Office Products International ISSUE NO.2 5 5
The word in office.
magazine
Big Interview
Jeff Whiteway, Group CEO, SPOT p18
December 2015/January 2016
DECEMBER 2015/JANUARY 2016 WWW.OPI.NET
pays tribute to p14 Industry p13 HP’s long road to growth OP icon Tom Stemberg
FM in transition p44 Staples’ battle with the FTC p22
Contents December 2015/January 2016
www.opi.net
News
Events
7 Round-up
37 ISSA/INTERCLEAN
Ecover exists B2B sector; Christian Horn leaves Staples; EOPA 2016 shortlist announced
This year’s flagship ISSA event in North America was the best yet
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12 News Analysis
38 European Forum
Dealers’ e-content conundrum; Growth challenge for HP Inc’s ink
Europe’s top executives gather in London for OPI’s premier education and networking event
14 Tribute
41 Climb of Life
OP industry pays tribute to Staples founder Tom Stemberg
Another record year for Climb of Life fundraisers
Features
43 Heart of the matter
Getting ready for Paperworld 2016
Category Analysis
18 Put on the SPOT
Jeff Whiteway talks about progress at the SPOT Group and the priorities for the business
44 Changing facilities
The FM category offers numerous growth opportunities with plenty of untapped potential
22 Ready to slug it out
Staples/Office Depot merger in serious doubt, but it’s not over yet
Regulars
44
26 The right connection
Partner to remain successful, says Canadian dealer Rubanco
51 Where are they now? Paula Jagemann-Bane
28 Independently driving growth How to make dealers more sales and marketing-savvy
31 A chemical reaction
5 Comment
52 5 minutes with... Eva Baumann
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54 Final word Pascal Mitchell
GHS labelling compliance explained
If Essendant combines this with its scale in purchasing, skill in merchandising, front-end support and national distribution, it could look a lot like a contract stationer. However, the key is keeping the resellers involved so that it maintains its wholesale status and avoids channel conflicts... For the full story, turn to page 22
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This month’s cover is supplied by Pilot w w w.opi.net | OPI Magazine
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Editorial Editor-at-large Andy Braithwaite +33 4 32 62 71 07 andy.braithwaite@opi.net
Editor Heike Dieckmann
Comment
+44 (0)20 7841 2950 heike.dieckmann@opi.net
Deputy Editor Michelle Sturman
March or die for Staples/Depot deal
+44 (0)20 7841 2942 michelle.sturman@opi.net
Sales and Marketing VP – Continental Europe, Middle East and Africa Ewan Dickson +44 (0)20 7841 2954 ewan.dickson@opi.net
VP – North America and UK Chris Turness +44 (0)20 7841 2953 chris.turness@opi.net
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 and Finance Designer Charlotte Gerhardt +44 (0)20 7841 2943 charlotte.gerhardt@opi.net
Operations & Production Eda Sismanoglu +44 (0)20 7841 2950 eda@opi.net
Accountant Jairo Paya +44 (0)20 7841 2956 jairo.paya@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
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No part of this magazine may be reproduced, copied, stored in an electronic retrieval system or transmitted save with written permission or in accordance with provision of the copyright designs and patents act of 1988. Stringent efforts have been made by Office Products International to ensure accuracy. However, due principally to the fact that data cannot always be verified, it is possible that some errors or omissions may occur. Office Products International cannot accept responsibility for such errors or omissions. Office Products International accepts no responsibility for comments made by contributing authors or interviewees that may offend.
Wow! Just before we went to press with this issue, the FTC stepped in and challenged Staples’ acquisition of Office Depot. I have to admit, I thought that Staples and the FTC would have reached some kind of agreement to get the deal done. Maybe they still can, but it looks like it will all come down to a preliminary injunction hearing set to start in March. The longer this saga drags on, the better it is for Staples and Depot’s rivals, there’s no doubt about that. Vendors will probably be hoping that the whole thing gets scuppered by the The longer this saga drags FTC and they don’t have on, the better it is for Staples to contend with a $34 and Depot’s rivals billion mega-reseller demanding better terms. See page 22 for the latest on this major story. OPI has just held another successful European Forum in London (see the review on page 38). Unfortunately, I was not able to attend this year, but the feedback I have had has been really positive and delegates were appreciative of the varied and relevant programme that the OPI events team had put together. Believe it or not, OPI will be 25 years old in 2016. To mark this momentous achievement – while other print publications have fallen by the wayside – we will be producing a special 25th anniversary edition in November. In the meantime, I hope you enjoy our new ‘Where are they now?’ feature on page 51. Wishing you all a very happy end of 2015 and much success for the next 12 months. Andy Braithwaite Editor-at-large
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News from opi.net Bureau Vallée celebrates 25 years Franchisees, suppliers, partners, staff and friends of France-based office supplies retailer Bureau Vallée gathered in Paris at the end of November to celebrate the company’s 25th anniversary. The event coincided with Bureau Vallée’s Papet’ Show, its annual trade expo to prepare the following year’s back-to-school season. One of Bureau Vallée’s strengths over the years has been the ability to keep its feet firmly on the ground and not forget its roots. In a speech at the event, founder and CEO Bruno Peyroles paid tribute to the vendors, suppliers and shareholders that had supported his idea all those years ago, especially in the early days when the going was very tough indeed. In fact, in closing, Peyroles described the stationery and office supplies industry as “an industry of loyalty”, a message he is keen to pass on to the younger generation that is coming through – his children Christel and Adrien hold positions of responsibility in the company and one of Bureau Vallée’s newest franchisees is just 25 years old!
Large Resellers
Apology In the November issue of OPI we stated that Office Club founder and Managing Director Mark Austen had passed away on 18 September. The correct date of Mark’s passing was 17 September 2015. Our sincerest apologies to Mark’s family for this error.
People
Martin leaves Kaut-Bullinger Johannes Peter Martin stepped down as Group Managing Director of leading German independent dealer Kaut-Bullinger at the beginning of December. In a short statement, Kaut-Bullinger said that Martin had left with immediate effect in order to pursue another career opportunity. Martin had been in charge at Kaut-Bullinger since 2008 and his resignation came just a few months after the dealer announced the appointment of Oliver Mathes to a joint Managing Director role. The reseller told OPI that Martin’s departure was “a personal decision” and that there was no disagreement over the strategic direction of the company. Johannes Peter Martin
People
Chambre promoted at Lyreco Long-serving Lyreco executive Christophe Chambre has been promoted to COO of the global reseller, effective 1 February 2016. Chambre has spent most of his career at Lyreco, starting out as a field sales rep in the Paris region in 1994. He became Managing Director of Lyreco France in 2008 and since 2012 has been Managing Christophe Chambre Director of Europe, responsible for the strategic development of several of Lyreco’s subsidiaries in Europe, including Germany and the UK.
School Specialty targets healthcare Educational products reseller School Specialty has launched a healthcare division and announced an agreement with group purchasing organisation Amerinet. The new healthcare division is called Soar Life Products and has been formed following the agreement with Amerinet – a leading group purchasing organisation in the US that services around 80,000 healthcare facilities. The offering features various School Specialty product categories – arts and crafts, physical activity, recreational sports, furniture and general supplies – that could be used by healthcare establishments. School Specialty said the products would be sold directly or on a third-party basis.
Education
Ecover exits B2B sector
European jan/san products vendor Ecover has sold its B2B business to Greenspeed in order to focus exclusively on the consumer market. Included in the deal – which becomes effective on 1 January – are Ecover Professional’s existing customer relationships and product formulas. The product range and the look and feel of the packaging will remain the same, with the Ecover Professional logo replaced by the Greenspeed logo and the tagline ‘Engineered by Ecover’. The Ecover Professional team will transfer over to Greenspeed. Johan Tops, currently Ecover International B2B Manager, becomes International Sales & Marketing Manager at Greenspeed and will remain the contact person for B2B resellers.
Facilities Management w w w.opi.net | OPI Magazine
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News n Round-up
Epson launches EOPA 2016 shortlist announced in-house recycling Epson has revealed details of its PaperLab, an integrated system that shreds A3 and A4 sheets and turns them into new office paper – all on-site. The company said it plans to put PaperLab into commercial production in Japan next year, with sales to other regions to be decided at a later date. PaperLab securely shreds documents and transforms them into fibre. It then uses a dry process to turn the fibre into copy paper, coloured or scented paper, or even business cards. Epson explained that PaperLab produces the first new sheet of paper about three minutes after it has been loaded with waste paper and switched on. The system can produce about 14 A4 sheets per minute and 6,720 sheets in an eight-hour day.
OPI has announced the shortlist – as below – for the 2016 European Office Products Awards (EOPA). An independent panel of industry executives gathered in Budapest, Hungary, in early December faced with the challenge of whittling down the large number of high-quality entries and nominations into a list of finalists.
New Product of the Year – Core Office Products Esselte – Leitz Style Range International Paper – Easy Open Solution Renz – Ring Wire Opener
New Product of the Year – Powered Products Brother – DS820W Portable Document Scanner with Wi-Fi Epson – EcoTank Printer Range Evolis – Badgy Fellowes – AutoMax 200C Shredder
Sustainability
Leadership change at Staples Advantage Europe Christian Horn, SVP of Staples Advantage Europe, has left the reseller after almost 18 years and taken on an executive role at building materials distributor SIG. Horn joined Corporate Express in 1998 and occupied a Christian Horn number of increasingly senior roles, becoming head of the Staples Advantage B2B unit in Europe in 2011. Succeeding him is Hervé Liboureau, who joins Staples from SAP where he was Head of Mobility Solutions. Liboureau has spent most of his career in the telecoms and IT industries, with companies like Blackberry, Nokia and Cisco, perhaps a pointer to the key focus areas at Staples Advantage in the near future.
People 8
OPI Magazine | December 2015/January 2016
New Product of the Year – FM Avery Zweckform – LIVING Range Henkel – UniBond Aero-360 Moisture Absorber Muggi – Muggi Rubbermaid Commercial Products – Slim Jim Step-on Container
Innovation of the Year
Dealer Group of the Year Integra Office Solutions Marketing Gruppe West/ Bürologistik NEMO Group Partner XXI Quantore
Wholesaler of the Year Alpha International/ALSO Corwell JGBM Relef VOW
Reseller of the Year Amazon Büromarkt Böttcher Bureau Vallée Codex Coolblue Plaisio
Vendor of the Year Brother CEP Epson Fellowes grupo Portucel Soporcel
Esselte – Leitz Complete Credit Card Power Bank 1350 Fellowes – AeraMax Air Purifier International Paper – Easy Open Solution Newell Rubbermaid – Dymo XTL Industrial Labelling Solution
Professional of the Year
Marketing Initiative
The EOPA 2016 winners will be announced in Amsterdam on 9 March 2016 during a special presentation dinner that is taking place as part of OPI’s Partnership 2016 event. The dinner – a must-attend event in the European OP calendar – is open to anyone, not just attendees of the Partnership event. For more information and to book your place, please visit www. opi.net/eopa2016
Esselte – Leitz Icon Benelux Campaign Fellowes – Bankers Box by Fellowes: Organisation For Your Organisation Newell Rubbermaid – Paper Mate InkJoy Pilot Pen – Pilot FriXion Sponsors Best Solo Artist at the 2015 NME Awards tesa – 360 Degree tesa Powerstrips
No shortlist – winner to be announced on the night
Industry Achievement No shortlist – winner to be announced on the night
news n Analysis
Solving the e-content conundrum Efforts to help independent resellers have better control of online content are making progress
One
major component of the ‘BIG Collaboration’ theme at this year’s Independent Stationers (IS) and TriMega EPIC convention (see Event Review, OPI November 2015, page 34) was a joint effort by the dealer groups to allow their members to have better control over the content they put on their e-commerce sites. The stakes are high, not just for independent resellers in the US, but in the rest of the world too. Amazon Business, which offers millions of business products in the US and is expected to expand internationally, and Staples – with over a million SKUs online – are able to offer an ‘endless aisle’ of products to business customers who are increasingly using online and mobile commerce solutions to make their purchases.
Restricted content Dealers, on the other hand, have largely been restricted to going to market online based on the content provided by their main wholesaler partner, argues IS CEO Mike Gentile, who has been concerned with what he calls the “digital destiny dilemma” for dealers for some time. Even the largest dealers in the US are unlikely
said Gentile. “We just know that there is a significant number of SKUs and a number of categories that our independent dealers are not enabled to go to market with and sell because it’s not on their content load.” TriMega President Mike Maggio agrees that e-content is a priority. “We think it’s really critical for the channel and for our members to have some level of control over their content,” he noted. Now IS and TriMega are working together on the issue, collaborating with various stakeholders,
“We don’t know how many orders our dealers are not getting because their content is insufficient” to be able to offer in excess of 100,000 SKUs – that sounds a lot, but obviously pales in comparison to the Amazon and Staples numbers above. An example was given at EPIC: that of a major OP manufacturer which had about 440 products on a dealer’s website, more than 1,400 available at Staples.com, and even more on Amazon.com. But no one really knows how much business independent resellers are losing to their large online competitors. “We don’t know how many orders our dealers are not getting because their content is insufficient compared to the competition of Staples, Office Depot and Amazon,”
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including wholesalers, vendors, software providers, dealers, content aggregators and industry associations to drive meaningful and profitable change for the channel. So far, they are encouraged by the reaction they have received despite a number of hurdles that have had to be overcome. These include adding content to libraries, the stocking and delivery of products, and the integration with e-commerce and back-end software, for example, but it is hoped that testing will get underway in the new year. TJ Crayne, President of PTC Associates and an industry e-commerce expert, is certainly
OPI Magazine | December 2015/January 2016
someone who understands the importance of this project and the challenges involved. “Content is a big deal for a variety of reasons, the most significant being there is no easy way to add content for non-wholesaler provided items,” he told OPI.
