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BIG INTERVIEW

Connecting the

business products world

Denis Mathieu, Novexco April 2018

INSIDE THIS ISSUE l l

Essendant’s difficult road ahead l Newell clashes with Starboard l Depot transformation continues l BSA and why it’s still vital EOPA winners up close l Consolidation and what it means for independents l How to maximise Twitter l What’s cool in school?

CONTENTS 18 Big Interview A complete rebrand is just one of many initiatives being implemented at Novexco 24 Hot Topic A new wave of consolidation is upon us. What does it mean for independents?

28 Spotlight OPI talks to BSA’s Barry Lane about the continuing relevance of the association 32 Category Update Technological change is driving the education sector as global markets open up 36 Vendor Profile International Paper kicked off 2018 with a rebranded portfolio of HP Papers 40 Category Update The paper industry is feeling the pressure of declining demand

Big Interview: Denis Mathieu, Novexco

Canada’s Novexco was one of the very early adopters of the hybrid wholesaler, reseller and dealer group model. Since the arrival of President Denis Mathieu in 2016, it’s a combination that’s become increasingly polished. Mathieu’s new strategic plan is now well underway, resulting in impressive organic growth, several acquisitions and a complete rebrand HOT TOPIC: CONSOLIDATING THE FUTURE

45 How To... ...use Twitter to your advantage in business 46 Review: EOPA 2018 The winners of this year’s EOPA in the spotlight 53 Preview: INTERCLEAN What’s in store for the cleaning/sanitation sector at the Amsterdam show?

54 Preview: School & Office Expo OPI takes a look at the first pan-African stationery show

REGULARS 5 Comment 6 News 56 5 minutes with...

Ricardo Ferreira 58 Final Word Skip Ireland

April 2018

Mike Gentile, CEO of US dealer group Independent Stationers hopes this current consolidation cycle will offer the impetetus needed to bring the industry even closer together: “There will be fewer mid- to large-sized dealers due to M&A activity and market attrition. However, this will hopefully encourage manufacturers, wholesalers and dealer groups to seriously collaborate for the greater good of the IDC. The IDC will not become extinct. Smaller, yes, but still relevant.”

42 Advertorial Boise is a paper brand that manages to buck the trends

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COMMENT The OPI team EDITORIAL Editor Heike Dieckmann +44 (0)20 7841 2950 heike.dieckmann@opi.net Deputy Editor Michelle Sturman +44 (0)20 7841 2942 michelle.sturman@opi.net Reporter Joshua Allsopp +44 (0)20 7841 2952 joshua.allsopp@opi.net OPI Special Correspondent Andy Braithwaite +33 4 32 62 71 07 andy.braithwaite@opi.net Freelance Contributor David Holes david.holes@opi.net

SALES & 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 Director of Growth Services Jeremy Hughes +44 (0)7807 810617 jeremy.hughes@opi.net Digital Marketing Manager Aurora Enghis +44 (0)20 7841 2959 aurora.enghis@opi.net

EVENTS Events Manager Lisa Haywood +44 (0)20 7841 2941 events@opi.net

PRODUCTION & FINANCE Studio Joel Mitchell +44 (0)20 7841 2943 joel.mitchell@opi.net Operations & Production Eda Sismanoglu +44 (0)20 7841 2950 eda@opi.net Finance Kelly Hilleard +44 (0)20 7841 2956 kelly.hilleard@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 Executive Assistant Debbie Garrand +44 (7718) 660249 debbie.garrand@opi.net

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The importance of staying relevant

ast month saw the winners of the 2018 European Office Products Awards (EOPA) crowned in Amsterdam (see page 46). Being involved in the whole EOPA process from the very start – as a mere onlooker, not a judge – I always find it all hugely interesting and insightful. The winners – and the shortlist in fact – often say plenty about the companies in the fray.

Take International Paper (IP), for example. If you look at our Category Update on paper (page 40), the reasonable conclusion to draw is one of doom and gloom in the sector. Yet, IP has just won another award, following on from its last one just two years ago.

I could name several other examples where, from the outset, the shortlisted companies – or even the winners – operate in environments best described as challenging. What these companies have in common is that they’re progressive, they evolve, they are tech-savvy and they embrace new opportunities. For that alone they ought to be congratulated.

Longevity [...] is meaningless if you’re not on the ball and stay relevant to whoever you’re serving It’s all about staying relevant, as Barry Lane from the Business Solutions Association also knows only too well (see page 28). Longevity in the industry is meaningless if you’re not on the ball and stay relevant to whoever you’re serving. And these days relevance is acutely linked to technology – our current How to… series on using social media as a sales and marketing tool (see page 45) is a good example of this.

Meeting ever-changing – and more demanding – customer expectations is another big topic and one that’s being addressed by the leading operators in our industry. With that point in mind and going back to EOPA, there’s one winner in the reseller category that topped every other contender – no prizes for guessing who it is.

The Hot Topic this month is market consolidation (see page 24). Again, to be on the ‘winning’ side, it comes down to the same things: staying relevant and meeting customer expectations. No doubt there will be a lot of short-term pain in this latest wave of consolidation, but ultimately it’ll be for the greater good of the industry. As for the future of independents specifically, I think Mike Gentile’s comment just about sums it up: “The IDC will not become extinct. Smaller, yes, but not extinct.”

Have a good month.

HEIKE DIECKMANN, EDITOR

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April 2018

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NEWS

Analysis:

Which road will Essendant take?

There is a lot of noise in the US market about potential developments at the wholesaler

At the end of February, US business products wholesaler Essendant reported a set of challenging 2017 financial results, with sales declining by almost 6% (around $330 million) to $5 billion, adjusted EBITDA down nearly 30% to $121 million and adjusted net profit tumbling by more than 50% to $25 million.

The company is experiencing headwinds from a number of areas such as secular declines in its traditional product categories, reseller consolidation, and more direct sourcing by large customers. In addition, weak sales and earnings and no obvious signs of a turnaround have hit Essendant’s share price hard: at the time of writing, the company’s stock price was trading at under $8 – about a fifth of what it was three years ago – and its market capitalisation had slipped to below $300 million.

All these factors are leading to intense speculation in the US market about Essendant’s future strategy and direction, including potential changes to its business model and its status as a publicly-listed company.

OPI looks at some possible scenarios.

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1. GO PRIVATE Last year, Staples’ shareholders decided the best way to cash out of their investment was to accept an offer from Sycamore Partners to take the company private.

It would not be a surprise if Essendant’s shareholders were considering a similar course of action, while the low market capitalisation would appear to make the wholesaler a more attractive takeover target.

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OPI estimates that, at a premium of around 20% on the current share price plus approximately $500 million in debt, a deal to take Essendant private would be worth around $1 billion.

Two leading investment firms, Pzena Investment Management and Blackrock, have upped their stakes in Essendant in recent months, and now hold more than 25% of the wholesaler’s common shares between them.

For private equity to be tempted

by Essendant, there would need to be a third party involved Pzena, in particular, has more than doubled its exposure to Essendant over the past 12 months, taking a 13.5% stake in the firm, up from 6.3% in February 2017. It is an investment firm that has historically chased undervalued and underperforming stocks and was one of the leading shareholders in Staples before it was acquired by Sycamore.

One sticking point might be simply why a private equity firm would want to buy Essendant and what the profitable exit strategy would be. An answer to those questions might lie with Sycamore and Staples’ strategy in the mid-market customer segment.

As Staples scales up in this area and broadens its product assortment to compete with Amazon

2. ACQUIRE RESELLERS In the past 18 months or so, both Staples and Office Depot have acquired large independent dealers, with a resulting negative impact on Essendant’s sales from its most important independent customer group.

With the likelihood of the two national players pursuing this acquisition strategy, one solution for the wholesaler is to buy dealers before the big boxes get their hands on them, thereby protecting its volumes. That would mean a change in strategy and would be – for some – a controversial course of action, the counter-argument being that it is better for the health of the IDC if these resellers are acquired by Essendant rather than by one of the national chains.

3. MERGE WITH A RIVAL Blackrock, the second-largest shareholder in Essendant with around 12%, is also the largest shareholder in Genuine Parts (GPC), the owner of SP Richards (SPR).

What influence does it wield with each company’s board of directors?

On GPC’s recent earnings conference call, CEO Paul Donahue said this about SPR: “We continue to evaluate our long-term outlook for this business.” Is this a euphemism for: “We are exploring a sale of the business?” Possibly.

Historically, an Essendant/SPR tie-up would have sent antitrust alarm bells ringing furiously. With more dealers and the big boxes purchasing direct, the ability to buy wholesale from Amazon, the declining mix of traditional office supplies in the product offering, and the important ink, technology and paper categories already well covered by other distributors/vendors, the Federal Trade Commission might have a tougher time blocking such a move today.

A possible scenario, therefore, could see both Essendant and SPR being acquired by private equity and then brought together. Not dissimilar to the attempt

by Platinum Equity in Australia and New Zealand to combine Winc (formerly Staples) and OfficeMax – although that is proving to be more of a challenge than it probably first thought.

Apart from SPR, other names to throw into the hat could be the likes of Grainger, Wesco or Veritiv. The point being that, for private equity to be tempted by Essendant, there would need to be a third party involved at some stage which would lead to significant synergies and/or economies of scale.

Office Depot assigns marketing partner Office Depot has teamed up with Y&R – a subsidiary of advertising and PR conglomerate WPP – as the brand’s new marketing agency.

Depot called it an important step in its planned transformation away from being a traditional office products retailer to a broader business services platform (see also page 8).

AOPD gets makeover US dealer network American Office Products Distributors (AOPD) unveiled a comprehensive new rebrand which includes a new logo, tagline and website, as well as plans to develop sales and marketing tools.

New Managing Director for ADVEO Italy European office supplies wholesaler ADVEO has appointed Luca Borroni as Managing Director of its Italian subsidiary. Borroni brings more than 20 years of experience in the sector, joining from Office Depot Europe. He replaces Fabrizio Pistoni, who stepped down from the company after five years.

Avery appoints ‘West Region’ leader Label maker Avery has promoted Nicolas Jean-Jean to Managing Director for Avery Europe, West Region. Formerly General Manager of Avery’s Benelux and France operations, Jean-Jean will oversee the running of the UK, French and Benelux businesses.

ISSA launches new show Global cleaning industry association ISSA has partnered with Trade Press Media Group to launch the Clean Buildings Expo. The commercial cleaning-focused trade show will make its debut at the Baltimore Convention Center in Maryland from 26-27 March 2019.

EO Group acquires Eurostat UK reseller and technology platform EO Group – parent company of Euroffice and Office Power – has acquired leading dealer Eurostat Office Solutions.

Founded in 1991, Eurostat is one of the largest independent office supplies companies in the UK. The two firms initially met to discuss the possibility of Eurostat joining Office Power, but instead EO Group CEO Simon Drakeford described it as “too good an opportunity to pass by” after owner Stefan Mercado revealed his plans to retire.

The acquisition will allow EO Group to further develop the Office Power platform, improve the group’s category roll-out plans and drive customer loyalty.

In related news, EO Group has appointed John Browett as Chairman of the board. He brings extensive senior management experience across retail, technology and M&A. Most recently he was CEO of UK homewares retailer Dunelm, having also previously headed Dixons and Tesco.com.

April 2018

Whatever happens, there needs to be a major catalyst for growth and profitability at Essendant. The $50 million cost-savings plan recently announced by CEO Ric Phillips and other strategic drivers are unlikely – on their own – to be able to offset the impact of further sales declines that are expected for the foreseeable future.

IN BRIEF

NEWS

Business, there are suggestions that it will need to enhance its distribution network across the US. That could bring Essendant into the equation as a potential target for Sycamore/Staples. It would also put the cat among the pigeons in the independent dealer channel (IDC), particularly with Essendant’s largest customer WB Mason – something that Staples could no doubt look to take advantage of.

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NEWS

Analysis:

Office Depot’s transformation gathers pace

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Office Depot shifts away from retail and expands its B2B services portfolio in the US

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As anticipated, the acquisition of IT support and repairs company CompuCom in October 2017 set the wheels in motion for Office Depot’s new business model. It plans to invest a further $40 million to expand its services portfolio in 2018 as it continues to move away from retail and into B2B. Speaking on the recent FY2017 earnings call, Office Depot CEO Gerry Smith confirmed to analysts: “We are transforming our business from a primarily product-based company into a services-driven enterprise that leverages our omnichannel platform to provide a wider range of solutions for our customers.”

He said that as top-line sales continued to decline, it was vital Depot offered more value to its customers. FY2017 results revealed that sales had declined 7% to $10.24 billion, while adjusted operating profit was down 2% at $46 million. The primary driver of this poor performance was the ongoing market weakness in its retail segment, and it’s something the reseller has contended with for some time.

But the shift is not as drastic as it seems.

Although Depot is known predominantly for its bricks-and-mortar stores, between 50-60% of its overall business already falls under the services category, which is why the plans are perhaps more disruptive than drastic. Its image as a retailer is ingrained in the psyche of US customers, but that’s nothing clever marketing can’t fix. Indeed, last year the group recruited several former advertising execs with strong IT backgrounds and recently appointed WPP-owned Y&R as its marketing partner (see In Brief, page 7).

SERVING NEEDS As it moves away from retail and the consumer market, Depot has found that the biggest demand for the small businesses it is seeking to serve was for technology and IT support.

The company’s first major step in its transformation was the aforementioned CompuCom acquisition, which brought on board its SMB offering TechZone. Rolled out as an integrated in-store service to a number of store locations last year, there are another 28 TechZone service centres in the pipeline for this year. Depot also expects to expand CompuCom’s broader offering across both its retail and online platforms.

CompuCom is already proving its worth, ending 2017 on a strong note. Under Depot’s ownership it achieved record order levels for the fourth quarter, reporting sales of $156 million and an operating profit of $8 million.

What’s more, subscription-based digital solutions platform BizBox, which was launched in November last year, has since been trialled as an in-store service in Austin (TX) with plans to extend this.

Depot is also building a subscription-based security offering for the SMB market that will be launching nationwide with a “very well-known” but as-yet-unnamed partner late in Q2 2018.

Smith said: “[We are] continuing to drive services and subscriptions across the company and our Austin pilot [BizBox] is a great example of the services-led transformation coming to life in our retail stores.”

RETAIL REMAINS IMPORTANT However, Smith is keen to emphasise that Depot is not abandoning its core retail arm, highlighting the last-mile advantage as a key strategic component.

With nearly six million SMB customers within three miles of its stores, the group plans to take market share from small local providers, which currently represent around 75% of the $25 billion managed IT services market.

We are transforming [Office Depot] from a primarily product-based company into a services-driven enterprise “Providing tech support and repair capabilities within our stores not only provides immediate scale and the ability to tap into this growth opportunity, but it also helps us increase store traffic,” said Smith.

As the retail footprint is still a critical part of its omnichannel transformation, the group is looking to significantly slow down the pace of future store closures, with only about 20 net closures scheduled this year.

