OPI APP JUNE 2024 A

Connecting the

business products world

BIG INTERVIEW

Brooks Smith, Innovative Office Solutions June 2024

INSIDE THIS ISSUE l ODP and RAJA confirm contracts partnership l New leadership at Essendant and SPR l US dealers fight for government dollars

l Print under pressure l Growth potential: safety and workwear l Addressing neurodiversity in the workplace l State of the industry

CONTENTS 18 Big Interview Brooks Smith is on a mission to write the next chapter in the story of one of the largest dealers in the US – Innovative Office Solutions 26 Focus Fujifilm Business Innovation is targeting the office channel in Europe. Does the market need a new OEM player?

28 Interview OPI speaks to HP Inc’s Stephanie Dismore, now in charge of the tech giant’s market in Northwest Europe

Big Interview: Staying nimble, informed and relevant

Innovative Office Solutions is one of the largest independent dealers in the US – in the top five.

Founded in 2001 and run by the late Jennifer Smith for many years, Jennifer’s husband Brooks has been at the helm since February 2023.

Today, Innovative is on the cusp of breaking through the $200 million revenue barrier. In OPI’s first interview with Brooks Smith, the CEO charts a journey that speaks to his competence, resilience and infectious enthusiasm for his company and compassion for our industry as a whole.

SMALL TALK: PLATFORM PIONEERS

38 Category Update For those ready to take the plunge, opportunities abound in the safety and workwear segment 42 Research Progressive companies are becoming more and more conscious of the need to cater to a neurodiverse workforce 44 Research Chasing volume – not value – in the digital age: a look at the state of the industry by Martin Wilde Associates and OPI 46 Research Global cities are dealing with and adapting to the evolving demands of the modern workplace in different ways

REGULARS 5 Comment 6 News 14 Green Thinking News 16 OPI Small Talk 48 5 minutes with...

Jake Mages 50 Final Word Brendan Hughes

June 2024

We are building pioneering government e-commerce to help agencies and the public sector buy better, faster and simpler. It’s about trying to balance the need for agile, simplified online trading with the requirements of the government, which include compliant purchasing as well as highly detailed socioeconomic goals.

Glass Commerce has the tools – and is creating more – which governments [...] have not had access to in the past couple of decades to be able to conduct these types of transactions. We understand the necessity to make things simple for the largest purchaser in the world – the US government. Simple is very powerful.

32 Category Update As print volumes continue to decline, the imaging supplies, MPS and print sector is feeling the strain

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COMMENT The OPI team EDITORIAL

Editor Heike Dieckmann +44 1462 422 143 heike.dieckmann@opi.net News Editor Andy Braithwaite +33 4 32 62 71 07 andy.braithwaite@opi.net Assistant Editor Kate Davies kate.davies@opi.net Workplace360 Editor Michelle Sturman michelle.sturman@workplace360.co.uk Freelance Contributor David Holes david.holes@opi.net

SALES & MARKETING Chief Commercial Officer Jade Wilson +44 7369 232590 jade.wilson@opi.net Head of Media Sales Chris Turness +44 7872 684746 chris.turness@opi.net Commercial Development Manager Chris Armstrong chris.armstrong@opi.net Digital Marketing Manager Aurora Enghis aurora.enghis@opi.net

EVENTS Events Manager Lisa Haywood events@opi.net

PRODUCTION & FINANCE Head of Creative Joel Mitchell joel.mitchell@opi.net Finance & Operations Kelly Hilleard kelly.hilleard@opi.net

PUBLISHERS CEO Steve Hilleard +44 7799 891000 steve.hilleard@opi.net Director Janet Bell +44 7771 658130 janet.bell@opi.net Executive Assistant Debbie Garrand +44 20 3290 1511 debbie.garrand@opi.net

O

Industry in flux

ffice products wholesaling is a volatile place to be – or so it seems. Nothing in this issue of OPI particularly suggests that anything major is about to happen. But there are hints it could. Brooks Smith, CEO of Innovative Office Solutions, admits in our Big Interview (page 18) that spend with its main broadline wholesale partner, Essendant, has reduced.

It’s partly to do with wide-spanning product diversification, but also because some historic delivery models – such as nationwide express despatch – just don’t make sense anymore due to cost inefficiencies.

This then leads to other avenues being explored (by the likes of the Supply Chain Investment Group, for instance).

It’s definitely been a sobering return to the world of business supplies If a near-$200 million stockless dealer substantially re-evaluates the reliance on its wholesale partner, there is cause for concern.

Independent dealers, Smith says, have to think long and hard about what makes them relevant to their customers; the wholesalers, likewise, need to take a good look at their relevancy too.

Does the news of the leadership changes at both US wholesalers (page 7) add fuel to the fire and generate speculation? Maybe.

I certainly feel there’s more to come – and not just in the US wholesaling market; the same pressures exist elsewhere. And, of course, it’s not just the wholesale channel which is struggling.

You only have to look at the headlines in our News pages (from page 6): ‘ODP to offload Varis’, ‘Staples sells DEX’, ‘BSA no more’, ‘GOJO pulls out of Europe’, ‘Renz in administration’... Just back from my short absence – thanks again to the team for stepping in – and it’s definitely been a sobering return to the world of business supplies.

Meanwhile, one product sector in a constant state of flux right now is printing and everything associated with it (consumables, MPS, etc). There are a number of features in this issue which aptly illustrate this. Our annual Category Update (page 32) gives a broad overview of the segment. In this feature, PaperCut’s Steve Holmes, talking about the future and potential consolidation, also hints at the very subject of this issue’s Focus (page 26) – Fujifilm Business Innovation.

Whether this operator is indeed a ‘new entrant’ or an established player with expansion plans is open to interpretation.

But secular trends coupled with the sheer number of market players in the picture HEIKE DIECKMANN, EDITOR surely mean disruption is imminent.

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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.

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June 2024

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NEWS

an international presence and we needed a reliable partner in Europe able to service them. RAJA is that partner; it has been a great relationship so far and we’re looking forward to expanding it even further.”

From left: David Centrella and Alain Josse

Analysis: ODP and RAJA in contracts partnership OPI met up with ODP Business Solutions and RAJA execs to learn more about their cooperation in the contract space

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North American business products supplier ODP Business Solutions and Europe-based RAJA Office continue to strengthen their partnership to service international contracts.

The two organisations had kept their cooperation under wraps for some time. But recently, OPI was invited to a meeting in Paris, France, which took place between senior execs from ODP Business Solutions – including President David Centrella – and RAJA Office Managing Director Alain Josse.

At this gathering, it was revealed that talks between the two companies had started shortly after RAJA’s acquisition of Viking in 2021 and the establishment of its Europe-wide contract unit led by Brian Hall. He had joined Office Depot Europe as Director Contract Channel when the company was still owned by private equity firm Aurelius. This meant Hall had connections with Brian Abromovage in the US, a contracts veteran who is currently VP of Business Development at ODP Business Solutions. One of Abromovage’s responsibilities is international contracts.

These flourished when Office Depot International (including Office Depot Europe) was owned by the US-based parent company.

It is fair to say they were less actively managed once Office Depot’s international businesses started to be sold off, although historical relationships remained in place.

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FRESH IMPETUS As Centrella noted, the approach to finding partners was something of a piecemeal process once ODP had left the European market – not an ideal situation.

“About 60% of Fortune 100 companies in the US are our customers,” he stated.

“As you can imagine, most of those have

BROAD REACH The arrangement covers the whole of Europe, not just the ten markets where RAJA Office currently has a physical presence. While there are certain traditional country strongholds, the partnership has also helped with expansion into developing markets, resulting in a truly broad European presence.

Of course, it’s not a one-way process. RAJA has major Europe-based clients with sites in North America; being able to offer them a global solution is a competitive advantage.

“As we build out our contract business, it is important we establish our credentials as a supplier at many different levels,” said Josse. “Some customers are really asking for an international presence, which we can only develop with partnerships such as the one with ODP Business Solutions.”

It has been a great relationship so far and we’re looking forward to expanding it even further The two leaders pointed to a number of common traits: an obsessive customer focus; an industry-leading approach to providing sustainable solutions; and a diverse product assortment. All of these have helped the partnership to develop. Another upshot is the ability to offer a consistent overall experience, despite regional differences.

“Our shared approach ensures that customers are getting what they need,” affirmed Centrella. “They are able to leverage their spend globally and – thanks to our reporting – have a transparent view of this spend.”

Currently, there are “several dozen” customer agreements in place that represent a “significant” amount of business, although neither ODP nor RAJA was willing to disclose what this means in terms of annual sales.

It is worth noting that ODP Business Solutions has no commercial arrangements with Office Depot-branded entities in Europe.

While the continued use of the Depot name in certain European countries could potentially lead to confusion in the market, these are now independently run businesses with no affiliation to The ODP Corporation and no connection to the agreement between ODP and RAJA.

S.P. Richards (SPR) and Essendant have both appointed new leaders over the past few weeks.

At SPR, the new President is Andrew Wallach, CEO of the wholesaler’s owner Central National Gottesman (CNG). Wallach – a fifth-generation member of the founding family – has been working at the firm since 1996 and was appointed CEO in 2015.

Although based at CNG’s group headquarters just north of New York City, OPI understands that Wallach is spending a lot of time in Atlanta, Georgia, and is very much adopting a hands-on approach to running SPR. Wallach’s appointment allows former SPR President Bill Meany to focus on his duties as President of CNG’s paper, packaging and facilities supplies distribution arm, Lindenmeyr Munroe.

Joining Wallach on the senior leadership team at SPR is Jason Horst, who has been named CCO. Horst is a veteran of the North American paper industry and has been Commercial Director at CNG since 2014. He has a strong track record of selling into the retail and e-commerce markets. SPR said he will leverage this experience to navigate new customer channels.

Horst reports directly to Wallach, as does Jack Reagan, who remains as the wholesaler’s EVP. Meanwhile, at Essendant, former Staples Canada CEO David Boone has been named interim CEO. His appointment comes following the news that long-standing CEO Harry Dochelli is to retire.

Boone is an experienced finance and leadership exec who recently left his Staples Canada position after more than six years. Since then, he

Staples sells DEX

David Boone

has been an Operating Advisor at Sycamore Partners, private equity owner of both Staples in North America and Essendant.

Jade Wilson Dochelli – who said his retirement had been “well planned” – will stay on in an advisory role until the end of the year. He is also helping cleaning association ISSA with its new strategic plan and will be busy carrying out his duties as the 2024 Spirit of Life Honouree for City of Hope.

PBS Holding acquires in Italy Desktoo, the Italian wholesaling business owned by PBS Holding, has strengthened its position in the educational supplies segment with the purchase of OCL Trade.

OCL is a 75-year-old Milan-based distributor that was owned and run by the Alemanni family. The deal was completed on 30 April and financial details were not disclosed.

Desktoo Managing Director Fabrizio Pistoni said the acquisition offered the wholesaler’s customers the opportunity to expand their assortments into new segments, given the complementary products sold by OCL. At the same time, Desktoo has launched a web portal featuring more than 23,000 items plus new marketing and e-commerce tools.

From left: Alma Alemanni, Fabrizio Pistoni and Andrea Alemanni

June 2024

Staples Inc has agreed to sell its DEX Imaging business to the company’s management in a private equity-backed buyout.

New York-based investment firm Gamut Capital Management, in partnership with DEX’s founders – Dan Doyle Sr and Dan Doyle Jr – have signed a definitive agreement with Staples to buy the company. Terms of the transaction, which is expected to close shortly, were not disclosed.

The business products reseller acquired DEX from the Doyles in 2019. It was a move aimed at expanding Staples’ B2B offering into the managed print space, with MPS opportunities also identified for customers of Staples-owned wholesaler Essendant.

COVID-19 was clearly a disruption and there is little to suggest the potential cross-selling synergies between DEX and Staples came anywhere close to being realised. DEX made a number of tuck-in acquisitions, such as some Konica Minolta dealers in 2021, and could now accelerate its national expansion with funding from its new private equity partner.

As for Staples, one assumes any proceeds from the deal will go towards paying down debt or covering interest payments.

The company is thought to have total debt of around $7.5 billion – including a $300 million loan that matures this year – and has recently announced moves to extend the maturity of some of its obligations.

Andrew Wallach

NEWS

Leadership changes at US wholesalers

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NEWS

ON THE MOVE Leadership change at Alkor Leading French dealer network group Alkor has appointed Frank Deshayes (left) as its new Managing Director. An experienced retail executive, Deshayes was most recently in charge of home furnishings company Habitat before it folded at the end of last year. Prior to that, he held senior roles at Conforama and Leclerc, both leading retailers in France.

He succeeds Laurent Proy, who is retiring after 18 years in the job.

Expanded role for OTG’s Weedall Martin Weedall has taken on extra responsibilities at OT Group’s (OTG) Spicers wholesaling division. In addition to his role as OTG COO, he is now leading all areas of Spicers that impact dealer customers. These include price, stock, service, operations, transport and customer experience.

OTG said that, in this “strategic shift”, Weedall will “take the lead in aligning sales and customer service strategies with operational enhancements to improve service levels and customer experience across the Spicers dealer network”.

Gentile joins ESG US office products industry veteran Mike Gentile (left) has joined consultancy firm Execution Specialists Group (ESG) as a Partner. Gentile stepped down as CEO of US dealer group Independent Suppliers Group at the start of 2024.

ESG CEO Mark Newhall commented: “The value Mike brings to clients undertaking technological innovation and business transformation is unparalleled.”

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Logicblock confirms Gatens appointment US e-commerce solutions provider Logicblock has named Paul Gatens as its VP of Marketing.

Gatens is a familiar face in the US business supplies industry after spending 23 years at S.P. Richards as well as seven years at the Hammermill Papers unit of International Paper (now Sylvamo).

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Heimes promoted at Amazon Business Experienced Amazon Business exec Todd Heimes has a new role at the organisation. He has been elevated to VP status, with his full job title now VP, Amazon Business – Marketing, Business Prime, and Emerging.