Overcoming inefficiencies “Feeding into the search engines of what are considered unique items is cumbersome,” he added. “Dealers want full access to vendor lines and non-wholesaler manufacturers, along with quick access to new items. Adding content is difficult and terribly inefficient.” He continued: “Key will be the wholesalers as they own the search engines today, and acceptance by the software providers. If done correctly and the wholesalers embrace [it], there should be no impact at the software provider level.” Referring specifically to the IS/TriMega initiative, Crayne said he believed it was “the first collaboration to actually have a plan that makes sense”. “There is finally a group that is trying to remove the inefficiencies of the current process and make it easier for dealers to get access to the endless aisle concept,” he added. OPI will cover more on this topic, the future of catalogues, tackling Amazon Business and other digital commerce areas in upcoming issues.
Changing print dynamics are hitting HP Inc’s sales
As
it begins life as a standalone PC and print company, HP Inc is facing a number of challenges in its lucrative ink supplies business. In its last set of quarterly results before the split into HP Inc and Hewlett-Packard Enterprise, the ‘old’ HP reported a constant currency decline of 9% in its Printing division. As well as the secular Dion Weisler challenges in the printing category, HP Inc is being hit by the stronger value of the US dollar versus the Japanese yen as rivals such as Epson, Brother and Canon are able to lower their prices, forcing HP to follow suit. HP Inc CEO Dion Weisler said that this has had two knock-on effects, over and above the lower revenue generated from reduced prices. Firstly, in a number of markets, prices have fallen to below HP’s break-even point, meaning the company has walked away from some loss-making business. Secondly, price points for machines such as the Officejet Pro series have dropped to such an extent that they are now attracting home users – a market segment that typically prints fewer pages than business users. Therefore, it’s a double-whammy of few printer placements (meaning less potential for future supplies sales) and less demand for ink from the installed base. As a result, HP’s bread-and-butter revenue from supplies – about 65% of total printing sales – was lower than expected in Q4, down 5% in constant currency, and Weisler now doesn’t expect supplies sales to stabilise until late 2017. The HP Inc CEO reiterated the commitment to making $1 billion in productivity improvements, but added that he may now have to accelerate and increase the previously-announced restructuring actions to take out $300 million of non-revenue-generating costs over three years. HP is not alone in facing challenges in the print market. Lexmark and Xerox have both recently said that they are ‘re-evaluating their strategic options’ in the category, fuelling speculation of some M&A activity – although Weisler said that HP Inc wouldn’t acquire any assets just for the sake of consolidation. A more likely scenario is for HP Inc to invest in growth areas such as 3D printing and try to use the current uncertainty at its rivals to its own commercial benefit.
News n Analysis
Growth challenge for HP Inc’s ink
Tribute
Industry past and present pays tribute to Tom Stemberg Tom Stemberg, who sadly passed away in October, meant a lot to a lot of people. Industry icons past and present share their memories of him
OPI
has asked current and former Staples’ executives, competitors and suppliers to offer their personal recollections and reflections of the legendary Tom Stemberg – how he changed the industry and what he meant to them.
Below is a rich array of often very personal anecdotes, observations and admissions. All of them confirm the indelible mark that Tom has left on the office products industry as a whole and on all those he came into contact with.
Ron Sargent Chairman & CEO, Staples I’ll always remember when I first met with Tom back in 1988. I asked him how many Staples stores there were. He said there were 15, but there would be hundreds someday. I asked him about profits and he told me that they were working on becoming profitable. I asked him about total sales and Tom told me that he hoped for total sales of $40 million in 1988, but he thought Staples could be a billion dollar company someday. I went home and told my wife: “Well, the entrepreneur thinks Staples can get to a billion in sales... I think we can probably get to half a billion.” Almost 28 years later Tom’s company is over $22 billion in sales. Tom was the rare entrepreneur who could come up with a great idea and could also execute it successfully. He was a visionary and a giant of our industry. On a personal level, he cared deeply about others. Tom was a great friend to many of us at Staples, and a great mentor to me. To everything he did, Tom brought tremendous energy, passion and, of course, a sense of humour.
Jay Baitler Former EVP, Staples Contract I worked for Tom Stemberg for well over a decade, but never fully appreciated his genius until I didn’t work for him any longer.
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There are few people in history who through the sheer power of their vision and insight totally reinvent an industry. Henry Ford, Alexander Graham Bell, Thomas Edison… and Tom Stemberg. He single-handedly drove the highly fragmented office products industry into the twentieth and twenty-first centuries. His sense of humour was cutting and hysterical. He was once asked at an investors’ conference 25 years ago how he felt being the father of the office products superstore industry when there were 10-15 copycats at that point. His instantaneous answer was: “I should have used a condom!” He had no patience for pretenders or phonies, but infinite wisdom to share with those of us who surrounded and learned from him.
Jamie Fellowes Chairman, Fellowes It was a sad day for our industry when we learned of Tom Stemberg’s passing. More than anyone else, Tom was the ‘game changer’ for our industry. His launch of the first office products superstore in Brighton, Massachusetts, in 1986 changed the success paradigms for every segment of the industry. Tom was a ‘one-off-the-mould’ kind of character. I have never met anyone more competitive and driven. He was brilliant and opinionated about most things. At one of his vendor shows in the early days, I listened to his detailed instruction of what
OPI Magazine | December 2015/January 2016
the world needed in the way of a 5.25-inch diskette tray! Ours was apparently all wrong...! After growing the business to substantial levels, he remained nevertheless a ‘ground level’ executive with a great command of the details of the business. He had a vision of what a great business looked like and he drove it. He remained accessible to vendors and especially warm-hearted to those who had been with him from the beginning. He once flew in to speak to our global leadership team: he was in and out in a couple of hours, leaving the audience spellbound. I have always admired Tom for his selection and partnership, and ultimately his CEO succession to Ron Sargent. Here were two strong individuals with very different make up and temperament. Tom understood what his business needed to be successful for the future and turned to Ron for next-generation leadership.
Mike Feuer Founder, OfficeMax Tom Stemberg was unique, to say the least, but in a good way. He wore many hats and had numerous faces and changed them as frequently as others change socks. He combined street smarts with academic knowledge and produced one of the great retail and direct-to-business powerhouses in the world.
for a dinner to discuss the world’s business problems; in Cleveland when he was traveling in the Midwest or in Boston and New York City during my travels on the East Coast. Never once, however, did we discuss merchandising, pricing or vendors. Setting aside the ethical and legal issues, it was most likely because neither of us, God forbid, would ever want the other to know if he’d been outdone! I liked and respected Tom a great deal and even enjoyed our theatrical and wildly exaggerated adversarial relationship in public. On a personal basis, over the years we called upon each other for non-business favours and to further good work, charitable and otherwise, for the industry. During our halcyon days we both thought we were legends, at least in our own minds. Tom, however, is now truly a legend in the business for having created an industry, tens of thousands of jobs and wealth for many, including his competitors, and for giving all of us the idea to enter an industry which was previously never envisioned. Tom did much to improve the world, displaying his commitment to charitable activities and having the gumption to support those political candidates and causes that he thought would truly make a difference. Many owe much to Tom, including me. Rest in peace, Tom Stemberg, you sure had a hell of a run.
Todd Krasnow Success has many fathers, and Tom would have been the first to credit the men and women whose contributions helped Staples become a great company. There were early investors who risked capital on his idea; landlords who risked tying up their space for an unproven start-up; early employees who risked careers; suppliers who took risks in supporting a venture that threatened the industry’s status quo. These risk takers, entrepreneurs in their own right, each helped to make Staples what it is today. But only Tom Stemberg brought us all together. And only Tom had the vision, drive and force of personality to inspire us to build such a remarkable business and change our corner of the world. I am grateful to Tom for the opportunities he opened for me and for the trust he had in me to be part of his great adventure. It was an honour to work with him and to be his friend. Todd Krasnow was part of Staples’ original management team and was EVP of Sales and Marketing until 1998. He and Tom subsequently partnered in other businesses, including most recently with Highland Consumer Partners, an organisation Tom founded in 2007 when he worked for Highland Capital Partners.
Jack Miller & Harvey L Miller Former owners of Quill In Yiddish we would say that Tom was a real ‘mensch’ – a real man; someone who stood by his word and who always did the right thing. We knew Tom through business, following him from when he first started Staples through to when they bought us (Quill). We then invested with him when he went into the private equity business. In all of our dealings, Tom was straightforward, a man of his word and someone we grew to respect a great deal. With his shirt tail flying and his aggressiveness showing, Tom was always at the top of his game when pursuing a goal. He was a true entrepreneur and the world was better for his having been here. Much more you cannot ask. To read all the tributes, please visit opi.net/tomstemberg w w w.opi.net | OPI Magazine
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Tribute
According to folklore, Tom, the co-founder and CEO of Staples, and I, the co-founder and CEO of OfficeMax, were arch enemies and more than once allegedly had ‘High Noon Shootouts’ at the OK Corral. Yes, we had our differences – but that was normal in a then meteorically-growing and fiercely competitive industry. Fur flew many times between us, particularly during the 1997 attempted merger between Staples and Office Depot. Tom’s job was to get his deal done, and my mission during this tumultuous game-changing period was to protect OfficeMax’s market position and act as an opportunist to take advantage of the situation – which I did, much to the chagrin of Staples’ supporters, especially Tom. Tom and I had many conversations after that failed merger and frequently acknowledged to each other that we were doing the right thing for our constituencies. Retrospectively, after the smoke had cleared and emotions subsided we had many a good laugh about our respective tactics in the heat of battle. We were competitors and over the years we had a few side bets about who could outdo whom. The loser wrote the cheque and the winner, of course, framed the cheque, but always gave the money to charity. On a personal level, Tom and I met many times over the 16 years when I ran OfficeMax and the relationship continued thereafter. Most times, this meant secretly sneaking away
News ■ And finally...
Comment This month, OPI asked some major players in the facilities management (FM) category if there is any untapped potential in the sector and what dealers can do to realise that potential. Below is a selection of answers. (For a full investigation of the FM sector, read the Category Analysis on page 44) In the past eight years, the office supply channel has taken over $1.7 billion in market share within the overall facility and breakroom solutions category. To continue this solid growth, dealers need to engage with business development managers that are solely focused on this category in order to understand where easy opportunities are. Dealers should also take advantage of available training as this provides an inexpensive way to become category experts. John Molidor, Merchandising Manager, Facility and Safety, SP Richards There is a compelling ‘one-source solution’ positioning that independent resellers can offer their customers for FM products in a very broad range – from cleaning to breakroom to safety, pack and ship, and other MRO items. Successful dealers are navigating the balance between total costs to serve and needing item-level pricing to compete. They tap into a multitude of purchase options to strike that right balance in their sourcing strategies. Dealers also need to overcome their fear of presenting FM solutions to their customers. Jeff Bobroff, VP of Merchandising, Essendant
12%
Percentage of students in the US that confessed to eating in the washroom
39%
Percentage of employees who admit that they do not shred work documents when working remotely
40%
Workers who are incapable of checking email before drinking a cup of coffee in the morning
$13 billion Estimated worth of the global market for green and bio-based solvents by 2020
TWEET CHAT follow us on Twitter @OPInews, @andy_opi
@REVL_world How not to create a meeting table... #startuplife #officefails @Maintenance_Mag William Faulkner: Famed Author and Physical Plant Manager? #facilitiesmanagement @kevinolearytv Landing in #lasvegas to address #entrepreneurs at the #ISSA conference. Talking about building businesses! @Circumspect4 Workers say better #breakroom, free #coffee, room to #recharge would help job #burnout
SNAP SHOT Who knew that the rich and famous were so into cleaning and hygiene? At the 2015 ISSA/INTERCLEAN show, a whole host of celebrities turned up in Las Vegas. Some, including Jay Leno and Kevin O’Leary, addressed the attendees, while others such as Elvis decided to mingle with the crowds. (See a review of the ISSA/INTERCLEAN North America show on page 37).
Dealers that want to stand out from their competitors should put a focus on promoting the health and wellness benefits that using natural cleaning products can offer. A growing segment of their customer base will give the edge to firms that offer a well-rounded green solution. Michael Hall, National Sales Director, Seventh Generation Many resellers have already identified FM as a new business opportunity. However, there is still a lot of room to grow and improve the product portfolio. FM applications are often driven by solutions, not by products; therefore long-tail products are a major competitive advantage. Falk Butterwegge, Head of Office Supply, Stationery & Online, tesa Clearly, there are opportunities. It’s just looking at what else the customer is buying. Period. In 1992, when Viking was getting going, I remember saying that I’ll supply them pickles if they want them. They didn’t, but the principle still applies. Geoff Betts, Managing Director, Stewart Superior
Don’t forget to take part in the discussions on the OPI LinkedIn page 16
OPI Magazine | December 2015/January 2016
opi.net poll results Resellers, which of these facilities categories is growing the fastest for you?
