Office Supply

A sluggish economy can’t be good for office supply stores, and this was certainly true in 2009. Both OfficeMax and Office Depot reported sales declines in their North American operations, though Staples managed to post a 3.5 percent increase. Staples also differentiated itself on the expansion front, growing its North American store count (1,555) by 2.1 percent while OfficeMax’s domestic chain strength declined 1 percent and Office Depot shed 8.8 percent of U.S. locations.

Coming off a difficult year, OfficeMax launched a campaign to offer more in-store services like printing, shipping and document shredding, as well as assisting customers in setting up and programming new computers. It also is targeting female customers, as research shows that 70 percent of office supply shopping decisions are made by women. The company will also be taking merchandise beyond its own stores and offering goods in supermarkets (it already has agreements with Safeway and Food Lion), drug stores and mass merchants.

Office Depot is redefining itself in U.S. markets, building LEED-certified stores and remodeling older units to its M2 format. Under this design, merchandise is organized in “pods” with basic office supplies around the perimeter of the store and bigger ticket items like furniture and technology at the center of the store. The company recently pumped up its Christopher Lowell Office Collection with three lines of modular furniture for home offices.

Though it doesn’t directly impact its North American business unit, Staples purchased the 41.6 percent of shares it didn’t already own in Corporate Express Australia. Staples is looking abroad because it is projecting lackluster domestic performance for the remainder of this year.