With a career spanning almost 25 years at the online giant, Heimes joined Amazon Business in 2016 and was instrumental in launching the reseller in Germany, the UK, France, Italy and Spain. He was most recently Director of Amazon Business Worldwide.

ODP to offload Varis

The ODP Corporation (ODP) has confirmed it will sell its Varis B2B procurement platform and accelerate its Project Core plans after a slower-than-expected start to 2024.

In February, ODP said it was conducting a strategic review of Varis after the business ran into implementation issues. On 8 May, it announced it had initiated a sale process for Varis which will begin “immediately”; the unit is being classified as ‘held for sale’ on the group’s accounts.

The reseller said it is moving to finalise a transaction “in the very near term”, although a regulatory filing stated that “management expects to complete the sale within one year”. Varis’ senior management team – including President Prentis Wilson – will stay on during the sell-off process, CEO Gerry Smith explained. He did not speculate as to what might happen afterwards.

Meanwhile, ODP is accelerating its Project Core cost reduction programme after a weak start to the year. Smith said this would position the company “to offset the impact of an ongoing challenging macroeconomic and business environment” after revenues at its Office Depot and ODP Business Solutions divisions fell by a respective 14% and 8% year on year.

Excluding Varis, ODP is now targeting Project Core savings in 2024 of $50 million, with total annualised savings of more than $100 million when fully implemented. Much of the $40-$50 million in expenses associated with the programme is expected to be incurred this year.

ODP will begin reducing costs in the current quarter, with most of these actions scheduled to be completed over the coming 12 months.

Previously, Project Core had targeted savings in the range of $50-$60 million – including the Varis business – so the changes announced are major ones and will likely result in further significant job cuts.

Prentis Wilson

Kimberly-Clark has agreed to sell its PPE business (KCPPE) to Australia-based firm Ansell for $640 million in cash. KCPPE comprises the Kimtech and Kleenguard brands, which are sold into scientific and industrial safety channels.

Products include gloves, protective apparel, masks and safety eyewear.

In 2023, the unit generated revenue of $272 million – just over 9% of Kimberly-Clark Professional’s (KCP) total sales of $3.4 billion.

Ansell said it had been watching KCPPE “for many years” as one of its “most attractive acquisition opportunities”. The Kimtech and KleenGuard brands will give it good market recognition in North America, complementing its other brands, such as BioClean and AlphaTec, which are stronger in regions such as Asia-Pacific and EMEA. Following the transaction – which is expected to close in the July-September quarter – Kimberly-Clark’s B2B focus will be on the washroom segment with its KCP, Scott, Kleenex and Wypall brands.

BSA no more

Board development at Office Choice Australia’s Office Choice has appointed independent director Mark Ashby (left) to the role of Chair. Experienced entrepreneur and consultant Ashby – who is also a non-Executive Director at Cash Converters – joined the dealer group board at the beginning of 2023.

Former Chair Daniel Kelly remains on the board as Deputy Chair.

Strategic appointment at United UK independent dealer United has said the recent appointment of Finance Director Steve Johnson will aid its ambitious growth plans to reach the revenue milestone of £100 million ($124 million). Johnson has extensive finance leadership and M&A experience.

Most recently, he was CFO at vehicle technology business Collision Management Systems, where he played a key role in its strategic repositioning and ultimate sale to US market leader Samba Safety.

ISG names Marketing Manager Independent Suppliers Group (ISG) has appointed Ashlee Hunt as its new Marketing Manager. Hunt has more than 15 years of experience in the office products and school supplies vendor channels.

Most recently Senior Channel Marketing Manager at Uniball, she has also worked for Fellowes and Follett Educational Services.

Durable promotes Day James Day has been named as Managing Director of Durable UK. He has been with the vendor for almost six years and was most recently Sales and Marketing Director.

Day is on the committee of the BOSS Leaders of the Future initiative. He was the 2023 winner of the Young Executive of the Year category at the European Office Products Awards and was included as one of the rising industry stars in OPI’s ‘40 Under 40’ list.

Senior changes at Katun Aftermarket print consumables and parts vendor Katun has appointed Kuoying Wang (left) as its new CEO on an interim basis. Wang, who has been Katun’s Chairman since April 2021, was recently made COO of General Plastic Industrial (GPI), the Taiwan-based group that acquired Katun in 2017. The appointment comes following the sudden departure of company veteran Bob Moore, who joined the vendor in 1994 and had been CEO since 2016.

Katun has also named print industry expert Kay Fernandez (left) as VP of Global Marketing.

June 2024

The Workplace Solutions Association (WSA) has opened its membership to the former members of the now defunct Business Solutions Association (BSA). The BSA – which represented the interests of the vendor and manufacturer rep community in the US – quietly folded at the end of 2023.

Now, the WSA will establish a Manufacturer Forum to provide a platform for business products manufacturers to meet, network and discuss pertinent business issues. Additionally, the WSA will invite vendors and manufacturer reps to join its advisory committee.

The WSA said this move “aligns with its mission to serve the entire workplace solutions industry and establish important connectivity between the supply chain, independent dealers and service providers”. Among the benefits vendors and rep groups will enjoy is dual membership of the WSA and its parent, cleaning association ISSA.

ON THE MOVE

NEWS

Kimberly-Clark sells PPE business

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NEWS

GOJO pulls out of Europe

GOJO Industries has withdrawn from the wider European market, including the UK and Ireland, after what it called “an enduring business challenge”.

GOJO Industries Europe (GIE) was incorporated in 1990, with its headquarters in the UK city of Milton Keynes.

In 2014, it expanded into continental Europe with the acquisition of France-based LPK. It saw tremendous growth in demand due to COVID-19.

However, the maker of the Purell brand of hand sanitiser said GIE had “struggled financially for over a decade, requiring significant ongoing support from the US throughout that time”. After conducting a strategic review, during which “many options to turn around the business or to sell it were explored”, GOJO said no viable solution could be found.

For European business customers, part of the wind-down process includes continuing to manufacture product in France “in the immediate term” and making existing inventory available. The closure of the UK operations is being handled by insolvency firm AlixPartners.

Last year, there was speculation that US-based GOJO – a family-owned business – would be sold. Ultimately, the company remained privately held, but laid off about 10% of its workforce.

Following the news of the closure of GIE, the manufacturer reassured the market that its overall business was “healthy and growing” and demand “continues to strengthen”.

Ambiente axes office supplies B2B office supplies will no longer be part of the Ambiente trade fair in Frankfurt. Messe Frankfurt has announced that, going forward, its commercial office products offering will be focused on the Paperworld Middle East event in Dubai, UAE. “Current market developments, structural shifts and transformations in the world of work – these factors remain challenging, especially for manufacturers and suppliers in the commercial office supplies sector,” the organiser stated.

It added: “In Germany and Europe, this market has been stagnating for years, driven primarily by the digital transformation. In response to new requirements, manufacturers are increasingly expanding their B2B office product portfolio by adding B2C stationery offers or looking for new distribution channels and sales markets for their office products.”

As a result, suppliers which were previously housed in the Ambiente Working expo and Office Heroes section in Frankfurt will now be encouraged to exhibit in other halls, such as Creativeworld in Hall 1 and the stationery/ back-to-school-themed Hall 4.2.

Messe Frankfurt talked up the decision to bring together B2B business products suppliers at a single location in Dubai, saying it will “offer focus and valuable efficiency gains to the internationally operating industry”. No reference was made to the Remanexpo aftermarket print supplies event – it is scheduled to continue as part of Ambiente in Frankfurt.

Paperworld Middle East next takes place from 12-14 November 2024. Ambiente 2025 will be held from 7-11 February, while Creativeworld will run from 7-10 February.

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Epson and Amazon team up to fight counterfeiters

10

Epson and Amazon have filed a joint lawsuit in the US accusing numerous individuals of selling counterfeit Epson ink bottles.

In the complaint – filed on 6 May with a Seattle, Washington, district court – the companies said the defendants had “advertised, marketed, offered, distributed and sold counterfeit Epson products” on Amazon at various times between January 2023 and February 2024.

The named individuals – who are all believed to be residents of either the UK or Turkey – are said to have acted together in the manufacture, distribution and sale of the fake ink products, the latter through 24 selling accounts on Amazon.com.

Epson and Amazon are seeking damages and equitable relief, although specific amounts were not specified in the lawsuit.

Highlands has announced that it is now exclusively representing Spanish visual communications and office furniture brand Rocada in the UK and Ireland.

Rocada owner Marc Roca said he had been looking for a long-term partner following the sad passing of Ken Trenberth last year.

The e-commerce, sales and marketing agency has also hired two new Business Development Managers (BDMs) for the UK. Joining the team are experienced execs Chris Armstrong and Sharon Renshaw. They are taking on the respective roles of BDM National Accounts and BDM North.

Armstrong has been in the business products sector for the past 14 years, with spells at Superstat, Office Power and OPI. In addition to his position at Highlands, he will continue to work for OPI’s sister publication Workplace360.

Renz in administration

NEWS

Highlands takes on Spanish brand

The Germany-based parent entity of print finishing specialist Renz went into administration earlier this year. Administrators were appointed on 20 March by the Aalen insolvency court after the company ran into financial difficulties.

The business is now being overseen by Dr Martin Hörmann, Partner at law firm Anchor, and his colleague Ole Brauer, although Renz Managing Directors Raphael Barth and Michael Schubert are still handling the day-to-day operational activities.

The company is continuing to trade, with the German state underwriting staff salaries for three months in accordance with local employment laws.

Hörmann expressed optimism that all 127 jobs in Germany would be saved and the company would emerge from the current difficulties in a stronger position. It appears the administrators have the support of the manufacturer’s main lenders and creditors.

Speaking to OPI, Iain Bullock, Managing Director of Renz UK, said it was “business as usual” at the subsidiary after a strong start to the year.

June 2024 11

NEWS

IN BRIEF

We’ve challenged every closely held belief in our fulfilment network, re-evaluated every part of it and found several areas where we believe we can lower costs even further while also delivering faster for customers

-14.6%

Year-on-y declines re ear volume por Brands in th ted by ACCO eA region in Q mericas 1 2024

Andy Jassy, CEO, Amazon

NFL campaign for Sharpie S-Gel pens

Logitech adds AI

Logitech’s latest mouse has a built-in AI feature. The Signature AI Edition M750 mouse has a dedicated button that opens the vendor’s own ChatGPT-powered Logi AI Prompt Builder tool.

€800 billion Amount Europe needs to invest in energy infrastructure to meet 2030 climate targets

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Newell Brands’ new Sharpie S-Gel pens garnered good publicity during the recent NFL draft. The vendor has signed up Rome Odunze (pictured) and Michael Penix Jr to use S-Gels as the official writing instruments during its Sharpie Rookie of the Year campaign.

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60%

Proportion of private label products sold across the stationery, education and art categories at Australia’s Officeworks

PICTURE OF THE MONTH

Long-established UK networking group, The Society of Old Friends, hosted its annual Spring Dinner in London in April. It marked the inauguration of OPI CEO Steve Hilleard as President, pictured above with special guest Perry McCarthy, former Formula 1 driver and perhaps best known as ‘The Stig’ on BBC’s Top Gear.

Trodat acquires UK vendor Trodat UK has completed the purchase of ASAP Stamps, one of the country’s largest independent rubber stamp manufacturers.

GREEN THINKING

An ERI recycling centre in the US state of Indiana

Staples broadens battery recycling programme Staples in the US has expanded its existing Recycling Services programme with partners ERI and Call2Recycle. The initiative now includes rechargeable and single-use alkaline batteries, which can be dropped off at almost 1,000 Staples stores in the US.

The reseller is offering a new scheme that enables consumers to collect their used batteries at home in a special Call2Recycle box and return them to a Staples outlet. ERI will then recycle the collected batteries at one of its facilities and deliver recovered precious metals and materials back

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SEC pauses climate reporting rules

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The US Securities and Exchange Commission (SEC) voluntarily postponed the implementation of its climate disclosure rules less than one month after they were approved.

In early March, the body adopted the new rules after a 3:2 vote of its commissioners. Although the final requirements for publicly listed companies were seen as something of a compromise versus those originally proposed – for example, they did not include Scope 3 emissions – the SEC immediately faced legal challenges.

After a US Court of Appeals granted a motion for an administrative stay on the rules and 31 other petitions were combined into a single lawsuit, the SEC itself announced it would voluntarily pause the implementation of its final rules pending judicial review. It said the stay would avoid “potential regulatory uncertainty”, but that the SEC would continue “vigorously defending” the validity of its regulations.

In the meantime, impacted companies are being advised to keep an eye on the legal battle and remain ready for the potential changes to climate-related disclosure requirements.

into the market to be reused. Staples said it utilised recycling behaviour research from MIT, along with the expertise of Call2Recycle and ERI, to design the new programme.

“We’re proud to partner with two leading organisations in battery and electronics recycling,” said Brian Coupland, Senior VP Merchandising at Staples. “Since launching our Recycling Services programme with ERI in 2009, together we’ve recycled approximately 165 million lbs (75 million kg) of technology.

“With the inclusion of battery recycling, we’re working to help prevent nearly three billion batteries from entering landfills each year.”

According to recent figures from Call2Recycle, more than eight million lbs of batteries were collected for recycling in the US in 2023 – a year-on-year increase of 1.5%, driven by single-use batteries.

Additionally, over 60,000 lbs of e-bike batteries were recycled during the second year of a voluntary, industry-supported e-bike battery recycling programme that is overseen by the non-profit organisation.

Fiducial tests hydrogen power As well as deliveries made with electric vans, river transport and cargo bikes, French reseller Fiducial Office Solutions is now testing hydrogen-powered vehicles. The company asserted hydrogen presents a number of advantages over electricity, including longer ranges of up to 700 km (420 miles) and much faster charging times.

Christophe Chabert, Transport Director at the reseller, said it is among the first to use these types of vehicles for its last-mile deliveries.

Henkel has launched an initiative to reduce Scope 3 carbon emissions from its suppliers worldwide. Called ‘Climate Connect’, the new programme aims to advance decarbonisation along the supply chain through the collection of emissions data, jointly defined actions for reduction and continuous upskilling.

