3 problems for the office supplies retailers
Feb. 04, 2015
NEW YORK (AP) — Staples Inc. announced Wednesday it will be buying rival Office Depot for $6.3 billion in a deal that's expected to help it compete better with rivals like Wal-Mart and Amazon.com.
But the acquisition may not solve their problems. These office retailers are not only being tripped up by overall retail industry challenges: shoppers moving online and looking for convenience at smaller stores. But they're also grappling with their own unique issues: workplaces have gone digital, which means printers and reams of paper are less in demand.
Here are three major problems that supersized supplies stores are facing:
1. Shoppers are looking for more convenience. Starting in the 1980s, Americans seem thrilled with the convenience of one-stop shopping at a crop of big-box chains that added locations throughout the country. But more recently, the rise of online shopping and increased competition from small stores have made those behemoth stores less attractive to shoppers. And those who still want to shop at big box stores would rather go to some place where they can buy different items under one roof, from apples to staples.
2. Changing technology. Staples, Office Depot and other office supplies stores used to be able to boost sales with big ticket items like printers and PCs. But sales of those products are falling as shoppers buy smaller mobile devices like iPads. The cloud and other services where customers can store documents virtually are now also making it less necessary for faxes and photo copiers.
3. The birth of the virtual office. With the rise of the home office in the 1990s, office supply retailers catered to the whims of customers looking to furnish their rooms with different furniture, PCs, and other accessories. But now, workers can work from anywhere.