Cleaning 58%
Coffee 9% Safety 0% Warehouse supplies 6% We don’t sell these product categories
27%
Big Interview | Jeff Whiteway
Put on the SPOT Jeff Whiteway has had a challenging 16 months or so after the coming together of OfficeTeam and Spicers in the summer of 2014. OPI’s Steve Hilleard caught up with Whiteway in London to find out exactly where the priorities lie right now for the SPOT Group CEO
IT’S
only been a couple of years since OPI interviewed Jeff Whiteway, but how times – for him as well as the industry at large – have changed over that period. He’s still in charge of large dealer/contract stationer OfficeTeam, but Whiteway now also wears the additional hat of Spicers chief and indeed SPOT Group CEO. It hasn’t been all plain sailing for OfficeTeam, of course, as recent H1 results have shown. But the main concerns – and the dominant talking point of this interview – remains with Spicers, not least because, in revenue terms, it constitutes the larger part of the combined Spicers/OfficeTeam entity. In addition, as Whiteway freely admits, the wholesaler’s problems have lasted longer and are more profound than was perhaps expected and plenty of work remains to be done.
banks ownership and for sale. In so doing, they brought in a management team who had much needed industry experience. It was an inspired move because clearly there are a great deal of synergies between Spicers and OfficeTeam. Also, Office Team was a major customer of VOW at the time, so was always going to bring in some extra business. The deal was done at the end of July 2014. Trading to August 2014 Spicers showed a trading loss of almost £40 million. The period September to December 2014 saw the loss reduced to a run rate of £1 million a month, so £12 million annualised. It all made sense on a bigger scale too. It started to address a failing company and one that was very important as – we’d all agree – the UK needs two strong OP wholesalers.
OPI: What actions did you need to take to reverse the situation? OPI: Let’s start with the circumstances JW: The first thing we had to do was get some that led to the creation of SPOT in the working capital into Spicers. The £80 million summer of 2014. that Better Capital invested in OfficeTeam JW: Well, leading up to August 2014, was just the start. They have since invested Spicers had obviously got itself into a huge another £20 million into Spicers so we could pickle, mainly based around the move into buy stock. The service levels weren’t going the Smethwick warehouse, which was an to get any better until Spicers invested in unmitigated disaster that affected both very significant levels of the right stock. The service levels and dealer confidence. finances before the acquisition didn’t allow It took a long time to sort out. Indeed, them to do that. by August it still wasn’t sorted and Better Capital, having bought Spicers at an OPI: But Better Capital could have just attractive price [£32 million/$48 million] invested that working capital without in 2011, had seen major losses coming acquiring OfficeTeam, couldn’t it? through. It had two choices: either walk JW: It would have been a bold move to invest away from its investment in Spicers or take another £20 million into a failing company a bold step and do something imaginative. run by interim directors in virtually every The latter was to buy OfficeTeam which, major position. Better Capital needed to be having been sold for £163 million in 2007, sure there was a management team that was just weeks before the financial crisis hit going to spend that money wisely and had a the economy, was under a consortium of good chance of turning the business around.
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SPOT Group | Big Interview
OPI: Other than acquiring additional inventory, there were some significant changes to your structure and the team. What was the overriding aim? JW: Taking costs out of Spicers. First of all, we eliminated some significant expenditure with the interim directors who had been employed for some time at fairly fancy rates. But we also had to drive cost out of the logistics side. I’m a true believer that the best way to reduce costs is to have the highest levels of service. Take an order for 100 lines and deliver 100 lines and your costs can’t get much lower. A second or third delivery always duplicates a good degree of expense as well as delivering a poor customer experience. You can imagine how many duplicated costs were at Spicers when service levels were 80%. The main challenge was to get availability up and make sure we reduced those duplications of costs. OPI: What were the fill rates at their worst? JW: It went right down and for a short period hit sub-60%, but on average it was about 70-80%. OPI: Where are you now? JW: We’ve been disappointed in recent weeks because of a slight decline in availability. We’ve just had three fairly major suppliers go bust on us on own brand products, which has hit us, while some other suppliers also haven’t been hitting their fill rates. I don’t believe we are alone in these areas. We’ve taken a step back from achieving 98% and at the moment we are on average at 96%. Dealers test our service levels in different ways: a stocking dealer will look at our long tail whereas a stockless dealer will focus more on our A lines. In truth, both types of dealers have been affected and aren’t where they should be, but we have short-term plans in place to get the 5 Star service levels back up to in excess of 98%. It’s a key focus area and we’re not where we need to be. OPI: You referred to the situation with Smethwick as ‘an unmitigated disaster’; it sounds like Spicers’ foray into managing the own brand programme through own personnel in the Far East was also fairly disastrous. JW: It was and we closed the Shanghai office. The 5 Star brand that we source from Asia is key for us in terms of availability – being out of 5 Star products for us is like a pub being out of beer. As such, my immediate target of 98% fill rate that I just mentioned isn’t really high enough; it needs to be 99%+ and it will be.
“Being out of 5 Star products for us is like a pub being out of beer”
OPI: Smethwick was one of the root causes of the implosion of what was once a great business. What’s the current situation there? JW: The old Smethwick dealer distribution centre (DDC) part is completely fallow at the moment. The regional distribution centres (RDCs), following investments made, are handling the dealer distribution business effectively. We are busy taking all the old equipment out and we have a thoroughly detailed and well-managed plan to put the site back into operation at some stage.
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Big Interview | Jeff Whiteway There’s no rush and no pressure from Better Capital to get that going quickly – we did fast before and failed spectacularly. OPI: What about market share? Given the numbers that we’ve seen from your primary competitor, you seem to have lost some. How concerning is that decline? JW: Spicers’ problems certainly were to the benefit of VOW and also of other pseudo wholesalers such as Antalis and Exertis. We gave them an easy run throughout 2014 and during the early part of 2015. Our sales force was completely on the back foot, occupied with keeping existing dealers rather than looking for new ones. After all, what dealer would have actually come to Spicers and opened up a new account in 2014 when we couldn’t even deliver basic stationery! Over the past ten weeks or so we have won 14 new dealer customers – that’s pretty much the first new customers in two years. Spicers has removed all of its direct-selling sales people it historically had and now only sells through the trade. The elevator pitch for our sales people is that we want to help dealers grow. Spicers itself cannot grow unless we help dealers grow. Aside from offering a very efficient supply chain of moving boxes, we also want to help them sell a much wider range of products. Now Spicers employs sales people whose sole job it is to work with supporting dealers to help them bring the expertise into their business that will allow them to sell that expanded range.
OPI: Are they conversions from VOW? JW: Yes, mainly VOW. But of course, we lost an awful lot of customers in 2014 and the early part of 2015. OPI: Where would you like to end up next year, just looking at Spicers for now? What would be a reasonable performance in terms of top and bottom-line growth? JW: I’m thinking very much about bottom-line growth for now, given the huge loss that Spicers was making. We’ve turned it around nicely this year, but Spicers will still struggle to post a profit. Turning a business round that recorded a near £40 million trading loss in August 2014 was always going to be a challenge in the short term, but 2015 will show just a marginal loss assuming December is its normal loss-making short trading month. And in 2016 we are budgeted to move Spicers back into profit. In terms of the top line, we have to first of all be completely focused on maximising spend of wallet with existing dealers and, in so doing, helping them reduce their cost to serve. Next comes winning business back, and that trend will accelerate during 2016 and into 2017/2018. OPI: What stands Spicers apart from VOW now, given that both are multichannel businesses? You can’t play the trade-only card any longer. JW: I disagree – Spicers is absolutely trade only. SPOT obviously owns OfficeTeam as well, but there is a very strong Chinese wall between Spicers and OfficeTeam in terms of sales.
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“Spicers’ problems certainly were to the benefit of VOW and also of other pseudo wholesalers such as Antalis and Exertis”
OPI: You’re talking about adjacent categories, I presume? JW: Yes, categories like facilities management. We need to have people – ex Bunzl/Arco for instance – who live and breathe that type of product, who get excited about 460 different types of toilet rolls. These people can really help dealers get into that market. MPS is another area we’re moving into. By the time this issue of OPI is published, we’ll have signed an agreement with Xerox to help dealers move into the MPS market. Historically, the wholesalers have hooked up with a third party; we’ve just moved into dealing directly with a leading and highly respected OEM. OPI: I seem to remember that a few years ago at OfficeTeam you weren’t that bothered about the MPS opportunity... JW: You could well be right. I didn’t see at the time how a dealer could compete against the likes of a Danwood, for example. And I still
SPOT Group | Big Interview think now that we need to have some real credibility and not just try to sell the concept of MPS when we haven’t got the infrastructure to back up our claims. Xerox gives us that. OPI: Just going back to your toilet roll example. Are you going to help dealers acquire and recruit those people? JW: No, Spicers will be recruiting that talent to help dealers. There are a couple of rules to observe here: firstly, the sales person will never go into a dealer’s customer without the dealer representative also being there; secondly, if our sales person opens up that business to a dealer, we’ll expect that dealer to buy the product through Spicers. OPI: There’s still the perception that the traditional wholesalers are not competitive enough on the A brands in this category. JW: Historically that’s been absolutely right. It takes a decent balance sheet and a long-term outlook to break the vicious circle of ‘we haven’t got the volumes and therefore we can’t compete on price’ to an attitude of ‘we need the volumes to get a better price’. So we need to work back from the street price. That means we initially may have to work on tiny margins because of the small volumes. But once we have the big volumes, we’ll also get the price. OPI: On a last note about Spicers, how do you think its long-standing traditional dealers have been getting to grips with the new dynamic of being supplied by a group which does have a direct supply company inside it? JW: OfficeTeam has walked away from upwards of 50 end-user accounts where we’ve been made aware that either a Spicers dealer is the incumbent, or indeed where it’s very obvious that the dealer is a material 5 Star customer. It’s absolutely vital for us to get the message across that we’re not going to bite the hand that feeds us. Clearly, this needs to be within the constraints of competition legislation, but I believe we have put that early concern firmly to bed. OPI: What happens when a dealer decides to go prospecting one day, stumbles into an OfficeTeam account and bids aggressively for that business? JW: To the huge frustration of OfficeTeam there’s nothing they can do about it. Competition law dictates that Office Team can’t compete downstream with a Spicers dealer, but the same can’t be said for a dealer
competing with OfficeTeam upstream. So unfortunately, the OfficeTeam accounts are open for the dealer to attack. OPI: But you don’t say to OfficeTeam sales people that they have to back away and hand that business over? JW: No, absolutely not. They will compete and defend their existing business. OPI: Finally, what does the future hold for Jeff Whiteway? JW: SPOT’s development came at a wonderful time for me because it gave me a new challenge. Life under bank ownership was not ‘inspirational’ and we are now clearly starting along the path to actually move forward. The fact that this interview has been focused on Spicers and not OfficeTeam is pretty indicative of where my focus lies at the moment. The challenge for the SPOT Group and the real value lies in turning Spicers around and actually putting a decent bottom-line profit on it. And that’s what’s really piqued my interest – it’s a huge learning curve and, in a way, a completely different career for me and I’m enjoying it tremendously. Does it disappoint me that there are people in the industry who really should have retired by now, but instead prefer to say nasty things about what we’re trying to do? Yes, it does a little, but I find it amusing that when things were really bad during 2014 and criticism fully justified, how a little retainer payment each month ensured they’d say nice things about us – I’m sure it was a coincidence that, just as payment stopped, nasty started. I’m big enough to rise above it and move forward. OPI: Well said and on that note, thanks for your time today Jeff.
“I spend most of my time on Spicers because that’s where the majority of the work needs to be done”
For more exclusive content from the interview, such as Whiteway’s views on the UK’s dealer groups, the future of the BOSS Federation and more on OfficeTeam, please visit opi.net
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Hot Topic | Staples/Office Depot
Ready to slug it out Staples’ acquisition of Office Depot is in serious doubt, but the deal is not quite dead yet, explains OPI Editor-at-large Andy Braithwaite
AfTer
several days of intense media speculation ahead of its investigation deadline, the US Federal Trade Commission (FTC) filed an administrative complaint on 7 December to challenge Staples’ proposed merger of Office Depot, stating that the deal “would violate the antitrust laws by significantly reducing competition nationwide in the market for ‘consumable’ office supplies sold to large business customers”. At the same time, the FTC’s counterpart in Canada, the Canadian Competition Bureau (CCB), issued its own challenge to the merger, saying that it “would likely substantially lessen competition in the office products delivery business” in the country.
So why didn’t they? “The signs are that things turned hostile between Staples and the FTC,” one US-based antitrust expert told OPI, pointing to the 4-0 FTC Commissioner vote against the deal and the CCB weighing in with its own challenge. “It’s interesting that in its press release Staples referenced the $500 million in contracts that it was willing to let go,” he continued. “That is well under the divestiture cap [of $1.25 billion] that presumably Staples was comfortable with, so why was there no suggestion that they offered more? “It could have been gamesmanship on Staples’ part, they may have not been able to find a buyer for the $1 billion+ in contracts,
The likelihood of the acquisition gaining FTC approval rested on Staples and the FTC being able to agree on a ‘remedy’ in the large enterprise contract space Were these announcements a surprise? In a way they were because the consensus opinion from industry and antitrust experts – at least until a few days before the 8 December deadline – was that Staples and the FTC were trying to reach a solution that would satisfy the latter’s concerns. Given the fact that the transaction would not be able to close anyway until the European Commission completes its own investigation at the beginning of March, there was definitely an opportunity for Staples and the FTC to extend their deadline if they hadn’t found a mutually satisfactory remedy by 8 December.