As a result of the planned expansion and investment, Office Depot anticipates that sales in both the Business Solutions segment and CompuCom will be flat in 2018.

Still, it seems that everything is finally falling into place for the reseller, with key parts of its strategy well underway. If 2017 was Depot’s ‘transformational’ year, 2018 may well be its pivotal one.

Icahn backs Newell in Starboard battle Newell Brands has entered into a high-profile agreement that could well secure its position in the power struggle with US-based activist investment group Starboard.

Earlier this year, the hedge fund aligned with former executives of Jarden – the business Newell acquired in April 2016 – to decry the vendor’s plans to cut back its core brand categories and proposed a full slate of its own candidates to replace the current leadership team.

Fighting back, the consumer goods group has announced the appointment of four nominees to its board by prolific investor Carl Icahn. Billionaire Icahn – who controls around 6.9% of Newell’s shares – secured a leading equity position in the company in March, just as it was in the throes of the proxy battle with Starboard.

Patrick Campbell, Brett Icahn, Andrew Langham and Courtney Mather have been elected to serve alongside the remaining Newell executives – including CEO Michael Polk – with retired 3M CFO Campbell acting as Chairman. As part of the deal Icahn agreed to vote all of his shares in favour of Newell’s own nominations at the upcoming 2018 annual meeting.

With Icahn’s backing, Newell has now expanded its transformation plan. The group’s Finance Committee – which will be chaired by Icahn nominee Mather – will oversee the divestitures proposed by Newell in pursuit of its streamlining targets. Polk, who has seemingly secured his place on the board despite Starboard’s efforts, said the agreement with the investor reflected his understanding of Newell’s “complex strategy”.

Icahn has also been in the public eye recently for his involvement in a similar leadership fight involving Xerox and Fujifilm (see News, OPI March 2018, page 11).

BOSS encourages young talent

UK industry association BOSS returned with its award-winning Leaders of the Future Conference at London’s historic Stationers’ Hall in March.

The event featured several insightful talks aimed at inspiring the next generation of office products professionals, including a presentation by 22-year-old adventurer Alex Staniforth who shared his story of surviving the 2015 Nepal earthquake during an attempt to climb Everest.

After a social lunch and an interactive productivity workshop, attendees had the rare opportunity to pick the brains of some of the UK industry’s most-respected leaders as part of the two panel discussions.

The speakers – including Steve Haworth from EVO Group of Companies; Ian Buckley from Prima; and Graham Craik from Pentel – outlined the qualities needed to make a good leader and highlighted some of the tough decisions faced by those at the top.

An intellectual property ruling panel has deemed Aurelius, Office Depot Europe’s private equity owner, guilty of engaging in reverse domain name hijacking.

When Aurelius completed the acquisition of Office Depot Europe in January 2017 – which included Depot’s B2B delivery business Viking in the UK – the domain name Viking.com was not part of the deal.

In an attempt to gain control of the web address, Aurelius filed a complaint with the World Intellectual Property Organisation (WIPO) last November accusing Office Depot in the US of so-called ‘cybersquatting’ – otherwise known as registering ownership of a domain name in bad faith.

But a WIPO panel has failed to find evidence to support the allegations, ruling in favour of Office Depot, which had previously owned the Viking brand for more than 15 years and continues to control the registered trademark in other parts of the world, including the US. Instead, the suit backfired and WIPO found Aurelius to be guilty of reverse domain name hijacking. It asserted that the firm had made unlawful cybersquatting claims in order to coerce Depot into handing over the domain when it had no legal entitlement to begin with.

IN BRIEF Evoca boosts US presence Italy-based professional coffee machines manufacturer Evoca has acquired US-based coffee machine dealer VE Global Solutions (VEGS). VEGS is a distributor of Evoca brands Necta, Wittenborg and SGL coffee machines in the US.

NEWS

Depot in Viking domain name spat with private equity firm

Rebrand for Stationery Wholesalers Australia-based OP reseller Stationery Wholesalers has opted for a new name and refreshed look. The company will now be known as GetYoo (Smarter Business Supplies).

Clorox buys multivitamins firm US cleaning products manufacturer Clorox has agreed to buy Florida-based Nutranext for around $700 million. Nutranext produces and markets dietary supplements in the retail, B2C and e-commerce channels.

Staedtler sales chief resigns Head of European Sales at German stationery vendor Staedtler, Udo Peters, has resigned.

Peters will be succeeded by current Chief Sales and Marketing Officer Axel Hülsmann until a permanent replacement is appointed.

Guy Brown unveils online B2B marketplace

US office products and MPS supplier Guy Brown has launched its own B2B e-commerce platform Guy Brown Office Direct. It is the first of two spend management platforms the firm has slated for release this year.

The new online marketplace is aimed at delivering a consumer-like shopping experience and has been made with business procurement requirements in mind.

According to the reseller, the platform gives business customers access to over 1,000 brands in mainstream categories such as workplace and breakroom supplies, printer and toner supplies, office furniture and technology products.

It also makes the group’s cost-saving services more accessible and provides users with an easier way to manage spending.

Cowans boss joins Integra board Kevin Foot, Managing Director of Essex-based OP supplier Cowans Group, has been appointed to the board of UK dealer group Integra Business Solutions. His industry experience includes 20 years of running wholesaler Hanmar before it was sold in 2006.

Pentel Australia boss resigns General Manager of Pentel Australia Alex Streeter has resigned after nearly five years with the group. He is departing the OP industry altogether to join power tools vendor Hitachi Tools Australia.

Leadership change for 3M 3M has announced a management shift, effectively placing two leaders at the helm.

COO Michael Roman has been made CEO, succeeding Inge Thulin who has been appointed Executive Chairman.

Iceberg completes refinancing US-based office furniture and viscom manufacturer Iceberg Enterprises has successfully finished its refinancing process to the tune of $15.2 million in committed facilities.

of office workers choose to spend their lunch hour alone

of Americans say a clogged toilet would negatively impact their perception of a business

April 2018

80% 8 0% % 86%

WB Mason versus Dairy Queen US mega dealer WB Mason has hit back at fast food chain Dairy Queen after it filed a lawsuit alleging infringement of its ‘Blizzard’ frozen confectionery brand. WB Mason – which sells bottled water under the same name – described the case as a “sneak attack filed in the midst of active settlement discussions”.

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NEWS

Exertis buys UK distributor IT distributor Exertis has acquired a digital memory and PC accessories business as it continues to expand its UK footprint.

It has bought Hypertec, a distributor of third-party and own-brand products including data storage, assistive technology and security software.

The company has also bolstered its Unified Communications (UC) and Audio-Visual (AV) teams. Former Business Development Manager Steve Robertson has been promoted to Head of AV Sales at its AV division Medium. Meanwhile, Simon Cadman has joined Exertis as UC Technical Consultant.

VOW appoints new board VOW has appointed its own leadership team and, in doing so, has given itself total autonomy in the day-to-day running and decision-making of the UK wholesaler, away from parent group EVO. Headed by VOW Managing Director Adrian Butler, the board now comprises: • • • • • •

Sales Operations Director: Lisa Hainsworth Merchandising and Marketing Director: Andrew Stacey Operations Director: Martin Weedall Commercial Director: Thomas Barber Customer Experience Director: Nikki Todd Managing Director of VOW’s Managed Services Division: Cheryl Lamont

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The announcement is very much in line with its strategy set out late last year to improve the reseller experience and become a “world-class wholesaler”.

Butler said the implementation of the board will lead to a number of important initiatives in the months ahead, including a soon-to-be-announced sales structure.

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Adrian Butler

$231,000 The amount Amazon CEO Jeff Bezos makes

in one minute

WHO’S WHO IN OP

Top 100 new entry 2018: Dolph Westerbos – CEO, Staples Solutions Dolph Westerbos was appointed CEO of Staples Solutions in November 2017. He took the helm almost a year after Staples’ European operations split from US parent group Staples Inc when they were sold to private equity firm Cerberus Capital Management.

Westerbos joined from global technology distributor Westcon Group where he was also CEO. Prior to Westcon, he held executive management positions at IT giant Dell as well as logistics groups Brambles-CHEP and ModusLink.

Westerbos’ core focus is to invest in key growth areas designed to improve the company’s competitiveness, position it for long-term sustainable growth, and capture opportunities that emerge from changes in the workspace products, service and solutions industry.

KOGCO founder Kevin O’Gara passes away

OPI is saddened to report the passing of Kevin O’Gara, founder of KOGCO, the precursor to US sales and marketing agency Highlands.

Kevin passed away in Ponte Vedra (FL) on 11 March aged 82. He was a well-known personality in the OP industry for more than three decades. After a stint with office supplies vendor ACCO in Philadelphia (PA), he launched a manufacturers’ representative group in his hometown of Atlanta (GA) in 1963. The company, KOGCO, went on to become the largest office supplies rep group in the Southeast of the US. He retired from the industry in 1995.

Kevin’s son, Bob O’Gara, who is now CEO of Highlands, said: “Any success Highlands has achieved would not have happened without the foundational work my father did over 30 years from 1962 until 1995. He was a great business person but also a great mentor to many. All of us who were lucky enough to work with him will carry some part of him with us for the rest of our lives.”

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% of documents are thrown in the bin the same day they are printed

NEWS

ALSO ramps up digital prowess

European technology distributor ALSO has revealed a number of changes to its offering and management structure.

The group is expanding its state-of-the-art print services marketplace WePrintSmarter. It has launched SmartSupplies, an end-to-end web-based solution to automate the procurement and delivery of toner and ink cartridges.

ALSO has also established a team to drive its digital transformation strategy.

The newly-formed interdisciplinary Transformation Executive Team comprises 12 experienced employees tasked with shaping the group’s digitisation, optimising business structures and developing new models. It will be managed by the Steering Committee.

In other news, VP of Northern/Eastern Europe Ole Eklund left the company at the end of February after almost ten years with ALSO. The group’s management team now consists of CFO Ralf Retzko and CEO Gustavo Möller-Hergt, with all regional managers reporting directly to Möller-Hergt.

NAOPA 2018 open for entries

Submissions are now being accepted for this year’s North American Office Products Awards (NAOPA). The awards – now in their ninth year – are organised

by OPI in association with SP Richards.

Presented during the US wholesaler’s annual Advantage Business Conference, this year taking place in San Antonio, Texas, from 19-22 August, the categories for 2018 are: l l l

Business Product of the Year People’s Choice Professional of the Year

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Product Innovation of the Year Young Executive of the Year Industry Achievement

The awards are free to enter via the simple online form. In order to qualify, applicants need to operate in North America, but do not have to be an SP Richards vendor or dealer.

More information on the awards, judges, categories and entry procedures can be found on www.opi.net/NAOPA2018.

IN BRIEF 3M settles chemicals lawsuit Consumer brands manufacturer 3M has settled a lawsuit in the US with Minnesota’s Attorney General for $850 million, ending eight years of litigation over chemicals formerly used in its Scotchguard tape that found their way into the state’s drinking water.

ACCO’s Haynes to retire Managing Director of ACCO Brands Australia Bruce Haynes has announced his retirement.

His departure – set for 30 June 2018 – marks the end of a 46-year office products career.

Sales and Marketing Director Adam Colman has been appointed as his successor.

ECi appoints Chief Marketing Officer Office products technology provider ECi Software Solutions has appointed a Chief Marketing Officer. Leslie Bodnar has taken up the role and will be responsible for building the ECi brand and driving the company’s global go-to-market, digital marketing and demand generation strategies.

BIRD FEED @PrimaSoftware We would like to wish our CEO Steve McLaughlin a very special 60th birthday. We threw him a surprise party earlier this week.

Thanks to Jo for the wonderful Prima cake!

@oldfriends Current and past presidents with our honoured guest @TheoPaphitis

www.opi.net

Canon launches US patent crackdown

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Canon has filed an infringement suit with the United States International Trade Commission against as many as 50 vendors and dealers of cartridges in the US. It named a long list of Asian remanufacturers and their US importers which most notably contains names such as Print-Rite, Ninestar, Apex, Static Control and Aster Graphics. The EOS and print supplies vendor has accused them of infringement of at least nine of its recently-obtained patents, which include dozens of compatible versions of both Canon and HP products, particularly involving so-called ‘dongle gear replacement mechanisms’.

Canon has ramped up protection of its intellectual property in the past few months, most recently also suing two distributors of toner cartridges in Russia for breaching copyright.

@LJMacPherson My ‘snack drawer’ is getting out of hand!

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BIG INTERVIEW

FULL

The

package

(Canadian)

Canada’s Novexco was one of the very early adopters of the hybrid wholesaler, reseller and dealer group model. Since the arrival of President Denis Mathieu in 2016, it’s a combination that’s become increasingly polished

D

www.opi.net

enis Mathieu, President of Novexco, is a man on a mission. Having arrived at the Canadian multichannel operator when his predecessor Robert de Montigny retired in 2016, he set to work with plenty of ambition, a vision of what he wanted Novexco to be and a fast-developing strategic plan.

When OPI’s Heike Dieckmann caught up with Mathieu 20 months into the job, execution of this strategic plan was well underway at Novexco, with impressive organic growth, several acquisitions under its belt and a complete rebrand. But there’s plenty to be done still, as Mathieu points out…

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OPI: You’ve been in charge of Novexco since you took over from Robert de Montigny in June 2016.

What’s been your focus since then?

Denis Mathieu: The first step was an overall assessment of the company to understand what we needed to do going forward. That assessment included a tour of our dealers and major customers to get input on their perception of the services we provide. It quickly became apparent that we needed to put a new strategic plan in place.

This new three-year plan is based on three major pillars: brand awareness, acquisitions and organic growth. The customer experience is another huge part of our focus. Within that specific context, there are four core values in Novexco that everybody needs to follow. I call them TRIP. T stands for teamwork, R for respect, I for innovation and P for performance. These pillars and values run through everything we do, all with the aim to improve the customer experience.

OPI: Why was there a need to change – what was wrong with the Novexco as it stood in 2016?

DM: There was nothing wrong as such, but for a start we still hadn’t quite finished the integration of Lyreco Canada which we acquired in 2014 – that was finally done in 2016.

Broadly speaking, we had to bring all our employees under one umbrella and overall become a much more cohesive company. We also had too many brands and names – BuroPLUS, Lyreco Canada, Club express, etc – and a real split identity in the organisation.

Of course, all these different facets and entities make Novexco what it is – a multichannel operation with a unique approach to supply, distribution, customer service and also social contribution.

OPI: Let’s start with your first strategic pillar – brand awareness. What have you done?

DM: This is a very current topic for us. In fact, our rebrand has just been launched officially and we’ll go to market with the new brand in mid-April.

OPI: Tell me more about that rebrand.

DM: Our new brand is called Hamster. The idea behind it is that we’re always moving. Like the little thing in our head that is always spinning, we are always looking for better solutions and better answers.

BIG INTERVIEW Denis Mathieu

We believe that we’re different from the competition and we want to show the market that difference.

