Staples moves away from office supplies

Staples is overhauling its marketing as part of a high-stakes pivot away from what it was built on — selling low-priced office supplies at big stores.

The rebranding campaign kicks off next week with nationwide television commercials in which stores are nonexistent and products are only shown in passing. There’s no mention of discounts either.

Instead, the spots star and extol office and building managers as they fix copy machines, clean up spills and restock the breakroom — all with the help of Staples’ delivery business. These are precisely the workers the company sees as crucial to its revival from years of falling sales because they make the purchasing decisions for more than a million U.S. small businesses.

“We wanted to tell a new Staples story,” said Frank Bifulco, the company’s chief marketing officer. “It’s going to convey to all audiences that Staples is much more than a retail office-supply company.”

After U.S. regulators blocked the company last year from buying smaller rival Office Depot Inc., Staples shifted from consolidation mode. Instead, it began to aggressively pursue customers in the $80-billion-a-year U.S. midmarket — or businesses with fewer than 200 employees. Staples currently has less than 5 percent of that market. The plan includes adding 1,000 people to its sales staff, acquiring regional distributors, and offering memberships and services to make office and facilities management easier.

This is all part of the company’s push to expand its delivery business, which offers customers a sales representative and online ordering. This division was already generating more revenue than the brick-and-mortar stores, which have struggled as more consumers shop online. Staples, based in Framingham, Massachusetts, still has about 1,500 locations, but continues to pare down that the number.

While delivery has been a key part of the company’s history since 1993 — just seven years after Staples was founded — it’s barely been mentioned in advertising. The focus has always been the physical store, but that’s not where the company sees its future. By 2020, it expects only 20 percent of revenue to come from retail locations — down from about 40 percent now. The rest will be generated by delivery and online sales.

Having the delivery unit already in place gives Staples a concrete way to veer off the dubious path that many of its retail peers are headed down. The company wants to be seen as a business-to-business “solutions partner” that “makes the workplace work,” Chief Executive Officer Shira Goodman said in an interview earlier this year.

That’s reinforced in the commercials, with the new corporate slogan “It’s Pro Time” replacing “Make More Happen.” One 30-second spot portrays office and facilities managers taking pride in their work as the voice-over says, “It’s not always easy to summon your pro, but once you’ve found it, you’ll find you can do anything.”

That theme will be woven into the company’s back-to-school shopping campaign — with moms being treated as the pros, Bifulco said.

The campaign, crafted by ad agency MRM/McCann, also marks a tonal shift from the silliness that permeated Staples marketing for years. That history has included ads featuring ink fairies, robot love triangles, riffs on “The Sopranos” and a guy walking around the store absurdly yelling, “Wow, that’s a low price!”

“Levity has been part of how we communicated and we’ve done that extremely well on occasion, and other times we kind of did not,” Bifulco said. “We have moved away from that. We’re honoring and celebrating work.”

By Matt Townsend for www.providencejournal.com

Office Depot sells off Korean business

Office Depot has closed on the sale of its business in South Korea to private equity firm Excelsior Capital Asia.

Office Depot had previously disclosed its intention to sell the majority of its international businesses under a process that began in 2016.

“This transaction follows on the recently announced agreement to sell our businesses located in Australia and New Zealand,” Gerry Smith, CEO of Office Depot. “We are now one step closer to achieving our goal of divesting substantially all of our international businesses in order to focus on the growth opportunities available in the North American market.”

Excelsior Capital Asia is described as a Hong Kong and South Korea-based direct investment firm.

Source: www.stationerynews.com.au

Record numbers for London Stationery Show

The London Stationery Show is held annually during National Stationery Week in the UK.

The seventh London Stationery Show closed its doors last week after recording its highest ever visitor numbers.

Visitors were up 9% on 2016 with registered attendees from 43 countries.

The show, which was purchased by Ocean Media Group last year, has seen consistent growth in the number and size of stands being requested by exhibitors and this year more than 160 exhibitors and 300 brands were represented. at the show. The show recorded the highest number of entries for its Stationery Awards, which this year topped just over 400.