The vendor will cooperate with Manufacture 2030, a partner in the field of carbon reduction, to address its raw material and packaging suppliers as well as contract manufacturers and suppliers of traded goods worldwide.

This area is responsible for over 90% of Henkel’s Scope 3 upstream emissions.

Climate Connect, which will record key figures on energy, water consumption and waste volumes, will be rolled out and adapted gradually to an increasing number of suppliers in the different Scope 3 categories. With

the help of the data generated, as well as training, Henkel and Manufacture 2030 will offer participating suppliers individual support in assessing their baseline and establishing measures for climate actions.

“Compared with large companies, our small- and medium-sized partners often find it difficult to record their CO2 emissions as they lack the capacity to do so. Yet, this data is the only way to define targets and measures to reduce these emissions,” said Bertrand Conquéret, Chief Procurement Officer at Henkel.

He continued: “This, for us, is the basis for reducing our Scope 3 emissions and achieving our climate protection targets. The Climate Connect programme is therefore designed as a long-term partner project with which we can support our suppliers directly and as individually as possible.”

Biomass project on track for Clairefontaine Papeteries de Clairefontaine – part of the Exacompta Clairefontaine group – has provided an update on the €37 million ($40 million) investment it is making in biomass energy.

Assembly of the biomass boiler at its Etival-Clairefontaine site in northern France is now underway, with engineering work focusing on the silo building and, shortly, the wood-handling equipment.

The project is on track to put the 20-megawatt boiler into service by mid-2025.

Once it is up and running, half of the company’s energy consumption will come from renewable sources.

GREEN THINKING NEWS

Henkel introduces supplier engagement programme targeting Scope 3

Keep IT equipment longer, says TCO Development IT products sustainability organisation TCO Development said hanging onto IT equipment for longer can have a considerable impact on Scope 3 carbon emissions.

While businesses are being encouraged to refresh their computer fleets due to technology advancements such as AI chips, TCO has highlighted that an extended lifespan can “make a huge difference” to reducing climate footprints. For example, when a PC is discarded after just three years, Scope 3 emissions will account for 94% of its total lifetime emissions – a figure that is halved if the device is kept for a further three years.

To help buyers make more informed choices when it comes to selecting equipment, TCO has produced a guide (available at tcocertified.com) to promote circular IT practices. It details five steps to take into consideration:

June 2024

1. Choose a supplier with sustainability ambitions.

2. Include circularity criteria in procurement policies so that materials and components can be recovered.

3. Buy products with the capacity to meet long-term needs.

4. Buy and sell used products.

5. Set up KPIs.

In addition to the Scope 3 impact, TCO said extending a product’s lifespan has a significant impact on e-waste levels. If an organisation purchases 1,000 laptops which are discarded after three years, e-waste amounts to an average of 733 kgs (1,500 lbs) per year. Extending this by just one year will reduce e-waste by 25%.

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SMALL TALK

Platform PIONEERS

OPI catches up with two small US businesses with places on the GSA’s new Commercial Platforms Program

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S

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everal weeks ago, the US General Services Administration (GSA) awarded contracts on the highly anticipated next stage of its Commercial Platforms Program (CPP). This initiative, in the making since 2018, allows federal government purchase card holders to buy commercially available off-the-shelf items from online websites and marketplaces.

Since its introduction, most of the spending on the CPP has been channelled through Amazon Business. Now, competition has been increased, with a total of eight suppliers fighting for federal agency dollars. Four of the new awardees are small businesses, including two California-based companies – Pacific Ink and Glass Commerce.

Pacific Ink and Glass Commerce share some similarities: they are both woman-owned enterprises and each launched as a start-up, although some 17 years apart. A key difference is that Glass is a marketplace concept which enables third-party vendors to sell to the government, while Pacific Ink is a seller in its own right after racking up more than 20 years of experience as a business-to-government (B2G) supplier.

In two recent podcasts, OPI spoke to Pacific Ink founders Jaime and Alex Mautz, and entrepreneur Paola Santana, the founder and CEO of Glass Commerce, for their respective thoughts on the CPP awards.

Jaime Mautz

PACIFIC INK Product expansion Jaime Mautz: Pacific Ink was founded in 2000 and started by selling inkjet and toner cartridges to consumers online. We also offer office, facility and industrial supplies. We actually hit six of the product categories in the CPP solicitation and now sell more than 1.5 million SKUs. Alex Mautz: When we launched, we were a platform strictly trying to serve consumers and businesses. From those e-commerce

When the solicitation came out, it seemed like a natural fit for us

Alex Mautz

beginnings, we then ventured into the government space, but still maintain the e-commerce portion today.

The government has the GSA Advantage programme, which doesn’t lean as heavily on commercial platforms as we think it could.

However, when the solicitation came out, it seemed like a natural fit for us. We had the e-commerce background and the GSA was looking for strength in this area. Plus, we had more than 20 years of federal experience, which have enabled us to build the platform and tailor it to government needs.

Paola Santana

GLASS COMMERCE The vision Paola Santana: We are building pioneering government e-commerce to help agencies and the public sector buy better, faster and simpler. It’s about trying to balance the need for agile, simplified online trading with the requirements of the government, which include compliant purchasing as well as highly detailed socioeconomic goals.

Our initial focus is on small businesses because they have traditionally had a hard time getting into B2G Glass Commerce has the tools – and is creating more – which governments [including Mexico’s, for example] have not had access to in the past couple of decades to be able to conduct these types of transactions. We understand the necessity to make things simple for the largest purchaser in the world – the US government. Simple is very powerful.

Glass Commerce sellers PS: Our initial focus is on small businesses because they have traditionally had a hard time getting into B2G despite all the education and training provided by the likes of the Small Business Administration.

There are more than 33 million small businesses in the US, but if no one gives them the chance, they will never get the performance history they need to compete on a contract.

Glass concentrates on helping a sub-section of these 33 million companies that have products the government is buying but which are not yet fully digitalised – meaning they cannot be found by government buyers. We give them a set of tools which allows them, for example, to issue quotes and invoices in the way the government wants to receive them.

What we have also been doing in some cases for our government clients is to pair small and large business purchases. Say, a city requires 100 units of a particular item – 50 might come from a medium or large seller and the remaining 50 could be split between two small or minority-owned companies. The buyer places one order, makes a single payment and receives one invoice, but we help this buyer to achieve its socioeconomic goals.

June 2024

The CPP bidding process PS: The hardest thing for us was to communicate in a way that would make us a very solid, trusted and respectable partner. We

Government procurement cards PS: We are serving a specific customer – the US government – which is very concerned, in some cases, about how its credit card programmes are getting out of control. I understand now how smart the GSA is: it’s not saying to every government agency it is mandatory to join the CPP, but wants to know where users are swiping those cards and why.

At first, it wasn’t obvious to me why the GSA would wish to have more credit card data. If the federal government is the largest purchaser in the world, the GSA should have information about everything everybody’s buying with its cards. Then I realised the way the credit card and software providers feed data back to the GSA doesn’t necessarily give it the visibility to understand to SKU level what has been bought.

Pacific Ink & Glass Commerce

Competing with large, national sellers AM: We’re not fazed. They are what they are and many of them play in the B2G space. We’re confident [in our proposition] when we get in front of customers and show them what we can deliver. They get the benefit of buying from a woman-owned small business and earning credits – it’s a win-win.

JM: We’re very optimistic. It’s a game-changer for us and we are excited about having this amazing opportunity.

started with our commercial marketplaces after 2020. Since then, we’ve generated millions of dollars from transactions, but we’re still a new player with not a lot of history.

However, selling to the government is what we do best and we convinced the GSA that it needed the best.

SMALL TALK

Solicitation challenges AM: Most of our work went into the administrative portion of the website, such as the reporting functions the GSA was looking for, security and what government buyers need on the back-end to get their jobs done. We have made areas including reconciliations more accessible to the contract administrators.

JM: We’ve been involved with AbilityOne for over ten years, have worked closely with this agency on different contracts and have won outstanding distributor awards. There has always been a block-and-substitute feature on our site, so it was easy and natural for us to offer this on the CPP.

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BIG INTERVIEW

Staying NIMBLE, INFORMED and RELEVANT

I

Aiming to break through the $200 million sales barrier this year, Brooks Smith is on a mission to write the next chapter in the story of Innovative Office Solutions – by Steve Hilleard

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nnovative Office Solutions is one of the largest independent dealers in the US – in the top five. Founded in 2001 and run by the late Jennifer Smith for many years, Jennifer’s husband Brooks has been at the helm since February 2023.

The period leading up to that point was immeasurably tough: on the one hand, with Jennifer’s prolonged cancer treatment and in-patient care at City of Hope in California; on the other hand, back in Minnesota, navigating COVID-19 and all the challenges it brought to the fast-evolving business supplies industry. It took an incredibly strong company with solid leadership and an outstanding can-do attitude and culture to weather such personal as well as professional storms.

In mid-2024, Innovative is on the cusp of breaking through the $200 million revenue barrier. In OPI’s first interview with Brooks Smith, the CEO describes a path that speaks to his competence, resilience and infectious enthusiasm for his company and compassion for our industry as a whole.

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OPI: Brooks, despite being pretty familiar with Innovative as a company, I don’t know a huge amount about your background, so let’s start with that.

Brooks Smith: Sure. My journey to the dealership was quite winding. I went to college to major in economics but determined after about a year that it wasn’t for me, so I swapped to political science.

Choosing political science, you get to the end and wonder what to do next – teach, go into politics or whatever. My decision was to follow college with law school for another three years.

I attended law school at the same university where Jennifer was studying as an undergraduate. I discovered fairly quickly that I didn’t want to go into litigation or be in a courtroom for the rest of my life, so I gravitated towards the business side of law.

After completing law school and passing the bar exam, I went into public accounting for about eight years with a couple of large, multinational firms. I was on a partner track, but when my children were very young, I concluded that it would be tough to be a connected father and spouse as a partner in a large accountancy firm. Instead, I bought a medical manufacturing company, Medcare Products, which made patient lifting equipment for nursing homes.

During this time, Jennifer owned and ran Town & Country Business Products (T&C), originally founded by her father. In 1997, she sold T&C to USOP and joined me at Medcare.

We did this for a number of years until Jennifer’s non-compete agreement ran out and she convinced some of her old T&C colleagues to start Innovative in 2001. I stayed on at Medcare for another nine years before selling it and joining Jennifer full time at Innovative in a CFO/General Counsel role.

BIG INTERVIEW Brooks Smith

Jennifer was so instrumental in developing our core values and our purpose And this is where I remained until February last year when I become CEO due to, as you know, Jennifer’s passing.

June 2024

OPI: A few years ago, I had the opportunity to meet Jennifer at your offices. It was clear to me then what a great culture she had created at Innovative and the fantastic engagement the company has with its local community.

How difficult has it been maintaining both?

BS: Very, particularly to begin with. Not only was Jennifer very close to everyone at Innovative, but also to our vendor partners and our customers, etc. The first few months were mostly about survival.

As we moved on, we began thinking about the next chapter and how we should continue our culture. As difficult as it was, it was also easy because Jennifer was so instrumental in developing our core values and our purpose.

OPI: Before we talk more about the company and its place in our industry, I want to touch on something which has meant so much to both you and Jennifer – City of Hope. Our sector has had a tremendously long and fruitful relationship with this organisation, but you were a lot closer than anyone would ever want to be.

BS: As you say, we’ve been connected to City of Hope from an industry standpoint for a long time. So when we were confronted with cancer as an individual, a couple and a family, we knew instantly what to do – go to City of Hope.

I’m a personal friend of Jennifer’s doctor, Dr Marcucci, and I always keep up to date with his research and what he’s doing. His speciality is in fighting leukaemia but I know there are so many doctors and teams at City of Hope with the exact same philosophy in other areas. And I’m sure there are facilities other than City of Hope which are just as remarkable.

But I don’t know them. My experience is with City of Hope and to me it’s a very special place that, I’m convinced, will continue to be at the forefront of fighting cancer and other diseases.

The annual tours we, as an industry, have of City of Hope give a great insight, but it’s a mere

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Brooks Smith BIG INTERVIEW

meant substantial ups and downs, but also exacerbated a completely different composure of revenue make-up today.

glimpse. I’ve lived there, on and off, for two years and I know what this organisation does is remarkable – every single day.

OPI: Extremely well said. Now, what’s Innovative’s footprint today?

BS: Up until our first acquisition in 2015, we had expanded pretty much organically out of one location in the Twin Cities of MinneapolisSt Paul in Minnesota. As we continued with more acquisitions, we grew out to the Dakotas as well as western Wisconsin.

Right now, we have 14 locations throughout the Upper Midwest with about 325 staff. In terms of revenues, we’re aiming to hit $200 million this year.

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OPI: That must put you in the top three or so in the IDC’s pecking order in the US? BS: Probably top five, I’d say. There are a few larger dealers than us.

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OPI: What growth rates are you seeing year on year to achieve those figures?

BS: To be honest, the last four years have been more about revenue replacement rather than growth – our numbers in 2023 barely surpassed our 2019 sales. The pandemic has

OPI: We’ll go into that “different composure” in a moment – it’s something affecting the whole industry, of course.

First, though, what are the major milestones which got you to where you are today?

You’ve mentioned your first acquisition back in 2015...

BS: That certainly was one of them. We had some absorptions beforehand, where people were going out of business and maybe three or four reps had come over to Innovative. But S&T was our first actual acquisition; it was also our largest independent competitor in the Twin Cities market.

As regards milestones, they are not particularly date-specific. Before the S&T deal, for example, we had done a lot of work figuring out who we were, vocalising what we stood for and developing our core values.

It’s hard to go out and do an acquisition without a real identity – it’s like a merging of equals, which we didn’t want. As we’ve already briefly touched on, we had developed our culture, almost like a franchise, and anyone could ‘buy into’ our story. Between 2015 and today, we bought 13 companies. Without all the prior work we had done, I would argue all the integrations would have been much more difficult and not as productive.

Verbalising to the people you’re bringing into your organisation who you are is hugely important. It’s because they’re always going to lose their identity somewhat, from a business perspective, so it’s essential to come into a distinct culture. I think we did a really good job in making everyone feel welcome in that sense.