The company name Novexco hasn’t changed and will not change, but everything else now falls under the Hamster brand – the name of our commercial business and the dealer group side. We had an internal launch on 1 February, the press release was issued on 20 March and all dealers will have until the end of April to complete the transition to all the new banners, signage of the delivery trucks, retail stores, and so on.

OPI: Secondly, you mention acquisitions. One of the purchases you made last year was Rubanco – that was a dealer. But there were two others...

DM: That’s correct. Rubanco used to be a Novexco dealer. It’s very close to the greater Montreal area in the province of Quebec, so it was easy to integrate it into our commercial division.

The other two were wholesale distributors – Chestwood Mezey in Toronto, Ontario, and Crites & Ridell which is also based in Montreal. We bought both of these companies from the other Canadian dealer group Basics Office Products.

With these two purchases we added approximately 85,000 sq ft (8,500 sq m) of warehousing and distribution capabilities.

OPI: How is Novexco looking now? You earlier also referred to organic growth…

April 2018

OPI: How prominent will the Hamster branding be and how much of their identity will dealers keep?

DM: Good question. As I said, the Hamster brand will span all our divisions. For dealers specifically, let’s say the name of a dealer is ABC. From now on it will be Hamster ABC which means dealers can keep their own regional name and identity, but combine it with the national Hamster brand.

The significance of this is that if a dealer has a customer that has requirements in a different locality, for instance, it can call on the services of a fellow member. The customer will already be familiar with the brand and is much more likely to be loyal to that brand.

You are only as strong as your weakest link and it’s very important to be seen as one force and one dedicated group across Canada.

The company name Novexco hasn’t changed and will not change, but everything else now falls under the Hamster brand

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OPI: What is the biggest part of Novexco now?

DM: That’s our commercial division I mentioned before – you would probably call it the contract division. This accounts for 70% of total revenues now and grew by 13% organically in 2017 and 16% in the past quarter, excluding acquisitions. A substantial part of commercial is the old Lyreco Canada. Before we bought that business, commercial was only about 30%, so the complete reverse of where we are now.

In terms of customer base, the commercial division comprises anything from small businesses, hospitals and the education sector to large government contracts – we have about 70,000 customers in total.

OPI: That’s impressive growth. So your dealer members account for 30% of revenues now. Is that mostly B2B? You talked about retail stores too…

DM: In total we’re 95% B2B and only 5% B2C and the latter comes from the retail stores as you say. All of our dealer members have either a store or a warehouse.

As you can imagine, the stockless concept is rare in Canada due to the distances involved.

It’s still difficult to reach a customer for next-day delivery. We can do it 90% of the time, but there are still the 10% where we can’t confidently say that we’ll deliver next day. We’re working on that though!

Today Quebec represents only 42% of the total business. Ontario is 35% and the rest is all across Canada

and move on. So yes, we definitely used to have some issues, but if that first question is asked, we are usually ok and there’s not a problem.

OPI: You already mentioned geographical reach in terms of your wholesale presence. When we spoke to Robert quite a few years ago Novexco still operated predominantly in Quebec, with a tiny presence in Ontario and Nova Scotia. How is that looking today?

DM: Today Quebec represents only 42% of the total business. Ontario is 35% and the rest is all across Canada. We’ve really tried to reduce the dependency on the Quebec province.

OPI: Is that a result of the acquisition of Lyreco Canada?

DM: That’s one part for sure, because we added a warehouse in Calgary and in Halifax with that transaction and a lot of customers across the country.

But with the addition of Chestwood and a couple of other acquisitions, we can now also do coast-to-coast delivery next day.

OPI: The bilingual aspect has always been very important. Is that still the case?

DM: Yes it is and it’s the reason we have four different catalogues – one for dealers in French, one for dealers in English, one for wholesale in French and one for wholesale in English. It’s hugely time-consuming, but it’s part of our differentiation.

OPI: You talked about the commercial versus the dealer business and how the balance of those two parts has shifted. Are you actively trying to recruit more dealers to redress that balance?

DM: We are certainly looking to attract new dealers in Canada. Our business model means that it’s very important to keep a healthy balance between dealers that cater to smaller customers and the

April 2018

OPI: How much of an overlap is there between the customer base of Novexco’s commercial division and your dealer members? That must be a concern.

DM: It’s not really. There isn’t much overlap to start with, because the commercial division focuses largely on the metropolitan areas like Montreal, Toronto and other big cities, while the dealers are strong in the regions. The understanding is that when it’s a local customer it ‘belongs’ to the dealers; if it’s a multi-location or multinational customer, it’s a direct Hamster commercial customer.

There used to be more of a conflict, but we really worked on this in the past 18 months and put up some sort of Chinese wall. Whenever one of the national commercial reps calls a customer, the first question would be: “Who do you do business with?” If it’s one of our competitors, they will continue the discussion, but if it’s one of our local dealers they would retract

BIG INTERVIEW Denis Mathieu

DM: We went from 400 employees to 500 over the past 18 months and, as I’ve just explained, we made three acquisitions – two in the province of Quebec and one in Ontario. We now have five warehouses across Canada – from Halifax in Nova Scotia in the east to Calgary in Alberta in the west – and Laval, Montreal and Toronto in between. We have 109 stores through our 75 dealer members – up from 86 stores about 18 months ago.

I’m not going to reveal specifics, but in total our revenues have gone up 19% in that time – 12% organically, plus 7% through acquisitions.

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Denis Mathieu BIG INTERVIEW

commercial division which is more geared towards national accounts. Our remit is to create a network that reaches all customers in every part of the country.

We’re hoping that with the new brand name and our broader strategy we’ll be successful in attracting new dealers across Canada.

OPI: When you recruit new dealers, are you mostly looking at geographical reach or also at product coverage?

DM: Very much both. The last few acquisitions really added to our jan/san and furniture expertise while Crites & Ridell also has a printing facility, so it’s our one-stop shop now in the commercial division for business cards, brochures, pamphlets, etc. But it also had a presence in the suburbs which we sold back to a local dealer in that area.

The physical location is important as well, of course, but overall we’re looking to find like-minded partners and entrepreneurs that offer value-add services for our customers. Everything we do needs to complement each other rather than be a duplication.

We used to have a lot of overlap, but that’s not the case anymore. When a dealer is for sale in an urban, high-density population, for example, we will buy it and integrate it into our commercial division. That’s what we did with Rubanco in Montreal last year, as I mentioned earlier.

We are fortunate because we have an excellent young entrepreneurial group in Novexco that is working hard on increasing our network, helping with succession planning and finding solutions for dealers to accelerate their growth. We also have very good equity in the business and a great balance sheet, so we can support dealers in ways that a straightforward buying group couldn’t. It’s a real value-add service.

We have different business models for various situations – but they are all very efficient. One thing that’s obviously hugely different from the UK, say, is the scale of the country. It’s huge and transportation costs are a real barrier to entry because they are so expensive. You need to be as close to the customer as possible or you’ll never be profitable, hence our endeavour for a broad but close-knit network.

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OPI: How would you describe the Canadian market overall?

DM: It’s very challenging and it’s important to be competitive against the big boxes. As such, our model of having a direct presence in the metropolitan areas and operate through dealers in the regions has proven to be quite unique.

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OPI: How does the other main Canadian dealer group, Basics Office Products, compare to you?

DM: Like I already alluded to our business models are completely different. First of all, we have warehouses so we’re not only a buying group. Then we have our direct business – Basics doesn’t.

Basics is a buying group, Novexco is a multichannel operator. Whatever similarities we had many years ago, they have almost completely disappeard.

OPI: Who is your competition? Big boxes, other dealers, Amazon even?

DM: Our biggest competitor no doubt is Staples

Business Advantage. We compete a little with Staples retail on the B2C side, but mainly during the back-to-school season. Amazon is not big in office products right now in Canada and is not aggressively pursuing business in the country, partly because of the transportation issues I already referred to.

We compete with some Basics dealers, but they are dwarfed by the size and importance of Staples.

You need to be as close to the customer as possible or you’ll never be profitable, hence our endeavour for a broad but close-knit network OPI: There was speculation when the Staples/ Office Depot merger talks were going on that Novexco might be interested in acquiring the Staples Advantage assets in Canada had a divestment been necessary for the merger to go through. Was that ever on the cards?

DM: I never comment on rumours!

OPI: Fair enough – it was worth asking.

DM: Let’s just say part of our strategy is to grow – through acquisitions and organically – and there are other companies than Staples out there.

OPI: What about Grand & Toy as a competitor?

DM: Well, Staples is by far the largest reseller of office products in Canada and Grand & Toy comes second. But Novexco is the biggest Canadian-owned distributor of OP in the country and the number three overall. We are very close to number two and obviously our goal is to keeping moving up the scale.

OPI: You said that Amazon doesn’t sell that many office products in Canada at the moment. Does Amazon Business in the US have a significant impact on the Canadian market?

DM: I wouldn’t call it significant. They are using independent dealers in their marketplace of course to gain some traction. But for now the penetration rate is very low and one of the reasons for that is that the average order value of office supplies is not enough to support the costs of delivery.

BIG INTERVIEW Denis Mathieu

The size of the Canadian territory and the high transportation costs offer a substantial natural barrier to entry. We’re keeping a close eye on Amazon, but at the moment the threat is negligible.

OPI: But the dominance of e-commerce is just as prominent in Canada as it is in other parts of the world I guess?

DM: It’s getting there. About 60% of our dealers now have fully-functioning, front-facing web shops I’d say and we are working on the other ones, particularly with the Hamster branding and our new catalogue in mind.

While I’m on the topic of catalogues, the trend here in Canada – certainly if you look at Staples, Grand & Toy and Basics – is to reduce the number of pages.

We’re doing the opposite. We added 200 pages to our 600-page catalogue for 2018. We have 1,150 new SKUs and a new marketing approach whereby we include QR codes for new products in the catalogue, allowing customers to access videos directly from the vendors and giving them a lot more information. So rather than being a static file, it becomes a lot more dynamic and interactive.

OPI: These new SKUs – do they cover all categories or are they from specific segments?

DM: More than 50% of those new SKUs are dedicated to the jan/san, breakroom and furniture segments. With the acquisition of Chestwood, we now also have our own private brand of furniture called Double Diamond.

OPI: What about further afield? You still have a partnership with WB Mason, haven’t you?

DM: Yes, we do have a partnership with WB Mason and also with Lyreco on the sales side. These are very good partnerships that give us access to other partners across the globe to serve international customers.

On the non-sales and more operational side, as you know we’ve also just joined the International Office Products Alliance (IOPA) together with four other groups from around the world (see News, March OPI 2018, page 11). It was spearheaded by Office Choice in Australia and is not intended as an international buying group, but as a best practice-sharing organisation where we can discuss private label sourcing, corporate and dealer benchmarking, and generally cooperate to improve each others’s business model.

OPI: Finally, what does the future look like for Canadian dealers, the Canadian OP industry and indeed Novexco in your opinion?

DM: I believe the future of Canadian resellers is directly related to the quality of the service and the customer experience that they provide. Customer expectations are changing and our industry needs to adapt to this evolution and, more importantly, lead it.

One of the things that we are really looking at and which is becoming an important part of our strategy is the use of third party logistics providers (3PL). I don’t mean 3PL as you would normally refer to them in an outsourced way, but through our dealer network. We want to build this and attract dealers in every part of the country to represent our Hamster brand. The premise is to reduce transportation cost and ship from the closest location possible. Customers should even be able to go to the nearest store and pick their products directly if they so wish.

The ultimate aim is for our commercial division to be able to use those dealers as a network of warehouses.

There’s plenty of work to be done still, with everybody working on the same e-commerce platform which would give access to live inventory per location.

April 2018

OPI: What, in your opinion, are the advantages of having a multichannel model like you have compared to the more pureplay wholesalers such as SP Richards and Essendant in the US? DM: It’s a good model and it’s the most efficient model in my opinion because, to be profitable, you need critical mass to reach a new plateau. A small regional dealer cannot compete against the big boxes. It needs a buying group like us to have access to a full range of products at the right price.

Our commercial business, meanwhile, adds volume to their network and generates better rebates for the dealers. More profit for Novexco results in higher dividends for dealers. The local aspect is also very important. Of course, we always need to make sure that nobody crosses the line and

everybody pulls in the same overall direction. The commercial business is for national, multi-location and metropolitan customers while the dealers are at their best in the regions. It’s an excellent compromise and creates a very strong network overall.

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HOT TOPIC

T

The office products industry has always gone through periods of market consolidation, but the latest wave could be pivotal for the independent dealer channel.

Michelle Sturman finds out more…

here is nothing so constant as change. The OP industry is no exception. It has spent the past two decades going through bouts of consolidation, but in the past year or so, this has accelerated across all industry channels – so far in 2018 there have been many acquisitions featured on opi.net (see below for a selection).

There are many reasons for this momentum, but the most notable are: a declining demand for core office products, linked to shifts in technology within the office space and category diversification into areas such as breakroom and jan/san; the rise of a digital generation used to negotiating and purchasing online; fall of retail; increased competition from outside the industry; and, of course, the elephant in the room – e-commerce, specifically Amazon Business.

These challenges cut across the entire industry and increasingly vendors, large resellers and independent

dealers are opting to merge or head down the acquisition route (either acquire or be acquired). The wholesaling sector is not exempt – the rumour mill has been in overdrive in past months regarding speculation over the two primary US-based wholesalers, Essendant and SP Richards. With lacklustre sales, particularly in the case of Essendant, it could be an acquisition target for private equity firms, or the wholesaler could look to snap up some large resellers to protect its customer base (see ‘Which way will Essendant go?’, page 6).

LEVEL PLAYING FIELD If the US wholesalers chose to go down the latter route of acquiring resellers, the precedent has already been set elsewhere – by Spicers-OfficeTeam (SPOT) and EVO Group of Companies in the UK, and Novexco in Canada. While the acquisition of large reseller OfficeTeam by Spicers private equity owner Better

NOTABLE ACQUISITIONS OF 2018 SO FAR Here are some of the acquisitions and mergers from across all sectors of the industry that have featured on opi.net in the first three months of the year. l

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EOS and IT reseller group Visual Edge is expanding its reach in the US with numerous acquisitions since the start of 2018, including office

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equipment group United Business, office technology providers Counsel and Midwest Office Automations, and dealer CopyRight.

US cleaning products manufacturer Clorox bought Nutranext for around $700 million.

UK reseller and technology platform EO Group acquired leading UK dealer

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Eurostat Office Solutions.

US OP dealer Spencer Office Supply combined its operations with those of jan/san supplier JCL Solutions.

US private equity firm Platinum Equity completed the acquisition of OfficeMax in Australia after buying Staples ANZ in 2017.

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US beverages and office products supplier Crystal Rock was acquired

by Canada-based beverage solutions service provider Cott for $35 million.

US dealer The Supply Room bought fellow Virginia-based independent reseller Lawrence Environmental Group.

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UK high street chain WH Smith acquired online writing instruments specialist Cult Pens. The deal is part of WH Smith’s strategy to expand its stationery category.

German office equipment supplier Takkt acquired UK online office furniture dealer Equip4Work.