“The show continues to grow and attract more support from the industry and interested buyers. We’ve had an excellent response from exhibitors wanting to book for next year, and strong interest in our new show, which will be based in Manchester,” Tim Willoughby, managing director at Ocean Media Group, which also owns the National Stationery Week program.

This year’s show, held at London’s Business Design Centre, introduced a LaunchPad competition to help aspiring stationery designers and companies get started in the industry. This resulted in 12 winners being given free stands at the show.

The 2018 London Stationery Show will be held on 24 to 25 April, 2018.

Source: www.stationerynews.com.au

Is Le Pen about to Trump France?

As France undertakes its general elections this week, the world’s eyes will be on Marine Le Pen as concern grows about the future of the European Union (EU). Lingering insecurity, especially in the wake of the most recent terror attack on police on the Champs-Elysees in Paris, will have a marked effect on voter sentiments in one of the founding members-states of the Union. EU-critics will see this as the inevitable result of the EU’s failed integration policies.

While it is impossible to predict with certainty which candidate will win the French election, it is useful to consider the cascading events that will transpire should Le Pen be given the opportunity to implement her program of protectionist nationalism in France. The Front Nationale’s policies of border closures, an anti-Islamic religious clampdown and their France first economic policies, reminiscent of US-president Donald Trump’s populist campaign, will send tremors through the very fiber of European civilization. The EU’s tectonic plates will shift.

In our analysis there are four major tipping points that will shape the EU in the next decade, should Le Pen be victorious. Our assessment is that the French people will be less conservative than the Dutch, who pulled the Netherlands back from the brink of Geert Wilder’s brand of Islamophobic nationalism. This is certainly not a preferred scenario for EU supporters, but contemplating a worst-case scenario is useful in sensitizing one to the strategic alternatives.

Watch out for; the end of war in Syria and jockeying for political influence in the region, contagion from conflict in the South Caucuses and the militarization of the Black Sea, Turkey choosing to, or being asked to leave NATO, and the weakening of the Euro in the wake of a so-called “reform” of the European Central Bank (ECB).

End of War in Syria and Jockeying for Political Influence

As backdrop to the French political process, there is an uptick in American interventionism in Syria. It is conceivable that the US, with their NATO allies including Turkey, will want to dictate the terms of a post-war settlement in Syria. Protracted negotiations between factions will surface a contentious Turkey-Russia-Iran-Egypt nexus of growing influence in the region. The Americans will not be pleased, and will look to Turkey’s European neighbors, to assist in pressurizing Istanbul to take a position that is more friendly to their regional interests and ally, Israel. Turkey will refuse. The absence of the lure of potential EU membership, growing authoritarianism from the regime of Turkish President Recep Tayyip Erdogan, and an unexpected improvement in Turkish-Russian relations, will muddy the waters in Istanbul’s working relationship with Washington.

Turkey will calculate that Europe’s gas-dependence on Russia, via the Turkish Stream, gives them leverage and puts them in a strong position to make demands that serve their interests. President Erdogan will flirt with the idea, that in the absence of President Bashar Al-Assad in Syria, he can play a more prominent leadership role in the Arab world. In December 1997 President Erdogan is quoted as having recited a Ziya Gökalp’s poem saying of Islam, “The mosques are our barracks, the domes our helmets, the minarets our bayonets and the faithful our soldiers…” Drawing on this militant theocratic worldview, Turkey will choose realpolitik and prestige over democratic constitutionalism in their sphere of influence.

Contagion from conflict in the South Caucuses and the Militarization of the Black Sea

Growing tensions in the South Caucuses will accelerate the militarization of the Black Sea. This will not sit well with Germany, who will be pressed upon by Romania and Hungary to exert pressure on the Russians and Turkey by increasing their military presence. As a former close friend of the US under Obama, a newly elected Angela Merkel will be reluctant to mobilize her weakened coalition, and risk protracted conflict. The unease of these two tipping points will place strain on NATO members who would already be contemplating the fallout of the potential collapse of the EU. US President Donald Trump’s incoherent foreign policy approach will not help the situation.