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or simply there might have been a total brick wall and no level of divestitures would have satisfied the regulators.” As we have repeatedly stated in OPI over the past few months, the likelihood of the acquisition gaining FTC approval rested on Staples and the FTC being able to agree on a ‘remedy’ in the large enterprise contract space, where a combined Staples/Depot would have a virtual monopoly in the office supply category. On 16 November, we revealed that wholesaler Essendant had been linked with a possible solution involving $300-$500
Staples/Office Depot | Hot Topic million of contracts (see ‘Insight: Essendant to the rescue?’, opi.net), but even then doubted whether this would be enough to satisfy the FTC (see also ‘Analysis: Staples tight-lipped on merger progress’, opi.net 20 November 2015). Clearly, that was not a solution that satisfied the FTC, but Essendant may well still have a critical role to play in whether this acquisition ultimately goes through or not (see ‘Does Essendant still hold the key?’, page 25).
What happens now? The FTC has instigated what it terms as ‘administrative litigation’ proceedings. In a nutshell, this is an internal FTC legal process that will result in a trial presided over by an administrative law judge. The date for this trial has been set for 10 May 2016, but the chances are that this will never happen. That’s because the FTC needs to seek a preliminary injunction (PI) from a federal court to stop the parties from consummating the transaction before that 10 May date. The PI hearing will begin in March 2016 in the US District Court for the District of Columbia (Washington, DC) and is expected to take a couple of weeks. If US District Judge Sullivan grants the FTC its PI, then there is a strong possibility that Staples will walk away from the deal, similar to how the Sysco-US Foods transaction played out earlier this year. However, if the judge rules against the FTC in the PI hearing, it is most likely that the FTC will then abandon its case against the Staples acquisition of Depot. That’s why the PI hearing is crucial to the whole process. In a preliminary meeting before Judge Sullivan on 8 December, Office Depot’s legal representative Matt Reilly reportedly said as much, acknowledging that going through the drawn-out FTC administrative litigation process would “kill the merger”. At that 8 December meeting, Judge Sullivan encouraged the parties to try and reach a settlement. That’s still a possibility, but given the fact that the FTC and Staples already had the opportunity to extend their deadline – and didn’t – the issue is likely to be settled at the PI hearing in March. There is no doubt that the FTC is holding most of the trump cards. It just has to convince the judge that there is a “reasonable” likelihood that the transaction is anti-competitive. “The PI hearing is a pretty low hurdle for the FTC to have to clear,” OPI’s antitrust contact noted.
Independents buoyed by FTC decision Reaction from the independent dealer community in the US to the news that the Staples/Depot saga may drag on for several more months was understandably positive. Here are some of their comments: Mike Gentile, CEO, Independent Stationers “I was not surprised. The alleged ‘remedy’ was exposed to be not a remedy at all. EPIC Business Essentials will be the national/regional accounts model offering a centralised, turnkey solution that will enable dealers to maintain and acquire the right customers – customers that require the centralised and integrated services they receive today from Staples and Depot.” Mike Maggio, President, TriMega “Part of me always felt that Staples buying Depot did not make competitive sense if you understood the market, so it is not that big of a stretch in understanding the FTC’s rationale for blocking it. “My hope is that we can leverage the distractions facing both Staples and Depot into opportunities for independent dealers and EPIC Business Essentials which ultimately result in market share and revenue gains.” Dave Guernsey, CEO, Guernsey “I was not surprised. Until there can be assurances that enterprise customers will not be disadvantaged by Staples gobbling up the only remaining, viable competitor, I can’t see why the FTC will bless this acquisition. “End users weighed in aggressively and, I suppose, got the outcome they wanted, but there’s nothing definitive here except that we now go on to chapter two.” Bud Mundt, Executive Director, AOPD “I’m not very surprised since all the Fortune 1000 companies started voicing concerns about price increases if they [the FTC] allowed the merger. “If this [transaction] is denied, then I see Depot weakened considerably and perhaps it would be a possible takeover target for another company that is more suitable for the FTC.” That means the onus is on the Staples/ Depot legal team to convince Judge Sullivan that the FTC’s complaint is not valid. It will probably try and do that by showing that the FTC’s analysis of the market is “flawed” – as the companies contended in an open letter to customers on 7 December – or show there is a viable alternative in the office supplies marketplace in the enterprise customer channel.
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Staples/Office Depot | Hot Topic For the first of those points, the 2013 FTC statement on the Office Depot/OfficeMax merger will be a key argument. At the time, the FTC said that Depot and ‘Max faced “strong competition” from “a host” of competitors. The trouble, in addition to the fact that the 2013 FTC statement is not a binding document, is that Staples itself was the main competitor and customers still had the ability to play Office Depot and Staples off each other in terms of pricing. Customers have been much more vociferous in their opposition to the Staples/Depot merger, the FTC has shown. Staples and Depot cannot deny
that, together, they will have virtually all of the office supply contracts for Fortune 500 companies. With the FTC having taken such a narrow view of the market – sales of traditional office supplies to large businesses in the US – it looks unlikely that the judge would rule against the FTC on these grounds. This leaves the second option of demonstrating that a viable and sustainable competitor in this niche of the overall business supplies market does exist. That will still be a challenge: the FTC’s complaint asserts that “entry or expansion into the market – by other office supplies vendors, manufacturers, wholesalers or online retailers – would not be timely, likely, or sufficient to counteract the anticompetitive effects of the merger”. It may be a bit of a long shot, but that’s where Essendant could come in (see ‘Does Essendant still hold the key?’, below). The whole transaction – and even the very future of Office Depot – may depend on it.
Does Essendant still hold the key? Reliable sources have already confirmed to OPI that Essendant was involved in discussions to try and find a divestment remedy which would be palatable to the FTC and enterprise customers. While that proposed solution involving fulfilment services for around $500 million worth of contracts currently handled by Staples did not work out, Essendant still appears to have aspirations in the enterprise contract channel. In a note to clients, Jefferies analyst Dan Binder revealed that he had met with Essendant management at the beginning of December. “It is clear that Essendant will be pursuing this segment of the business in a unique way and doing it in a wholesale capacity whether there is a deal or not,” he wrote. “Essendant is poised to make investments in a number of areas to enable larger independent resellers to take share in the large
That could certainly present Staples with the opportunity to demonstrate that there is an alternative for large corporate buyers in the market, perhaps as a solution to take to the FTC before the March preliminary injunction hearing. An Essendant-run consortium could even possibly be a viable acquirer of a contracts assets sell-off. However, as Binder cautioned, there are no guarantees that Essendant’s strategy would work in practice, especially in the short space of time available for Staples to try and save the Depot acquisition. “Large accounts will need to get to know large resellers and Essendant better and grow comfortable with their capabilities, and that will take time,” he noted. “Secondly, accounts can easily move from one reseller to the next, so if Essendant does not execute well, accounts could just go back to Staples and thereby limit Essendant’s ability to grow and have an impact on the large enterprise market.” Nevertheless, Binder concluded that Essendant “may be building a good alternative to corporate buyers”. That could be why large dealers such as HiTouch Business Services have recently decided to make Essendant their first-call wholesaler. Whether this development has an impact on the final outcome of the Staples/Depot merger remains to be seen, but it would appear that large dealers – together with Essendant – are preparing to take advantage of the current market conditions and the future potential in the enterprise space.
“Essendant is poised to make investments in a number of areas to enable larger independent resellers to take share in the large enterprise business [space]” enterprise business [space],” he continued. “This will include technology, such as an e-commerce component that provides a front-end interface, a sales team, a customer care centre and last-mile delivery capabilities. “If Essendant combines this with its scale in purchasing, skill in merchandising, front-end support and national distribution, it could look a lot like a contract stationer. However, the key is keeping the resellers involved so that it maintains its wholesale status and avoids channel conflicts.”
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Dealer Spotlight | Rubanco
The right
connection
With an economy that is showing signs of a weak recovery, having a good relationship with a strong partner always helps, as Canadian dealer Rubanco knows only too well
by Michelle Sturman michelle.sturman@opi.net
FOR
a dealer that started life 36 years ago specialising in ribbons, typist accessories and dot matrix printers, pulling in annual sales today of C$12 million ($9 million) in a country with a relatively weak economy demonstrates the dogged Canadian je ne sais quoi. Based in Longueuil, just south of Montreal Island in the province of Quebec, Rubanco was acquired in 1995 by current Chairman
“If a customer needs something urgently, we will do everything we can to get it to them” of the Board Donald Forman and his wife Jacynthe Girard. Like many local dealers over the years, the business managed to keep pace with OP trends and now considers itself a specialist in office products and office furniture. However, despite keeping up with product developments, Rubanco has had to transform the company to deal with the wider changes in the business supplies industry. Initially, the reseller had two retail outlets, but the arrival of big box retailers in the province necessitated a strategic rethink of that business. Eventually, one retail outlet was integrated into the other in the late 1990s, but this was not enough. The remaining store was closed in the late 2000s
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and the reseller shifted its focus to serve the B2B market exclusively. Since then, Rubanco has been successfully supplying businesses, institutions and government departments.
Fierce competition While this was clearly the right move, the company still faced competition from the big boxes. As Rubanco President and Managing Director Guillaume Baril explains, the business model at the time – and still to this day – is based upon the principle of customer service excellence. “If customers need something urgently, we will do everything we can to get it to them; if customers have ordered something they don’t want, we will take it back, no matter how or when it was purchased,” he says. It is exactly these attributes that have enabled Rubanco to meet the customer
Rubanco | Dealer Spotlight requirements that the big box retailers could not, and differentiated the company within the highly competitive marketplace, according to Baril. He adds that its intense customer focus has helped to grow both sales and margins, even though Canada as a whole remains in economic difficulties – Quebec is only forecast GDP growth of 1.3% in 2015 and 1.9% in 2016. Maintaining contact with customers, providing real business solutions, and a one-stop shop approach has also helped Rubanco weather the storm. The trick is to accept and acknowledge limitations, says Baril. Therefore, with a staff of fewer than 40, it’s no surprise that Rubanco has been selective with the services it has decided to extend to customers. As a result, part of the one-stop shop strategy has been to partner with expert service providers to offer customers with a full array of solutions, including IT and social media. Environmental responsibility is also at the heart of the company, with a number of initiatives that make the organisation a ‘model citizen’. Rubanco offers ink cartridge and battery recycling and is an authorised Electronic Products Recycling Association drop-off point in Quebec. In addition, Rubanco has set up an education and awareness programme for its customers to encourage the use of paper products approved by independent organisations such as the World Wildlife Fund and the Forest Stewardship Council.
The real deal
Rubanco – known also as Rubanco | BuroPLUS – was one of the founders of BuroPLUS back in 2000. BuroPLUS is the largest network of independent retailers in eastern Canada and one of two dealer groups under the Novexco banner. In fact, Rubanco owner and former President Donald Forman was Chairman of the Board at Novexco for almost ten years before retiring from the position in 2011. Rubanco values the BuroPLUS brand for a variety of benefits it offers, including national advertising campaigns and the ability to bid on government tenders. In March 2015, Rubanco revamped its own website www.rubanco.com. Taking advantage of Novexco’s e-commerce abilities and common platform, transactions run through the BuroPLUS e-commerce platform www.buroplus.ca.
Part of Rubanco’s success must be attributed to its long and close relationship with wholesaler Novexco
Solid relationships The business has expanded over the years, mostly through organic growth, although it has acquired a few B2B distributors along the way. This growth necessitated a change of premises a few years ago, and with office furniture accounting for 20% of total sales, it opened a state-of-the-art office furniture showroom focusing mainly on ergonomic chairs and tables. Part of Rubanco’s success, however, must be attributed to its long and close relationship with wholesaler Novexco, which remains one of its biggest partners and suppliers. Initially, the reseller was involved in a wrap-and-label deal with the wholesaler, although it now procures a high percentage of stock direct from manufacturers and has its own distribution centre. Having said that, Rubanco also takes advantage of Novexco’s sophisticated distribution facility in Laval,
Rubanco fact box: Founded: 1979 HQ: Longueuil, Quebec Managing Director: Guillaume Baril First-call wholesaler: Novexco Geographical coverage: Quebec and Ontario Business model: B2B; stocks 1,500 SKUs in-house with access to around 15,000
just north of Montreal, which allows it to quickly source and provide over 15,000 SKUs to its customers. The relationship with Novexco has developed over many years and the reseller has remained part of the wholesaler’s BuroPLUS network of independent dealers since the very beginning. The BuroPLUS affiliation is vital, according to Baril, as it supports the business with marketing initiatives, IT deployment and part of its e-commerce streams (see ‘The real deal’, above). Looking ahead to the coming year, Baril expects the value of the Canadian dollar versus the US dollar to provide relief for Canadian exporters and therefore employment in the east of the country. The focus for Rubanco, he adds, will be in categories such as traditional office supplies. Baril sees plenty of growth opportunities in this segment in particular, due to its geographic proximity to Ontario, Canada’s second largest market. The company also remains on the lookout for potential acquisition targets, he concludes. w w w.opi.net | OPI Magazine
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Special Feature | Dealer Services
Independently driving growth
Focus7 International aims to help dealers in the UK become a real sales and marketing force in the digital arena. OPI’s Heike Dieckmann spoke to Managing Director Vida Barr-Jones to find out what Focus7 is all about and – importantly – what makes it unique and necessary OPI: In a nutshell, what is Focus7 International? Vida Barr-Jones: We drive sales growth for dealers by generating leads, converting prospects and nurturing customers to ensure their long-term profitability. We see a big gap in the OP market. Resellers are not proactive enough in their marketing and as a result they struggle to generate new business. Most of the industry’s marketing is produced by wholesalers or dealer groups, so lacks individuality and creative differentiation.