OPI: There’s a big leadership component in what you say. What does your leadership team look like now?

BS: Before Jennifer passed away, it was her, myself, Jason Player on the IT side, Julie Owen as COO, Jennifer Rosenzweig as Chief Service Officer and Ryan Burgwald as Chief Sales Officer.

As we mentioned, Jennifer and I were out in California at City of Hope for a couple of years for her treatment. It meant we weren’t as involved on a day-to-day basis. Our leadership team and senior managers got incredibly energised and were empowered to operate in our absence. They were amazing and really stepped up to the plate.

OPI: Have your acquisitions noticeably shaped your business model?

With all diversification, expect to kiss a few frogs because it’s not always going to work out OPI: Diversification! Everybody talks about the importance of it but, speaking to many dealers on both sides of the Atlantic, it’s a challenge. How do you overcome that?

BS: It’s not easy. As you say, it’s become a no-brainer to offer a wide range of categories and we certainly do that. Back in 2015, our product category pie chart looked simple: 65% OP, 35% furniture. This year, OP is down to about 27% of overall revenues; jan/san and breakroom is 19%; print and promotion 5%.

Furniture still stands at about 35%.

Where we’re really making strides right now is on the MRO side. But we’ve learned that you would be foolish to assume you can serve your customers across all the various segments without bringing in another layer of sales support. What I’m saying is, you have to realise and acknowledge when to bring in specialists to help your sales team.

OPI: How, then, are you looking to grow Innovative north of $200 million?

BS: Services are very important to Innovative and will definitely be part of that growth. We bought a couple of smaller companies, for instance, which sell industrial and cleaning equipment. They were companies that had previously repaired this type of equipment for us. It meant we already knew they were great outfits. Bringing them aboard has really helped gain credibility and expand sales in those lines.

Audiovisual (AV) is something else we’re looking at. We’ve always sold the equipment, but since the technology has become so important in the workplace, designing, installing and servicing this type of product is even more crucial.

OPI: We’ve spoken about your product range, diversification and things like that. Is there a perfect Innovative customer?

BS: I believe there is. We essentially have five big categories. From a cost-to-serve

June 2024

OPI: MRO is quite complex and not a category for dabbling in, would you agree?

BS: It’s a big segment where you either go all in or, alternatively, find a niche. About 18 months ago, we bought SIM Supply, which is primarily an e-commerce distributor in the MRO space that sells through its online webstore and third-party marketplaces such as Amazon, Walmart, eBay, etc.

We’ve managed to continue SIM’s very nice growth pattern and are in the process of migrating this MRO knowledge on the e-commerce side to our traditional Innovative customers of OP and facilities products.

You can fail quickly here. Focus on specifics, safety for instance, and zoom in on a limited number of manufacturers. Just don’t try to do everything. Essentially, with all diversification, expect to kiss a few frogs because it’s not always going to work out. Talk to your customers: what else are they buying; how can you assist; what are their headaches in the supply chain?

All this is not just to find new opportunities, but also to figure out how to remain relevant.

I’ve always believed your current customers are the best source of maintaining and expanding revenue, so that’s a good start.

BIG INTERVIEW Brooks Smith

BS: I guess they did. With the first few purchases, we knocked out our larger competition. The more recent ones have been on the smaller side – a jan/san-only dealer or a player purely in the furniture space, so much more specific in terms of categories.

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Brooks Smith BIG INTERVIEW

standpoint, the more of these we can sell to a customer, the better. What’s hard about it sometimes is that, for instance, in the furniture realm, a lot of our competitors only sell furniture – Herman Miller, Steelcase dealers and so on.

We’re a Teknion dealer, but we have multiple other categories and I think this has been used against us. Along the lines of: “Innovative is an office supplies dealer” or “It’s selling jan/san but we only sell furniture, so we’re the specialist”. The reality is that our furniture design team is one of the largest in the marketplace.

We compete head-to-head with these other dealers. What we also bring to the table is the transactional side of all the products we sell.

We see this customer multiple times a week and we’ll always be invested in that business.

The same happens on the facilities side, where our competitor would say: “We’re specialised in jan/san whereas you guys just have it as a category.” True, but all these multiple segments are a bonus for a customer which sees the value in our broad reach.

That’s the sweet spot.

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OPI: Talking about furniture, are we seeing the end of this period of growth as a result of people adapting their home offices and reconfiguring the workplace? Or is this transformation ongoing?

BS: About half of our furniture business is on the K-12 education side while the other half is commercial. K-12 continues to be a very strong vertical for us.

Commercial is different. The ‘reconfiguring’ stage has definitely slowed. Companies continue to evaluate their situations: “Do we renew the lease or should we downsize?”

I wouldn’t go so far as to say we’ve stalled in our return-to-work business but it’s calmed down and the number of opportunities out there are different now. Many businesses certainly haven’t configured their offices yet to be, say, 2025-ready.

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OPI: With all these changes in mind – to products and services – your spend with a traditional broadline OP wholesaler must have shrunk considerably, especially as a stockless dealer, and you no doubt have started a whole host of new relationships.

What’s your view, to start with, on how your wholesale partners have adapted to the evolving conditions?

BS: You’re right, our wholesale spend has definitely reduced and the broadline players need to move a little faster as the market shifts.

We have to do this with our customers – find out what makes us relevant to them for their

survival. The onus is on the wholesalers to do the same; what’s important to us right now is quite different from four or five years ago.

The shift started with the pandemic. Our spend hadn’t changed much beforehand – we were built basically on the back of Essendant, its footprint and what it offered. Also, when we focused predominantly on OP, we had a lot of locally based clients with a national footprint.

Through Essendant’s National Express Delivery programme and its reach throughout the country, we were able to service those clients.

With the ever-rising cost of transportation and serving those customers, in many cases, it doesn’t make sense for us to continue to chase this model. It’s a challenge for the wholesalers to address those issues and establish how they can better support local dealers.

OPI: Has your reliance on Essendant somewhat lessened?

BS: It has to a degree. Essendant had its own issues in March 2023, of course, with its temporary shutdown. It opened our eyes to how dependent we were on it. When the cyberattack happened, we spent the first couple of hours running around, wondering what to do.

What then happened is that we developed a better relationship with S.P. Richards (SPR)

representation we bring. If it’s a pricing issue, we can quickly disperse that. But you cannot just say, “You guys shouldn’t be buying from Amazon” – it’s pointless.

OPI: With SPR in mind, what’s your view on the changes happening there?

BS: I’m not fully aware of everything that’s been going on. Overall, the company has been very open and welcoming – the first call, second call mentality has changed. I’m really appreciative we have a much better relationship with SPR now than we used to.

OPI: I remember being at an event where Essendant’s Harry Dochelli was on stage talking about Amazon and he described it as a ‘habit’. That word really stuck with me and I totally get it. No matter how great your offering is, sometimes we just slip into this way of habitually doing something. Buying from Amazon is one of these things.

BS: (Laughs) I am probably one of the few people in the world who has never bought anything on Amazon.

BIG INTERVIEW Brooks Smith

and – through our buying groups – with some of the manufacturers out there. It’s probably something we should have done before as a back-up strategy.

Everybody is continuously trying to figure out how to remain OPI: Seriously?

BS: It’s true. I like going to stores and ordering relevant to customers direct from manufacturers when I can. Like you OPI: Let’s move onto your competition.

People often watch the US market because it can be the forebear of what’s to come in the rest of the world. Walmart originated there as well as the OP superstores. So too did a lot of mail order firms. And Amazon is a US-headquartered business. What are your views on the landscape as it stands?

BS: It has definitely changed. For much of the past two decades, the operators we worried about the most were Staples, Office Depot/ OfficeMax – the superstars of their days. And our local competition.

The IDC – still strong – has contracted considerably, with Innovative being one of the consolidators. Other channels and verticals too have grown by absorbing or acquiring. All round, there is a smaller pool now, no doubt.

The big boxes are still the competition, but less so. As I mentioned, there’re some very large corporations based in the Twin Cities but we don’t really target that space. We play in our own sandbox and excel in the middle market.

Then there’s Amazon, of course – we continue to see leakage there.

OPI: The other big operator which keeps making noises about becoming a big B2B player in this space is Walmart. Do you see much impact here?

BS: It’s a mixed bag. On the e-commerce side, it’s probably our second biggest marketplace and we’ve really tried to invest in growth with Walmart. But there are some business processes that need to be improved because, despite our best efforts, we haven’t seen enough traction yet.

OPI: As we said before, you’re in a pretty good position as regards your standing in the IDC. How do you view its overall health?

BS: There are fewer fish in the pond, certainly, as mentioned, and you either have to have gained scale or found a specific niche. But overall, it’s fairly healthy in my opinion.

Everybody is continuously trying to figure out how to remain relevant to customers and do different things. Being independent means being entrepreneurial, so I’m pretty confident many operators have been able to find success somehow.

OPI: Some have decided to jump ship, including to Depot’s Federation. How is this model affecting you?

BS: In the Twin Cities, one of our larger competitors became part of the Federation early on. It’s not a bad model – you still have the local presence but with the strength of a large organisation behind you.

June 2024

OPI: How do you deal with it? Or is it just something to come to terms with?

BS: A bit of both. It’s a different buying force today with more empowered end users. The fact customers are spending outside a regular contract is just the reality you have to accept.

We, as a company, have also gone further away from contracts, instead looking to provide solutions to the unique issues customers are facing – and being flexible.

It’s not always obvious why customers are using Amazon. Maybe they don’t appreciate the value of the local, personalised

said, it’s a habit – Amazon just isn’t mine.

Having said all this, on the e-commerce side of our business, 85% of what we sell is through Amazon, so I can definitely see the value of online marketplaces.

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Brooks Smith BIG INTERVIEW

In terms of products, we’ve had pushes over the past decade or two about recycled products and things like that. There’s a decent offering available, but when I actually look to sell them, there’s a delta in the cost which people are typically reluctant to pay.

This will continue to be a challenge.

Then there’s the cost to serve, which also has relevance to sustainability. Is next-day delivery on some rural routes really that important? Or can we fulfil the order next time we’re in the area and just try to be more responsible at the same time?

Overall, I’d say there’s growing awareness when I talk specifically about our customer base, but there’s currently no accountability as there seems to be in Europe.

Photography by Maddie Segovia, Innovative Office Solutions I tend to only hear things second hand rather than having a direct line but, for the most part, I gather it’s been successful in a somewhat limited scope. It’s certainly been hard to grow the model through the pandemic, so perhaps it will yet resurface stronger.

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OPI: Speaking of the pandemic, there were a lot of challenges and we saw organisations like the Supply Chain Investment Group (SCIG) try to address issues such as last-mile delivery and costs. Were you involved in that initiative?

BS: I was and SCIG is still relevant. Most of us now have business in other markets; figuring out the best way to serve them is important because what we’re doing now, either through Essendant or SPR’s national delivery, has become too expensive.

As always, when you have a lot of minds trying to do different things, it’s sometimes hard to get a cohesive strategy together.

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OPI: I want to talk about something which appears to be quite divisive geographically, certainly in terms of Europe versus the US: sustainability. What’s your take on it?

BS: We’re behind Europe, for sure. First of all, there’s so much more awareness, tracking and tracing in your part of the world. I came across this recently when I checked out some European travel in the next few months. Just looking at air fares, I see notices such as “this is a positive carbon flight”, “this is negative” or “this is carbon neutral”.

OPI: It’s a US election year – always an interesting time. Is this having a noticeable impact on your business?

BS: As we’ve seen over the past two administrations, it’s very polarising – whatever the result, a high percentage of the population will despise who ends up in government.

There’s always a lot of political emotion and commotion, but the real effect day to day can be overblown. What’s important is the confidence that whoever is in charge is engendering. Do we know where we’re headed, so that businesses can have confidence? Even if it’s not the plan they would have chosen, at least it’s one they can follow.

Innovative is a living, breathing enterprise and if something no longer works or has to change, we will look at it OPI: What’s Innovative’s plan?

BS: Well, we used to strategise five and ten years out, but this is just not possible anymore.

Change happens so quickly today that, with AI and all manner of other factors thrown in the mix, long-term plans are fine but only alongside short-term flexibility and action.

Nothing is set in stone as regards our strategy. Our culture and our framework are, absolutely; but Innovative is a living, breathing enterprise and if something no longer works or has to change, we will look at it.

The overall message is: stay nimble, stay informed and stay active. And just be relevant to your customers and the markets you serve.

OPI: I think your direction is clear to see.

A good way to end – many thanks Brooks.

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FOCUS

DISRUPTIVE influence How might Fujifilm Business Innovation’s recent entry into the European office print market play out? OPI’s Andy Braithwaite takes a look…

T

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he challenges in the office print sector are manifold. Already an industry in secular decline pre-COVID, the pandemic heralded the rise of hybrid and remote working and a rethink of how workplaces are used.

Of course, fewer people in the office has meant a drop in pages printed. Current estimates put page volumes at around 75% of their pre-COVID numbers and many are predicting office occupancy rates to remain relatively stable in the near to medium term.

In its Industry Credit Outlook for 2024, ratings agency S&P stated: “We continue to take a more conservative view on printer unit growth, which we expect will decrease 2-3% again in 2024 after declining about 2-3% in 2023. Longer term, we expect printers will continue to lose momentum in the battle with digital alternatives.

“In the meantime, however, growth from low-internet-penetrated countries within Asia-Pacific and South America – particularly China, India and Brazil – will keep the overall industry relatively stable.”

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NEW KID ON THE BLOCK It might come as something of a surprise, therefore, that we have recently seen a new player enter the European office segment.

In April, Fujifilm Business Innovation announced it was launching its Apeos range of multifunction printers (MFPs) in the region.

This has already begun in Italy and the UK, to be followed by a “phased roll-out” in France and Spain and then into other markets.

Gary Organ is spearheading the sales push in the UK as Head of Device Techology. After a long career at Canon, he says he jumped at the chance to grow a business from scratch,

but disagrees Fujifilm is a ‘new entrant’ in the market: “We’ve been established for more than 60 years and our technology already exists in Asia-Pacific, where we are the number one A3 player,” he states.