When Sweden and Finland leave the EU

Wanting to avoid fiscal contagion from the aforementioned conflicts through their EU membership, Sweden and Finland will try and renegotiate their position to something that resembles that of Norway. Germany will be faced with a conundrum – still reeling from zero-sum negotiations with the UK, and having to make the choice between playing hardball with northern European member-states on the basis of principle, or accepting the inevitable and undermining their own arguments in favor of the EU. The German people will be fed-up and decide to cut their losses and want abandon the EU project. Watch for a call for a referendum on the EU by Angela Merkel.

When Turkey leaves NATO

Turkey will increasingly find it difficult to assure their NATO allies that they will act in their interests should an all out conflict erupt in the region. Making the counter calculation, that the US and European countries will not come to their rescue either, and in the absence of a large-scale threat from Syria, Turkey will opt to leave NATO. Russia and Iran will see this as an opportunity for consolidation in the Middle East, looking to Egypt to pivot in their direction. Israel will be dismayed at an escalation of an already volatile security environment as a consequence. The 1950s Egyptian revolutionary president, Gamal Abdel Nasser said of the Jews, “you will never be able to live here in peace, because you left here black but came back white.” Turkey’s abandonment of NATO will remind the Zionists of Nasserims blasé bigotry and the unraveling of the Bagdad Pact in 1979.

ECB Reform and the Weakening of the Euro

The remaining members of the EU will by this time be pushing for wholesale “reform” of the ECB, in favor of less fiscal conservatism. Global financial markets will likely overreact looking to the dollar, yen and yuan as havens in the medium-term. The Euro will weaken considerably, though not collapse, now entrenched as the currency of choice for global trade with Germany.

Taking the long-view of Europe, what surfaces is the continent’s unresolved relationship with both fascism and Islam. In a twist of great irony, author Kevin Coogan quotes a friend of Adolf Hitler, Ahmed Huber as recounting the fürer as having said, “the only religion I respect is Islam. The only prophet I admire is the Prophet Muhammad.” Hitler’s sentiments are obviously not shared by the fascists who now threaten to redefine the essence and contours of the EU and Europe. It remains up to the French electorate to decide how they navigate the insecurity of this political moment. Whether or not they remain loyal to their secular, tolerant and democratic roots will have far-reaching consequences for the next half-century.

By Marius Oosthuizen for www.thoughtleader.co.za

Is Amazon under-valued?

Amazon is one of the largest companies in the world, but its valuation leaves plenty of room for growth. The stock’s valuation multiples don’t do justice to the growth prospects of this e-commerce giant.

Amazon experiences 27% year-on-year sales growth and this growth profile is simply too good for a company trading at only 3,2-times revenue.

Relatively weak operating margins have long been a roadblock for Amazon. But massive growth in both sales and margins in Amazon Web Services (AWS), as well as the growing dominance of Amazon Prime in the US, mitigate such concerns and make a strong case for undervaluation in the equity.

Amazon’s international segment currently operates at negative operating margins. However, the trend looks set to reverse as Amazon Prime penetrate these markets.

Future growth

Amazon’s primary top-line growth factors are international expansion and Amazon Web Services. AWS will improve overall margins, but international expansion is still in a negative margin situation. The trends have exacerbated in 2016.

In the full year 2016, North America represented almost 60 percent of total revenue while international and AWS represented roughly 30% and 10%, respectively. There is room for growth here, and it isn’t unreasonable to expect Amazon to be able to replicate North American success in other developed regions of the globe.

Source: www.seekingalpha.com

Stationery specialist WHSmith is trialling a range of new store concepts in key locations as it moves to bolster sales at its high street division.

The retailer kick-started the high street trial by fully refurbishing its store in Holborn, London.

The revamped branch now dedicates more space to stationery and stocks headphones and Apple accessories.

WHSmith chief executive Steve Clarke told Retail Week that the improvements form part of an experiment.

“The store in Holborn is a trial for us to see, if we improve the store environment, radically change the layout and improve the ranges, what sort of a return on that scale of investment we get,” he said.