We each bring complementary and diverse experience and expertise to the table. My background is predominantly corporate at board level, having served on Spicers’ board for over 11 years. David brings 25 years of experience of creating and developing businesses, mostly from the vantage point of the independent. Leona, meanwhile, has a strong leadership background, having served as an officer in the Army before forging a successful career as a business growth advisor, specialising in change and transformation.
OPI: How is Focus7 set up and financed? VBJ: Focus7 International comprises Focus7, Barr-Jones Associates and FocusPoint Geeks. But we really go to market as either Focus7, which incorporates all the elements of our three brands, or as FocusPoint Geeks which concentrates on CRM with some marketing support. Three equal equity partners form the core of the Focus7 board – Sales & Marketing Director David Langdown; Operations Director Leona Barr-Jones and myself as Managing Director of the company. We have set the business up with personal funding and we’re well-funded and secure.
OPI: So what’s your core premise? VBJ: Focus7 offers a holistic business development journey, which comprises seven standalone modules. At the heart of what we do, the FocusPoint as it were, is our CRM software platform. We are Infusionsoft-certified partners, which means that we are qualified to sell and train the software. Infusionsoft is a fully-automated three-in-one CRM system that provides database management, automated sales and campaign marketing. It essentially brings all of the clients’ activity and customer data together in one place.
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Vida Barr-Jones
We offer a totally managed and bespoke service for our customers. For instance, for companies that like the CRM solution but want to create and manage their own campaigns, we make the software and a range of training solutions available to them through FocusPoint Geeks. OPI: Who is your target customer? VBJ: We are multi-market, but the OP reseller channel is currently the biggest part of our business, essentially because that’s where our background is. For Focus7, we would typically work with dealers turning over a minimum of £1 million ($1.5 million) that need help with customer acquisition or are looking for growth from within their existing customer base. FocusPoint Geeks packages are relevant for smaller
Founded: June 2015 Managing Director: Vida Barr-Jones Locations: HQ in Weston, Hertfordshire; creative/telemarketing in Selby, Yorkshire Staff: 20 in total
Dealer Services | Special Feature businesses or even start-ups. We also see opportunities to work with manufacturers, wholesalers, distributors and charities in other industries that want to amplify their product ranges or services. The basic premise is that we’re looking to help companies that want to sell products or build relationships in the online world – in any industry. OPI: There are quite a few other business service models in the UK market, all aimed at helping dealers in one way or another. How are you different? VBJ: Firstly, we are truly independent, not aligned to any wholesaler or dealer group, and every programme or solution we create is unique to the individual customer. We are financially independent, charge on a commercial basis and are not benefitting from any rebate schemes. We are totally committed to delivering the Focus7 programme and are not distracted by other activities. Secondly, we work with customers at the front end. Other service models offer dealers a managed back-office solution, so dealers can concentrate on selling and marketing. But there’s a massive assumption that dealers actually know how to do sales and marketing and that they can work in a digital environment. Often they can’t. In essence, we provide resellers with a front-end digital communication and marketing tool to win business and to keep business. That’s not what any of the other service models in the UK OP industry are about. Many dealers speak a lot more
frankly with us because we’re not aligned to anyone. We’re not recommending anybody like VOW or Spicers, and of course we’re also not leading them down any particular path as far as products are concerned, in terms of category or manufacturer. As such, we are not limiting them in any way. On top of that, we can help dealers – and many really appreciate this – to move out of the limitations of their existing supply chain. Dealers recognise that one of their fastest-growing competitors is Amazon, but they haven’t yet responded to how this pure online player goes to market. Amazon is a data-driven business. Dealers, meanwhile, still have lists and multiple Excel spreadsheets, and the most important information on a customer is in their heads. This prevents any form of proactive nurturing and digital marketing. There are also a large number of dealer owners starting to look for an exit strategy and realising how little value there is in their business because it’s in their database and customer relationship and they cannot quantify or demonstrate either.
to the channel, which means dealers that are used to being funded by wholesalers and manufacturers are now being presented with a business growth service they have to pay for themselves. There is a view held by many that dealers won’t pay for anything and I am pleased to say that this is not completely true. We are working with a number of progressive and proactive independents that understand the need to invest in developing their business and they are perfectly willing to do so. They are now seeing a return on investment and return on engagement that justifies this action.
OPI: You mentioned the commercial aspect. That’s something else that differentiates you and that has raised a few eyebrows, hasn’t it? VBJ: Initially it can do, but the opportunities far outweigh the challenges. We are bringing a different model
OPI: Lastly, the ‘international’ in the name suggests expansion plans – are you thinking of taking the concept abroad? VBJ: We are not limited to the UK and there’s no reason why our services would not work as well in many other countries. We are already in discussion with a number of potential customers in Europe and we see real opportunities there.
OPI: How would you describe your current momentum? Which of your services is seeing the greatest take-up? VBJ: We are making good progress with a number of high profile customers and have a very strong pipeline. Our most popular solution is a combination of the CRM software with managed e-marketing and telemarketing support. You need to create brand awareness and then drive that throughout everything you do. Most big companies do that; small ones, more often than not, don’t. You have to be visible with your sales and marketing today and that means you have to have a digital presence. If your potential buyer can’t see you in the e-world, then you’re simply not there.
w w w.opi.net | OPI Magazine
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GHS Labelling Compliance | Special Feature
A chemical reaction Technical writer Del Williams explains why managers in charge of safety, purchasing, facilities or operations must now ensure that chemical labels are GHS compliant
THE
Globally Harmonized System of Classification and Labelling of Chemicals (GHS) was established by the United Nations to create a unified system for identifying and communicating hazardous chemicals. The Occupational Safety and Health Administration (OSHA) set a June 2015 deadline for chemical manufacturers to use GHS-compliant labels, followed by a December 2015 deadline for distributors, and June 2016 deadline for end users. Chemical manufacturers must re-classify hazardous chemicals based on a common chemical classification system defined by GHS. Both manufacturers and distributors have to ensure the hazardous chemicals sold have GHS-compliant safety data sheets and labels.
In place of the familiar black and white pictogram symbols previously used in safety labelling, it is important for environmental health and safety managers to realise that GHS labels now require pictogram symbols that convey hazard information with a red diamond border. Implementing GHS labelling can seem daunting, particularly to SMBs, but it does not have to be. While large organisations can hire integrators to automate GHS software with a bank of printers tied into high-end ERP infrastructure, smaller businesses do not require this approach. Instead of investing in costly, dedicated printer/label/software systems, SMBs can ease the transition to GHS label compliance. Many are turning to flexible, lower-cost options such as industrial-grade
Implementing GHS labelling can seem daunting, particularly to SMBs, but it does not have to be Employers that have hazardous chemicals in the workplace, meanwhile, need to have safety data sheets and labels for their exposed workers, and train them to handle the chemicals properly.
Labelling requirements On each GHS label, six specific items of data are required: product name or identifier; hazard statement; signal word; GHS pictogram symbols; precautionary statement; and supplier information.
labels from Avery that allow for the printing of durable GHS labels on demand with existing laser printers and certain inkjet printers. Avery has recently expanded into the industrial market and developed industrial-grade labels designed to be GHS compliant. Unlike standard labels, industrial labels are used in harsh environments like warehouses, manufacturing facilities and in the field, so must be more durable and able to withstand exposure
to chemicals, abrasion, tearing, moisture, sunlight and extreme temperatures. The challenge, however, is that to be GHS compliant, labels must stay reliably affixed without fading or becoming unreadable despite harsh indoor or outdoor conditions including during international shipping. This requires not only a durable label substrate but also a marine-grade adhesive.
Making it stick As such, Avery designed its UltraDuty GHS Chemical Labels to meet the most rigorous GHS requirements. The durable synthetic labels are chemical, tear and abrasion-resistant, and constructed with a marine-grade adhesive that is waterproof and passes a 90-day seawater submersion adhesion test. Unlike typical labels, which crack and harden in harsh conditions, they are UV-resistant with over two years of outdoor UV life. They are temperature-resistant and can be applied at temperatures of as low as -12°C, but also as high as 150°C. To help companies stay compliant with GHS and other regulatory situations, Avery has partnered with chemical compliance and information specialist RightAnswer. Through a portal in Avery’s website, RightAnswer offers access to over 100 proprietary, government and EHS data sources, with over 11 million documents covering more than 400,000 chemical substances. Del Williams is a technical writer based in Torrance, California. He writes about business, technology, health and educational issues. w w w.opi.net | OPI Magazine
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Vendor Focus | Pilot
n e p e h t f P o w er o
Dr Michael Kaschak and Pilot Pen’s Director of Marketing Ariann Langsam explore the place of handwriting in the age of digital technology
YOU
might think that the digital age would eventually make both handwriting and writing instruments obsolete. However, recent studies have shown that many individuals value handwritten communication more now than ever before. Most people are not just enjoying the physical act of writing, they are benefitting from the more subtle neurological effects that range from cognitive gains to the greater emotional well-being. The myriad benefits of writing by hand keep this form of communication and self-expression not only relevant, but also necessary. In a recent study fielded by Pilot Corporation of America (Pilot Pen), 86% of individuals surveyed reported that they prefer handwriting over typing when composing a personal communication. The driving factor for these handwriting loyalists is intimacy – survey results indicate that 68% of respondents agree that they feel ‘closer or more intimate’ when handwriting a personal note versus typing the same message. Since each person’s handwriting is as unique as a fingerprint, the recipient can instantly recognise the handwriting and feel the closeness of that relationship.
Neurological benefits Writing by hand has a variety of neurological benefits across all phases of life, ranging from greater information retention in the classroom to higher productivity in the workplace. The act of writing helps us to organise our thoughts and tasks, so it’s not surprising that 80% of those surveyed prefer to handwrite their to-do lists, with 53% “agreeing completely”, that it makes them feel more productive. Also, 59% of people surveyed felt they retain more information when they handwrite class or meeting notes, indicating that in
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OPI Magazine | December 2015/January 2016
true working memory tasks, handwriting is not only a motivator, but a memory aid. It’s a proven method to help the brain integrate complex thoughts and create positive results for both practical and creative tasks. There is a growing body of research that highlights handwriting’s unique relationship with the brain with regard to composing thoughts and ideas. It suggests that picking up a pen, rather than using a laptop, can help individuals and especially students reap advantages in reading comprehension, information retention and time management. The foundation of Pilot’s Power to the Pen marketing campaign lies in connectivity and benefits offered by handwriting. We believe in the power of the written word and that the pen is more than just a functional tool – it’s an instrument that can help inspire change. That’s why we have partnered with STOMP Out Bullying*. One in four kids is bullied, and 8% miss at least one class per month for fear of bullies. We need to help empower our children to take a stand. We can’t think of a better way to use the power of the pen. A percentage of proceeds from sales of Pilot’s FriXion Clicker erasable gel ink pen is helping to fund STOMP Out Bullying’s educational and support programmes to “erase bullying” behaviours in US schools. At Pilot we embrace the ongoing relevance and importance of writing, along with the need for new and innovative writing instruments that deliver unsurpassed quality and an exceptional writing experience. The true power of the pen is that it allows us to learn, communicate, express ourselves and connect in a way that no other medium can offer. We remain committed to helping to write the next chapter in this digital age.
We believe [...] the pen is more than just a functional tool
Pilot | Vendor Focus
Even collegeage students can benefit from handwriting
Handwriting and literacy development Learning to read is an academic milestone that has important, lifelong consequences. Children who fail to develop literacy skills tend to perform poorly in school, and grow up to face limited career prospects1,2. Reading to preschoolers and engaging in activities to build their oral language skills can contribute to the successful acquisition of literacy skills’. According to a recent set of studies, learning to handwrite letters also has a role to play in fostering a child’s transition to literacy. Dr Karin James and her research group have conducted a series of experiments examining the role of handwriting in the development of letter perception3,4, which is an important component of literacy skill. Brain imaging studies conducted on adults have identified neural circuitry that is involved in the processing of letters and words3. Dr James and her colleagues reported that the same neural circuitry is involved when preschool children process letters, but only when the children had experience printing the letters. Children who learned about the letters by typing, as well as children who were exposed to the letters through other means, did not show activity in this circuitry3,5. This means children who learn about letters through printing seem to integrate knowledge of these letters into the developing ‘reading system’ in the brain. Dr James has an intriguing hypothesis about the benefits that printing can have for developing readers3. Skilled readers need to be able to recognise letters in whatever form they are encountered. For example, you need to be able to recognise a letter whether it is written in uppercase or lowercase, whether it is typed or handwritten, and regardless of the idiosyncratic features of the font or handwriting you are reading. This skill requires readers to recognise the core features of the letters, and to ignore those features of the letter that do not affect its identity (eg think of the difference between an ‘b’ when it is printed, used in cursive writing or typed in different fonts). Printing is a fine motor skill that requires time to develop, and thus children’s earliest efforts to print letters will tend to be imperfect. Dr James suggests that the production of imperfect letters helps children to learn which features are important to the recognition of that letter, and which are not3. Giving children the opportunity to produce letters, and to do so imperfectly, might therefore be a useful way of facilitating the development of key literacy skills. Learning to read is a complex task and the successful acquisition of literacy skills is affected by many factors. Nonetheless, there is a growing body of evidence suggesting that handwriting practice, particularly in the preschool and early elementary school years, may provide children with benefits in learning this vital skill.