“In addition, we have launched in India, South Africa, the Middle East and Mexico.

From our perspective, it is an established player with market-leading technology expanding its global presence.”

EUROPEAN ROLL-OUT Fujifilm’s European office adventure began in Italy in April with partner Tyche – a start-up established by several former Olivetti executives in 2022. This is what is known as a ‘two-tier’ model, with Tyche as the focal point.

It is an established player with market-leading technology expanding its global presence In the UK – where it launched later that month – the set-up is different. Initially, well-known local managed services provider Aurora has been appointed as the sole reseller. This has been done to test processes, procedures and the market reaction to the Fujifilm offering. Over the next three years, the goal is to achieve a balance of nationwide, regional and local partners via – to begin with, at least – a channel-only approach. The distribution of supplies is being managed by leading wholesaler Westcoast.

As Hiroaki Matsui, Manager of Device Technology for Fujifilm Europe, notes: “We don’t have any baggage or legacy in Europe; we are free to select the most appropriate routes to market.”

Fujifilm is pushing the product attributes you would expect in terms of technology, reliability, security and sustainability. But, as Organ adds, other areas of focus are “honesty, integrity and trust as a provider”.

“We want to make sure this is how we establish our relationships from the very beginning,” he states, possibly alluding to actions by other manufacturers which could be viewed with suspicion by channel partners.

That said, Organ believes Aurora recognises the benefits of – and is even surprised by – Fujifilm’s technology. “We knew we were going to shake the market up a little, but we may disrupt it more than people originally imagined,” he suggests.

[Fujifilm] will need a razor-sharp focus on all channels if it is to build market share

Gary Organ

RIPE FOR CONSOLIDATION? This is assuming the competitive landscape hasn’t dramatically changed by then – which is by no means certain.

In Fujifilm Business Innovation’s Vision 2030 document, published in May 2024, it declared its intention to develop its business “as the only solution partner that can cover the entire range of printing, from office to commercial and industrial printing”.

The same cannot be said of other OEMs. Ricoh, for example, recently revealed it will “focus all business resources on transformation into a digital services company”.

Meanwhile, the likes of Xerox and Konica Minolta are undergoing major overhauls as they attempt to reduce costs. Brother and Canon’s new medium-term plans speak of “business model transformation” and “enhanced structural reform”, respectively.

In addition, rumours continue to circulate about the future of Lexmark under the ownership of Ninestar.

A number of print OEMs have also been looking to consolidate costs by partnering with each other on R&D and production. Just a few weeks ago – also in April – Fujifilm and Konica Minolta announced strategic plans to create a joint venture. This follows on from a similar initiative by fellow Japanese firms Ricoh and Toshiba Tec which will formally launch on 1 July 2024.

Throw into the mix the supply arrangements between Canon and HP Inc, and Fujifilm and Xerox (Xerox bought $933 million worth of parts and supplies from Fujifilm in 2023), and you have a melting pot of relationships and strategies bubbling away against the backdrop of a market under severe pressure.

All of the above suggests an industry ripe for consolidation. With Fujifilm entering the European A3 print segment of its own volition, it would not be a surprise to see it take an active role in any future M&A activity.

June 2024

A UNIQUE OPPORTUNITY According to Louella Fernandes, CEO at global market research firm Quocirca, Fujifilm has a “unique opportunity to solidify its position in the competitive European office print landscape”.

“By demonstrably prioritising its strong reputation for technology innovation – particularly its toner and drum technology, environmental sustainability and robust security – it can gain a strong foothold alongside established players,” she notes.

Fernandes continues: “Fujifilm will need to evolve its European strategy to incorporate A4 devices and advanced MPS solutions and services to support the evolving hybrid workplace. To compete effectively, it must develop a comprehensive ecosystem that leverages the Apeos cloud platform.”

For Peter Mayhew, Principal Analyst at research firm Keypoint Intelligent, Fujifilm’s entry into Europe with its Apeos MFP range is an “interesting” move: “Given the western European A3 market has been declining by approximately 4.5% annually since 2019, a new entrant will need a razor-sharp focus on all channels if it is to build market share.”

He adds: “For the first time this year, placements of all technologies of A3 devices will fall below the million units marker.

This comes as office centralisation and reconfiguration – consequences of hybrid working – change where and how pages are printed. This is not likely to concern Fujifilm, which traditionally takes a long-term strategic approach to its businesses.”

The question is: what is Fujifilm’s rationale for developing the office market in Europe?

Fujifilm’s Business Innovation division was rebranded from Fuji Xerox in April 2021 following the end of the joint venture between the two OEMs. At the time, Fujifilm expressed its intention to grow beyond its traditional strongholds of Japan and Asia-Pacific, and expand into the Americas and Europe.

In fact, the company has already been doing this. It has had a presence in the production print segment in Europe for the past couple of years and recently introduced its Revoria print-on-demand technology in the US. If it follows the same roadmap as Europe, then we could see Fujifilm launch A3 devices into the US within the next 18 months.

FOCUS Fujifilm Business Innovation

For more on the print sector, see ‘Opportunity knocks’ on page 28 and ‘The path of print’ on page 32

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INTERVIEW Stephanie Dismore is confident HP Inc’s holistic approach to hybrid working solutions is a winning recipe for the company, its customers and end users

OPPORTUNITY knocks

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fter leading HP Inc’s North America market for four years, Stephanie Dismore moved to London, UK, in 2023 to head up part of its European operations as SVP and Managing Director of HP Northwest Europe.

OPI’s Andy Braithwaite recently caught up with Dismore – an HP veteran of 27 years – to find out how she has adjusted to life on this side of the Atlantic.

OPI: Please tell me, first of all, what was behind your recent move to Europe?

Stephanie Dismore: The bulk of my career has been in the Americas and I wanted to get experience and learn more from a global perspective – really getting my feet on the ground outside of the US. The Northwest Europe position was an opportunity for me to come and do just that.

I’ve been here almost nine months now and have completely immersed myself in this market, which for us includes the Nordics, Benelux and the UK and Ireland clusters.

www.opi.net

OPI: How is Europe organised at HP? SD: EMEA is structured into three markets. In addition to Northwest Europe, we have Central and Eastern Europe (CEE) and Southern Europe, Middle East and Africa (SEMA), each with one SVP and Managing Director.

Splitting it like this allows us to be closer to the customer. We can be agile, listen and understand what’s going on in the market.

Even in my region, I have three clusters and I’m learning they’re so varied in terms of their needs and challenges.

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OPI: What are some of those peculiarities?

SD: There are basic differences – for example in culture and also in terms of the economy.

In the UK, for instance, inflation is currently a challenge. The Nordics lead on sustainability, so we have to look at how we want to respond and be on the leading edge of that topic.

Benelux is an incredible opportunity with the presence of global organisations such as NATO and the United Nations.

There is so much potential for us to provide solutions across all of the areas where we play, whether that’s personal systems, hybrid – in terms of advancing equality from a

hybrid video conference room collaboration perspective – or print. All of these are very distinct, depending on what country – or even vertical – you’re in. It’s fascinating.

OPI: What are the goals set by HP HQ? SD: We must continue the impressive work the team has been doing. It’s about putting the customer at the centre of everything we do.

It’s about understanding the challenges our customers have, and addressing those and the opportunities that go with them.

We are incorporating AI into everything we do, both in personal systems devices and in print Being able to print anything you want perfectly – from any device, first time and every time – is the idea behind our thinking of how AI can help improve the user experience in the printing landscape. It, of course, also reduces waste from paper and supplies.

OPI: What’s your overall impression of the current state of the print market in Europe?

SD: Print is a very important and strategic business for HP. During COVID-19, we saw a massive rise in home printing while, at the same time, print declined in the commercial landscape – because everyone was at home.

What we’re seeing now is a rebalancing as employees are returning to the office.

However, they’re not coming back at pre-COVID levels and, frankly, I don’t think we will ever get back to that level.

This leads to a very dynamic environment.

The opportunity for print is around how we create the right solutions for hybrid environments. Customers are looking at their print infrastructures; they want to reduce costs but also need solutions for remote/hybrid users – not only in terms of the experience, but also from security and sustainability perspectives.

I believe the potential is immense.

OPI: What will this mean for the installed printer base?

SD: There will be significant changes. A3 is still very important for certain verticals, such as finance, banking, education, the public sector, etc. However, there will be a shift towards A4 and more personal devices for hybrid environments.

June 2024

OPI: You’ve already mentioned AI. Where do you see it having the biggest impact?

SD: AI is not new in print. We’ve been using it to optimise how printers are serviced and deployed, for example.

Our vision for how we are going to continue to innovate in the print ecosystem is about making experiences easier. Take the printing of a large spreadsheet: it can often be cumbersome and frustrating. AI will change this and intuitively know and understand what you’re trying to print and do it in a seamless fashion.

Stephanie Dismore

OPI: How much of a holistic approach to hybrid do you take across your PC, video collaboration and print portfolios?

SD: Today, there’s a dearth of leadership and expertise in terms of how you manage hybrid, and it continues to be a topic of conversation with every C-level executive I speak to.

We position ourselves as a total solutions provider across all our categories. One of the reasons we acquired Poly is because videoconferencing is going to be critical as we move forward.

If you look at the stats, there are roughly 90 million conference rooms in the world and only 11% of them are outfitted with audiovisual.

As such, there’s a huge opportunity to wrap everything together in an entire experience: using your phone or your PC and being able to print from those devices from anywhere; the ability to walk into a conference room and automatically connect to the technology in it.

The focus is not on a particular device or service, but on providing the ideal experience for employees. It goes back to the relationship with work. When the relationship is positive, employees become more productive, satisfied and engaged. That’s the high-level strategy we’re focused on.

INTERVIEW

For me, there are two key areas of focus: firstly, how do we help clients transition to the new world of hybrid? This can mean different things for different people, but at the end of the day, it’s about creating the best experience for employees to come to work and be happy in their working environment.

We recently conducted a work relationship index study whereby we interviewed over 15,000 knowledge workers. I was shocked by the findings – just 27% were “happy” with their relationship with work. HP can make a difference by providing the technology and solutions which enable a seamless experience, whether someone is working at home, in a coffee shop or going to the office.

The second area is the tremendous change AI is bringing to people in organisations, helping them do their jobs better and be more productive and creative. We are incorporating AI into everything we do, both in personal systems devices and in print.

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Stephanie Dismore INTERVIEW

OPI: Let’s talk about sustainability. What differences have you noticed between North America and Europe?

SD: In both markets, there is a lot of new regulation and action by governments and businesses to make ‘sustainable impact’ an integrated part of purchasing decisions.

For HP, this means the need to continue to incorporate sustainability across all of our portfolio – whether that’s in the products, the packaging, circularity, you name it. What I am also seeing is that regulation will become even more enhanced and stricter, for large multinationals all the way down to SMBs. HP’s promise is that we want to be the IT vendor which will help bring a customer’s footprint down: the way we produce and use recycled materials; the services and solutions we offer for the whole product lifecycle, including circularity; and how we can make our devices even more energy efficient.

One example in printing is our next-generation TerraJet toner technology.

We have a unique toner formula which not only gives more vivid colours, but also requires 27% less energy consumption – and we have reduced the plastics in these cartridges by 28%. In addition, the packaging contains 71% less plastic. This is just one data point, but we’re looking to drive sustainable solutions across the board.

For us, the key is to be able to deploy both enterprise and home devices from an MPS perspective: put all these under one contract through our channel partners – some of which have not typically played in the ‘home’ space.

www.opi.net

OPI: At the recent Amplify event, HP CEO Enrique Lores highlighted the importance of the channel, which represents 85% of your business…

SD: Absolutely. Number one, we are a channel-first company; number two, our partners are an extension of HP. They know our customers better than anybody. When we team up with them, with our products and solutions and their customer intimacy, it’s a winning combination.

Amplify was one of the largest conferences ever attended by our global channel partners, and the event tagline was ‘united we win’.

We believe we have the world’s best partner programme, but also understand we are not perfect. We are asking our partners to be demanding of us and continue to push us – we will become better as a company if the channel is strong.

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OPI: How does the channel fit in with your subscription offerings?

SD: Subscription is a great focus for HP. Instant Ink has over 13 million subscribers and this is largely fulfilled through our retail partners. We have started to think about subscriptions for the commercial side and will shortly be launching a pilot for managed print. This is in addition to our existing MPS offerings.

It will be a simple and flexible option – a low-commitment annual subscription.

The plan auto-adjusts each month to give customers the lowest-cost option based on what they print. There’s also a proactive monitoring system which delivers ink and toner before the device runs out.

We are going to consistently work to integrate the principles of reduce, reuse, refurbish and repair into everything we do

For more on the imaging supplies, MPS and print sector, see ‘Disruptive influence’ on page 26, and ‘The Path of Print’ on page 32

OPI: I understand there is EU legislation set to come in which will have ramifications regarding the use of third-party supplies.

You sometimes get a bad press for your dynamic security software. Looking ahead, how do you view your relationship with aftermarket manufacturers?

SD: Our focus is to provide a total end-to-end solution which addresses circularity and provides the ‘greenest’ option. When you compare us to remanufactured cartridges, I would argue that an HP Original supply is the greenest when you look at it end to end. We take back our cartridges, break them down into the raw materials, and we recycle and reuse.

Compare that to a remanufactured cartridge: when it’s empty, what happens to it? Who is taking it back and recycling it?

We will continue towards our vision of becoming a fully circular company, and we are going to consistently work to integrate the principles of reduce, reuse, refurbish and repair into everything we do.

CATEGORY UPDATE

THE PATH of print

As print volumes fall and new ways of working become entrenched, the imaging supplies, MPS and print industry is feeling the strain – by David Holes

www.opi.net

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t’s a tough time for the print and consumables market, which is having to deal with pressures from multiple directions. Research organisation Quocirca asserts that print volumes continue to fall: its recent Future of Document Capture report reveals that companies expect a further average 3% reduction in the coming year, with the largest drops predicted to be among SMEs (6%) and the public sector (9%).