He added that the 225-year-old retailer would carry out other additional trials “of different types” in the coming months.

“From those we hope to cherry-pick a number of initiatives that are affordable to roll out,” he said.

Far-flung regional stores

Clarke insisted there is ongoing investment into the rest of WHSmith’s 613-store high street estate.

“We do tend to target investment where it matters most to customers”

“We have a rolling improvement programme. Over the last three years we’ve probably replaced or repaired around 300 floors, and have done a lot of work on our storefronts,” he said.

But not every store will receive an immediate or radical facelift.

“We will target the investment where we think we will get the biggest return and where customers respond to it the most,” he explained.

“There will often be stores in far-flung regional high streets where the store could do with a little bit of an upgrade, but they are not desperately out of the context of their environment.

“We do tend to target investment where it matters most to customers. We will eventually get around to all the stores, but in a very sensible, measured way.”

Overall performance

Clarke said that the business was very pleased with its half-year performance on the high street, where profits were flat and like-for-likes were down 3%, as it came off the back of its “best Christmas in 20 years”.

“We had a profit upgrade last year. Given the living wage and everything else, holding flat is a really good outcome,” he said, adding that he expected like-for-likes to decline as the adult colouring book phenomenon died down.

“We’re feeling pretty confident about the year ahead despite the broader uncertainty,” the stationery boss concluded.

By Emily Hardy for www.retail-week.com

Yet another struggling retailer is trying to shore up foot traffic with a unique in-store experience. Staples is offering customers cooperative working spaces and is finding some success with the endeavor.

Staples’ new offering, called Workbar, resembles a tech-heavy upstart in the wake of WeWork’s success in office space sharing. Seven-year-old WeWork’s valuation has skyrocketed to an estimated $20 billion recently after it secured some $300 million in investments from SoftBank Group Corp. (See also: Behind WeWork’s Billion Dollar Valuation.)

The Framingham, Mass.-based Staples is banking on a hip vibe at Workbar – with young workers at their laptops sipping gourmet coffee amid funky art – to offset soft demand and revive its brand. At its first co-working space in Boston, where Staples opened its first location in September, there’s a putting green, skylights and happy hours.

“If you go to most people on the street and ask about Staples they’d go, ‘Oh yeah, the office-products superstore,’” Staples’ new CEO Shira Goodman told Bloomberg. “But the reality is that’s very far from where we are today, and even farther from where we want to be.” Goodman said she expects Staples’ online sales to be 80% of the retailer’s overall sales by 2020.

Staples, with $18 billion in annual revenue after years of declines, recently said it plans to close 70 stores in the U.S. and Canada to reduce costs amid declining sales. Fourth-quarter sales fell 7% from the year prior.
The company closed 13 stores during the quarter and ended the year with 1,255 stores in the U.S. and 304 stores in Canada.

The office supply retailer is also planning to launch a new marketing campaign that will underscore its role as a partner to businesses, including with its co-working space. Monthly memberships to Workbar cost $130. More than 200 people have signed on since its debut in September.

Staples stock is down 23.3% the past year, and down 6% year to date. Staples tried to buy Office Depot in 2015, but that proposal was not approved by regulators.

By Rebecca McClay for www.investopedia.com

Amazon Business launches in the UK

Amazon is adding a trade counter to its UK Web site to sell equipment such as office supplies and industrial tools to woo business customers that account for around two-fifths of online spending.

Its new service called Amazon Business launched on Monday, and offers a range of business-friendly features like being able to track purchases and set spending limits, as well as an expanded range of products specifically targeted at commercial customers.

Amazon Business will sell more than 100-million products spanning laptops to test tubes to cleaning products, and is targeted at a range of businesses, from small to large, as well as universities and charities.

It marks the latest effort by the e-commerce giant to expand beyond the typical retail business. Jeff Bezos’ firm had already started its business marketplace in the US back in April 2015, racking up $1bn (£800m) of sales in its first year to 400 000 customers, before launching in Germany four months ago.

The UK online market for business-to-business sales was valued at a cool £96.5bn for 2015 by the Office for National Statistics.

