015 Leuven, Belgium JAN 31-FEB 03 Paperworld 2015 Frankfurt, Germany

MAR 19-21 Education Show 2015 Birmingham, UK

APR 28-29 London Stationery Show 2015

NOV 20 Integra Annual Conference Nottingham, UK

2015

Contact: Lisa Haywood Email: lisa.haywood@ opi.net Nominations and entries are now being accepted. Visit www.opi.net/ EOPA2015 for further information.

Contact: Chris LeonardMorgan Email: clm@ firstevents.com Tel: +44 20 8462 0721; Web: www. stationeryshow.co.uk The only UK exhibition dedicated to stationery products, writing instruments and accessories for the home, school and office. Organiser of National Stationery Week.

FEB 16-19 United Stationers & Lagasse: CORE Live Nashville (TN), USA

MAY 17-19 OPI Global Forum 2015

FEB 25-27 ISSA/Interclean Latin America Mexico City, Mexico

Contact: Janet Bell Tel: +44 20 7841 2941 Email: janet.bell@opi.net Web: www.opi.net/GF2015 An invitation-only forum for CEOs and senior executives from the business supplies and associated sectors.

MAR 02-04 Paperworld Middle East 2015 Dubai, UAE

Sofitel Chicago Water Tower, Chicago (IL), USA

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Your OPI

Final word Your industry, your opinions

Jennifer Huckeba, Director of Business Development, Your Business Source, SP Richards

A new perspective on outsourcing Do what you do best and consider outsourcing the rest

I reflect on the last 12 months, a few things about Your Business Source (YBS) dealers come to mind. First of all, YBS dealers are loyal, and our YBS programme membership continues to grow because they believe in it. Secondly, YBS dealers understand the importance of collaboration and just how much more leverage a group can have compared to that of an individual. Most importantly, YBS dealers are ready to embrace the changes that this ever-changing marketplace commands and have the drive to do what it takes to come out on top. Our YBS dealers want to compete better, faster and more efficiently, and are determined to lower their overhead costs and increase profitability. We get that and we’re ready to help them find the next step that’s right for their business. After all, they are our future and we’re here to help them achieve success. Accomplishing more with less isn’t easy – no one knows that better than independent dealers. So how can they thrive in a marketplace where closures and acquisitions continue to reduce the number of office products resellers? Many small and medium-sized business owners believe that one way to succeed in a difficult environment is through outsourcing.

accountancy and payroll; and workers that have specialised knowledge which could include IT support. Outsourcing daily office tasks increases efficiency and gives business owners more time to focus on generating income, but research cautions that just because something can be outsourced, doesn’t mean that it should. According to Entrepreneur.com, it is essential for business owners to determine their strengths and values prior to choosing which tasks to farm out. Failure to recognise the core competencies of the business and keep them in-house is likely to diminish or eliminate that company’s differentiation in the marketplace.

Added agility Research shows that outsourcing, when done correctly, provides a way for business owners to improve efficiency and increase expertise without adding headcount. Businesses that outsource may be more agile to scale up or down quickly as the economy or workload changes, which is why some small businesses see outsourcing as a solution for staying below the 50-employee threshold of the Affordable Care Act. During his presentation at the 2014 Advantage Business Conference (see also ABC Review on page 35), Gene Marks emphasised to YBS dealership owners how outsourcing can help them to control costs, expand their businesses and focus on what they do best. The next year is sure to bring many more changes in the OP marketplace, but with a strong industry partner and solid outsourcing strategy, the future looks bright for YBS dealers.

“Many small and medium-sized business owners believe that one way to succeed in a difficult environment is through outsourcing”

Outsourcing opportunities Now, I know what you’re thinking. Just seeing the term ‘outsourcing’ may foster some negative feelings for many. It certainly did for me at first. However, when I did a little digging, I found that the research painted a very different – and much brighter – picture than I had expected. In an article for Web.com’s Small Business Forum, Gene Marks, small business expert, said: “Too many people are trying to do too many things. The smartest ones I know have recognised their own limitations and [turned to] others so that they could focus on what they do best.” According to Gregg Landers of professional services company CBIZ, outsourcing can successfully be done in three areas of a business: executive positions requiring advanced general skill levels, such as a part-time CFO; employees responsible for highly repetitive tasks, such as

OPI Magazine | July/August 2014

Want the final word? Email editorial@opi.net or write to OPI, Diamond House, 36-38 Hatton Garden, London, EC1N 8EB, UK

IN THE NEXT ISSUE • Big Interview with TriMega President Mike Maggio • Jan/san Special – OPI takes a close look at this booming category that is becoming ever more important to OP resellers • From marginal add-on to core business, MPS is here to stay