According to CEO Louella Fernandes, 75% of businesses are accelerating the move to digital alternatives as they seek improved sustainability, efficiency and security. However, only 11% operate in a fully paperless environment right now, with the rest still very much on a journey.

This is a global phenomenon, agrees China-based manufacturer Ninestar, but volume declines are especially prevalent in North America and Europe.

Adding to the woes is the fact that the rise of home/hybrid workers, who prefer inkjet or smaller, sub-$200 laser models, has led to smaller profit margins from these lower-end devices and reduced revenue streams overall.

Ninestar spokesperson Ruby Wei says: “OEMs dominate with more than 80% of market share, which leaves the rest struggling with cut-throat price competition and low margins. That said, opportunities do exist

and discerning distributors can find value in mature markets, with emerging ones also offering potential. The aftermarket needs to move beyond price wars and focus on quality and innovation.”

EVOLVING PREFERENCES Print management software developer PaperCut asserts that volume declines are, in part, being driven by more stringent ESG goals and net zero ambitions. Solutions which facilitate pull or ‘find-me’ printing as well as mono or double-sided printing also mean devices are used less frequently which, in turn, helps lower energy and consumables consumption.

Steve Holmes, the company’s Global Head of Sales & Channel and EMEA General Manager, highlights a further development which could impact volumes: the rise of the twin-screen desk.

“With people having to access so many apps and services, many now have two screens,” he says. “The first usually shows their messaging platform – Gmail or Slack, for example – while the second is used for switching between other platforms as required. They can also review a document on one screen while working on another, further diminishing the need to print a hard copy.”

The need to adapt amid these challenges is obvious. Fernandes sees the line between

Louella Fernandes

THE FUTURE OF MPS Kevin Pineda, Merchandise Manager of Technology at US wholesaler S.P. Richards (SPR), predicts MPS will continue to be a strong offering in the market. “We’re already seeing a shift from transactional to contractual sales,” he comments. “Contracted print is the one category where we see growth – in terms of both basic ‘supplies only’ agreements and more advanced MPS engagements.”

Users are increasingly demanding that their MPS systems are underpinned by tangible CSR benefits

Greig Millar

RISE OF THE ROBOTS AI leads companies’ technology priorities in 2024, according to Quocirca’s AI Adoption Trends report, with 78% of businesses saying it is one of their top areas of focus. Fernandes remarks: “We are seeing vendors building AI features into their portfolio of products and services. Examples include predictive device maintenance, generative AI-based customer support tools, AI-powered security solutions and intelligent document processing.”

Ninestar’s Wei concurs: “Wherever you turn, AI impacts you. While it is a threat to some, it is an opportunity for others. Many manufacturers in China, particularly in our industry, used to be proud to share the number of employees working on the production lines in their factories – thousands in each facility. You do not hear those numbers quoted anymore.

“We now use AI to make better products. To be more competitive, we needed to increase the success rate of every remanufactured or new-built cartridge. This meant removing the human error factor and deploying smart equipment which could consistently produce quality products. Robots assess the standard of every item and remove those that fail to meet the required level.

“We have implemented this flexible manufacturing technology in all 55 of our automated production lines. This has allowed us to lift the success rate to a consistent 99.8% – equivalent to what the printer OEMs achieve.”

David Connett, founder and board member of the European Toner and Inkjet Remanufacturers Association, says AI is revolutionising this sector, infusing MPS with smart monitoring capabilities and leading the charge in crafting personalised FAQ processes which adapt to user behaviour.

This paves the way for more intuitive user experiences and streamlined operations, he believes: “AI’s impact is not just felt; it’s becoming the driving force behind innovation and efficiency.”

Like so many companies, PaperCut is currently trying to establish the best way to embrace and embed AI – adding value to areas such as support and self-help and further optimising customer satisfaction.

Holmes is convinced AI will dominate the tech landscape for some time: “The conversation is evolving from ‘AI risk’ to ‘AI

June 2024

Steve Pearce, Head of Marketing at Kyocera Group UK, agrees: “MPS continues to be popular with customers looking for a simple way to realise greater benefits from their print fleet. These include better cost control, security, consumables management, monitoring and reporting, alongside timely maintenance and high-level uptime. It’s important to note specific requirements for MPS solutions can change over time; as such, there is a significant need for them to remain flexible and scalable.

“Furthermore, users are increasingly demanding that their MPS systems are underpinned by tangible CSR benefits; services and contracts need to offer demonstrable carbon neutral and sustainability programmes.”

The potential for cost savings is significant for organisations switching to MPS, according to Greig Millar, General Manager Sales, Services & Solutions at Brother UK. The company’s most recent analysis shows that a typical large business could save as much as £16,500 ($20,650) over a three year-period, compared to buying printers and supplies purely on a transactional basis.

Such incentives are driving customers to make the swap, he says, adding: “Over a 12-month period, we’ve seen pages printed via MPS agreements increase by nearly one-quarter (23%), with devices on contract growing by one-third (32%).”

CATEGORY UPDATE Imaging Supplies/MPS/Print

hardware and software opportunities increasingly blurring as businesses of all sizes seek comprehensive digital workflow solutions which deliver certain business objectives.

At Altkin (formerly Armor Print Solutions), Services and Solutions Manager Emmanuel Ponce points out that the printing market has moved beyond physical documents to encompass comprehensive digital document and information management across multiple core business platforms. Having a thorough understanding of the type of information circulating within companies is vital for those operating in this sector, he stresses.

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Imaging Supplies/MPS/Print CATEGORY UPDATE www.opi.net 34

reality’, whereby we start talking in pragmatic terms about implementing the technology and the guardrails needed to ensure its use is responsible. Following the AI Safety Summit hosted in the UK last November, we’ve seen more discussions about putting technical and ethical AI rules in place as organisations learn to deploy the technology in ways which automates routine tasks without compromising safety.”

EMERGING TECHNOLOGIES AND TRENDS Experts in the field OPI spoke to identified several other technologies and areas of innovation influencing the direction of travel of the print and imaging supplies industry.

Chief among them is the trend for hardware vendors to go beyond supplying only equipment to also providing integrated cloud printing and content platforms. This model allows them to generate recurring revenue from these services, potentially improving hardware profitability and overall competitiveness. By combining hardware with a content platform, they can create a one-stop-shop for users, simplifying the printing process and offering a wider range of options.

Innovations in laser printing, meanwhile, include the recent launch of five-colour photocopying technology. This is disrupting the traditional four-colour model by expanding the printable spectrum and enhancing document vibrancy.

Market trends identified by Altkin highlight that wide-format, label and packaging printers are also very much on the rise – and proving quite lucrative too. Improved inkjet printing technologies are opening up new opportunities for businesses, while consumables are offering better quality, greater durability and lower costs. This allows them to explore new markets such as textile printing, wallpaper and wall decorations as well as providing more profitable on-demand printing services.

Emerging ink formulation technologies such as direct to film (DTF) present an opportunity for businesses to differentiate themselves and offer unique personalised services. Unlike traditional printing methods, DTF involves printing a design onto a special transfer film, which is then heat-pressed onto various textiles and materials. One of the key features setting DTF ink apart is its formulation, optimised for adhesion, vividness of colour and durability on different substrates.

Other developments piquing the interest of those involved in this category include the rapid pace at which the transition to cloud-based solutions is taking place. “It’s really exciting,” says Holmes. “Yesterday’s

Steve Holmes

‘cloud first’ organisations are increasingly ‘cloud only’ firms, and we’re seeing customers which weren’t embracing this technology before now coming on board. What will be interesting to observe is whether end users moving to the cloud spur more customers to migrate to subscription pricing models.”

He adds: “We’ll also be looking closely at how channel acquisitions pan out in 2024.

We’ve already seen the creation of some very large independent resellers which are now bigger than some OEMs. This has created quite a compelling dynamic.

“It leads us to speculate as to where this is going next – could OEM consolidation be on the cards this year? It seems as if it could be, as the industry expects a new entrant in the EMEA region [see page 26]. It would bring a new twist to the sector – a different vendor ushering in radical ideas and potentially needing to disrupt in order to develop. It’s certainly worth watching how this will impact both OEMs and the independent market.”

Could OEM consolidation be on the cards this year? [...] The industry expects a new entrant in the EMEA region Unsurprisingly, we will likely continue to see a strong focus on security, partly because of the risks posed by developments such as hybrid working. This requires robust security solutions, products and policies in order to mitigate risk as much as possible. Managing print in a controlled office environment is far easier than remotely. For the many companies which empowered staff to purchase printers for home use during the pandemic, these now represent another potential attack point.

AI, of course, could also be used to unleash a new wave of threats we’ve not encountered

Imaging Supplies/MPS/Print CATEGORY UPDATE www.opi.net 36

PAAS OR MPS: À LA CARTE OR HOLISTIC APPROACH?

before. Bad actors know print can be vulnerable, so stricter security measures will be required. One measure is the adoption of multi-factor authentication – with the use of, for example, one-time passwords – to gain access to documents.

There’s an opportunity here too, says SPR’s Pineda: “Security is a top priority for customers looking to us to keep their printer fleet free from vulnerabilities. This added service provides peace of mind, while allowing resellers to offer higher value to their clients. It has made contracted print more relevant and we are seeing growing numbers pivot to these platforms.”

ROAD TO RICHES? So, in this volatile, ever-changing category, where is the money to be made for office products dealers?

Ninestar’s Wei has some sage advice: “Distributors need to broaden their product base and expand. If you’re just selling copier toner and parts, for example, then also start to offer paper, plus laser and inkjet consumables.

Become a one-stop-shop, but be sure to differentiate yourself from your competitors – by being first to market with the largest array of products, for example.

“If you are a bricks-and-mortar store, look at going online as well. For those wanting a better retail experience for their customers, create interior designs that will attract people off the street to do business with you.

“Finally, do not sell your products too cheaply. There’s a reason why the OEMs can be so expensive and still capture over 80% of the market. Consumers know they will get what they pay for and you can achieve great margins competing against the OEMs by providing high-quality, non-infringing products, packaged beautifully. It’s all part of delivering a better printing experience.”

For more on the imaging supplies, MPS and print sector, see ‘Disruptive influence’ on page 26, and ‘Opportunity knocks’ on page 28

John Roche is a seasoned expert in the printing industry, with over 35 years of experience.

As CEO of UK print procurement specialist Haybrooke, he leads the company’s mission to bridge the gap between traditional print and modern technology.

The distinction between printing-as-a-service (PaaS) and managed print services (MPS) often causes confusion, he says, with these similar-sounding terms actually representing quite different approaches to handling an organisation’s printing needs.

As Roche explains, PaaS is akin to a subscription model for printing, whereby you pay for services on demand. Think of it as a cloud-based approach to printing, similar to how you subscribe to software services such as Microsoft 365 or Adobe Creative Cloud.

PaaS providers offer a range of solutions, from basic document printing to more specialised services like large-format printing or promotional materials. A typical user might, for example, be a marketing team needing high-quality brochures for an upcoming event. With PaaS, they can upload their design files, choose paper quality and then have the brochures printed and delivered – all without owning any printing equipment.

Overall, the service offers: • Flexibility: it allows users to scale their printing needs up or down based on demand. They are not tied to specific hardware or infrastructure.

• Cost-efficiency: pay only for what you use, thereby avoiding upfront capital expenses.

• Centralised management: PaaS streamlines print management by providing a unified platform for all printing requirements.

• Cloud integration: PaaS leverages cloud technology, making it accessible from anywhere with an internet connection.

MPS, conversely, is a comprehensive solution which goes beyond individual print jobs and focuses on optimising an organisation’s entire print fleet, including printers, copiers and scanners. The goal is efficient, cost-effective and secure printing across the business.

A client best suited to MPS could, for instance, be a large corporation with multiple offices. The service then ensures consistent print policies, monitors usage and optimises the entire print environment. When a printer malfunctions, a technician promptly resolves the issue, minimising disruption.

The key benefits of MPS are: • Proactive maintenance: MPS providers handle all day-to-day maintenance, ensuring printers are always fully operational.

• Supply management: toner, parts and repairs are included, minimising downtime.

• Efficiency: MPS organises print fleets strategically to improve workflow and reduce waste.

• Security: the technology sets access controls, tracks usage and enhances document security.

In summary, PaaS is like ordering printing services à la carte, while MPS is a holistic approach to managing a company’s print infrastructure. Choose the former for flexibility and specific print jobs, and the latter for comprehensive fleet management and cost control.

CATEGORY UPDATE

Safety

BY CHOICE, NOT CHANCE

For the wide-ranging category of safety and workwear, the signs point to sustainable growth ahead – by Kate Davies

F

www.opi.net

ollowing the well-documented decline of traditional product segments and troubling supply chain disruptions, diversification is a hot topic on many agendas. The safety and workwear category appears to have returned to pre-pandemic highs and the path forward is clear for those open to a new direction.

Heading Lyreco Intersafe, Joris Wels, says: “Over the past few years, we’ve seen rapid growth in our revenue from safety products and workwear. Both international and local cross-selling opportunities are continuously increasing our pipeline and results.”

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ON THE UP Before COVID-19 catapulted PPE to the forefront of the category, Lyreco had already spotted its potential and acquired Intersafe in 2018. With both operators focused on sustainability and customer satisfaction, Lyreco’s logistic expertise dovetailed seamlessly with Intersafe’s knowledge of consultative selling and tailored solutions.

“We’ve invested in expanding our marketing and sales force to consolidate our place in all EU markets and establish a leading position in safety in the coming years,” says Wels.

At US research firm Circana, Footwear analyst Beth Goldstein explains how industry-wide price hikes have negatively impacted progress, even though numbers are firmly above pre-COVID levels: “Sales of work and safety footwear declined 4% in 2023 compared with 2022, but remained 19% above 2019 due to double-digit price increases. We expect this softness to continue before the category returns to growth in 2025.”

Wels concurs that some markets and verticals have slowed down due to economic turmoil but reiterates demand has returned to pre-pandemic highs. “A common prerequisite for our customers has become the reliability of the supply chain for safety products because of the experiences with disruption over the past few years. Our broad supply chain capabilities and excellent supplier base have pacified concerns like this,” he notes.