Bill Burkland, head of Amazon Business UK, said the new site “combines more than 100m business products with a new set of unique business features – from reporting and analytics to spending limits”.

In February, the online giant said it was creating 5,000 new full-time jobs in the UK this year to fill a range of positions from software developers to warehouse staff.

The recruitment will take Amazon’s UK headcount to more than 24,000 as it opens three new warehouses in Tilbury, Doncaster and Daventry. The extra space will also handle deliveries for third-party retailers who sell through Amazon’s site.

By Rebecca Smith for www.cityam.com

Britain leaves the EU

Prime Minister Theresa May has signed the Article 50 letter of notification that she will send to the European Union on Wednesday to formally get Brexit underway.

May was pictured in Downing Street on Wednesday evening adding her signature to the historic letter, which will formally notify the European Commission of Britain’s departure from the EU.

The letter will be handed to European Council President Donald Tusk at 12:30 p.m (BST) tomorrow by British ambassador to the EU Sir Tim Barrow, immediately after May finishes debating Labour Party leader Jeremy Corbyn in this week’s instalment of Prime Minister’s Questions.

A two-year process of negotiations will then get underway where May and her negotiating team will try to come to a divorce agreement with EU figures. The discussions are set to cover how much Britain must pay the EU as part of its divorce settlement and what long-term free trade deal — if any — can be finalised before the two-year window expires.

Britain is set to officially drop out of the EU no later than March, 2019.

In an address to Parliament on Wednesday, May is set to call on the country to “come together” and support a “truly global Britain” as the nation braces itself to leave the 28-nation bloc after nearly half a century of being a member.

The prime minister is expected to say:

“When I sit around the negotiating table in the months ahead, I will represent every person in the whole United Kingdom – young and old, rich and poor, city, town, country and all the villages and hamlets in between.

“And yes, those EU nationals who have made this country their home.

“It is my fierce determination to get the right deal for every single person in this country.

“For, as we face the opportunities ahead of us on this momentous journey, our shared values, interests and ambitions can – and must – bring us together.

“We all want to see a Britain that is stronger than it is today. We all want a country that is fairer so that everyone has the chance to succeed.

“We all want a nation that is safe and secure for our children and grandchildren. We all want to live in a truly Global Britain that gets out and builds relationships with old friends and new allies around the world.

“These are the ambitions of this Government’s Plan for Britain. Ambitions that unite us, so that we are no longer defined by the vote we cast, but by our determination to make a success of the result.

“We are one great union of people and nations with a proud history and a bright future.

“And, now that the decision has been made to leave the EU, it is time to come together.”

Source: www.businessinsider.com

Australian retailers are woefully unprepared for the imminent entry of US tech giant Amazon and many could go under if they don’t lift their game.

The online goliath is due to hit Aussie shores this September but a new analysis shows almost a third of Australian retailers are blissfully unaware Amazon is preparing to set up shop.
Only 14 per cent have put any serious thought in to competing with global brand.
This blissful ignorance could be a huge mistake.

While some of the smaller retailers unaware of Amazon’s plans could be hit hard, an analyst told news.com.au one of Australia’s major stalwarts could suffer greatly: Woolworths’ struggling discounter Big W.

Amazon is hoping to launch in Australia in September.

The Commonwealth Bank Retail Insights Report, released today, found 49 per cent of retailers are unfazed by Amazon’s Australian push, with only 11 per cent seeing the company as a significant threat to their business.
Yet, in the US the so-called ‘Amazon effect’ has seen its share price skyrocket as shoppers flock online, while bricks and mortar retailers shutter shops.
CommBank’s National Manager of Retail, Jerry Macey, told news.com.au many Aussie retailers had no idea what they were in for.

“30 per cent of retailers said they aren’t even aware of Amazon and that was even bigger number for small companies, purely online stores, or retailers in rural areas.
“This is concerning when you consider the impact Amazon has had on the US, a very mature market.”
A third of retailers had no idea Amazon was coming to Australia, claims the Commonwealth Bank Retail Insights Report 2017

The key area where retail is falling behind is innovation.
CommBank measured levels of innovation across a range of Australian industries.