UK reseller Banner bought Ventura

Staples store closures positively impacting on retailers and quality sales people from the contract stationers looking for work in the channel,” he says.

As Maggio remarks, previous consolidation cycles laid the foundation for many of today’s largest and most successful dealers. But, he says, comparing the demographics of the IDC today with the last wave of consolidation, there is a fundamental difference that could have a profound effect. “I’m referring to the current dearth of a robust mid-sized independent dealer base. My concern is that if we reach a tipping point with large dealers exiting the channel, we lack this base of dealers to take advantage of the disruption caused by those exits. The beneficiaries will be primarily Amazon and the power channel, and it could take the IDC years to recover, if at all,” he warns.

I believe the key driver for the market shake-up is simply a very mature market in decline...

Many industries blame Amazon for a lot of their current woes, and it certainly holds true for the business supplies sector, but it is just one piece of a very large puzzle. “At the highest level, I would call [consolidation] a natural progression of our industry but technology, in the form of e-commerce, Amazon, etc, does indeed play a role in our need to become better through efficiency. Other factors, such as the customer’s need for faster service, product lifecycles maturing and increasing bargaining power from large suppliers also play their part,” says Eakes Office Solutions President Mark Miller.

In fact, the majority of those that OPI spoke to across all sectors agree that this period of consolidation is simply the industry realigning itself as it has done on several occasions before. As McDonough points out: “I believe the key driver for the market shake-up is simply a very mature market in decline, which is being driven by usage patterns, price transparency which puts pressure on margins, and technology changes.”

Perhaps the biggest difference this time is the unstoppable force of technology driving the cycle. The continued rise of e-commerce compounded by the

GLOBAL SHAKE-UP Globally, there have been plenty of acquisitions by resellers such as Complete Business Solutions and Penketh Group in the UK, and Innovative Office Solutions and Eakes Office Solutions in the US. While the biggest potential shake-up of the reseller channel – the Staples and Office Depot merger – failed to materialise, it still managed to change the OP landscape and many who champion the independent dealer channel (IDC) are convinced it is cause for concern. Both resellers are now private equity-owned, have divested their international operations, and are busy implementing transformation strategies. As these companies chase the mid-market, part of their strategy clearly includes acquiring other large resellers, the most significant of which so far is Depot’s purchase of Complete Office Solutions in October 2017.

However, Integra Business Solutions CEO Aidan McDonough states that while the disruption caused by the large reseller changes does generate massive uncertainty in the market, it can also create opportunities for the independent channel. “We have already seen

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The sale of US aftermarket imaging supplies vendor Katun to Taiwan-based General Plastic Industrial was completed.

US mega dealer WB Mason bought leading Jacksonville-based dealer Gator Office Products. This deal came after it acquired central Florida dealer

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Patterson’s Office Supply in June 2017.

Progressive US independent dealer Innovative Office Solutions began 2018 with a major acquisition. It purchased Sioux Falls-based Brown & Saenger, a dealership that was founded in 1889 and has ten locations across North and South Dakota.

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US office products dealer Eakes Office Solutions expanded its presence in Nebraska when it bought fellow office supplies reseller Latsch’s.

ECi Software Solutions strengthened its presence in the managed print services space by acquiring

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Canada-based service provider PrintFleet.

UK-based dealer Citrus Office Group acquired the goodwill and assets of Clarke’s of Nottingham.

US-based office products and jan/san reseller OfficePro bought Elkhorn Chemical & Packaging.

April 2018

Office Supplies, an independent OP dealer based in the north of England.

US business solutions provider AIA acquired Georgia-based OP dealer and franchise network OfficeZilla.

UK independent OP dealer Penketh Group acquired photocopier and office supplies firm Currie Business Services.

HOT TOPIC Market Consolidation

Capital caused more than a few raised eyebrows in the UK when it happened in 2014, it seems to be working.

Back over the pond, Mike Maggio, President of US-based dealer group TriMega, voices many of the concerns Spicers faced over its reseller acquisition, the main one being: how does a dealer manage the wholesaler relationship if one of its competitors is owned by its primary wholesale partner?

On a level playing field, the fact that many dealers rely on the same wholesaler doesn’t specifically give an advantage to one dealer over another, but as Maggio points out: “I understand the need [for wholesalers] to protect their primary customer base, I just believe there are ways to do that which don’t involve the outright acquisition of independent dealers.”

Whatever course of action the two main wholesalers in the US decide to embark upon – incidentally, both Essendant and SP Richards declined to comment for this feature – Mike Gentile, CEO of fellow US dealer group Independent Stationers believes that “market contraction is normal, however, big boxes and wholesalers that are challenged because of unsustainable models will create much of the shake-up”.

He adds: “This is good as it will force innovation, progressive action and serious collaboration.”

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Market Consolidation HOT TOPIC

arrival of Amazon Business is forcing all OP channel players to rethink strategies. Innovative Office Solutions CIO/CMO Jason Player thinks this wave is pivotal for the survival of the industry. “Consumer demand has challenged independent dealers to embrace e-commerce for many years, but I think it is rapidly starting to outpace capability for most of them. Technology is becoming one of the biggest reasons that smaller dealers will struggle to remain relevant,” he says.

NECESSARY MOVE This maelstrom swirling around the IDC isn’t necessarily a bad outcome. Many dealers are selling up for a wide range of reasons including retirement, lack of succession planning or offers too good to refuse. The changing dynamics of the IDC are definitely seen in some quarters as positive. “I believe the fear, uncertainty and rate of change that is occurring will be the stimulus that causes the IDC to change internally,” says Gentile.

Mark Heath, Group Managing Director of UK dealer Bluefish, agrees that the current M&A activity is a necessity to give dealers size and scale, both in terms of competing for commercial business, but just as importantly within the supply chain. “We’re looking to develop our ‘king of the hill’ mindset, being the best we can be in our region. Constructed and executed well, this will be very positive for us and our partners,” he says.

Bad for the industry

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Will have to wait and see

opi.net poll

57%

WHAT’S YOUR OPINION ON THE INCREASE IN OP MARKET CONSOLIDATION?

Consumer demand has challenged independent dealers to embrace e-commerce for many years, but I think it is rapidly starting to outpace capability...

The upshot of this is that many smaller dealers will have no choice but to merge, be acquired by others, or face stagnation or decline as this trend continues.

But, as Heath explains, and which can be seen in the number of dealers teaming up, it’s also leading to the emergence of stronger regional players.

In the US, for example, mega dealer WB Mason is busy acquiring dealers in the state of Florida, expanding its reach outside of its traditional ‘Masonville’. Others such as Innovative and Eakes are also in acquisition mode. Innovative recently added well-known Brown & Saenger to its portfolio. “We believe that banding together, independent dealers still have a lot to offer the industry and we plan to continue our growth story through acquisitions, organic growth and product category expansion,” says Player.

What has happened in recent years is the industry taking steps to manage the change, with help for the IDC arriving from many corners, such as dealer groups and wholesalers offering a helping hand to those that wish to buy or sell. “There’s a mix of resellers that are on the acquisition trail or looking for investors in their

Good for the industry

29%

business. We do act in some instances as a broker where we know there’s an opportunity to assist the reseller,” comments Adrian Butler, Managing Director of UK wholesaler VOW. Meanwhile, Spicers is financially supporting dealers to acquire other dealers. It also provides advice gained from years of experience of successful acquisitions by OfficeTeam – a few years back, the reseller was a significant consolidator, making almost 40 acquisitions. “The strength of the dealer community is vital for the success of the wholesalers, so if we can help a dealer principal gain a well-earned exit after years of driving a business, or strengthen dealers through consolidation, it can only be positive,” says SPOT Group CEO Jeff Whiteway.

Dealer group Integra also aids dealers throughout the exit or acquisition process: “We are proactively engaged in helping dealers that wish to exit. We also provide introductions to members looking to expand through acquisition together with consultancy to assist in the process and post-merger help and support,” says McDonough.

The long-term future of dealer groups themselves, of course, has also come under scrutiny and McDonough is realistic about this: “We will see some dealer groups go through administration and hopefully some will amalgamate to mitigate the effects of a sector under massive pressure. I’ve said for years there are too many groups and consolidation is a commercial imperative.”

Gentile hopes this current cycle will offer the impetus needed to bring the industry even closer together: “There will be fewer mid- to large-sized dealers due to M&A activity and market attrition.

However, this will hopefully encourage manufacturers, wholesalers and dealer groups to seriously collaborate for the greater good of the IDC. The IDC will not become extinct. Smaller, yes, but still relevant.”

The general consensus is that consolidation will continue, albeit with a smaller, but stronger dealer channel. As mentioned before, some see this as a positive outcome, but evidently opinions are divided (see opi.net poll above). What is clear is that, in the next couple of years, the broad reseller channel will be looking quite different.

SPOTLIGHT

RAISING standards OPI’s Michelle Sturman talks to Business Solutions Association President Barry Lane about the work the organisation is undertaking, current issues facing the OP sector and the future of the industry

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ot all industry organisations have staying power, but those that do are in a constant battle to stay relevant to their members and the industry they serve.

Strong leadership and a willingness by its committee to continually seek solutions to industry challenges are just two reasons 102-year-old Business Solutions Association (BSA) keeps operating as a vital aspect of the US OP industry.

OPI spoke to current BSA President Barry Lane (and VP of Commercial Sales for Avery) to find out more about the inner workings of the association and its plans to support the industry.

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OPI: What are the main BSA goals and priorities?

Barry Lane: Our priorities are straightforward: to provide industry leadership and increased value to our members – manufacturers, wholesalers and manufacturer representatives – that are responsible for working with the independent dealer channel (IDC) across the US. As the industry in general, and the IDC in particular, continues to evolve, we believe BSA must play a more strategic role in terms of leading collaboration efforts, which ultimately results in the development of plans to keep dealers competitive and relevant.

I’m fortunate to have an active and engaged board and a strong planning committee. We volunteer our time to establish programmes, build awareness and provide solutions on the most important challenges facing the IDC. Years ago we developed objectives and strategies and some members would say: “That’s great, but how is this helping my business?” We want our members to believe they are receiving value throughout the year and not just at our annual Forum.

We are doing all we can to improve communication with respect to our objectives, strategies and plans.

Throughout the year at industry events we have three or four town hall meetings for our members to provide progress reports, seek feedback on our initiatives and then course correct as needed.

OPI: Content standards is a big issue, particularly for the IDC. How is BSA involved?

BL: It is one of the most important and significant initiatives that we have taken on. We have had exceptional participation and involvement across the entire business – representatives from dealers, wholesalers and manufacturers have been dedicated in driving this channel-wide initiative.

The success of our standards group is inspiring to me. It validates that we have enormous talent in the channel with individuals and companies that are willing to collaborate and drive necessary change. Candidly speaking, I don’t believe the standards committee has received the level of recognition it deserves – the entire board is proud of its accomplishments (see ‘BSA Standards Council’, page 30).

I don’t believe the standards committee has received the level of recognition it deserves If we use the successful outcome of the standards initiative as a proxy, I’m confident our industry principals and companies can take collaboration efforts to a new and necessary level.

Historically, a core activity for BSA was a two-day Forum where commercial channel leaders would meet once a year to discuss a variety of topics. Now, our desire is to provide our membership with an ongoing opportunity to discuss, debate and deliver through a scalable, strategic vehicle that helps address and balance channel expectations and priorities.

As a sector, we have to find new ways to streamline and optimise our collective resources and budgets to ensure the independent dealer remains a relevant and competitive member of our customer portfolio.

Speaking as a manufacturer, our balance sheet will not support the status quo. The rapid pace of economic change requires a call to action.

OPI: You’ve been BSA President for 18 months.

What has been done and implemented under your leadership?

BL: First of all, I would say it’s not about what I’ve done. I’ve had the good fortune to learn from Joe Templet and Jim O’Brien who came before me. They are true friends, respected industry leaders and have been great mentors.

I learned from my family years ago that we only get out what we put in. Being BSA President is a significant time commitment. I’m grateful the Avery management team has been so supportive. My boss Jeff Lattanzio [VP of Sales for Avery] understands the significance of our vision and importance of this group.

I take my role seriously and in cooperation with a strong executive committee – Casey Avent of Smead, Mike Metchikoff from OPMA, Todd Carlson of 3M, Paula Kreuzburg and Alice Simpkins of BSA – we have implemented the following: • a quarterly town hall communication process • an ongoing, proactive outreach programme to members and non-members • the development of crisp and concise priorities • the validation of our priorities and strategies by “keeping the customer in the room”

1. The feasibility of a US-based end-user study to better understand how historical work is conducted within corporate America (paper usage, impact of technology, etc) 2. Begin an industry-wide discovery project to examine event consolidation opportunities to minimise duplication and reduce costs – ‘Industry Week’, for example.

3. This year’s IDC Industry Forum on 5-6 September in Indianapolis. The emphasis is on consumer research, education, technology and networking.

The independent dealer has survived through years of disruption because of strong, passionate and forward-thinking individuals OPI: How should the industry deal with all these challenges?

BL: By having candid, timely and straightforward strategic conversations with customers. I’m an optimist. We still have a huge installed base of paper-based products in the US if you look at it in absolute dollars. Even though it’s declining, it remains a seriously big-volume business.

We need to understand where it’s heading from a consumption standpoint. Done properly, I know BSA can play a role in helping all manufacturers understand it better. Equipped with facts and not opinions, we can then sit down with our customers and have an intelligent conversation.

OPI: You mention Industry Week – hasn’t event consolidation been attempted before?

BL: We tried to merge some events a few years ago and, for a variety of reasons, we weren’t ready. Now, economic conditions have changed for everyone and based on recent conversations we have had, I’m confident executives are more open-minded to implementing real change.

April 2018

We want BSA to be seen as an opportunity for members to discuss business topics that are of central importance. We can all identify problems.

However, our mission at BSA is to work collectively on realistic channel solutions that are a result of open dialogue, healthy debate and timely action plans.

The independent dealer has survived through years of disruption because of strong, passionate and forward-thinking individuals. The IDC is critical to the marketplace. It pays attention to its customers. It sells brands. It’s a unique relationship where I believe we care equally about each other’s business.

BSA can play a pivotal role to ensure the IDC has the proper tools and resources to prosper, and that’s a compelling reason for the association to exist.

OPI: What are the biggest challenges right now and what role can BSA play in helping to solve them?

BL: That’s a great question and one that has multiple answers. I think the main challenges are: the decline of core supply categories and the economic impact this reality has on dealers; the rapid shift from print to digital; and consumer behaviours – alternative channel options, product search and declining loyalty.

How can BSA help? The board and our Forum committee are working on three initiatives:

SPOTLIGHT Business Solutions Association

For years we have all talked about the need for better collaboration and being completely objective, but I believe our report card warrants a fail grade.

However, it’s not for a lack of trying. Many of our industry executives worked tirelessly to inspire and drive change, but for a variety of reasons we keep embracing legacy practices.

It’s never easy. Implementing change is hard work.

It takes courage, clarity of thought and a vision for the future – as well as a thick skin to manage the criticism.