We’re seeing that more PPE is especially made to fit women, which was necessary and overdue The shift to remote and hybrid working has affected many segments of the business supplies industry, yet safety and workwear product lines are somewhat immune. Most of the roles which require safety footwear, for example, aren’t conducive to remote work, says Goldstein, meaning this trend has not had a significant influence on the performance of the category.

However, work-from-home has opened up new avenues for vendors to explore. “There may be more opportunities in the home improvement, garden and hardware channels, since hybrid working has resulted in more time at home,” she notes.

EQUALITY REPERCUSSIONS One development which has had a more noticeable impact on the broader industry is greater diversification of staff. Data from McKinsey & Company shows that the

Each country has its own [...] regulations that make it impossible to have one solution for all CERTIFICATIONS AND REGULATIONS Globally, the first aid market has proved a positive one for Acme United. Managing Director of Acme United Europe Georg Bettin reveals that the vendor already occupies an established position in this niche category in the US, while in Europe it’s still very much on a growth trajectory.

This sub-segment also isn’t immune to obstacles. According to Bettin, the introduction of Medical Device Regulation (MDR) certification services in 2021 has led to new complexities, particularly in the EU. “The huge challenge is that although we have a united Europe, each country has its own habits and additional regulations that make it impossible to have one solution for all,” he explains. “With the new MDR in place, policies have become much tighter and several players in the market are suffering.In addition, external resources such as notified bodies to award MDR certification are insufficient.”

Wels has experienced similar issues with certification and says it’s hampering development: “Smart PPE, for instance, is being introduced to the category but at a slower pace than we had anticipated. Current legislation and lengthy certification processes can hinder progress.”

June 2024

FUTURE-PROOFING Sustainability means different things to different people. Broadly speaking, it involves balancing resource consumption to ensure that meeting today’s needs doesn’t compromise the future of the next generations.

According to Circana’s Future of Footwear report, “long-lasting and high-quality” is the top response of footwear consumers when asked what sustainability signifies to them.

“Even if they aren’t demanding footwear made with specific materials, consumers’ desire for durable products plays into the sustainability discussion. These come at a premium price. And work and safety footwear buyers are less likely than those of fashion and athletic footwear to report they have traded down to cheaper options due to price increases,” Goldstein notes.

Also targeting circularity is double European Office Products Awards 2024 winner tesa (see Event, OPI April/May 2024, pages 46-48). The vendor’s Head of Marketing, Vincenzo Sammarco, says: “The demand for eco-conscious products is increasing. It’s an ongoing process to replace our assortment with sustainable products that are made using recycled or bio-based materials.”

One example of its sustainable range is the tesa 4965 Original Next Gen tape.

Produced with a biomass adhesive and 90% post-consumer recycled PET backing, it results in a 40% reduction in CO2 emissions compared with the tesa 4965 Original.

Lyreco Intersafe is focused on increasing transparency around the sustainability of its goods. Wels comments: “We favour the development of a life cycle assessment and the introduction of environmental product declarations in PPE. “I’ve seen too many sustainability claims in our industry that aren’t supported by evidence.

All of our suppliers must sign our Code of Ethics and those that manufacture own brand products are audited regularly by third parties on social and environmental aspects.”

Overall, Bettin asserts, most customers agree with using sustainable materials if they’re not more expensive. But, he adds, while recycled materials are good for the planet, they’re not appropriate for every product: “When we’re talking about medical

CATEGORY UPDATE Safety & Workwear

representation of women in traditionally male dominated roles is on the rise. Its Women in the Workplace 2023 report revealed the largest increase is in C-suite roles, which grew 6% since 2018 to 28%, while the number of women in entry-level roles has remained at 48%.

In the past, women have used men’s workwear in smaller sizes because equipment for female workers simply wasn’t readily available, according to Lyreco Intersafe.

“We’re seeing that more PPE is especially made to fit women, which was necessary and overdue,” asserts Wels.

Ill-fitting clothing not only affords the wearer less protection but can also look unprofessional and affect morale. Correspondingly, Goldstein reports a growing focus on comfort features and colour in safety footwear, for example.

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Safety & Workwear CATEGORY UPDATE

goods, several components are sterile and therefore need distinct packaging to maintain this status. On a similar note, most people wouldn’t like to use a recycled plaster.”

E-COMMERCE OPPORTUNITIES As a general rule, the pandemic has accelerated the transition to e-commerce.

Goldstein comments: “Consumers have become accustomed to buying online. And while the penetration of online sales is lower for work and safety footwear compared with other footgear categories, it has nevertheless grown quickly.” In 2023, almost one-third of revenues were generated online, up from 20% in 2019, she reports.

Lyreco Intersafe’s Wels adds that digital solutions can also benefit resellers and end users by simplifying operations and administrative workloads. “We’re currently accelerating the implementation of solutions such as the Employee Safety Manager (ESM) to give customers a platform to manage their needs efficiently,” he explains.

ESM is an online registration and ordering system designed to catalogue what PPE is being purchased, when it needs to be replaced and the budget allocated for each individual employee.

4965 Original Next Gen tape by tesa

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Underprotection and overprotection can lead to dangerous or even fatal situations

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Meanwhile, the growth of e-commerce within the first aid sub-segment has come with its own problems. As Bettin explains, a lot of products sold in the European market aren’t in line with regulations. “No CE certification and no local language to explain how to use the products are just the most obvious shortcomings,” he says.

“Unfortunately, there isn’t any real regulation on several marketplaces to protect people from buying products which might be dangerous for their health.”

To safeguard customers, Bettin advises resellers to identify and work with a reliable partner with all the necessary certifications and knowledge instead of settling for cheaper alternatives: “We support our customers in this segment because they can’t build the expertise we have in-house. They are responsible for many different categories and cannot dive into the first aid segment as deeply as we do.”

Equally important is maintaining a culture of safety within the workplace. By ensuring

products comply with regulations and employers follow the correct guidelines, staff can feel confident that they will be safe in their working environments.

The importance of physical and mental well-being cannot be overstated. As companies become increasingly conscious of the benefits of a healthy workforce, safety and workwear products should be promoted with this in mind, according to Circana.

“Work and safety footwear should be in any worker’s toolbox. It can help individuals perform better and should be marketed accordingly,” Goldstein says. In order to do this successfully, Sammarco suggests, it’s essential to make contact with the appropriate person in an organisation.

THE RIGHT BALANCE There is, of course, also such a thing as overprotection. For example, the UK’s Health and Safety Executive recommends hearing protection which reduces noise to at least 85 decibels, but it also strongly advises against ear protection that cuts out too much noise.

Overprotection can result in workers missing warning signals, mishearing colleagues or even feeling isolated which could cause them to remove the equipment or refuse to wear it in the first place.

Wels warns: “The most important thing to consider is the level of safety a product provides compared with the activity the user needs to perform. Underprotection and overprotection can lead to dangerous or even fatal situations.”

Putting the end user first and staying up to date with new developments, Wels concludes, will go a long way towards ensuring players in the safety and workwear category will continue to thrive: “We’re constantly working with our partners to develop our products, making use of the learnings of other families within Lyreco and keeping in mind our principle of safety first.”

RESEARCH

Forward-thinking firms are beginning to make it easier for neurodiverse individuals to enter and remain in the workforce, recognising the distinct skill sets and talent on offer. However, many with such conditions fail to thrive as the right environment and support are not provided to cater to their needs.

THROUGH a different lens Creating inclusive environments in the rapidly evolving workplace

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he notions of diversity, equity and inclusion (DEI) are no longer just buzzwords but essential elements shaping the future of professional environments. As such, there’s an emerging realisation that catering to individual needs and differences is imperative to create a truly inclusive work environment.

However, inclusivity is multilayered and constantly changing. Furniture giant Steelcase explored the topic in two Inclusive Design webinars. In the Designing Inclusive Workplaces session, Steelcase EMEA Director of Applications and Design Consulting Elena de Kan described inclusivity as not a destination or an outcome, but a never-ending journey: “It invites people in, gives them a voice and provides them with the agency to participate.”

Kamara Sudberry, the company’s Inclusive Design Global Leader – based in the US – highlighted the need for deeper empathy and unlearning biases. “Designing with, not just for, is our way of inclusive design,” she remarked.

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A DIVERSE LANDSCAPE Increasingly, workplace inclusivity encompasses neurodiversity – an area where individuals experience and navigate the sensory landscape in unique ways. While most of the population is neurotypical, a significant proportion falls outside this boundary, with conditions such as autism, ADHD, dyslexia, Tourette’s syndrome, dyspraxia, dyscalculia and many more.

It is estimated that between 15-20% of the global population is neurodivergent.

SENSORY OVERLOAD In an Expert Session entitled Neuro-inclusion: A Holistic Approach, hosted by UK-based WORKTECH Academy, Kay Sargent, Director of Workplace at architectural firm HOK, explained that by understanding and accommodating diverse sensory thresholds, spaces can become catalysts for flourishing rather than sources of disadvantage.

Central to her approach is reimagining spaces by dividing them into zones addressing various sensory modalities. The aim is to create inclusive areas while still sharing a collective environment.

Through thoughtful spatial sequencing, Sargent suggested, locations can be designed with hyper- and hyposensitive options, ensuring everyone can find a zone that resonates with their needs. By allowing stakeholders to share their experiences and requirements, the workspace becomes more than just a physical entity; it reflects the diverse community that occupies it.

[Inclusivity] invites people in, gives them a voice and provides them with the agency to participate In Steelcase’s Inclusive Design in Practice webinar, Special Olympics Michigan CEO Tim Hileman stressed the importance of consulting specialists. Referring to the organisation’s inclusion centre project, Hileman explained that the initial master plan included sensory rooms in various corners of the building.

However, following a conversation with a partner organisation which serves individuals on the autism spectrum, the stigma of having a labelled room was flagged.

This started a discussion on incorporating sensory break areas throughout the building which could be utilised by everyone. “True inclusion goes beyond just being invited to the dance; it’s about being involved in planning it from the start,” he noted.

The bottom line is that inclusive workplace design isn’t a one-size-fits-all strategy. It’s a nuanced, ongoing effort that demands constant adaptation to meet the evolving needs of individuals.

Debbie Watts and Hayley O’Connor, co-founders of UK design consultancy ZoneND, discuss how to create neuro-inclusive workspaces

British Motor Show sensory pit-stop

OPI: What does it mean to be neurodivergent?

Hayley O’Connor: Being neurodivergent, in essence, refers to possessing a way of thinking, communicating, learning and processing information differently from the rest of the population. Thankfully, we’re moving away from the traditional medical model of disability which viewed neurodiversity as something to be fixed, to a more progressive social model of disability, with an emphasis on removing societal barriers.

It’s a positive flip for genuine inclusivity and, as a neurodivergent community, we have become our own advocates, driving us to overcome the stigma that hindered such progress in the past.

OPI: How difficult is it to design a place which works for everyone?

DW: As Hayley mentioned, finding a starting point that encompasses neurodivergent needs inherently creates a nurturing environment for everyone. It’s about blending and creating a recipe which accommodates introverts and extroverts within the neurotypical population.

There are simple sensory aspects that, as human beings, we all need and crave. Workplace design, when done in consultation with neurodivergent individuals, strikes a delicate balance that is entirely achievable.

OPI: Where does the responsibility for neurodiversity inclusion in the workplace lie?

DW: Embracing neurodiversity is more about company culture than size. Those businesses which champion it find it beneficial, as neurodivergent individuals bring unique perspectives and talents to the table.

While large corporations may have dedicated roles such as HR or diversity and inclusion, smaller companies can still be proactive. To facilitate, we use our ‘inclusion triangle’, which I’ll let Hayley explain.

HO’C: The inclusion triangle model puts the environment as the spearhead of neurodivergent support in the workplace.

You can have individual support (mentorship, reasonable adjustments, coaching) and organisational culture (awareness and training), but if you’re not accommodating the environment, it’s simply not going to work.

All three elements need to knit together and work in harmony. Once this happens, you create a community where individuals are not only seen and accepted but also deeply understood, thereby cultivating a strong support network.

OPI: Finally, tell us about your company, ZoneND. What services do you offer and what are your plans?

HO’C: ZoneND, established in March last year, is driven by our shared passion for creating neuro-inclusive environments. We offer consulting services in workplace design, health and education, with the aim of effecting positive change through inclusive practices.

In a recent project at the British Motor Show, we created a ‘sensory pit-stop’, witnessing first-hand how powerful inclusion can be – we constructed a psychologically safe environment where people felt secure, seen and heard.

DW: We design through an overt neurodivergent lens and have partnered with psychologists, charities and organisations which are all working towards the same vision of creating a sense of community to bring about meaningful change.

June 2024

OPI: What are the key elements for creating a neuro-inclusive workplace?

Debbie Watts: Creating inclusive spaces involves an understanding of the different needs of neurodivergent individuals. Think about how the workplace has evolved over time – from pods with high screens to open-plan environments. It’s gone from one extreme to another.

While those who are neurodivergent can function in various office settings, it can be challenging and, for some, detrimental, so certain criteria are needed to alleviate sensory overwhelm. Factors such as open plan, frequent changes in seating arrangements and sensory triggers must be carefully considered.

Addressing loud environments and repetitive sounds and providing privacy options (high-backed sofas or booths), along with incorporating biophilic elements and investing in acoustic solutions (wall panels and ceiling treatments), can contribute to a more neuro-inclusive workplace. Recognising these needs and allowing for flexibility, even in terms of workspace location, are crucial.

HO’C: Most neurotypical people get fatigued on certain days, which could be down to specific sensory input factors – noise, flickering lights, room temperature.

We all have sensory preferences. What’s really important to understand is if you are designing workplaces with neurodiversity in mind, you’re accommodating everybody.

OPI: Are there specific considerations for office furniture, for example?

DW: It’s an interesting question. There should ideally be a sub-category for furniture that caters to neurodivergent needs. As consultants, we physically experience and assess every piece of furniture for its suitability.