Handwriting and learning The benefits of handwriting do not stop in the preschool and early elementary school years. A recently published study by Pam Mueller and Daniel Oppenheimer suggests that even college-age students can benefit from handwriting6. In a series of experiments, Mueller and Oppenheimer presented students with lecture material and gave them the opportunity to either take handwritten notes or use a laptop. The key finding of these experiments is that students who took handwritten notes outperformed students who typed their notes. The difference was most pronounced on questions that probed the students’ conceptual knowledge of the material that was presented. w w w.opi.net | OPI Magazine
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Vendor Focus | Pilot Mueller and Oppenheimer suggest that handwriting and typing lead to different note-taking strategies6. Typing is fast, but also limited in the way that information can be put on the page. Students who typed the notes had a tendency to take down information word for word without thinking about it too much. Their attention was placed on the transcription of the lecture material, rather than on processing its content. Handwriting is slower than typing; therefore students taking notes by hand did not have the option to transcribe the lecture in detail. They were forced to think about the content and be judicious in what they wrote down, and how they put the information on the page. Thinking about the lecture content as it unfolds aided students’ acquisition of the concepts that were presented.
Handwriting: old-school technology, old-school principles The evidence reviewed here suggests that handwriting, a centuries-old technology, has a beneficial role to play in the educational process even in an age of increasing reliance on digital technology. There is undoubtedly a lot left to learn about how and why handwriting helps students, but our current understanding of the beneficial aspects of handwriting are firmly grounded in well-known principles of learning and memory. Mueller and Oppenheimer’s conjecture that handwriting benefits learning of lecture material by forcing students to think more deeply about the material while taking notes is an example of the levels of processing effect (memory is better for material that is processed more deeply) that has been observed in dozens of studies over the past several decades7,8. Dr James’ finding that handwriting letters aids learning is consistent with a large body of evidence showing that doing is typically better than more passive methods of learning. Indeed, the idea of action – in this case handwriting – as a driver of learning can be
observed in the foundational work of Jean Piaget9, and in the educational practices that have long been found in Montessori schools10. We conclude with a final point. The past several years have witnessed an awakening of the concept of ‘free range’ children, and the idea that free play and expression can have an important effect on children’s development. The work of Dr James and others suggests the possibility that it might be useful to also think about ‘free hand’ children, and the idea that developing the ability to handwrite, and to use handwriting for the expression of ideas, may pay dividends for our children3,11.
Michael Kaschak, BA, PhD Michael Kaschak is a cognitive scientist with expertise in the study of language and embodied cognition. He is a fellow of both the Association for Psychological Science and the Psychonomic Society, and has published numerous articles on the comprehension, production and learning of language, as well as on language-related issues in education. He holds a BA in psychology from Wilkes University and a PhD in psychology from the University of Wisconsin – Madison. Ariann Langsam, BA, MS, MBA Ariann Langsam holds a BA in biology from Johns Hopkins University, an MS in neuroscience from the University of Rochester of Medicine and Dentistry, and an MBA from the Simon School of Business. She is a successful marketing professional with over 15 years of diverse experience in the pharmaceutical, medical device and consumer packaged goods industries. Ariann is Director of Marketing at Pilot Corporation of America where she leads the Marketing, Marketing Research and Product Marketing departments.
References 1) National Institute of Child Health and Human Development (2000). Teaching children to read: An evidence-based assessment of the scientific research literature on reading and its implications for reading instruction (NIH Publication No. 00-4769). Washington, DC: US Government Printing Office. 2) Beck, I. L., McKeown, M. G., & Kucan, L. (2002). Bringing words to life: Robust vocabulary instruction (Solving problems in the teaching of literacy). New York, NY: Guilford Publications. 3) James, K. H., & Engelhardt, L. (2012). The effects of handwriting experience on functional brain development in pre-literate children. Trends in Neuroscience and Education, 1, 32-42. 4) James, K. H. (2010). Sensori-motor experience leads to changes in visual processing in the developing brain. Developmental Science, 13, 279-288.
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5) Kersey, A. J., & James, K. H. (2013). Brain activation patterns resulting from learning letter forms through active self-production and passive observation in young children. Frontiers in Psychology, doi: 10.3389/fpsyg.2013.00567 6) Mueller, P. A., & Oppenheimer, D. M. (2014). The pen is mightier than the keyboard: Advantages of longhand over laptop note taking. Psychological Science, 25, 1159-1168. 7) Craik, F. I. M., & Lockhart, R. S. (1972). Levels of processing: A framework for memory research. Journal of Verbal Learning and Verbal Behavior, 11, 671-684. 8) Craik, F. I. M. (2002). Levels of processing: Past, present... and future? Memory, 10, 305-318. 9) Glenberg, A. M. (1997). What memory is for. Behavioral and Brain Sciences, 20, 1-55.
OPI Magazine | December 2015/January 2016
10) Glenberg, A. M., Jaworski, B., Rischal, M., & Levin, J. R. (2007). What brains are for: Action, meaning, and reading comprehension. In D. McNamara (Ed). Reading Comprehension Strategies: Theories, Interventions, and Technologies (pp. 221-240). Mahwah, NJ: Lawrence Erlbaum Publishers. 11) Berninger, V. (2009). Highlights of programmatic, interdisciplinary research on writing. Learning Disabilities Research and Practice, 24, 69-80. *STOMP Out Bullying is the leading national anti-bullying organisation for kids and teens in the US. With your support, Pilot will be making a minimum of $125,000 donation to STOMP Out Bullying to help bring awareness and education programmes designed to reduce and prevent bullying in schools and across the US.
Dinner PRESENTATION
Winners of the fifteenth annual
European Office Products Awards will be announced at a glittering industry dinner on
9 March 2016
at the Hotel Okura, Amsterdam
BOOK NOW To book your seats at this unmissable networking event or for more information visit www.opi.net/EOPA2016 or email awards@opi.net
SPONSORED BY
ISSA/INTERCLEAN 2015 | Review
Cleaning up HUGE
crowds attended ISSA/INTERCLEAN North America 2015, the four-day expo and convention held at the Las Vegas Convention Center from 20-23 October and organised by global cleaning industry association ISSA. The show brought together thousands of leaders, decision-makers and suppliers from the cleaning sector industry, all looking to “drive innovation, productivity and profitability”. The event squeezed in 729 exhibitors and pulled in 16,311 attendees in total. “The exhibit floor sold out completely and feedback from exhibitors has been really good,” said Rosie Rangel, ISSA Director of Industry Outreach. “As far as attendance goes, we had one of the best years we’ve ever had, attracting the most building service contractors the event has ever seen.”
Diversity Rangel attributes this success to ISSA’s concerted efforts to attract a diverse group of industry influencers as well as the top executives from the leading janitorial distributors. Importantly, she also refers to ISSA’s ability to draw from a variety of new audiences through relationships with organisations in the office products space, such as OPI and buying groups including TriMega and Independent Stationers.
Next year’s ISSA/INTERCLEAN North America will take place from 25-28 October 2016 at the McCormick Place South Hall in Chicago, USA.
Hailed as the ‘most successful show in years’, ISSA’s flagship North American event saw the largest attendance in nearly a decade This year, four US industry groups held their annual conventions in conjunction with ISSA/INTERCLEAN while other associations from across Europe, Africa and the Asia-Pacific region also participated in the event.
Keynotes Aside from the vast exhibition area, delegates were able to attend a plethora of seminars and workshops. These comprised several keynotes, including one from comedian and talk show host Jay Leno, and the ‘Afterburner’ session where two fighter pilots revealed the secrets of flawless execution in fast-changing environments. They culminated in ‘How You Can Be a Successful Entrepreneur at Everything You Do’, presented by TV’s Shark Tank host Kevin O’Leary on the last day. “Attendees responded particularly well to Kevin,” commented Rangel. “He really resonated with our audience, as was evidenced by the standing room-only crowd and the buzz after the show.” O’Leary also evaluated the four best solutions to common business challenges submitted to the ISSA Excellent Idea Contest, choosing Teresa’s Family Cleaning multi-purpose utility apron as the winner because of its simple concept. “It just goes to show – you don’t need a large business to be
successful,” he said. “You just have to solve a problem for somebody.” A strong theme running through the entire event centred around infection control, a sector that is really driving FM sales as issues around employees’ health and welfare become ever more prominent. An education session called ‘Cleaning for infection control: Not just spray and wipe!’ aimed at facility decision-makers urged them to realise the impact of improper cleaning techniques on disease transmission in their buildings. As Rangel explained, it’s a topic that continues to be a huge draw for attendees: “They are thirsty for both knowledge and solutions in this critical area, in terms of how they can help their customers as well as protect human health.”
Positive feedback Overall feedback from ISSA/ INTERCLEAN was very positive. “Our debut at the show was a resounding and overwhelming success,” said first-time exhibitor Ori Rosenbaum, President of REN Escalator Cleaning Tools. “It was hands down the best event I’ve ever exhibited at in over 30 years of participating at trade shows.” Tom Unger, Sales Manager for Minuteman International, concluded: “This truly is the one show for facility solutions because everything anyone in the commercial cleaning industry wants to find is right here.” w w w.opi.net | OPI Magazine
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Review | OPI European Forum 2015
Future-proof your business OPI’s fifth European Forum gave attendees lots of food for thought, particularly as regards digital technology and its implications for businesses
OVER
80 leading members of the European OP community gathered in London for the 2015 OPI European Forum. On the eve of the event, delegates met for a relaxed drinks reception and dinner before an early start the following morning for a full day of presentations and roundtables, all moderated by EVO Group CEO Robert Baldrey. As in previous years, OPI is unable to report on specifics from the Forum due to Chatham House rules, but suffice to say the theme this year revolved heavily around technology and the significant impact it is exerting on office products businesses. Unsurprisingly, another big, and very timely, talking point – in one of the roundtable sessions as well as during the numerous networking opportunities that the event provided – was the outcome of the much-anticipated Staples/Office Depot FTC decision (see also Hot Topic, page 22).
Digital transformation The Forum kicked off with an illuminating keynote on upcoming digital technology trends from WIRED’s Greg Williams who talked about some of the key trends that businesses will have to deal with
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shortly. The advent of robots, virtual reality, an on-demand economy, Bitcoin and the ‘Internet of Things’ are just a few of these. Even the humble catalogue is not immune to digitisation as a lively panel debate on the death of the catalogue – featuring Euroffice’s Simon Drakeford, Bruneau’s Nicolas Potier, PBS Holding’s Richard Scharmann and edding’s Thorsten Streppelhoff – demonstrated. Other sessions during the day included an update on 3D printing and the opportunity it holds for OP dealers and the business supplies sector, as well as an in-depth look at pricing models and pricing dynamics. Data – or lack thereof – is always a hot topic and before the popular roundtable sessions began in the afternoon, delegates shared some innovative ideas in trying to find a way to solve the issue of how data can be used and shared for the benefit of everyone. The consensus was that a solution would only be found if the entire supply chain
OPI Magazine | December 2015/January 2016
worked together (for more on what’s happening with e-content, specifically in the US, turn to page 12). As usual, the first day concluded with a Big Interview conducted by OPI CEO Steve Hilleard. This year, the interviewee under the spotlight was ADVEO COO Jean-Yves Sebaoun, who provided interesting insights into the European wholesale market, the move into new product categories, and a glimpse into the future of ADVEO’s business. After a spectacular evening on London’s Tower Bridge, delegates reconvened the next day for a couple of power presentations – much needed early in the morning – on content marketing and workplace transformation. The interactive feel of the second day concluded with a panel discussion about the core takeaways of the fifth European Forum. These can be broken down into five key points: using technology to future-proof your business, simplification, diversification, consolidation and finally the rather intriguing ‘something else’. OPI’s next Global Forum takes place in Chicago from 13-15 November 2016. For more details, please visit www.opi.net/GF2016
Climb of Life 2015 | Review
Saying NO TO CANCER ON
For the second year in a row, Climb of Life participants raised the bar with a new fundraising record
6 November, over 100 members of the UK business supplies industry took to the mountains of England’s Lake District and climbed ten of its highest and year seemed like an amazing one-off, so to most difficult peaks. The cause this charity actually beat it to reach over £101,000 this event was supporting and indeed this year’s time is like a dream. It is finally beginning Climb of Life (COL) message was evident from to sink in, not least because of the many the initial letters of the mountains scaled by congratulatory messages we’ve been the ten teams – NO TO CANCER. receiving from people and companies who Months of fundraising that culminated in donated and weren’t at the event. a day of persistent rain and incredibly high “Most importantly, however, the CEO of winds resulted in a phenomenal achievement the ICR, Professor Paul Workman, has sent – a fantastic £101,206 ($153,000) was raised, a message to thank everyone involved. He a new record that beat last year’s reiterated that every pound total by over £1,000. raised is going towards the For the ninth year fight against cancer.” in a row, all monies OPI – one of the biggest raised go directly to COL fundraising teams the Institute of Cancer alongside EVO Group – set its Research (ICR), one of the own record of £21,350 this world’s most influential year and CEO Steve Hilleard, cancer research charities who has been heading the The OPI COL team with Graeme Chapman that works closely with OPI climbers for the past six many leading like-minded years, issued a heartfelt ‘thank organisations. The ICR has been behind you’ to all who helped the COL cause. numerous significant breakthroughs in He said: “Once again the support of friends, cancer treatment. customers and associates in the business As tales of cancer heartbreak among family, products industry for OPI’s Climb of Life friends and colleagues were shared by the participation was extraordinary. But then, intrepid climbers during the many hours fighting this dreadful disease is no ordinary of challenging conditions, soggy feet and feat and we’re just delighted to have been aching muscles seemed to matter very little able to contribute towards another massive in the great scheme of things. sum raised for the ICR. And any discomforts were all but “Thank you to all who gave so generously – forgotten when the final result came in we’ll never take your support for granted, but at the end of the day. COL creator and I can assure you we’ll be back next year, and organiser Graeme Chapman MBE told OPI every year thereafter, until cancer finally gets after the event: “Achieving £100,000 last the message.”
