Office Supply & Paper Wholesalers
Companies in this industry distribute paper products and other office supplies. Major companies include Staples subsidiary Essendant, SP Richards (a subsidiary of Genuine Parts), and the distribution arms of retailers Office Depot and Staples (all based in the US), as well as Pelikan (Germany), Lyreco and Manutan International (France), and Spicers (UK and Australia).
The global office supplies market is projected to grow from $235 billion in 2017 to $247 billion by 2020, according to procurement intelligence firm Beroe. Worldwide, countries with strong economies tend to have the highest number of office supply distributors. Developing countries where new businesses are being created, such as China and India, will attract more office supply distributors as demand for office products increases.
The US office supply and paper wholesale industry includes about 4,350 establishments (single-location companies and units of multi-location companies) with annual revenue of about $39 billion.
Demand is closely tied to the level of business activity. However, workplace digitization is depressing demand for traditional office products. To compensate, SP Richards, Office Depot and other office products distributors are expanding beyond their traditional offerings, adding janitorial and breakroom supplies, among other products, and providing value-added services for customers. For example, Office Depot entered the managed IT services market in 2017 with its $1 billion acquisition of CompuCom.
The convenience and large economies of scale offered by ordering office supplies online from dealers such as fast-growing Amazon Business has resulted in e-commerce becoming the dominant ordering method in many countries, challenging traditional channels. Also, the US government's pending migration to an online purchasing platform for federal agencies has distributors, especially smaller businesses, concerned about an Amazon monopoly on government procurement given its sheer strength in e-commerce. The profitability of individual companies depends on merchandising and an efficient delivery system. Big companies have economies of scale in distribution because they can supply a wide range of products to the same customer. Small companies can compete successfully by distributing specialty products or providing superior customer service. The US industry is concentrated: the 20 largest companies generate nearly two-thirds of revenue.
Besides their online rivals, wholesalers may compete with their suppliers (office supply manufacturers), who may sell products directly to retailers or consumers. Wholesalers may also compete with their customers (office supply retailers), by selling directly to consumers themselves. In addition, mass merchandisers and warehouse clubs compete with wholesalers to sell office supplies to small businesses.
Products, Operations & Technology
Major products include general office paper, office supplies, labels, and greeting cards, which together account for about 80% of industry revenue. Toner
Sales & Marketing
Finance & Regulation
Regional & International Issues
Also includes the following chapters:
Quarterly Industry Update
Trends and Opportunities
Call Preparation Questions
Glossary of Acronyms