This isn’t for the faint of heart. Fortunately, we have a strong group working together.

As industry headwinds increase, doing nothing is unacceptable. Our customers, investors and employees deserve better! Many of us believe it’s the right time for BSA to step up and play a more effective management role. With the involvement of our legal counsel, and in partnership with Mike Tucker of the National Office Products Association (NOPA) representing many of our customer interests, our leadership team – Essendant, SP Richards and manufacturers – can begin a process to examine and identify options and alternatives.

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Business Solutions Association SPOTLIGHT

BL: The board has been very clear in terms of trying to bring in younger people as we don’t want to be perceived as an ‘old boys club’. Looking around the IDC, it’s impressive. We see many examples of strong and effective leadership coming from the next generation. They are smart, insightful, understand technology and are proficient with social media.

I’m hopeful that everyone will be as encouraged as we are... we can get to a better place when our focus is on what is right, not who is right. Fortunately, many agree and it’s time to test and prove a new model.

OPI: If you can get this off the ground, do you have a timeframe?

BL: Yes. 2019 would be the earliest but it’s probably going to be more like 2020. Critical to our success will be knowing how the executives at Essendant and SP Richards are thinking about 2019 and beyond.

Equally important in this process are TriMega, Pinnacle, Independent Stationers, AOPD, DPCG and Office Partners – their input is absolutely essential.

As we all know, organising and managing an event of this magnitude requires enormous planning and attention to detail in terms of budgets, logistics and legal matters.

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OPI: How would you describe the relationship between BSA and the IDC? BL: What we are trying to accomplish as a group of manufacturers, wholesalers and manufacturer rep groups is to figure out best practices and provide tools that can ensure the independent dealer remains relevant, profitable and competitive.

We invite dealers to sit on our panels as active and engaged participants. They are guests at the Forum and a meaningful part of the process, So, as we collaborate further with NOPA, I’m certain our partnership will strengthen.

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OPI: Any plans for international collaboration?

BL: An interesting question. Initially, my thoughts are let’s complete our homework in the US first. Down the road, if there is an opportunity to share with our peer groups in other countries, it may have some merit.

OPI: What’s BSA doing about helping the industry attract younger people?

OPI: What’s your long-term strategy for BSA? BL: I look at it very practically and compare it to being on the board of a private golf club. You want to keep your current members and at the same time you want to encourage new members to join and be part of the club. I can tell you, in this economic environment it has its challenges.

Budgets today are being reduced and while it’s not overly expensive to be a member, business leaders are looking closer at their P&L. Every dollar makes a difference, so unless we’re really delivering value they’re going to invest their dues and sponsorship funds elsewhere.

If we can persuade people to believe in us long term and allow us to work collaboratively across the wider industry, I believe BSA will be a valued investment for our members. We must add value – and we will do all we can to make it happen. More of the same isn’t going to cut it.

For more exclusive content from the interview, visit the April issue in the Magazine section on opi.net.

The board has been very clear in terms of trying to bring in younger people as we don’t want to be perceived as an ‘old boys club’ BSA STANDARDS COUNCIL The purpose of the BSA Standards Council is to develop, monitor and promote voluntary performance guidelines for manufacturers.

Standards created by the Council include brand, images, infographics and video, along with colour attributes and product attributes. In addition, there are the Print Cartridge Classes, Definitions and Use Guidelines which Amazon has adopted, while the Government Services Administration follows BSA Standards & Best Practices.

STANDARDS MARKETING CAMPAIGN 2018 BSA will begin a standards marketing campaign this year that identifies the value proposition for each Standard or Best Practice developed. The objective is to survey BSA members and prospects regarding manufacturers’ content marketing organisation structure, development, management and syndication.

BSA aims to gain wholesaler support for the initiative and the survey will be conducted annually for industry benchmarking. In addition, a glossary of e-commerce and digital-related terms will be created.

Those that participate in the BSA-sponsored survey will receive aggregated results to provide insights into content marketing at other organisations. BSA membership is not required.

BSA STANDARDS COUNCIL LEADERSHIP Co-chairs: l Jamie Mennicke, Senior Manager of Digital Product Development at Essendant l Jeffery Buysse, VP Sales and Marketing at GOJO Industries

CATEGORY UPDATE

T

What’s cool IN SCHOOL? Technological change is driving the education sector as markets open up worldwide – by David Holes

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he educational supplies sector is a huge global industry that’s expanding in large parts of the world. This is particularly prevalent in emerging economies which are devoting increasing budgets to schools, seeing investment in their children’s education as the key to future success and prosperity.

Nowhere epitomises this phenomenon better than China where the government focus on this category is huge. Coupled with the sheer volume of students in the country, it means this market is already massive and growing fast. The number of foreigners wanting to study in China has also been rising quickly, with South Korea, Japan, the US, Vietnam and Thailand the biggest source countries.

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BUDGETARY CONSTRAINTS In developed western democracies where budgets are being squeezed the opportunities are not as enormous, but they do still exist. For UK wholesaler VOW, for example, educational supplies was the fastest-growing sub-category in 2017 and this has continued right into this year. “We expect ongoing growth throughout 2018 and beyond as we become more adept at selling in this market,” says Simon McLoughlin, Category Director for Traditional Products at VOW. “The provision of classroom products builds on our wider traditional business supplies range.

However, it’s also important to remember that newer technology such as webcams are now just as essential in the modern classroom as a wide range of poster paint colours.”

Writing instruments manufacturer Pentel, meanwhile, reports modest growth in a market that’s under severe pressure due to budgetary cuts, according to its Director of Sales UK and Ireland Graham Craik: “Although there are challenging times ahead, we remain optimistic that buyers looking to deliver the best value for their schools will spend wisely on products they can rely on.”

In Australia, a new study published by Penfold Research reveals that the education supplies market is growing well ahead of the overall office products market. Growth of 2.8% in 2017 is set to move higher over the coming two years, with students in schools maintaining steady usage of traditional products, but with a healthy parallel increase in technology areas.

Here, as in other parts of the world, the digital revolution is driving major changes in the education system and with it changes in the product mix that is required.

In the US, the market is essentially flat, with only 0.2% growth overall in 2017. But the back-to-school (BTS) season still accounts for 35% of annual office supplies dollar volume and saw sales of $4.2 billion last year, a 1% increase over 2016, according to global information company The NPD Group.

“The seasonal lines of BTS are shifting, as September has become increasingly important to this shopping season,” says Tia Frapolli, the Group’s President and Office Supplies Analyst. “Varying school start dates around the country and changes to tax-free holidays play into this and reinforce the importance of engaging consumers in the right place, at the right time.”

WHAT’S IN DEMAND? Among the fastest-growing product areas in 2017 were traditional pens, mechanical pencils, appointment books, planners and spiral notebooks. Interestingly, the ‘slime’ trend among children – where white glue is creatively mixed with shaving foam and food colouring – was a major driver for this sector last year, with sales of glue soaring by 47%.

But, as Frapoli adds: “As technology continues to become more prevalent in the classroom, the needs of students are slowly changing and impacting the school supplies products they buy.”

Beth Wright, Chief Commercial Officer at Bi-silque, points out that “anything on wheels” is selling particularly well at the moment. Flexible spaces and new ways of

Tailoring a message to appeal to the objectives of the buyer is likely to result in a higher success rate

CATEGORY UPDATE Education

THE FIVE BIGGEST GLOBAL EDUCATIONAL THEMES At a recent seminar at the Bett education show in London, UK, Vipul Bhargava, a specialist in Education Technology and International Schools from the UK Department of International Trade, gave his views on the top five main themes currently driving the sector across the globe. These were the key areas he felt educational suppliers should be concentrating on.

1. Improving early childhood education: The focus on early years provision is an increasing phenomenon across many countries – particularly in China, Malaysia, the UAE and Brazil – where key stakeholders are now realising it represents the foundation for a child’s future prospects.

2. Creating a more equitable education system: Democratising learning so that access and opportunity are equal for all, regardless of wealth or ability, is a global theme, but particularly strong in Egypt, the UAE and Brazil.

3. Teacher training: There simply aren’t enough teachers available across the globe, with the crisis particularly acute across China and the ASEAN region. Anything that companies can offer to help alleviate this shortage will be extremely well received.

4. Coding and ICT: The high importance now given to these subject areas is a worldwide occurrence. That said, finding the tutors and resources for delivering them at an adequate level is a huge problem, with many schools now finding that pupils’ knowledge is greater than that of the tutors.

5. Ed Tech efficacy: It’s widely acknowledged that educational technology can significantly enhance the learning process, but there’s a lack of knowledge as to what systems work best. To sell into this category you need to prove that your technology works. You’ll need testimonials from people already using it and local partnerships to champion your cause with the budget holders in each region.

April 2018

teaching mean items such as mobile easels that can be wheeled between classes or set up in different locations are very popular.

She adds: “Another area of growth is in wall solutions where, using tiles or dry-erase paints, the educator can turn an entire classroom into a brainstorming area.”

All category experts OPI spoke to agree that you can’t treat the education sector like any other as it has its own unique challenges. “The key is to respect it as its own channel,” says McLoughlin. “The market continues to appreciate the role of the local reseller and the unique levels of service they can supply both from a delivery and support perspective. Many schools want to be part of their community and feel that spending in that community is part of being an active partner.”

“It’s important to identify decision-makers and influencers,” adds Craik. “Head teachers, the finance department and office managers all need to be made aware of key product developments and their benefits need to be convincing. It’s crucial to understand that an academy-status school may have a different set of purchasing criteria to a local authority-funded school, so tailoring a message to appeal to the objectives of the buyer is likely to result in a higher success rate.

“Thankfully, business managers responsible for centralised procurement usually realise that sensibly-priced, good-quality items last longer than cheaper alternatives, presenting a more compelling argument than lower specification products.”

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Education CATEGORY UPDATE

THE US PERSPECTIVE A recent study by Education Week – a US national newspaper covering K-12 education – revealed that a seismic shift in buying patterns could be underway.

It found that currently only 3% of the key educational supplies buyers in US school districts purchase products or services from companies based outside the US. However, 30% said that that they were likely to do so over the next two years. There are over 13,000 school districts in the US, so this represents a considerable opportunity for overseas suppliers hoping to break into this market.

Education Week’s advice for those wishing to do so was to do thoroughly research the Every Student Succeeds Act (known as ESSA) plans for the US states they want to target. These are what drive school spending, but different states prioritise different areas.

The publication says there’s also a new emphasis on targeting underperforming schools, coupled with drives to reduce absenteeism, develop students’ readiness for higher education and a renewed demand for learning platforms aimed at English as a Foreign Language – EFL – pupils.

The areas attracting the greatest interest in the US at present include robotics, virtual learning assistants and packages that can support personalised education.

But to crack this market you’ll need to customise your solutions to US schools and their needs, and be able to provide ongoing support – partnering with a US-based company should definitely be considered.M Markets are opening up worldwide and educational suppliers with the right product and approach are well positioned to capitalise on the positive outlook all these new circumstances present.

YOU CAN BETT ON IT

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Bett is the world’s leading education technology (Ed Tech) show and over four days each year it plays host to hundreds of the most innovative education service providers and distributors.

This year’s event took place at London’s ExCel Exhibition Centre from 24-27 January. It brought together a diverse cross-section of the global education community, with 850 leading companies, 103 exciting new Ed Tech start-ups and over 34,700 visitors from 131 different countries attending the show.

Bett’s focus is to provide inspiration and a forum for discussing the future of education, while showing the role that the latest technology and innovation can play in enabling all educators and learners to thrive.

As Anthony Salcito, VP of Microsoft Education, explained: “What excites me most about Bett is the opportunity to have a checkpoint annually, so we can reflect on our progress, see how far we’ve come and where we’re going. And to get a sense of the trends that will shape the future of education in the coming year. It allows us to connect with people who are the real leaders driving change.”

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FURTHER EDUCATION Exhibitors ranged from small software developers through to global giants such as Google and Microsoft. As in previous years, the emphasis was on the requirements of school-age children, with the vast spectrum from early years through to primary and secondary needs thoroughly covered.

Interestingly however, the 2018 show also saw more attention being given to how technology can enhance further and vocational education opportunities, with some interesting presentations being given in the Post-16 Theatre.

Attendees further said that this year generated renewed interest from UK government ministers, with appearances from members of the Department for Education throughout the event – an indication perhaps that it realises the potential Ed Tech has for improving access to education and enhancing teaching and learning techniques.

Discussing the main trends, Fergal Kilroy, Editor and Head of Content for Bett Global Series, said: “The biggest [trend] is the application of virtual and augmented reality and bringing that into the classroom.”

Other popular product areas included assessment solutions, robotics and the science, technology, engineering and mathematics (STEM) subjects. A recent development is the addition of arts subjects to this collection (so now known as STEAM), with companies involved in these areas enthusiastically showcasing their wares in the hands-on STEAM Village.

SPEAKING OUT Each year, the extensive Bett seminar programme provides over 300 hours of workshops, talks and discussions across its six theatres, addressing the most prominent issues in education, delivered by the people who are leading change and innovation.

A full agenda of speakers in the main Bett Arena kept visitors informed and entertained. Notable on the packed programme were sessions on cutting-edge subjects such as ‘Accessible AI: building neural networks in the classroom’ and ‘Telepresence robots, game-changing technology for students who can’t attend school’. Guest celebrity speakers included musician and political activist Sir Bob Geldof and UK TV broadcaster Natasha Kaplinsky.

WHY BETT? When visitors were asked for the main purpose of their attendance their collective feedback indicated that the show represented the best opportunity in the year to compare the solutions on offer, see demonstrations and talk to the providers face to face.

Networking and sharing best practice was also key and teachers especially relished the sense of solidarity the event provided.

BETT TWETTS Bett‫@ ‏‬Bett_show ‘Make teaching more memorable – give them experiences and they will remember learning far longer than through exams’ @ICT_MrP #Bett2018 Mary Farmer ADE‫‏‬ @ebd35 About to start looking at all the wonderful ideas I picked up from #BETT2018 and trying to get them up and running! I may be a while.

VENDOR PROFILE International Paper kicked off 2018 with the launch of a rebranded portfolio of HP Papers. The new rationalised range enables clearer product positioning and easier consumer choice

O

Rationalise to OPTIMISE

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ne of the world’s best-known brands, HP, has long been recognised for its focus on innovation. In fact, the company was founded nearly 80 years ago in a place in California, US, that would ultimately be dubbed Silicon Valley – the birthplace of innovation. Its tagline ‘Keep reinventing’ perfectly captures HP’s vision of continually creating technology that makes life better for everyone around the globe. It’s no surprise that HP is at the forefront of the 3D printing revolution, for example.

International Paper has been manufacturing and marketing the HP Papers brand in over 100 countries under exclusive licence since 2000. It has been a long-standing, mutually-beneficial relationship of joint innovation whereby HP’s iconic brand complements International Paper’s position as a worldwide leader in cut-size papers.

HP products have always been synonymous with outstanding quality and the most reliable printing performance. HP Papers specifically use advanced innovation to give the highest-quality results across a wide range of office applications.

