Office Supplies and Stationery Stores
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 2,100 firms in the US sell office supplies, school supplies, stationery, computers, office equipment and furniture at retail. Firms may also offer business-related services, such as printing, copying, mailing and shipping, or technology-related services, such as software installation.
Competition from Alternative Stores
Office supply and stationery retailers face stiff competition from a variety of alternative brick-and-mortar channels, including wholesale clubs, discount stores, mass merchandisers, food and drug stores, and computer and electronic stores.
Competition from Online Retailers
Like most of the retail industry, office supply and stationery retailers face intense competition from online-only channels, which offer convenience and enjoy lower overhead costs.
Industry size & Structure
The average office supply and stationery retailer employs about 33-34 workers and generates $4-5 million annually.
- The office supply and stationery retailing industry consists of about 2,100 firms that employ 71,000 workers and generate about $10 billion annually.
- The industry is highly concentrated; the top eight companies account for 84% of industry revenue.
- Large firms include ODP Corporation (Office Depot and Office Max) and Staples. Stationery retail chains include Hallmark Gold Crown (independently owned and stores owned by Hallmark Cards, Inc.) and Paper Source (Elliot Investment Management).
Industry Forecast
Office Supplies and Stationery Stores Industry Growth
Recent Developments
Jun 5, 2024 - Prices Drop, Wages Rise
- In Q1 2024, producer prices charged by office supplies, stationery, and gift retailers were down significantly compared to a year earlier. Amid softer demand, office supplies and stationery stores may be reducing prices to boost sales. In Q1 2024, average wages for office supplies and stationery stores increased sharply compared to the same period in 2023. Falling prices and rising wages may pinch office supplies and stationery store margins. Industry employment decreased moderately in Q1 2024, year over year.
- Office supply retail firm ODP Corporation (Office Depot and OfficeMax) recently reported first-quarter 2024 sales of $1.8 billion, down 11% compared to Q1 2023. The firm said the drop in sales was primarily due to its Office Depot consumer business, which had 56 fewer locations than during the same reporting period in 2023. The Office Depot division also experienced lower retail and online traffic and sales. ODP posted net income of $15 million in Q1 2024, down from $72 million in Q1 2023. For its full-year fiscal 2024 sales guidance, ODP expects sales to decline by about 2%.
- Inflation is expected to remain a concern for the rest of 2024, according to the May 2024 update of the Outlook Survey released by the National Association for Business Economics (NABE). The NABE Outlook Survey is a consensus macroeconomic forecast by a panel of more than 40 professional forecasters. The May NABE forecast expects inflation to remain around 2.6%, or about half a percentage point higher than the Outlook Survey released in February 2024. Amid stubborn inflation, NABE forecasters dropped their estimate for a Fed interest rate cut to half a percentage point from three-quarters of a point in the earlier February report. The panelists also expect employment growth to slow to about 125,000 jobs per month, and about 90% of panelists believe the US economy will have a so-called soft landing in 2024, whereby inflation falls to 2% or lower without a recession.
- In April, the National Federation of Independent Businesses’ (NFIB) Small Business Optimism Index rose 1.2 points to 89.7, marking the 28th consecutive month of being below the 50-year average of 98. Nearly a quarter of small businesses (22%) cited inflation as their most significant problem. The percentage of small businesses reporting an inability to fill open positions rose three points to 40%. About 56% of those surveyed reported capital outlays in the last six months, unchanged from March. Of small businesses that reported expenditures, 38% bought new equipment, 24% purchased vehicles, and 16% expanded or improved facilities. NFIB Chief Economist Bill Dunkelberg said, “Cost pressures remain the top issue for small business owners, including historically high levels of owners raising compensation to keep and attract employees. Overall, small business owners remain historically very pessimistic as they continue to navigate these challenges. Owners are dealing with a rising level of uncertainty but will continue to do what they do best – serve their customers.”
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