Paper Products Distributors
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 6,200 paper and paper product distributors in the US act as middlemen between paper products manufacturers and large customers, such as publishers, printers, government offices, corporate offices, manufacturers, resellers, and retailers. Companies may specialize in bulk printing and writing paper; stationery and office supplies; or industrial and personal service paper. Some large companies have retail operations.
Competition From Alternative Sources
Paper products distributors compete with a variety of alternative sources, including office supply superstores, office supply distributors, traditional retailers (mass merchandisers, warehouse clubs), manufacturers, and Internet retailers.
Push For Less Paper
Technology and the increasing concern over recycling and the environment have led to considerable efforts to reduce paper consumption.
Industry size & Structure
The average paper products distributor operates out of a single location, employs 18-19 workers, and generates $13.2 million annually.
- The paper products distribution industry consists of about 6,200 companies that employ about 116,000 workers and generate about $82 billion annually.
- The industry is concentrated at the top and fragmented at the bottom; the top 50 firms account for about 70% of industry sales.
- Some companies are vertically-integrated; converters may act as distributors and large distributors may have retail operations.
- Large companies with paper distribution operations include Office Depot and Essendant (formerly United Stationers).
Industry Forecast
Paper Products Distributors Industry Growth
Recent Developments
Aug 6, 2024 - Corrugated Container Mergers Steady
- As of mid-2024, the volume of corrugated container manufacturing mergers and acquisitions (M&A) activity has been strong, according to Printing Impressions. The pace of dealmaking in the corrugated box industry is the strongest in five years. Between August 2023 and July 2024, there were about a dozen corrugated M&A deals. The latest came in July when Ireland-based Smurfit Kappa acquired US packaging firm Westrock to form Smurfit Westrock. The new company will be headquartered in Ireland and have estimated revenue of $34 billion. In April 2024, US-based International Paper (IP) agreed to acquire the UK’s DS Smith in a deal valued at $9.9 billion. The transaction is expected to close before the end of 2024. Industry observers suggest interest in further corrugated M&A activity is robust.
- The paper product distribution industry is expected to experience weaker sales growth for the next several years. The industry’s year-over-year sales growth declined to 1% in 2023, according to Inforum and the Interindustry Economic Research Fund, Inc. Sales growth is projected to moderate further to 0.8% in 2024 before rising to about 1.1% in 2025, then see steady average annual growth of about 1.1% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
- US boxboard production declined 1% in the second quarter of 2024 compared to Q2 2023, according to the American Forest & Paper Association (AFPA). The boxboard operating rate was 88.5% in the second quarter of 2024, up 2.5 percentage points from Q2 2023. US containerboard production increased 7% in the second quarter of 2024 compared to Q2 2023, according to the AFPA. Total US containerboard production for export increased by 40% in the first half of 2024 compared to the same period in 2023.
- Even with the pandemic in the rearview, ecommerce spending has remained robust, and much of that online shopping is being fueled by hybrid workers who make purchases during the workweek, according to The Wall Street Journal. According to a report by researchers at Stanford University, Northwestern University, and the Mastercard Economics Institute, in 2023, consumers spent $375 billion more on online shopping than they would have if the pandemic had never happened. The study’s authors suggest much of that increase is due to people who still work hybrid or fully remote schedules. Sustained ecommerce demand is a significant business opportunity for manufacturers of paper packaging.
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