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CONTINUED INNOVATION International Paper shares HP’s relentless pursuit of quality and innovation. One notable example of this is the ongoing development and implementation of ColorLok technology. A joint initiative of HP and International Paper, ColorLok was introduced to meet customers’ growing demand for improved inkjet performance and a lower cost of printing.

Both vendors have continued to enhance both print and paper technology and today HP Papers with

ColorLok offer more vivid colours, bolder blacks, crisper text and faster drying.

There are other examples of innovation, such as International Paper’s award-winning tear-strip packaging, which lets users quickly and easily open a ream without damaging a single sheet of paper.

Innovation can be expressed in many ways. Last year, HP Papers’ Pink Ream campaign successfully used an inventive concept and an eye-catching packaging design to raise substantial funds for the

In today’s environmentallyconscious world, consumers want to know that the paper and wood products they buy come from sustainably-managed forests that will remain healthy for future generations. This is why all HP Papers sold in Europe are certified to the standards of the Forest Stewardship Council or the Programme for the Endorsement of Forest Certification.

To make an impact, all innovation must originate based on customer needs and consumer trends

THE NEW HP PAPERS RANGE HP Premium (BEST) A completely new product in the range, HP Premium is the best option for quality printing in a professional environment. Whiter and brighter than ordinary office papers, it gives documents a high-quality look and superior feel, along with stronger, sharper colours and text. With excellent formation for reliable feeding and performance, this is a superior paper that is designed to work perfectly with both inkjet and laser printers.

HP Premium has an optimised stiffness and is heavier and thicker than standard multipurpose papers, making all documents look and feel their best. In the office or at home, it is ideal for documents that require colour and a real professional look: presentations, estimates, reports, handouts, graphics, letterheads and commercial proposals. With a 100% recyclable plastic wrapper and an easy-open tear strip, HP Premium is available in 80, 90 and 100 gsm, A4 format, and comes in packs of 250 and 500 sheets.

International Paper

THE NEW LINE-UP Rolled out in early 2018, the new HP Papers portfolio is all about making it more simple and straightforward for users to select the right office paper. As part of the initiative, the number of products was reduced to six. The thinking behind this reduction is that the differences and the positioning of the various papers will be easier for channel partners and vendors to present, and easier for consumers to understand.

The range is divided into three groups – GOOD, BETTER and BEST – with two products in each of these categories to make the choice quick and easy. Generally, there’s an HP Paper for every office application: from the highest-quality presentations and large and cost-efficient print runs, to small or home office printing needs.

The rebrand is further enhanced by a new packaging design, reflecting the continuous development and innovative spirit that both International Paper and HP are so well-known for. First launched in North America and Europe, the HP Papers’ global relaunch will be completed by the end of 2018.

SUSTAINING FORESTS

VENDOR PROFILE

fight against breast cancer (see ‘Pink Ream campaign wins EOPA 2018 award’, page 38).

Of course, to make an impact, all innovation must originate based on customer needs and consumer trends. And these are continually evolving, so it’s vital to respond fast in order to remain relevant. This was the core driver behind the decision to rebrand the HP Papers product range.

HP Color Choice (BEST) The second product in the BEST category is HP Color Choice. Developed specifically to have the biggest impact with colour printing, HP Color Choice replaces the previous HP Color Laser product.

It offers bold, vibrant hues and rich blacks; it is highly white and super smooth for uniform toner gloss, sharp text and colour contrast. Completely opaque, this paper is perfect for double-sided printing. In addition, ColorLok technology allows the paper to give excellent results with both inkjet and laser printers.

HP Color Choice is ideal for documents requiring a professional look and feel: presentations, reports, newsletters, flyers, commercial proposals, invitations and certificates. Like the HP Premium, it comes with a 100% recyclable plastic wrapper and a tear strip for easy opening. HP Color Choice is available in 90 to 250 gsm, A3 and A4 formats, and in packs of 250 and 500 sheets.

April 2018 37

VENDOR PROFILE International Paper

HP Everyday (BETTER) Offering quality, reliability as well as value, HP Everyday is a premium multifunctional paper for daily use. Brighter and whiter than standard office papers, at 75 gsm it is also lighter, but with its newly-increased bulk it still provides a rigid, solid feel. This product is ideal for spot-colour applications on both inkjet and laser printers.

Cost-efficient for large print runs, HP Everyday is a great-value paper suitable for a wide range of daily uses such as memos, drafts, email, homework, letters and copies. It comes in a 100% recyclable plastic wrapper and is available in A3 and A4 formats.

HP Office (BETTER) The second option in the BETTER category is HP Office, another reliable, quality paper that is ideal for high-volume printing and copying of everyday business documents. Optimised for use in all printers, copiers and fax machines, it has been developed to run jam-free, saving time and money while maximising the shelf life of the hardware.

HP Office is one of International Paper’s most popular products. It is particularly suitable for all daily applications, such as reports, theses, internal documents, statistics and charts. Its 100% recyclable polypropylene packaging now provides even better protection and a professional look.

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HP Home & Office (GOOD) The name says it all: HP Home & Office is aimed squarely at the small and home office and has been designed to deliver excellent results for black and white printing with all standard printers as well as high-speed printers and copiers.

HP Home & Office is suitable for memos, drafts, email, homework, boarding passes and copies. It comes with a 100% recyclable plastic wrapper, an easy-open tear strip and is available in A4 format.

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HP Copy (GOOD) The final and sixth product and the second option in the GOOD range offers the best choice for everyday business needs. HP Copy delivers excellent results for black and white printing. It has been engineered to resist jams in high-speed, high-volume printers and copiers, but is also suitable for daily use on all printers, copiers and fax machines.

Like HP Home & Office, HP Copy is perfect for memos, drafts, email, homework, boarding passes and copies. It comes in the same packaging, but in addition to A4 is also available in A3 format.

PERFECT RESULTS HP Papers offer a solution for every conceivable printing need. For optimum results, they should ideally be used as part of an HP Printing System, which combines an HP printer, HP toner and HP paper. Developed to work together to the highest standards when used in this combination, users get the very best in print quality, with improved runnability and less waste – and at an overall lower cost. Both International Paper and HP believe that the synergies derived from this package will result in the strongest and most unique value proposition.

For optimum results, HP Papers should ideally be used as part of an HP Printing System PINK REAM CAMPAIGN WINS EOPA 2018 AWARD International Paper’s HP Office Pink Ream campaign which ran from May through December 2017 has made a real splash on a European level, both from a sales as well as philanthropic point of view. During this period International Paper set aside €0.10 from the sale of each ream of HP Office to donate to the Komen Europe Network, part of the world’s largest breast cancer organisation, the Susan G Komen organisation in the US. The amount given to the charity after the campaign totalled €198,000 ($244,000) – nearly double the planned minimum International Paper pledge of €100,000.

The funds will support European programmes that focus on breast cancer research, awareness and prevention.

The campaign attracted much attention, not least from the judging panel of OPI’s 2018 European Office Products Awards (EOPA). Having been shortlisted following the judges meeting last December, International Paper’s HP Office Pink Ream campaign ultimately won the Initiative of the Year award at the EOPA presentation dinner in Amsterdam in early March (see also EOPA Review, page 46).

CATEGORY UPDATE

There’s no let-up in the decline of paper usage and all elements in the industry’s supply chain are feeling the heat – by David Holes

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ast year proved to be a challenging year for the paper industry. Overall demand continued to decline and predictions are that this trend will continue downwards at an annual rate of 2-5%, depending on the type of product and its distribution channel.

As one US industry expert who prefers to remain anonymous says: “I’d estimate that total North American demand is currently around 7.5 million tonnes. At these percentage declines you’re talking about a drop in usage of 150,000 to 375,000 tonnes annually. It’s scary when you see those numbers.

Corporate America continues to push the idea that lowering paper

Iwan le Moine, Director at European paper industry consultants EMGE, adds: “H2 2017 figures were [actually] better than expected, thanks in part to very good capacity management across the globe which caused well-overdue price rises, helping beleaguered mills and merchants. However, we would argue that an element of this improved data was related to the supply chain pipeline filling up, as is usual when prices start rising.

“Real underlying demand has not been as good as the statistics suggest. Just because a mill is shipping a ream of paper doesn’t mean the customer is actually using it – it could simply be filling up shelf space in stockrooms somewhere along the supply chain.

Beware the backlash once prices stop rising.”

The key word is ‘survival’. Everyone is doing everything they can, because nobody wants to be the next to lose or fail

DEMAND IMBALANCE Global overcapacity continues to be an important issue. Supply and demand is not in balance and le Moine says that paper mills need to take action to rectify this: “Keeping the markets in equilibrium is essential if they are to maintain sustainable prices.

Mills know demand is falling and must manage this by closing down unnecessary machines.”

There are some signs this is happening, with a few significant manufacturers having reduced production or converting to alternative products. In recent months, International Paper and Packaging Corporation of America, which owns Boise, have both announced white paper capacity withdrawals.

“In recent years manufacturers have taken out significant capacity and there are persistent rumours around mergers and buy-outs which could lead to additional consolidation,” says Tim Percival, UK Divisional Sales Director at European paper merchant Antalis. “Further capacity reductions may still be required over time, but looking ahead there are positives to report. We’re hoping for some increased price stability which will then give greater

usage can result in higher efficiency measures and increased productivity levels throughout an organisation. I believe that one of the key factors behind this is monetary savings for businesses rather than benefits for the consumer or the environment.

“This decline in paper usage is a real concern for every manufacturer, merchant and broker. Yes, the tariffs implemented to block imports from China, Indonesia, Australia, Brazil and Portugal have made an impact, but it has also just opened the doors for other countries such as Finland, Thailand, Taiwan, Argentina, South Korea and Columbia.”

21ST CENTURY PAPER Indeed, the technological development of paper products is not standing still. The most significant recent innovation is the emergence of ‘intelligent’ paper that is seeking to bridge the gap between traditional and digital applications. One of the best examples of this is PowerCoat Alive, a paper which incorporates near-field communication (NFC) technology – a method of close-proximity wireless data transfer.

The paper is made up of three layers – with two conventional sheets sandwiching an inner layer with the electronic circuitry printed upon it – which are then laminated together. The result is an NFC-ready paper that can be programmed to activate a multitude of functions on a nearby electronic device, such as a smartphone.

The range of potential applications is huge, including triggering a URL link embedded in a specific location on the paper. This would, for example, enable magazine advertisements, packaging, labels or book covers to become interactive and deliver additional content, such as special offers, coupons or extra product information.

Additionally, important paper items such as security documents or diplomas and certificates could have anti-counterfeiting electronic ID measures integrated into them, making it easier to distinguish them from fakes.

As Percival explains: “Despite the maturity of the market, there is still product innovation coming through. We also see users becoming more adventurous and looking to create unique, striking end products using different substrates. Synthetic materials are increasingly being used for a myriad of print projects that require added durability and resistance. This includes menus, wristbands, membership and loyalty cards, and other applications where the end user requires tear-, water- and chemical-resistance.

“Also, print jobs are generally getting shorter. As such, we’re finding that customers are able to afford better-quality materials and leaning towards premium papers as a way to offer maximum visual impact and stand out from competitors, adding credibility to the printed document amid the onslaught from digital communications.”

Manufacturers have taken out significant capacity and there are persistent rumours around mergers and buy-outs it’s increasingly on the service side as quality becomes standardised. Niche opportunities exist in areas such as recycling, but these cannot compensate for the fall in bulk sales.”

Despite the drive to innovate and add value, the conclusion that the paper industry is under severe pressure and faces multiple challenges ahead is hard to avoid. Further casualties in the supply chain seem highly likely.

As le Moine summarises: “The key word is ‘survival’. Everyone is doing everything they can, because nobody wants to be the next to lose or fail. But the problem is that the situation is so precarious and fast-moving that it’s difficult to implement some of the more deep-seated structural changes necessary. As such, immediate strategies tend to focus on short-term survival rather than long-term health.”

April 2018

TESTED LOYALTIES Despite all the decline, paper continues to be a necessity and remains one of the tops spends in any office environment. There’s long been a constant battle to convince customers that it’s worth paying

a little more for a better-quality paper from a domestic mill, rather than opting for a cheaper import. This challenge is becoming more and more difficult as overseas mills have upped their game, improving paper quality while still maintaining a significant price gap.

It has made it an even tougher market for European mills, for instance, says le Moine.

“Brand loyalty and trust do still count,” he says, “but as budgets are squeezed, those loyalties are being tested. There’s always the potential to add value, but

CATEGORY UPDATE Paper

emphasis to product innovation and development.

And, while traditional parts of the industry are seeing reduced demand, this is being offset by new growth areas, with a growing appetite for creative concepts, personalisation and premium products.”

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ADVERTORIAL

What does it take to become the top-selling copy paper brand in the US? Paul LeBlanc, VP of Paper at Packaging Corporation of America, answers OPI’s questions about the journey to the number one spot OPI: Top-selling brand is a bold claim. How do you back this up?

Paul LeBlanc: We start with data from market research company The NPD Group, which is a leader in syndicated tracking services across more than 20 industries. Based on its analysis of the US paper market, Boise Paper is the top-selling brand*.

We then look at our own internal data to determine which of our brands come out on top in their respective segments.

*Source: The NPD Group: US Total Channel Tracking Service/ Technology Paper – based on dollar sales January 2014January 2018

Making great paper involves a whole lot of science and a little gut instinct

www.opi.net

OPI: And you have not one brand but two, correct?

PLB: Yes, two. X-9 is the top-selling mill-branded copy paper and ASPEN is the top-selling brand with recycled content.

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OPI: From your vantage point, what are the drivers that moved these brands to the top?

PLB: There are several, but if I am pointing my finger at the most important, it’s our focus on building strong customer relationships. Our entire team, from sales reps and logistics analysts to technical experts at the mills – absolutely everyone – is engaged in helping our customers. We spend a lot of time researching the market and understanding what end users want.

We’ve built a considerable amount of that knowledge into our marketing for these products, and we collaborate with our customers to help them leverage that brand value.

Paul LeBlanc, VP of Paper, Packaging Corporation of America

Next is product quality and consistency. The folks at our mills work extremely hard to engineer products that perform in the top tier. There’s a lot of pride that goes into our products, so we make sure they are rigorously tested – both internally and through an independent third party – against strict standards.

When we put the Boise Paper name on a product, we guarantee it will perform whatever the job. End users really like that both X-9 and ASPEN have 99.99% Jam Free guarantees.

OPI: Do you have a secret for consistently delivering that level of performance?

PLB: (laughs) Yes, and our paper makers want me to keep it that way.

In all seriousness, making great paper involves a whole lot of science and a little gut instinct. It also takes a commitment to sustainable practices that ensures we’ll be around to do business in the future.

We are actively engaged – through certifications, policies and initiatives – in not only addressing environmental sustainability issues, but also economic and social factors. Consumers these days want to be engaging with brands that align with their values, so our ‘Paper with Purpose’ promise means a lot to them.

OPI: Anything else you think is important for OPI readers to know?