“We’ll be back next year, and every year thereafter, until cancer finally gets the message”
w w w.opi.net | OPI Magazine
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Paperworld 2016 | Preview
The heart of the matter Paperworld 2016 will undoubtedly pull in the crowds as usual, and a few changes implemented last year will remain in place for the upcoming show
PAPERWORLD
2016 takes place in Frankfurt, Germany, from 30 January to 2 February 2016, and there have been a few new initiatives introduced for the show. The Remanexpo – which was moved into the newly-renovated Hall 6 last year to make way for the new Paperworld Plaza in Hall 3.1 – will stay in this area even though the Plaza will only happen again in 2017. However, according to Paperworld organiser Messe Frankfurt, a number of benefits have been introduced for both exhibitors and trade visitors of the Remanexpo. The first initiative is a business matchmaking programme, the second a business lounge with office facilities for companies that wish to take part in the show, but do not want an exhibition stand. For this first year, the matchmaking service is free for all participants and appointments to meet at the fair can be made. Other new developments include changes to Hall 5.1, which will play host to a new Greetings Card Centre of Expertise, while the Trend Show has moved to a new location, the foyer of Hall 5.1 and Hall 6.1. Interestingly, Hall 3.1 will remain closed this year. Paperworld had originally planned to use it to allow members of German trade association Verband der PBS-Markenindustrie to exhibit in smaller booths, but not enough companies signed up for the proposed format. According to Messe Frankfurt VP of Consumer Goods & Entertainment Cordelia von Gymnich, one highlight of Paperworld 2016 will be the Paperworld Academy programme of lectures. She told OPI that severeal speakers will tackle the subject of sustainability in the office and give presentations on the international certification systems for forest management and the SOfEA initiative for the creation of standard sustainability criteria in the paper, office supplies and stationery sector.
“I am looking forward to the Sustainable Office Day during which experts will offer valuable insights into current developments and the challenges of eco-fair procurement Cordelia von Gymnich in lectures and panel discussions,” she says. The 2016 Paperworld motto is ‘the heart of the business’, and commercial office supplies in Hall 3.0 are certainly at the heart of the exhibition. “The large number of international exhibitors [330 at the time of going to print], coupled with the blend of product variety and depth, as well as innovativeness, make the hall a magnet for all buyers interested in commercial office supplies,” adds von Gymnich.
2015 in numbers
1,636
exhibitors from 61 countries
39,287
visitors – 67% from Europe; 20% Asia; 7% US; 5% Africa; 1% Australia
35%
of visitors were interested in office supplies; 32% office paper; 27% school supplies
61%
of exhibitors stated their main objective was to initiate new business relations
Paperworld events Trend Show and Trends 2016/17: Visitors can immerse themselves in the colour, style and product worlds of the forthcoming season. Guided tours will take place several times daily. Hall 5.1/6.1 Design Competition: Winners of the design competition for greeting cards will be announced on 2 February at 2 pm. Foyer Hall 5.1/6.1 Lets wrap!: Demonstrations on how to wrap products simply, quickly and attractively. Hall 4.0 BMWi Promotional Area: German start-ups and new manufacturers present the latest innovations.
Remanexpo: A comprehensive product range from both OEM providers and the recycling industry, covering every aspect of printing and copying. Hall 6.0 Mr Books & Mrs Paper: Design inspiration for creating the right combination of books and non-book products in-store. Hall 5.1 Sustainable Office Day: Experts provide insights into the world of the green office on 2 February. Hall 3.0 Paperworld Academy: The Paperworld lecture area has a comprehensive programme of topics, including marketing, trends, sales and retail. Hall 3.0 C51
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Category Analysis | Facilities Management
Changing
facilities
THE
winds of change are sweeping through the FM sector, forcing a rethink among both existing players and new entrants to this category. Laura Braunecker, VP of Marketing Strategy at Georgia-Pacific Professional in the US, puts this down to some key factors: “Competition is driving demand. In city centres, new office buildings are being built and older ones renovated at breakneck rates. Potential tenants now have significantly more choice and buildings are only going to win
Facilities Management (FM) is in a major transition period that’s significantly impacting how FM professionals operate, but this shake-up has created increased growth opportunities new opportunities for the market to grow tremendously.” Bill Marsh, Sales Director for the Office Channel at Reckitt Benckiser, agrees: “The category certainly isn’t getting any smaller. The challenge is getting through to the office manager that, even though they use
“[FM] is a massive untapped market. We define [it] at over £17 billion [$25.6 billion] and currently the OP channel has less than 3% of this sector” potential business if they have the best amenities with the best overall FM effort. “In addition, the huge movement towards open-plan offices means more people are being squeezed into a given space. This increase in workforce density means facility managers must make sure that all products – from the washroom to the carpet in the hallways – can withstand the extra traffic. This can mean providing higher-quality products to ensure they meet the tenants’ needs. “FM is in the midst of some significant changes and delivering
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a cleaning service, they still have cleaning needs which aren’t being met. Specifically, I mean personal workspaces that are generally left untouched and shared workspaces where regular cleaning and disinfection is very important. “However, dealers continue to win against traditional FM distributors. They’ve figured out how to accept small orders, ship partial cases and get it to their customers the next day – three things that typical distributors can’t or won’t do.” UK wholesaler Spicers believes there is still significant potential in the facilities supplies sector.
OPI Magazine | December 2015/January 2016
Marketing Director Rebecca Stallard says: “We believe resellers can double their sales if they really get to grips with selling in this space. Our specialist sales teams are uncovering huge possibilities when working with resellers, highlighting where their current sales are significantly under-indexing compared to industry norms. But they really need to know their end users and use these insights to drive their sales and marketing push, tailoring the message and moving away from a ‘spray and pray’ marketing strategy.”
Untapped market As Andrew Stacey, Vendor and Product Director at rival UK wholesaler VOW, points out: “This is a massive untapped market. We define our addressable market at over £17 billion [$25.6 billion] and currently the OP channel has less than 3% of this sector. We are frequently surprised at how many resellers shy away from asking the FM question and this is invariably down to a lack of knowledge and a poorly-defined sub-category strategy.” Legislation is playing a large part in redefining FM categories. Stacey
Facilities Management | Category Analysis
reports that recent legislative changes in the signage and cleaning categories, such as the need for differently coloured cleaning equipment, has led demand for new products. Even airport security legislation has resulted in a run on plastic bags. Earl Engleman, President of R3 Redistribution, agrees there’s a need for distributors and dealers to diversify their portfolio and expand into new markets. “FM sub-sectors such as jan/san and safety are
considered hot categories and many traditional OP dealers have sought ways to deliver new revenue streams by expanding into these areas. This trend continues and those that haven’t yet considered these categories are not realising their full potential. Often customers they are serving are buying these categories elsewhere and opportunities are being missed.” However, Ralph Bianculli, CEO of Emerald Brand at the Paradigm
Coffee break The breakroom is an important sub-category for the FM sector, with coffee and tea still maintaining their status as the perennial top beverages of choice. But manufacturers are not standing still, introducing new ranges to an increasingly sophisticated workforce. Jeff Sisarsky, Marketing Director at Nestlé Professional in the US, cites its Coffee-mate business as a recent success story: “We’ve seen steady growth in the office coffee segment and attribute this to expanding the flavour options and an increased desire for breakrooms to keep employees on-site. With the growth of more demanding millennials in the workforce, employers are stretching themselves to ensure beverage options are enhanced. “Customisation is key to a successful employee coffee programme. Similar to popular coffee shops where consumers customise their order, hot beverages in the workplace must also provide that same latitude. We’ve achieved excellent results by selling a variety of creamer formats in both tubs and liquid concentrate pump bottles and now see workers using multiple flavours and varying quantities as they make their own speciality coffee drink at work.” Another trend that’s becoming increasingly prominent is the move towards foodstuffs that are ethically produced. Phil Leckinger, COO at manufacturer and distributor Sourcingpartner in Texas, specifically mentions a brand of coffee known as Westrock which taps into the growing desire to enhance livelihoods and encourage sustainable farming through honest, direct trade. Leckinger says: “Westrock Coffee has a fantastic story of developing the lives of tens of thousands of people and being a catalyst for real change in the lives of farmers and their families. It resonates through effective marketing and advertising campaigns that traditionally would only have been targeted at the home market. But now commercials are creating demand both at home and in the office. Westrock is selling coffee through all channels and capturing market share in both the supermarket and the boardroom.”
Group, sounds a major note of caution as he sees too many dealers trying to jump on the same bandwagon: “They’re continuously trying to capture and retain market share, yet they lack innovation and are going to market with the exact same products and expectations. Where is the creativity? This ‘me too’ approach is just eroding margins and further commoditising the category. “It’s just too easy for customers to find and access information through channels like Google and Amazon, so unless dealers are bringing true solutions they will continue to see high customer turnover rates. “We live in a world that is more dynamic than ever and the industry needs to take a look at itself and re-tool through innovation, because without this we will die on the vine.”
Safety net Research figures confirm that FM is a growth sector, in some areas more than others. In the US, data from The NPD Group shows overall sales up 2% year on year, whereas data from GfK in the UK reveals the category has grown an impressive 5.4% over the past twelve months, with even larger increases in the safety and security sub-category which is up 6%. Reports from several companies back up this particular surge in the safety arena. US wholesaler SP Richards has w w w.opi.net | OPI Magazine
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Category Analysis | Facilities Management launched a new catalogue dedicated to safety that’s been very well received. Jhenielle Brown, its Marketing Manager for Facility and Safety, reveals that this category is expected to grow 4-6% annually, primarily due to increased health and safety regulation and fear of legal action. “We live in a very litigious society”, she says. “The legal and financial ramifications of employees getting injured can be very costly. Overall, the benefits of prevention are greater than the cost of providing your workforce with the proper equipment. Employees are also starting to gain a better understanding of their own health and safety, putting additional pressure on employers to keep their workforce safe.”
Growth in safety And unlike several other categories that are simply shifting market share, the safety category is a huge growth market. Brown adds: “Capitalising on this trend, SP Richards has recently added over 1,000 new safety SKUs with the majority of those being in
Restroom results It may be the smallest room in the building, but getting the washroom experience right is crucial for keeping employees happy as well as giving a good impression to visitors. A recent survey by manufacturer The Bradley Corporation revealed that an unpleasant restroom experience creates perceptions of poor management, lowering opinions of the company and giving the impression of sloppiness. The top restroom complaint was bad smells (cited by 82%), followed by clogged or unflushed toilets (79%) and an overall appearance that’s dirty, unkempt or old (73%). Laura Braunecker, VP of Marketing Strategy at Georgia-Pacific Professional in the US, sees untapped potential here: “From half doors that don’t offer privacy to poor ventilation that can’t combat odours, there are ample opportunities for vendors and dealers to help solve this poor experience. Technology can help too: using tracking devices connected to a digital platform, a facilities manager can find out which washrooms have been used more often and deploy staff there more frequently to make sure they are clean and well stocked.” As the ‘Internet of Things’ – where physical objects or building plant become embedded with software, sensors and network connectivity – takes off, this type of remote monitoring driving proactive maintenance will become increasingly common. Georgia-Pacific Professional has launched a new product that aims to combat nasty washroom smells at source: its ActiveAire tissue dispenser. Bill Marsh, Sales Director for the Office Channel at Reckitt Benckiser, also points to the new Life Scents anti-odour product from Air Wick that aims to protect against ‘nose blindness’. He explains the concept: “If you enter a house where they’re baking cookies it smells lovely, but after a while you’ll no longer notice because your senses have got used to it. Life Scents combats this by alternating between three distinctly different fragrances in one air freshener so that your nose doesn’t get desensitised to a scent and forget it’s there.”
82% 79%
73%
“Employees are [...] starting to gain a better understanding of their own health and safety, putting additional pressure on employers to keep their workforce safe” personal protection equipment (PPE). Currently, disposable hand protection is our highest-velocity PPE category and we have expanded our glove offering to include a range of benefits such as chemical resistance, better grip and dexterity, cut resistance and thermal protection. In addition, pre-moistened lens wipes are one of our top-selling SKUs, so we have been doing more cross-promotion with our new safety eyewear.” Spicers sees the growth of the care industry as another key driver for
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sales of PPE items, with the demands raised by care professionals for personal hygiene and protective products prompting it to introduce a new range of non-medical supplies. “Changes in legislation create selling opportunities too,” says Stallard. “For example, demand from our Scottish resellers in the area of waste management precipitated an overhaul of our waste management supplies. We also recently created a new marketing campaign for our resellers on first aid, reminding
OPI Magazine | December 2015/January 2016
clients of their legal obligations around employee safety. Our statistics show that these campaigns work particularly well for resellers, and are a good margin-build opportunity too.” Brown sees technology bringing safety and enjoyment together, citing electronic ear defenders from suppliers such as 3M and Honeywell as a good example: “Consumers can plug their iPod or MP3 player into them, enabling them to enjoy their favourite playlist while still getting the same hearing protection as they perform noisy tasks. As people continue to learn more about PPE products, these will gain traction as they incorporate protective behaviour into their personal lives.” The fight against pathogenic bacteria and viruses is endless and
Facilities Management | Category Analysis the workplace remains one of the key battlegrounds. The need to keep staff healthy and protect them from disease is both a moral and commercial imperative that inevitably creates a market for those FM products that can help in this struggle, with key peaks across the year. As VOW’s Stacey explains: “One-off events, such as avian flu and foot and mouth outbreaks all offer opportunities to sell specific products. And seasonal trends see spikes in specific product demand, such as heaters during the colder months and even different types of beverages at certain times of the year.”