RESEARCH Neurodiversity

THE IMPORTANCE OF SUPPORTIVE AND STIMULATING WORKPLACES

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RESEARCH

CHASING

VOLUME in the digital age

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ore OP market volume and value took a turn for the worse in 2023 compared to what appeared to be an improving performance in 2022.

This is just one of the takeaways from The State Of The Business Products Industry Report 2023-2024, an annual guidebook published

by OPI in collaboration with Martin Wilde Associates (MWA).

In this eleventh market research study, the vast majority (76%) of respondents believed that core OP – traditional stationery, paper, EOS and furniture – market volumes had declined in 2023. A sizeable 41% also reported that core OP market value had fallen.

Indeed, the latter was pulled in two opposite directions throughout 2023. On a positive note, there were still some remaining price rises – especially on paper products – being pushed through, driving value ahead of volume, plus some restoration of demand as workers gradually returned to the office and previous supply restrictions eased.

However, ongoing digitalisation, continued work-from-home and hybrid working, an uncertain economic/political climate adversely affecting business confidence as well as some price decreases combined to pull core OP market values down.

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VOLUME VS VALUE So where were revenues primarily generated in 2023? Many of those revealing growing sales last year attributed them to price rises, taking market share or diversification away from core OP into new categories.

The findings in this 300-page sourcebook are based on 68 in-depth interviews with senior executives in the business supplies industry in Australia, Benelux, Canada, France, Germany, the UK and the US. Once again, MWA’s research has unearthed some fascinating results across these seven geographies. Across all product categories, for instance, values are outperforming volumes:

the state of the industry report

while 64% of respondents said that their sales volumes decreased in 2023, as many as 57% referenced an increase in sales values.

The full report reveals what exactly these operators did to mitigate the impact of falling volumes in 2023, how they achieved value growth and what their expectations are for 2024.

Margins, meanwhile, are improving, the research found, with over half of all companies questioned reporting growth (56%) and only 15% claiming they had decreased. Distributor respondents in particular were optimistic about margin developments.

About 60% of study respondents are looking to acquire another business in 2024

The State Of The Business Products Industry Report 2023-2024 is now available – visit www.opi.net/ SOTI2024 to order your copy

On the product side, the categories that were most widely reported to be growing in value terms in 2023 were cleaning/janitorial supplies, catering/breakroom items and ergonomic and well-being products. On a downward trend were traditional stationery products, cut office paper and printer/IT consumables. These results reflect the reality that digitalisation maintains its upward trajectory.

The supply channels most often cited as taking market share were Amazon/Amazon Business, other online marketplaces/ platforms and internet-only OP resellers. Small independent OP dealers/resellers, national contract stationers and OP wholesalers found themselves at the other end of the spectrum.

The State Of The Business Products Industry Report 2023-2024 covers a broad range of additional topics, such as the current and expected future strategy around paper catalogues. Another is the game plan for consolidation: about 60% of study respondents are looking to acquire another business in 2024.

RESEARCH

Prime POSITION

How are global cities creatively adapting to the evolving demands of the modern workplace and urban living? WORKTECH Academy has been finding out...

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digital economy with a traditional preference for in-person communication.

Across all surveyed cities, hybrid working has become a mainstream element of workplace culture, impacting how people work and interact within urban centres. The move towards high-quality, environmentally friendly office spaces is ubiquitous, with an increasing emphasis on creating vibrant, walkable communities.

OPI takes a glance at four of the cities – New York, London, Madrid and Sydney.

URBAN DICHOTOMIES However, local nuances provide distinct contrasts, with each city facing specific challenges. For instance, New York is seeing a decline in its coworking sector, whereas London’s flexible workplace market is flourishing. Tokyo is looking to address its ageing infrastructure and commuting culture, while political and economic instability has stalled progress in Buenos Aires.

Sydney is preparing for extreme weather events, while Madrid is balancing its budding

NEW YORK In 2023, New York’s real estate market saw a modest uptick in leasing activity, though it remained below historical norms. As companies forge different work patterns that meld remote and in-office activities, there has been a noticeable deceleration in new developments and a downturn in the coworking sector.

In response to the evolving work culture, some businesses are setting up satellite offices in outer boroughs such as Brooklyn and Queens, enhancing convenience and flexibility for their employees. Modern buildings are being equipped with better amenities to satisfy the demands of tech-savvy tenants.

Amid these shifts, New York is witnessing a burgeoning interest in mixed-use developments that integrate residential, commercial and retail components. These are designed to cultivate vibrant, walkable communities and are growing in popularity alongside adaptive reuse projects.

The city is also seeing a rise in transit-oriented sites, strategically located near major transport hubs to encourage public transit use and reduce car dependency.

Office occupancy rates remain volatile, with higher mid-week numbers. Despite these fluctuations, a considerable proportion of office workers are still regularly present at their place of work. To support employee wellness, firms are integrating amenities such as outside areas, fitness facilities and mental health resources.

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he global real estate landscape has been significantly reshaped, according to WORKTECH Academy’s Cities on the Frontline of the Future of Work: Trend Report Q1 2024.

The study surveyed six urban centres – New York, London, Sydney, Tokyo, Buenos Aires and Madrid – and found that change has been driven largely by the adoption of hybrid working models. These evolving work patterns are transforming city economies, altering public transport usage and redefining central business districts (CBDs).

A notable swing is the ‘flight to quality’, whereby corporations are shifting towards smaller, more sustainable office spaces with superior facilities. This migration is leaving behind a considerable amount of sub-prime office stock, leading to a geographic realignment of business districts and rental increases in prime locations.

Furthermore, there is a growing focus on the adaptive reuse of buildings and a concerted push towards sustainability. This is particularly evident in cities such as New York and London, where outdated buildings are undergoing essential upgrades to meet strict environmental standards.

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Local nuances provide distinct contrasts, with each city facing specific challenges On a cautionary note, London’s positive real estate outlook is tempered by the realities of high interest rates and limited space for new developments, compounded by an excess of outdated, less sustainable office structures.

But, predictions by JP Morgan suggest that by 2025, demand for prime office space in London could outpace supply by 1.2 times.

MADRID Prime office locations in Madrid continue to hold their value, whereas suburban areas are encountering issues, with rents on the decline.

However, most firms are staying in their current spots, while those choosing to relocate tend to look for offices with smaller footprints.

Madrid is responding to these market conditions by embracing the digital transformation and the adaptive reuse of existing buildings. Coworking set-ups are

SYDNEY In Sydney, the office market exhibits only subtle signs of revitalisation, with a cautious re-emergence of activity. Larger tenants are strategically reevaluating their workforce and workspace needs – mainly through consolidation and renewal.

The core and the CBD of Sydney continue to outperform more peripheral ‘fringe’ locations, emphasising the importance of amenities and connectivity. As broadly mentioned before, Sydney is experiencing a ‘flight to quality’, with developments such as Parkline and the proposed Chifley South drawing notable leasing interest. The transition of some businesses from lower-cost fringe areas to more premium spaces is happening gradually, although they are seeking smaller footprints in these locations.

As is the case in New York, there is increasing attention on ‘mixed experience’ developments, which transcend traditional models by creating environments that offer diverse experiences and promote energy, authenticity and social connection.

But the challenges in this city remain stark.

Efforts to promote a full-time return to the office have been only partially successful, with occupancy rates indicating that many employees continue to work from home for part of the week. The reduction in weekday city movement – especially on Mondays and Fridays – and a growing interest in a four-day workweek reflect changes in space utilisation and the purpose of cities.

Weekend foot traffic has returned to pre-COVID levels, indicating that high-quality experiences can still draw people into the city; this will need to be reflected in office spaces if employers wish occupancy rates to rise.

Amid these developments, Sydney also faces pressing environmental issues, with predicted temperature rises necessitating urgent investment to minimise the urban heat effect and enhance city resilience.

June 2024

To read the full Cities on the Frontline of the Future of Work: Trend Report Q1 2024 and watch the accompanying webinars, visit the WORKTECH Academy website

experiencing growth, serving as additional amenities within office towers. These spaces align with the efforts of firms to have their employees in the workplace more frequently; the city is seeing a high return to the office, with 59% of workers at their desks four or more days a week, surpassing the global average.

Innovative leasing arrangements are also emerging, such as tenants on long leases sharing their spaces with other businesses – a novel approach in the Spanish market.

Looking ahead, a renewed focus on city-wide regeneration, fuelled by new projects, indicates a positive trajectory for the capital.

RESEARCH The Future of Cities

LONDON London’s office market is displaying a renewed sense of optimism and the city’s famed ‘bouncebackability’ from major disruptions such as Brexit and the pandemic is once again evident. A notable resurgence in construction activity is marked by the development of 5.1 million sq ft (circa 500,000 sq m) across 43 schemes – the most substantial since 2005, as highlighted in Deloitte’s latest Crane Survey.

Despite these positives, the transition to hybrid working models is now deeply entrenched, conceivably more pronounced in London than in other European cities due to ongoing commuting issues. This lasting trend is transforming the office landscape, with the flexible space market not only recovering but also expanding its share. Interestingly, the main driver comes from managed space for larger businesses.

The demand for more sustainable workspaces is altering lower-grade assets and shaping the design of new buildings. The City of London Corporation is responding by easing regulations to allow the conversion of older, under-utilised buildings into spaces for cultural, educational and hospitality purposes.

Geographically, there are also shifts.

Traditional business hubs like Docklands and Canary Wharf are seeing major firms relocate, often with ever-growing attention being paid to locations in the West End and areas west of the City due to their social amenities.

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5 MINUTES WITH...

CAREER Q&A Describe your current job.

I am the VP of Sales at multicatgeory reseller Guernsey. My role tasks me with setting our sales strategy and assisting our account managers in achieving it.

Jake Mages

Jake Mages, Guernsey

What is your life philosophy?

Control what you can control. Life is overwhelming enough without carrying the extra burden of things you’re powerless to change. By staying focused on what’s within our sphere of influence, we can make a bigger, more positive impact on our life and the lives of those closest to us.

Who is your celebrity lookalike?

Global icon Bruce Willis.

What song always puts you in a good mood?

So Good by B.o.B. What’s the biggest risk you have ever taken?

Asking my wife (right) to marry me felt like a risk – she’s out of my league!

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Do you have a guilty pleasure?

I can’t resist chocolate chip cookies but they have to be homemade.

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If the world had a president, who would you vote for?

Andy Cohen. He seems like an excellent mediator who understands people. I think he could tell what conflicts need attention and which are frivolous.

What gameshow or reality TV programme would you love to be on?

I’d have the best chance on The Amazing Race. It would also be fun to hang out with the guys from Comic Book Men.

Who is the industry figure you most admire?

Without a doubt, it’s David Guernsey (below). Over 53 years, David has thoughtfully built his business and successfully navigated more than a few existential threats that come with being an independent dealer.

Best career decision you have made?

I made the choice to move from sales into a management track. I loved sales, but as my wife and I started planning for a family, I was looking for more stability than full commission could offer me.

Worst job you’ve had?

It was actually my first-ever job – a youth basketball referee. Talk about a thankless task.

What’s your preferred location of work?

Trick question! From an office supplies distributor perspective, I guess everyone should work from the office, shouldn’t they?

FINAL WORD

Unlocking DIGITAL growth

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n today’s e-commerce landscape, success hinges on more than just selling products. In March 2024, eDesk conducted a poll of over 400 customer service managers from multichannel e-commerce companies which revealed the delicate balancing act behind success. The results found 39% of respondents ranked customer satisfaction as the top focus, while 31% prioritised cost reduction and 30% emphasised global expansion.

The reality is that success demands a holistic approach and businesses cannot afford to view these separate points as mutually exclusive. Cultivating customer satisfaction is crucial for fostering loyalty.

Simultaneously, expanding into new markets offers opportunities for growth and diversification. However, both must be undertaken while also considering the costs.

In essence, success requires a strategy that embraces complexity.

EYEING EXPANSION The rewards of international expansion are certainly compelling. In a separate study of our customer base, sellers adopting global strategies reported a significant 25% increase in revenue during the peak season of 2023, highlighting the immense potential for growth within markets across the globe.

That being said, one of the main obstacles lies in providing harmonious customer support across regions. Ensuring consistent service quality becomes increasingly complex when catering to a diverse audience with wide-ranging cultural norms, preferences and language requirements.

A SATISFIED CUSTOMER One of the main challenges of navigating a comprehensive strategy is the tension between cost reduction and customer satisfaction. Seamless, personalised and lightning-fast support across channels is now a given but providing this drains resources.

Traditional cost-cutting measures, such as reducing staff or outsourcing support functions, can inadvertently compromise service quality, leading to dissatisfaction among customers. Furthermore, investing in technology and process improvements to enhance efficiency often requires upfront capital and ongoing maintenance costs, posing a barrier for some businesses.

However, creative support solutions can offer businesses a promising path forward.

For example, help desks that centralise support operations allow businesses to streamline processes and eliminate redundant tasks, meaning a reduction in operational overheads.

AI-assisted responses and automation further enhance efficiency by handling routine enquiries and tasks, freeing up human agents to focus on complex issues which demand customised attention. These technologies not only drive down costs but also improve service quality by accelerating response times and ensuring consistency in support interactions.

AI-powered multilingual support systems enable businesses to communicate in different languages, enhancing accessibility and customer satisfaction. Integrations with regional fulfilment partners, meanwhile, facilitate coherent order processing and delivery. On top of this, easier access to local marketplaces allows businesses to establish a presence in foreign markets meaning they can better understand local consumers and accommodate their preferences.

The convergence of customer satisfaction, cost efficiency and international expansion as intertwined pillars of e-commerce success has never been clearer. Implementing detailed strategies to navigate these priorities will not be a straightforward task though.

On a positive note, the opportunities from leveraging AI-powered technology to enhance user experience and scale operations internationally are too significant to overlook.

By embracing such solutions, businesses can achieve the crucial goal of sustainable growth.

Brendan Hughes, Chief Commercial Officer, eDesk

In essence, success requires a strategy that embraces complexity

E-commerce customer service software provider eDesk connects over 200 marketplaces, webstores, social media and logistics channels.

Founded in 2012, its AI-powered automation tools streamline support services, freeing up e-commerce brands’ time to focus on growth