PLB: We’ve got a great supply chain. Being made here in the US means that whether customers are buying cartons off a distributor’s floor or ordering a direct-ship truckload, our products are stocked and available when they need them. It also means when they call or email, there is a responsive customer service person on the other end who knows their business and is genuinely interested in finding the best solutions for them.

To TWEET OR NOT To TWEET

In this final part of our How to… series about using social media as a sales and marketing tool, Jennifer Rae Schulman takes a look at Twitter

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s we all know, Twitter is a social networking service where users post and interact with messages – tweets – which historically were made in 140 characters or fewer. As of November 2017, Twitter increased this character count to 280, ultimately to better accommodate the wide variety of languages. Most users still stick to the 140 limit, but increased space means more potential room for marketing messages, of course.

While Fortune Web Marketing continues to use Twitter within the majority of our clients’ social strategies, we are shifting focus and budget away from it in 2018 because we are finding that other social profiles such as Instagram and LinkedIn hold more value and opportunities. That said, it is still very important to keep up a presence on Twitter.

Why? Take a look at these statistics from social media management platform Hootsuite: • There are 330 million Twitter users, with more than 40 languages supported.

• 36% of people in the US aged 18 to 29 use Twitter, so if you are in the US and looking to target millennials, Twitter is a good bet. In fact, Twitter itself says that 80% of its users are “affluent millennials”.

• Users are likely to have above-average income.

• 93% of people who follow small- and medium-sized businesses (SMBs) on Twitter plan to purchase from those they follow.

PINNED TWEETS Pinning a tweet allows you to showcase your best content at the top of your profile page for as long as you like. Showcase your best content here. An example of this is Staples and its video called The Office MVP. It’s very well done and established Staples as the go-to source for everything related to the office. It’s the very first thing you see when you visit the company’s page.

VIDEO Video is a powerful thing, we all know this. Video on Twitter is no exception. It should be included in your content and social marketing strategies as often as you can. According to Twitter’s own figures, tweets with videos are six times more likely to be retweeted than tweets with photos. There are four ways to share videos on Twitter: 1. Record: you can record, edit and share videos from the Twitter app.

2. Import: if you use the Twitter app for iPhones or iPads, you can import videos from your device.

3. Upload: you can upload videos to twitter.com.

4. Go live: learn how to create a live video right from your Twitter app.

ADVERTISING In our agency, we don’t buy Twitter ads often, simply because they lean towards the more expensive side of all social ads. However, when we do, it is typically for an online retail store. Twitter’s own data shows that 41% of people on Twitter purchased products after exposure to an ad in the past 30 days. If you are selling products online, Twitter ads can be very powerful.

For companies that do not sell products online, Twitter advertising is great for brands looking to grow awareness. According to a recent Twitter study, 85% of users who follow SMBs said they believe Promoted Accounts help them discover new businesses, and 68% have followed an SMB after seeing their Promoted Account.

Advertising on Twitter can accomplish several goals: • Promoting your brand: promote your tweets to maximise your reach.

• Increasing engagement: promote your tweets and get more retweets, likes and replies.

• Growing your followers: promote your account and grow your Twitter following.

• Getting more clicks: promote your website and get more traffic (lead generation or sales).

April 2018

Jennifer Rae Schulman is President of Fortune Web Marketing, an POSTING BASICS (COURTESY OF TWITTER) • Keep it short and simple: keep each tweet focused on one online marketing specific message; link out to longer content as necessary. agency with an extensive team of • Use visuals: adding a bold image or video can lead to experts in the area three times higher engagement rates. You can add up of search engine to four images at once. marketing, content • Incorporate #hashtags: focus on keywords that are writers, link builders, relevant to your business. Best practices recommend social media using no more than two hashtags per tweet. gurus and creative • Retweet: retweeting relevant content and replying masters ready to to tweets are great ways to maintain a robust Twitter help businesses presence. Positive customer feedback, helpful articles, create and execute and messages that align with your business’s authentic a digital strategy. voice are all impactful and worth retweeting.

So how do you maximise tweets and your overall Twitter account? Here are some guidelines:

HOW TO...

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EVENT

EUROPEAN OFFICE PRODUCTS AWARDS

EOPA: The CLASS of 2018

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www.opi.net

t’s the season of award ceremonies. And while they are not the Oscars, Emmy Awards, BAFTAs or Golden Globes, it was nevertheless a night to remember at the European Office Products Awards (EOPA).

Held for the 17th time in 2018 and for the fifth time as part of OPI’s invitation-only Partnership event at the Hotel Okura in Amsterdam, the Netherlands, a total of 11 awards rewarded exceptional companies, inspiring initiatives and campaigns, innovative products and outstanding individuals.

After the networking reception – always a highly-valued part of the event as the biggest and best operators in the business supplies industry come together – and the gala dinner, Bernard Cloquet, Director of International Development at France-based reseller Bureau Vallée, kicked off award proceedings with a heartfelt industry toast.

The ensuing ceremony offered a veritable kaleidoscope of what our industry looks like today – varied, multi-coloured, ever-changing.

And perhaps that is part of the enduring appeal of the EOPA, even after all these years – the fact that every single year the make-up of the winners is somehow different and reflects what’s happening in our sector. Even the award categories often change from year to year, with OPI as the organiser and the judging panel always mindful of the need for fluidity and flexibility.

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OPI would like to thank the following sponsors for their generous support:

The winning companies are very much a mix of the familiar and the new. What they all have in common is that they are clearly operators that push the boundaries, think outside the box and manage to continuously reinvent themselves. Crowdsourcing as a marketing vehicle? Unheard of in our industry (and most others for that matter) until recently. A video that makes the humble shredder a topic of entertainment? Unlikely.

Recognising what’s good and great about our industry is important and vital for further ongoing improvement. Congratulations to all the winners and here’s to EOPA 2019!

Bureau Vallée’s Bernard Cloquet presented the industry toast on the night

EVENT EOPA

PRODUCT OF THE YEAR WINNER: LOGITECH SPOTLIGHT This was by far the largest category for the EOPA judges to go through. With an unprecedented number of entries, it showed that product development is alive and well in our industry. The range of nominations was wide-ranging and included everything from traditional desktop accessories – but with a modern twist – to on-trend categories in the areas of wellness, remote working and technology.

The winner was Logitech’s Spotlight, a simple but very effective presentation tool that fits in well with today’s on-the-move working life. The judges’ decision was unanimous, with all of them being impressed with the Spotlight’s simplicity and a consensus that it would sell very well in our industry.

From left: Jeffrey-James Köhler of Newell Brands presented the award to Quantore’s Arnold Theuws

WHOLESALER OF THE YEAR WINNER: QUANTORE

ples esterbos from Sta From left: Dolph W c ar M to d ar aw d the Solutions presente ech git Lo van den Helder of

The shortlist of this category comprises several worthy previous victors. This year’s winner, however, is one that falls under the broad umbrella of the so-called hybrid player, combining wholesaling with its dealer group status as well as its dealer-lead direct contract business. Quantore does all of it exceedingly well.

Wholesale-specific, in addition to an outstanding logistics infrastructure that keeps on getting better and better, Quantore manages to work on extremely lean margins while at the same time still offering plenty of value-add services.

The judging of a company that wears more than one business hat can be challenging, but in addition to all of the above credentials, the EOPA judges also praised Quantore for its outstanding partnerships with vendors and dealers alike. A very worthy winner indeed.

Highly commended: Exertis Supplies

VIDEO OF THE YEAR WINNER: IDEAL QUALITY

Office Depot’s Andrea Kenna (l) prese nted the award to Frank Matheis of Krug & Priester (r)

April 2018

Video of the Year is still a relatively new category. That said, more and more companies are using video today to creatively and informatively bring their products and services to life. Depending on the message they want to convey, short and snappy is often the way to go with videos, especially as regards products.

In judging this category, despite some great competition, the two favourites quickly became evident.

Both videos by shredder manufacturer Krug & Priester had an engagingly light touch, while being completely self-explanatory. The discussion as to which one would scoop the trophy took a little longer, but the ultimate decision was a unanimous one: the IDEAL Quality video for being entertaining as well as completely to the point.

A great victory for a manufacturer in a category that is very mature and often seen as a little uninspiring.

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Voll (r) Despec’s Michael Gerald to d ar aw the d presente per (l) Pa l tiona Demets of Interna

Initiative of the Year was split off the Marketing category this year as the many entries received fitted slightly varying purposes and fulfilled different criteria.

With its initiative, the winner International Paper further added to its corporate social responsibility credentials. The HP Papers Pink Ream campaign not only reached many geographical markets and increased the company’s own sales, it also made a considerable financial contribution to breast cancer charity, the Komen Europe Network. The initiative was commended for raising brand awareness of a commodity product as well as for generating a ‘feel-good, worthy cause’ factor among its customer base.

Well done to International Paper for an initiative that successfully combines business with societal benefits.

EVENT EOPA

INITIATIVE OF THE YEAR WINNER: INTERNATIONAL PAPER

MARKETING CAMPAIGN OF THE YEAR WINNER: BIC This was a big and popular category and one that, given the width and breadth of entries, was quickly split into two sections – Marketing Campaign and Initiative of the Year (see above).

On the marketing side, the judges were impressed with a number of campaigns and this was shown in the shortlist. With Fellowes as a highly-lauded exception, writing instruments featured strongly in innovative and consumer-driven campaigns. Ultimately, it was the #BICTemptations campaign that most piqued the judges’ interest with its contemporary concept that, importantly, also achieved excellent double-digit sales increases in the process.

The core premise of BIC’s campaign was a competition on crowdsourcing platform eYeka whereby 15-25 year olds were invited to submit videos about the value of BIC’s 4 Colours Pen. The best videos were then shared on YouTube and Facebook during BIC’s back-to-school season. Great contemporary marketing campaign with content produced by its own customer base that generated impressive results.

From left: Corwell’s Márk Hortobágyi presented the award to Danny Berendsen, André Vasconce los and Beth Wright of Bi-silque

VENDOR OF THE YEAR WINNER: BI-SILQUE

April 2018

r’s International Pape ) (m ts me De ld ra Ge to d presented the awar et (r) BIC’s Denis Bonn n (l) ru Su pe and Philip

This was a hotly-contested category that engendered plenty of discussion among the judges. Whittling it down to a shortlist was easy enough, deciding on a winner was not.

With all the facts to hand and the research done, however, the best of the best soon became apparent – Portugal-based Bi-silque. The reasons? Continuously innovative products in a mature category; considerable sales growth in a saturated market; excellent partnerships with the wholesale and reseller communities; and great marketing across several media.

The delighted Bi-silque team is richly deserving of this year’s Vendor of the Year award – congratulations!

Highly commended: Fellowes

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EOPA EVENT

YOUNG EXECUTIVE OF THE YEAR WINNER: ABDUL KHAMKAR

From left: Jolanda de Vries from 3M presented the award to Abdul Khamkar of Office Depot

This award, now in its second year, seeks to reward a young executive who is making a real impact in his/her business and has the potential to shape the future of our industry.

There were several very worthy candidates on the shortlist, but collating all the feedback received throughout the judging process, there was ultimately one clear winner – Abdul Khamkar from Office Depot. To sum Abdul up in one key word, he is someone who simply “delivers”. This is a person who’s expected to go a long way in our industry, having impressed already with his dedication, can-do attitude and absolute ease to work with.

The business products industry needs young and dynamic individuals to ensure its continued success – Abdul is one of them.

RESELLER OF THE YEAR – OVER ¤100 MILLION WINNER: AMAZON The reseller of the year category always sparks big and lengthy discussions, as one particular company looms so large.

Given that the market in many European countries is difficult and presents many challenges, especially for the retail sector, it’s an amazing feat to have a retailer on the shortlist (Bureau Vallée). But this year again, as on several occasions before, it’s the player that is the most disruptive, causes the most headaches to the competition and continuously meets customer expectations that pipped everyone else to the post.

Congratulations to Amazon for scooping this award by simply meeting and exceeding most of the criteria in this category. Add high double-digit growth, efficiency and – finally – profitability, and it’s an all-round package that’s hard to beat.

From left: CEP Office Solutions’ Cédrik Longin presented the award to Viktorija Masaityte and Marius Staugaitis from Officeday

www.opi.net

RESELLER WITH REVENUES UNDER ¤100 MILLION WINNER: OFFICEDAY

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an (m) Pilot Corporation Europe’s Paul Phel a Gatzke (r) Sonj zon’s Ama to d awar presented the and Virgilio Velasco Marquez (l)

A strong presence in their local market is one of the core criteria for winning the Reseller of the Year award. And the winner in the under €100 million category certainly has that.

Officeday is a true multichannel operator in the three countries where it operates – Estonia, Lithuania and Latvia – with wholesale, retail and as well as B2B contract operations.

Expansive in terms of product portfolio, tech-savvy in terms of how to sell that portfolio and ambitious in terms of its geographical reach, Officeday has done all the groundwork towards its objective of becoming an innovative office and school supplies company in the Baltics that provides best-in-class products and services.

The highest accolade of all the EOPAs – the Industry Achievement award – went to a person who would much rather stay out of the limelight and is much keener on getting on with running his business.

But that was not the reason why Hans Schmid, President of German reseller Printus, couldn’t be present at the awards ceremony in Amsterdam, with the trophy instead being collected by his wife Mary Victoria Gerardi-Schmid.

Sadly, Schmid was taken ill shortly before the event and couldn’t attend.

Horst-Werner Maier-Hunke Presenting the award to him via from Durable (r) with OPI’s Mary Victoria was long-time friend Steve Hilleard (l) and Mary and business partner Horst-Werner Victoria Gerardi-Schmid (m) who Maier-Hunke from German collected the award on behalf of manufacturer Durable. Charting his the winner Hans Schmid professional history to as early as 1973 when Schmid’s entrepreneurial spirit first shone through with the purchase of his own business at the age of 28, Maier-Hunke went through some of the highlights of Schmid’s career. He particularly emphasised his achievements at Printus, the company that began as a small mail order operator and developed, under Schmid’s leadership, into a multichannel, multi-million euro operator of stationery products, promotional items and consumer electronics. To give just some of the key facts, Printus now generates revenues of over ¤800 million ($895 million), employs 1,600 staff and supplies 40,000 products to more than one million customers. Schmid’s latest big business deal was the purchase of OTTO Office in 2015 which at the time added about ¤200 million in sales to Printus.

The Industry Achievement award stipulates a number of criteria that need to be met: a contribution and clear commitment to the industry; outstanding leadership and performance; and a high level of respect and admiration from colleagues.

Schmid easily fulfills all of them, with Maier-Hunke also particularly referring to his highly ethical approach to business in general, his company and staff in particular, as well as his local community. A highly deserving winner indeed.

EVENT EOPA

INDUSTRY ACHIEVEMENT WINNER: HANS SCHMID

PROFESSIONAL OF THE YEAR WINNER: ARNOLD THEUWS

April 2018

Introduced by last year’s winner of the Professional of the Year trophy, Bi-silque’s Beth Wright, this award seeks to reward individuals who are ambitious, dedicated and successful in their company specifically and their channel at large. The 2018 winner meets all of the criteria – and then some.

