Sample Term Paper
The office supplies industry primarily consist of the manufacturing and sales of paper, storage equipment, pens and pencils, forms, stationery, file covers, and other types of services which are required in the offices like photocopying, printing, scanning, binding etc.
The office services and supplies industry in the United States has business revenue of over$ 85billion with an annual growth rate of 3.1%. Among all the products the paper based product stand out of the list as far as profitability is concerned. In the year 2008 the paper based product generated total revenues of $ 40 billion which is 47% of the total market share. According to Bruce Nelson CEO of the Viking Office Products the growth in this industry could be observed from the fact that in the mid-1990s, there were not more than 1000 office products stores and now there are more than 2300 stores in the US (Miller, 2000)
It is forecasted that the performance of the market would slow down and it is estimated that the compound annual growth rate (CAGR) would decrease from 3% to 0.6% by the end of 2013.
Comparatively the United States is a much bigger and more lucrative market for the office supplies and services industry with an overall share of 46.80%. Second to the US is Europe with 22.70% market share.
The market in the United States is highly fragmented with the market players having a tendency of conducting business with large and diverse customers. This results in weakening the buying power of the individual customers. The buying power of the large customers has increased but it has affected the customer loyalty and provided customers with a wide variety of retailers
The leading company in this industry includes the world famous Hallmark cards. The company operates with almost 48000 products under its brand name and is considered as a leader in this industry (Hallmark, 2010). Giving Hallmark a tough competition is Office Depot, Inc with over 1193 stores around US and several more in Canada (Office depot, 2009). One the weaker opponent in the industry is office Max which is mainly operating in the US primarily they are doing business with the small and medium sized enterprises (Office Max, 2010).
As we have discussed before that growth opportunities in this industry is not much dominant and one reason that we have derived from this study is because businesses now days are shifting towards less paper culture.
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