Positive education

For a business established in 1957 to only have undergone two management changes in all those years is a rarity. But this is what’s happened at Egan Reid. Launched by Jim Egan and Jack Reid as printers and office stationers, the firm was taken over subsequently by Martin and Andrew Reid – who have become legends in the UK industry.

After the best part of 40 years, the brothers decided to step back from the daily running of the company in September 2022, with Martin presently Chairman and Andrew as CEO. The mantle has now passed to Martin’s son, Charlie, and business supplies veteran Bruce Davie.

The pair are joint Managing Directors and are buoyant about the future, with current sales of £14.5 million –higher than pre-pandemic. 20% organic growth year on year for the past two years has been achieved against plummeting COVID-related sales and declines in toner cartridges and traditional stationery items. For the 12 months ended 31 March 2020, sales were just shy of £14 million but dropped roughly 30% over the following

£14.5 million FY22 SALES

12 months due to lockdowns. “You cut your cloth accordingly, so we’re down around 12 employees and a few van routes compared to then,” says Davie.

Operating from four locations – Stockport (head office), Bradford (Education Express), Lincoln (Todds Group) and the Isle of Man (BHX Stationery and Furniture) – Egan Reid is conceivably a leaner outfit since the pandemic. Nevertheless, it has an impressive head count of 66, including directors. Totting up the team’s experience results in an astonishing 850 years, with 31 employees serving over ten years at the company.

Egan Reid maintains a fleet of around 20 vehicles spread across the four offices, intending to add more due to business demand. “Some players have moved to couriers and third-party deliveries, but it’s not what makes this channel special. We don’t want to be like Amazon and drop parcels off at reception. Our drivers will place the supplies in the stationery cupboard and leave paper next to the copier machines. There’s value in this service,” states Davie.

NO. OF EMPLOYEES

Stocking Up

80% of products sold are held by Egan Reid, with the rest derived from the wholesale chain. A former Spicers dealer, this set-up has safeguarded it from the marketplace disruption over the past few years. There is no intention to replace this model as it enables the company to maintain control of deliveries and allows for greater discretion concerning supplier choice.

Quick turnaround items, including big brand names for traditional office supplies, are bought direct. However, diversification has seen shelves filled previously with labels, binders, etc give way to pots of glue and play sand following a decisive move into the education sector. Davie explains it’s been a “significant change”, with the company now holding almost 3,000 products relevant to these customers. He adds: “We still buy 10,000-12,000 products through wholesale for the tail as the channel is set up to provide those ones and twos on our behalf.”

Today, the business is split into either a commercial or an education sale. While the former contributes a higher sales percentage, the latter is growing more rapidly. Aside from the usual classifications of products you’d expect to find with educational supplies, becoming specialists and delving deeper into the sector has revealed sub-categories such as special needs, arts & crafts and sports & games.

Dealing with the idiosyncrasies of the sector such as deciphering quotes with just a description and no product codes, has been a steep learning curve for the dealer. Reid, however, is of the firm belief that the company’s service mentality, incorporating nextday delivery and personalised assistance, is a “huge competitive advantage”.

Fit For Purpose

On the commercial side, Egan Reid’s furniture and fitouts division, Office Environments, is equally paying dividends. Boosted by the onset of hybrid working and return-to-work mandates, the team has noted a recent shift towards in-office attendance, but more striking is the swing to “doing something different” concerning workspace design.

But, advises Reid, it is a sector with a complicated supply chain and not one to merely dip your toes into: “Since we bought Education Express in 2012, we’ve learned the nuances and how to navigate the waters because the margin expectation is altogether different, as is the buying and selling process for every school.

“Relationship building is the most critical aspect of our job. Although customers are loyal, you can win an order today and lose it the following week. It is hard work, but every month more schools sign up with us. Once they start buying from us, they seem to stick.”

Pre-acquisition, Egan Reid was in a similar position to one many resellers may presently find themselves in, with the ability to supply only a limited set of traditional OP products to educational facilities.

Says Reid: “Right now, we’re dealing with projects designed to entice staff back to the workplace by making them feel more comfortable. For example, canteens modelled on Starbucks, the incorporation of biophilic elements and homely collaborative spaces which emulate living rooms.

“Rows of desks that pack employees in like sardines are not in vogue, but the fun has returned with table tennis and pool tables.”

The dealer covers the gamut of workplace furniture and interiors – from the supply of one chair to full design service and everything in between – with the sweet spot being mid-sized deals of £100,000-£750,000. Currently “exceptionally busy”, according to Davie, Office Environments is not far short of 40% of total revenue.

Work is wide and varied, from refurbishing a school toilet block to an upcoming project renovating hospitality suites at a football club. “What I didn’t appreciate until I started at Egan Reid is how complementary education and commercial is. Education activities are carried out during holiday periods, with multiple projects kicking off simultaneously in various locations, and commercial deals fill the rest,” says Davie.

Education and Office Environments may be the two growth generators, but other categories including catering and jan/san are doing well. Both Reid and Davie are advocates for not leaving money on the table and surmise many dealers are guilty of failing to mop up available ancillary sales. In fit-outs, as Reid explains, it could be anything from supplying white goods, adding lighting, installing flooring or sourcing picture frames.

Davie offers the example of one retailer’s requirement for a full darkroom studio, including photographic equipment, and another of stocking adult incontinence products for delivery to care homes following a client request. “It builds customer loyalty by taking the hassle out of sourcing quirky and wonderful goods not normally stocked. I never want a salesperson to say they can’t sell something. If a customer requires a specific item, we’ll supply it,” he notes.

Getting Noticed

The team is keen to promote its endeavours and is becoming increasingly active on social media through Twitter, Facebook, Instagram and LinkedIn. The digital strategy stretches back a few years following a move to EvolutionX, with an Egan Reid group webstore, alongside a standalone educational supplies version. While eganreideducation.co.uk is registering 60% growth, eganreid.co.uk commands a higher percentage of total sales at around 35%. Davie says the company is embracing the crossover of educational items available on its specialist website being bought by commercial buyers and bringing the two together by making product more visible to customers.

Sustainability is another huge focus for the group, with net zero and recycling top of mind. Internal targets have been set and thus far have resulted in a reduction in gas (40%) and electricity (14%) usage and a 16% decrease in business miles in the past year.

There are also plans to install solar panels at the company’s head office. In terms of reaching net zero, Davie says scope one and scope two are “pretty much covered”, whereas scope three is a different kettle of fish. “To vet our multimillion-pound supply chain for environmental performance from cradle to grave is quite a challenging proposition. We don’t want to just pay lip service to it, especially as customers are demanding to see our sustainability credentials.”

One aspect the duo is proud of is the recycling of cardboard, plastic, metal and wood waste streams. This includes recovering customers’ unwanted furniture etc, with pieces sent for recycling, broken down into components or given to charity. In 2022, Egan Reid planted 1,143 trees and is aiming for 2,500 this year. The dealer also recently joined the 100 Trees Club, part of a campaign to plant three million trees within Greater Manchester in the next five years.

While keeping a lot of plates spinning, Egan Reid is also significantly strengthening its balance sheet, selling well and seeing reasonable profits. But Davie is patently aware that other dealers may not be so fortunate.

To this end, he states, many may not know that Egan Reid has acquired nine businesses over the years and is currently hunting for further growth and is in a “very acquisitive mood”. He adds that the team is happy to talk to any dealers looking for a way out, whether that be in office supplies or other verticals like jan/san, print or workwear.

TOTAL YEARS OF EXPERIENCE WITHIN EGAN REID +/-3,500 NO. OF ACTIVE CUSTOMERS

850 years