He – not another female as Wright was quick to point out – has has been running Netherlands-based Quantore for seven years, after several years in the organisation. In fact, Arnold Theuws became the first Quantore employee when CIB and Veneka merged in 2001. Quantore, of course, also won the Wholesaler of the Year award this year, in itself an indication of Theuws’ credentials.

Theuws is deeply passionate about his business and completely committed to his employees and the cause of the independent dealer. But he expects the same professional commitment, honesty and passion from everybody around him, as Wright humorously pointed out, not just staff but also his members and suppliers.

One of the early adopters of the dealer group cum wholesaler cum reseller model, Theuws is extremely business-savvy and highly analytical in his approach.

Everything about his organisation is progressive – the large, fully-automated, sophisticated warehouse and entire logistics; its continuous investment back into its operations (Quantore is a not-for-profit organisation); its central branding initiative; its budding tender business; and its vision to grow and take market share in a declining market. e’s From left: Bi-silqu Never resting on his laurels and always aiming to do Beth Wright better, Theuws is also hugely personable and the judges d presented the awar had a very easy time indeed on deciding on this year’s e’s tor an to Qu Professional of the Year.

Arnold Theuws

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EVENT

Time for a SPRING CLEAN INTERCLEAN 2018 PREVIEW

OPI takes a look at the upcoming INTERCLEAN Amsterdam event and what attendees can expect from the jan/san trade show since cutting ties with cleaning industry association ISSA

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SHOW DETAILS 15-18 May 2018, RAI Amsterdam, Netherlands. For more information, visit www. intercleanshow.com

FOCUS ON HEALTHCARE Healthcare is one of the new focus areas at this year’s show and RAI Amsterdam is confident that the Healthcare Cleaning LAB and the concurrently running Healthcare Cleaning Forum – taking place on 16 May – will be popular additions to the event.

The Forum, organised in conjunction with the World Health Organisation and several infection prevention specialists, will look to raise the profile of the importance of cleaning and disinfection to reduce disease and improve patient safety. It will host a wide variety of sessions that aim to bring the worlds of healthcare and cleaning closer together and improve communication between the two segments.

Communication and networking is always an essential part of any trade show and INTERLCEAN Amsterdam is certainly catering to that need. There are several areas for visitors to network, rest and relax, including the Refresh lounge and the ever-popular – and somewhat self-explanatory – Lucard Beer Garden.

April 2018

aking place from 15-18 May 2018, INTERCLEAN Amsterdam is raring to go and appears unfazed by its split from former event partner ISSA at the end of last year (see News, OPI December 2017/January 2018, page 10).

The show once again brings together professionals from across the jan/san world to showcase the product innovation, services and solutions that are shaping the cleaning and sanitation industry.

More than 30,000 decision-makers from over 130 countries are expected to descend on event venue RAI Amsterdam for a comprehensive programme of events and displays set across 12 halls. They will have the opportunity to meet about 800 exhibiting companies from 40 countries, all of them keen to demonstrate the latest in jan/san products and services in a wide variety of categories, such as washroom, equipment and machines.

This year will see three new segments being introduced – laundry, waste solutions and healthcare – all in an effort to make the show even more comprehensive. “We are looking forward to showcasing an extensive range of innovative products and solutions during this year’s show,” says Rob Den Hertog, Director of Professional Cleaning & Hygiene at event organiser RAI Amsterdam.

“Innovation has always been the driving force behind INTERCLEAN. In fact, according to our aftershow research in 2016, it was the number one reason people attended the event.”

KNOWLEDGE-SHARING As in previous years, the trade show will also see industry experts share their knowledge in sessions and talks across a number of stages, including the INTERCLEAN stage, the InnovationLAB, the WasteLAB and the Healthcare Cleaning LAB – the latter part of the widely-anticipated Healthcare Forum which is running alongside the show.

The selection of seminars and workshops offer delegates the chance to gain expert insight into some of the challenges they’re facing while discovering the latest developments in jan/san technology to drive their businesses.

The INTERCLEAN stage specifically – located in the Elicium Ballroom – is open to visitors throughout the show and will feature a range of free educational sessions that explore some of the hot topics in the professional cleaning and hygiene industry: adapting to new regulations and standards, how to identify and implement innovation; and how to become part of the growing circular economy.

This stage will also debut the ‘Washroom of the Future’, showcasing the latest toilet technology and demonstrating how the Internet of Things can change the industry’s approach to bathroom cleaning.

Located in Hall 8, meanwhile, the InnovationLAB will host the Amsterdam Innovation Award nominations, a selection of products highlighting the best technology the show has to offer. The space will also host a varied programme of free events, including a seminar by trend expert and technological innovator Vincent Everts, a talk on the evolution of fragrance by hygiene tech vendor Vectair, and a discussion of the new role of supply chain and distribution by Amazon.

The Facility Inspiration Arena, which stages a special day of events dedicated to helping facilities managers improve their performance, and the Robot Arena where visitors can enjoy live demonstrations of the latest robotic cleaners taking on a series of sanitation challenges, are just two of many other learning opportunities that the trade show offers.

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EVENT

Focus on SCHOOL & OFFICE EXPO PREVIEW

AFRICA Opportunities abound as the School & Office Expo launches in Africa. OPI’s Joshua Allsopp finds out more

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Ashish Jain

www.opi.net

SHOW DETAILS

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The School & Office Expo takes place at The Sarit Centre in Nairobi, Kenya, from 18-20 May 2018. For more information, visit www.scofex.com

he first-ever pan-African stationery and school supplies fair is coming to Kenya’s capital Nairobi from 18-20 May, opening up a booming customer base for those looking to grab a share of this emerging market.

Organised by Maxton Global – the marketing partner behind several international trade shows – the School & Office Expo Africa will primarily cover the east and south of the continent, focusing on sub-categories including stationery and office supplies, writing instruments, paper, back-to-school and technology accessories.

Maxton Global hopes that the event will attract over 80 exhibitors, 1,000 visitors and 50 sponsored buyers. Attendees are expected not just from the host country of Kenya, but also from nations such as Burundi, Ethiopia, Malawi, Rwanda, Tanzania, Uganda, Zambia, Mozambique, South Africa, DR Congo and Madagascar.

IMMENSE OPPORTUNITY According to the organisers, there have never been any serious stationery-focused trade events in this part of the world. With East Africa alone accounting for 5% of the world’s population, it is certainly an area worth looking at for those companies wanting to achieve a truly global footprint.

Kenya itself is a leading distribution hub for the region, with Mombasa a major port servicing the entire east coast of Africa, especially land-locked

sub-Saharan countries, and also those with a less developed logistics infrastructure. Although the manufacturing sector in the region is slowly evolving, most of the demand for office and school supplies is still fulfilled by imported products.

“It’s a thriving market with immense opportunities,” Maxton Global Director Ashish Jain told OPI. “It has a growing population with more schools and jobs being created by the day, and that translates into growth in the school and office supplies sector. Over the past few years in particular, the region has witnessed significant expansion in both the education and corporate sectors, thanks to governments’ focus on schooling and initiatives to boost foreign investment.”

In particular, Jain highlights an increasing demand for branded products as a result of an emerging middle class and a better appreciation for high-quality stationery. Yet the choice available for consumers at the moment is fairly restricted as most dealers opt to import large-quantity shipments of generic products.

This, says Jain, presents an immense opportunity for new brands to enter the market and for local distributors to try out different ranges and expand their portfolios. Although, he adds, it’s worth remembering that this consumer segment remains quite limited.

RAISING BRAND AWARENESS The debut event will focus on the key trends of increasing consumption, manufacturer growth, and a slow but gradual shift towards better quality, international brands.

There are several key African resellers and distributors for whom stationery represents a large part of their portfolio. But many of these companies simply do not have the inclination to travel to any of the global stationery events. Explains Jain: “We have found that these importers are much more receptive to a local show and will also be open to trying new products and meeting new exhibitors.”

He adds that the focus right now is to engage more top-quality importers to attend which have the capacity and willingness to buy from exhibitors.

But the event also wants to attract a wide global presence and is offering hotel packages to international visitors for their convenience.

Jain concludes: “We are also encouraging referrals from exhibiting companies so that they get to meet buyers of their choice. One of the core selling points of the event is assured ‘Sponsored VIP Buyers’ from over ten African countries. This gives every exhibitor an opportunity to meet genuine stationery importers and form important connections.”

5 MINUTES WITH...

Ricardo Ferreira

CAREER Q&A Describe your current job.

The Navigator Company Global Brand Manager as well as Brand Management Team Coordinator and Marketing Manager for North, Central and South America.

If you weren’t doing your present job, what would you like to be doing?

I would definitely be working in marketing, but unsure whether it would be on the client side or on the agency side. I love building strong messages that help connect brands and consumers.

What’s your life philosophy?

E pluribus unum – ‘out of many, one’ – which highlights the importance of teamwork both in my private and professional life.

What do you do in your spare time?

Spend time with the family, catch up on my favourite TV shows, watch some football and, whenever I can, boot camp workouts.

What kind of music do you like?

I have quite an eclectic music taste which varies according to the time of day, mood and weather, even what I’m doing at the time. So it could be Enigma, Linkin Park, Beethoven...

But I actually need to listen to music in order to concentrate properly.

What are you particularly good at?

Seeing the finer details that would normally be overlooked.

What’s your favourite cuisine?

Portuguese food is the best – both fish and meat. Who doesn’t like salted cod?

And we have 1,001 ways of cooking it!

www.opi.net

If you were Prime Minister, what would be the first law you pass?

I would pursue transparency inside government institutions as well as fight the illegal trafficking of people and guns.

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Best compliment you’ve ever received?

People usually tend to forget about the compliments and only remember the criticism.

I’m no different, but I remember a colleague who sent me a postcard after more than 12 years of working together. It contained amazing and kind words of fellowship and admiration.

It’s not so much about the content, however, but about the people behind it, the unexpected surprise and the pleasure you get from when something like that happens.

What makes you happy?

Given that I’m not a materialistic or particularly spiritual kind of guy, what makes me happy are the simplest things in life such as spending time with the ones I love. Being a newly-wed, everything related to being a couple – from cooking a meal together or watching a movie with my wife. These are everyday activities that, when shared, give true meaning to the word happiness. Just like in the film Into the Wild, happiness is only real when shared.

Where is your favourite place to visit in your home country of Portugal?

Coimbra because it’s the place where I grew up and it is also home to one of the oldest universities in Europe. It has a lot of history.

What was the last gift you gave someone?

I gave my wife flowers, something she loves.

If you could trade places with someone for a day, who would it be and why?

It would be amazing to swap places with one of my favourite football players, Rui Costa, from Benfica. Football is one of my life’s obsessions!

Describe yourself in one sentence.

Perfectionist, dedicated and patient – I always strive to improve in every single task of daily life. When it comes to achieving the goals I set for myself, I commit 300% and persevere for as long as it takes to see the results of my efforts.

Your favourite gadget?

My iPad Pro. The single most important thing I bring with me on my constant travels. I wouldn’t even know how to pass the time without it.

Best moment in your career?

That would probably be back in 2009 when I became the Navigator Global Brand Manager. I had been in the company for some years and was definitely ready for it. It has proven to be both very challenging and rewarding.

Having the chance to work with hundreds of customers in dozens of countries in order to develop marketing solutions to spread the Navigator message has been amazing.

Your best piece of advice to someone who has just joined the OP industry?

Don’t despair with the amount of technical details that are vital to differentiate brands and products from your competition. Look for the competitive advantage that can give you the edge.

Don’t ever just take the easy route – always build added value for your customers and for your company.

What do you like best about the OP industry?

The fact that, unlike what many people think, it is innovative and that most products are directly linked to each other.

What personal item do you have on your desk?

Not many since I spend so much time travelling.

FINAL WORD

Call to dealers:

SUPPORT CITY OF HOPE

C

www.opi.net

OS Business Products & Interiors is a mid-sized company in Chattanooga (TN) in the US. We are 77 years old and a legacy business in our region.

All of us live, work, play, worship and shop locally.

We are totally committed to our community and we like being part of that community. As a result, we have always made it a company priority to share our resources with local charitable organisations so we can see our donations at work. We want to know they make a difference.

Like most independent dealers, we get more requests for donations than we could ever possibly grant. Even though last year we donated to 29 charities and not-for-profit agencies, it seemed like just the tip of the iceberg. There are so many worthy causes but, like most small companies, we only have a limited number of dollars, time and resources at our disposal.

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LACK OF KNOWLEDGE The City of Hope (COH) has never been on our list of charities. Until recently. To be honest, my knowledge of COH was very limited. I knew they were a pre-eminent research hospital focusing on cancer and diabetes. I assumed their work was worthwhile, but they are located in Duarte, California – that is 2,113.3 miles away from me, so not exactly local.

What could COS possibly have in common with COH? Well, much more than I ever thought possible.

As most OPI readers will know, COH is the business products industry’s national charity of choice. In fact, our industry has raised over $175 million over the past three decades – that is a pretty remarkable feat whichever way you look at it.

I learned that most of the money being raised comes from the manufacturers and the wholesalers and very little from the independent dealer channel (IDC). I wasn’t too concerned about that. The largest companies in our industry are national in scope, so it made sense they would support a national charity.

But then I was asked to be on a committee of independent dealers led by Rick Toppin of SP Richards and Joe Templet of Essendant. The goal was to find ways to engage the IDC to support COH. The question that needed answering was this: what’s the benefit to our local communities of contributing to this organisation?

I visited COH and that’s when I learned exactly how my as well as every single other community benefits, as the cutting-edge research, clinical trials, drug manufacturing,

shared education and supportive care services developed at the COH facilities are delivered to our local communities.

I learned that many of the leading cancer drugs now in use were pioneered at COH. Synthetic human insulin, used by millions of diabetics all over the world, was developed there. Their research in bone marrow and stem cell transplants is unparalleled and is providing the basis for the next generation of cancer-fighting protocols.

COMMUNITY BENEFITS As a two-time cancer survivor myself, I have seen first-hand that all these innovations are being delivered to cancer patients in my community – to

Skip Ireland, Owner, COS Business Products & Interiors

Special Issue

FACILITIES SUPPLIES

Join me and make the Special Issue IDC an important component Special Issue FACILITIES of the business supplies industry’s FACILITIES SUPPLIES giving platformSUPPLIES my family members, friends, neighbours and co-workers. You do not have to visit COH to take advantage of their discoveries. They share all their findings and each of our local cancer centres, for example, can and does use their drugs, therapies and research. My community directly benefits and so does everybody else’s.

That is why I have decided to add COH to my annual list of donations. In fact, COS has donated over $5,000 to this year’s campaign chaired by Special Issue Rick Toppin.

Cancer and diabetes affect all of BREAKROOM us. Let’s do something to end these dreadful SPECIAL diseases once and for all, so join me and make the IDC an important component of the business supplies industry’s giving platform. COH is truly worthy of our support.

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