While half of Australian retailers were experimenting with new strategies to attract and retain customers — just above the all industry average — they still lagged behind the telecommunications, education and mining and sectors.

Worryingly, retail innovation was erratic, often uncoordinated and the value retailers were generating from trying new things was less than half that of the average of all other sectors.

“In retail, innovation is not holistic. There are small innovations, in one area of business, but if you look at strong innovators they are being innovative across a number of areas like marketing, organisational structure, product and process,” said Mr Macey.

The online innovations that were occurring in retail, like click and collect, weren’t game changing and were way behind industry leaders.

“Just look at Amazon Go — this is a physical store where you pick things off the self and sensors know what you’ve put into your bag and you can just walk out — that’s innovation,” he said.

Amazon has launched the Amazon Go trial supermarket where hi-tech sensors mean customers just grab products off the shelf and go, paying directly through their Amazon account.
Amazon has launched the Amazon Go trial supermarket where hi-tech sensors mean customers just grab products off the shelf and go, paying directly through their Amazon account.Source:Supplied
Geoff Dart, a retail consultant with DGC Advisory agreed Amazon would change Australian retail.
“They will have an impact. If you’re a retailer, you always have to assume the worst when Amazon comes in.”
The US company was the next wave in a retail revolution sweeping across Australia’s high streets and shopping centres already changed forever by the emergence of international fast fashion brands.
But, said Mr Dart, new competitors — such H & M, Zara, and Uniqlo — had already forced some home grown stores to buck up their ideas. As such, many were now far better prepared for the onslaught of Amazon.
“Australian retailers were very complacent, but if you look where they are now Myer has really lifted, and so have Kmart and Target.”
Myer now stock rival TopShop’s products in their stores.

Rather than battling against the overseas onslaught, Myer is now actively working with would be competitors — such as TopShop and UK department store John Lewis — by stocking their products.

However, there was one long standing Australian retailer that Mr Dart was worried about.
“Big W don’t know who they are in my opinion, they are stuck in the past while Amazon know who they are have a good customer proposition.”
In the six months to January, Big W’s sales slumped 6 per cent while its earnings fell 137 per cent leading to a loss of $27 million.
News.com.au contacted Big W to ask how they were innovating, fighting back against increased competition and bringing in new customers. The company chose not to comment.

Following Woolworths’ closure of the Masters home improvement chain late last year, speculation is rife that the company is preparing the ground for either a sell-off or float of Big W.
Nevertheless, Mr Dart didn’t think Amazon would get a completely free ride when it lands.
While last week Fairfax reported that Amazon is planning to “destroy the retail environment in Australia”, Australia’s huge size and relatively small population would mean Amazon’s warehouse and distribution costs would be higher compared to other markets.
In particular, Mr Dart said Amazon would struggle in a key area which will please Coles and Woolies.

“They’re going to fail at food. Australians are very conservative when it comes to food and if they have a bruised banana in their delivery, Amazon is going to have to replace it and that’s not going to happen.”
For Australian retailers, their trump card was their store network, he said, as it gave brands a presence on the ground. Mr Dart predicted further consolidation in the sector, citing JB Hi Fi’s recent purchase of The Good Guys.
But the real innovation could be if competitors started working together to combat the international online threat.

“Retailer co-operation is a big opportunity. Why couldn’t you pick up a JB laptop you have ordered online from a Bunnings or Kmart? All of them have fixed costs and want to amortise that and one way of doing that is to increase traffic and people picking up goods is a way to do that.”

Mr Macey said some Aussie retailers were being ingenious at innovation.
He cited efforts to ‘personalise’ the shop by allowing customers to visualise online a new rug in their living room, say, or how they would look wearing a new shirt.
However, on the whole, retailers needed to have an innovation reality check.

“Retailers need to be honest in where they are in terms of their ability to innovate. They need to take advantage of changes in the marketplace, experiment, not be afraid to fail but if they do fail, fail fast and inexpensively.
“Retailers need to build a innovation culture and be agile and creative in the future.”

By Benedict Brook for www.news.com.au

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