Balanced approach But as Reckitt Benckiser’s Marsh points out, legislative concerns – driven by the environmental movement in the US – are not always an opportunity and are actually beginning to cause problems in the battle against germs: “States such as New York, for example, have enacted laws that make it illegal to use disinfectants in any state building, including schools. Surely a balanced approach is better. “We don’t believe it’s necessary to disinfect every time you mop the floor of the main hallway at the local school. However, it’s perfectly sensible to disinfect on a regular basis, especially during cold and flu season. Legislating against killing germs doesn’t make any sense.” Michael Hall, National Sales Director at Seventh Generation, a producer of environmentally sound cleaning products, believes there is a solution: “Consumers are rightly concerned about germs in the workplace – both for common illnesses like colds and flu, but increasingly for more serious diseases. Yet the vast majority of disinfecting cleaners are either inadequate against common germs or dependent upon chemicals to disinfect.
“The new generation of botanical disinfectants meets this need – killing 99.99% of germs, but doing so without chemicals.” But there’s more to it than surface wipes and disinfectants, according to Jeff Dryfhout, Fellowes Brands’ Global Director of Marketing, Air Treatment. He believes that the airborne environment is much
cited lack of knowledge or fear of the unknown as reasons why some dealers shy away from the FM sector. Support and training are the best ways to counteract these factors. John Molidor, Merchandising Manager for Facility and Safety at SP Richards, believes the hands-on approach works best: “Instead of sitting in a classroom reviewing
“Not all office dealers have joined the FM party yet and every day they wait to jump into this game is an opportunity lost. Make the leap” neglected by facilities managers and is a key area when it comes to taking on nasty bugs. He says: “We don’t give much thought to indoor air quality, but we should. Airborne contaminants are invisible and often go undetected and unaddressed. The air we breathe indoors can be five times more polluted than that outdoors. Public spaces like offices, healthcare facilities and schools are breeding grounds for bacteria, viruses, allergens and unpleasant odours. “We need to educate the general public about this threat. The Centre of Disease Control and Prevention is helping – it recently stated that the most common way to catch flu is through airborne exposure. This type of information drives the need to address air quality in common areas such as classrooms and waiting rooms. “AeraMax Professional’s commercial-grade air purifier is both certified as effective by the Asthma and Allergy Foundation of America and independently proven to capture the flu virus.” Many companies that OPI spoke to
PowerPoints, our OnPoint training sessions allow dealers to get practical experience with the products – they are hanging dispensers, stripping floors, vacuuming carpets and using proper PPE. As Ben Franklin said: ‘Tell me and I forget, teach me and I may remember, involve me and I learn’, and that is exactly what we’re trying to accomplish.” Stallard makes the distinction between the ‘carpet’ office environment and the ‘concrete’ warehouse space: “Our resellers are very well-versed in selling into the former, but more hesitant with the latter. We are supporting our workplace catalogue with a series of category fact sheets and marketing materials to help build resellers’ confidence in tackling this new selling opportunity, which has the potential to double their existing sales line. “Our aim is to create the complete sales toolkit. We have also invested in a team of specialist sales people who are on hand to help drive the education and training.”
FM in transition FM today is much more than just making sure the washroom or breakroom is properly stocked and the temperature is comfortable. The category is evolving and it’s critical that suppliers evolve with it if they are to reap the rewards. As Marsh summarises: “Not all office dealers have joined the FM party yet and every day they wait to jump into this game is an opportunity lost. Make the leap.” w w w.opi.net | OPI Magazine
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Your OPI
Where are they now? Paula Jagemann-Bane
“Oh my, not a minibar was spared”
2016
is OPI’s 25th anniversary year. And while our special anniversary issue is not going to be published until next November, discussing it with the team has prompted some interesting questions. Where are some of the personalities that have left our industry over the past 25 years and what are they doing now? Some, like the iconic Tom Stemberg, have sadly and untimely passed away (see our Tribute on page 14); others are no doubt enjoying their well-earned retirement. Then there are those who have seeked their fortunes elsewhere, but who have shaped our industry irrevocably. Over the next ten months or so, OPI will be sporadically catching up with some familiar faces and asking them for a short trip down memory lane and, of course, what are they doing now? First up is Paula Jagemann-Bane, founder of one of the first pure play OP e-commerce companies, OnlineOfficeSupplies.com, and later on CEO of what is now software provider ECi.
will raise $3.5 million, not just with the typical suspects, ie venture capitalists or accredited investors with $3 million of net worth or more, but with individuals as well. Anything you miss? I enjoyed my time listening to and introducing e-commerce to a litany of OP manufacturers, their reps and buying groups. I also miss the mega conferences and all they entailed. In return, I’m sure everyone misses my black lipstick – now retired you’ll be glad to hear! Do you think there’s anything you should have done but didn’t, or vice versa? I can honestly say ‘no’. Our timing was sublime, our message strong and the long-term impact of the technology revolution that ECi led fills me with nothing but pride. I did turn down the pan-European e-commerce deployment for Office Depot – I often wonder if that would have propelled or sunk us. We chose the independents and I guess we chose right.
“Our timing was sublime, our message strong and the long-term impact of the technology revolution that ECi led fills me with nothing but pride”
For those who don’t know – what’s your claim to fame in OP terms Paula? From a business perspective, I introduced new technologies into a complex industry. Integrating wholesalers, manufacturers and independent dealers – and the buying groups the latter align with – was an enormous and challenging endeavour. On a personal note, I’ll never forget the OPI conference in Montreux in 2001 and I suspect neither will a handful of other OP comrades. Oh my, not a minibar was spared.
Any lasting legacies? The company I founded was sold twice for a total value of over $500 million. That’s amazing! Still, the numbers take a back seat to the many ECi executives who were – and some still are – able to reap the rewards of their hard work and survive and prosper through not just one, but two economic downturns. What most defined your time in the industry? Acceptance of what was inevitable. We had a pretty radical idea in the 1990s. We raised significant venture capital to make hugely impactful acquisitions, notably DDMS, UBS and Interactive Products UK. $92 million, raised by John Sidgmore and I, was a staggering amount back then. It still has an impact on what I do today. My latest venture will be one of the first 25 companies to take advantage of the new JOBS Act RegA Tier 2 financing. We
So what do you do now? I took some time off after John Sidgmore’s death in 2003 and then had my daughter in 2005. I also recently remarried, hence the ‘Bane’. Business-wise, I am back with a vengeance in healthcare and banking. It started with Someonewith.com, an online marketplace for breast cancer products that I launched in 2009. Since then it has morphed into a patent-pending, financial instrument and crowdfunding platform to help tens of thousands of patients and their families who struggle to fund their unwanted medical journey, while helping hospitals reduce the $40 billion of bad debt they experience every single year. It’s taken three and a half years of regulatory manoeuvring and $3 million of IT spending, but we are ready to make a mark in the name of not just innovation, but with a hugely positive social impact. How does it compare to OP? Amazingly, a lot! I was as driven to bring the same transformative technological changes to healthcare and banking as I was in OP. What could the OP industry learn from the sector you’re in now? Compassion. The City of Hope initiative may be your strongest unifying mission. www.opi.net | OPI Magazine
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Your OPI
5 minutes with... Eva Baumann, Sales Service Manager, tesa
Describe what you do in less than 20 words. I coordinate our consumer export business in new emerging markets. I’m also responsible for all communication with office products and DIY trade magazines. If you weren’t doing your present job, what job would you like to be doing? Working for a radio station, planning and implementing children’s programmes. The industry figure you most admire. Steve Jobs due to his ability to innovate, plan and launch new products at Apple. Your best piece of advice to a colleague. Stay calm, have a good relationship with people and don’t be too judgemental. What would you like to be doing in five years’ time? Good question. Let’s wait and see how work and home fit together. But basically I would always like to work with customers. Your greatest strength. Communication and organisation.
“A bit more patience could be very helpful”
Your ideal night out. Meeting friends, seeing a good show and having dinner or drinks afterwards. Your favourite holiday destination. The Pacific Northwest of the US – it’s beautiful. If you could change one thing about yourself, what would it be? A bit more patience could be very helpful. Your first vehicle/car. A VW Beetle. If you had to sing at a karaoke next weekend, which song would you choose and why? New York, New York by Frank Sinatra because I really like both. The types of TV programme you like best. I’m a big fan of natural history programmes, especially those about oceans and sealife. If you had one day to live what would you do? Spend it with my close family.
The most influential companies in the OP industry. The big global players in our sector. And of course tesa as a major operator in its German home market! What do you think has been the best innovation in the OP industry in the last two years? Emphasising the design and function of everyday stationery products and bringing them to the attention of the end consumer. Your favourite office product? The tesa Easy Cut tape dispenser. The biggest change that has taken place in the industry since your career began. Definitely the online business and all the possibilities to select, buy and compare products that the internet offers.
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OPI Magazine | December 2015/January 2016
The best concert you have ever been to. Ray Charles in Seattle back in 1983 – what a fantastic performance!
Your OPI
Final word Your industry, your opinions
Pascal Mitchell, Group Marketing Executive, Lyreco
Aiming to offer protection THE
development of a variety of facilities management and diversified categories has become a key part of Lyreco’s strategy to drive future growth. Personal protection equipment (PPE) has become an important sub-category in this space. The international PPE market is constantly evolving, with improvements being made to the materials, overall products as well as manufacturing methods. This is coupled with growing demand for regulations on workers’ safety. In Europe, for example, the European Commission’s (EC) PPE directives are very strict and updated regularly, showing that more and more focus is being put on the protection of workers in all areas of the workplace. According to recent research data, the global market for PPE is set to reach $53 billion by 2020, with an annual estimated growth rate of around 6%. It’s easy to see why this is such a booming sector. A 2012 International Labour Organisation report showed that 2.34 million people die each year from work-related accidents and illnesses. Not only is this a huge human loss, but it is also an estimated 4% loss in GDP due to occupational accidents. Figures like these lead businesses to be very focused on improving safety awareness and habits in the workplace. But although PPE is a growing category globally, it is still fairly new in the traditional office supply sector. It is also intrinsically linked to economic buoyancy in the various geographical regions. PPE is complex and there are several considerations to be taken into account before delving into this field.
key factors in the decision-making process and they can vary from region to region. All these differences have a major impact on the number of suppliers used in different countries and the SKU count has to be closely managed. In addition, varying European work cultures influence PPE supplier and product choice. Trade unions, work committees, safety officers and engineers, human resource staff, production and procurement directors – they all have a part to play when it comes to selecting helmets, glasses, shoes, work garments, and so on.
“Will PPE be the golden bullet to secure Lyreco’s future? Certainly not, but it will go some way to combat the decline in the more traditional OP categories”
Complex European market As the aforementioned international statistics prove, implementing clear and applicable safety regulations in the workplace is vital and the industries involved span a wide spectrum, from construction, manufacturing and oil and gas to health care, mining and the food industry. The market in Europe for PPE supplies is extremely fragmented, with only a few pan-European distributors in existence. Most resellers cover single European countries due to the complexities and differences in demand. Naturally, first and foremost is the safety and protection aspect of the product, but comfort and style are other
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OPI Magazine | December 2015/January 2016
New PPE sources
With the continued development of EC guidelines, national, European and global customers are all searching for new sources for their PPE. For them it means analysing their needs at all sites in all countries and trying to source common PPE supplies from a reduced number of resellers. For resellers such as Lyreco, it requires a common top-level logistics solution across several countries. It also means that our staff in those countries are capable of discussing PPE and solutions face to face at a high level of competence with customers. Lyreco launched PPE on an international level in 2013. This relatively early foray into the category has allowed us to also give smaller businesses the opportunity to widen their basket size with us and created a one-stop-shop for business supplies that include a wide range of workplace products, in particular within the PPE category. Will PPE be the golden bullet to secure Lyreco’s future? Certainly not, but it will go some way to help combat the decline in the more traditional OP categories that we all face. What is of utmost importance for all distributors thinking of entering into markets with new product categories is to prepare the ground carefully. It is crucial to take the time to understand the complexities of these new markets, noting especially different customer needs and behaviours. Want the Final Word? Email editorial@opi.net
IN THE NEXT ISSUE • Big Interview with Udo Böttcher, CEO, Büromarkt Böttcher • Messe Frankfurt speaks to OPI about Paperworld 2016 • An in-depth look at the writing instruments category
Office Products International ISSUE NO.2 5 5
The word in office.
magazine
Big Interview
Jeff Whiteway, Group CEO, SPOT p18
December 2015/January 2016
DECEMBER 2015/JANUARY 2016 WWW.OPI.NET
pays tribute to p14 Industry p13 HP’s long road to growth OP icon Tom Stemberg
FM in transition p44 Staples’ battle with the FTC p22