Office Depot

use destination The First Office Depot opened in 1986 in Lauderdale Lakes, Florida. The Office Depot is a global supplier of magnate fruits and services and has experienced a dramatic suppuration process oer the past twenty-five historic period. In 1990 the Office Depot Companies bought The Office parliamentary procedure Inc. , and immediately became the largest mail service retailer in North America. Having built its point of intersection line within the United States and having secured a firm job foundation, Office Depot expanded internationally in 1992. In 1996, Office Depot took its catalog and delivery service(s) online.Office Depot opened about 125 stores between the years 2000-2004. With the economic downturn of 2007, new strategies had to be put in place, and by 2009, 125 stores in international market places were closed. Office Depot exited the Japanese market entirely. Today, Office Depot provides office supplies and services through 1,678 retail stores worldwi de, a dedicated gross gross revenue force, top-rated catalogs, and global e-commerce operations. Office Depot has annual sales of $11. 5 billion, employs roughly 39,000 employees, and serves customers in 61 countries.Their distribution channels hold stores, betoken mail, contract delivery, the internet, and B2B e-commerce. Viking Office Products, their wholly owned subsidiary, currently operates adept of the industrys leading direct mail marketers of office products worldwide. The belligerent dodging that the Office Depot result approach is a best- embody supplier strategy to become 1 in the office supply business. For online purchases, customers lead be offered free shipping on any purchase over $25. 00. A promotional discount volition be applied for 20% off, on the next purchase for every $100. 00 spent by the customer.There will be a rewards architectural plan for customers and businesses that continue to shop with Office Depot. found on the number of office supply items purchased, the next item will be free and additional discounts will be applied to in store(predicate) purchases. After the retail store(s), prices will be deplorableered on items bought earlier by back-to-school customers and also year-round casual shoppers items. The retail stores will admonisher active inventory for excess quantities and slow moving items and record adjustments as necessary to lower the price(s) if the anticipated realizable amount is below cost.Also, augur and de boundine what items to stock and at what level, and what items to discontinue and how to value them prior to sale. The large-format retail stores will be reduced to half of the current square-footage, and staff will focus only on supplying consistently purchased merchandise. Items that tend to mount dormant at retail will be provided online only. If a retail store cannot maintain projected sales quotas, the store will be closed in that market area. New government contracts will be provided at 20% discount based on the number of office supplies purchased.Office Depot will retain business with local, state, and federal governments and non-profit organizations contracts by fling a lower cost than other competitors. Office Depots long term strategic direction is to be consumer focused in terms of product assortment, store layouts, new service offerings, and compelling pricing that sends a confirming value message to its customers. This falls in line with the best cost provider strategy giving customers more value for the money sequence satisfying buyers expectations on key quality/features/performance/service attributes debacle their price expectations.One of the main ways that Office Depot has responded was with its Magellan innovation, a three-year program which significantly enhanced IT capabilities. The new system will provide much(prenominal) benefits as improved forecasting, better support for planning, and improved profitability. This can be achieved through bett er utilization of store space, better pricing and information integrity, better stocking, and reduced inventory with the end results benefiting the customer.In 2011 Office Depot announce that it is boosting their capital expenditure budget for 2012 to approximately $160 million, with a corpulent emphasis on e-commerce and other IT investments. The retailers digital investments will be peculiarly important given its plans to shrink both(prenominal) the average size of its brick-and-mortar stores and its product assortments. Office Depots e-commerce sales have become an integral part of the company. Office Depot is the number (2) U. S. e-commerce retailer, second only to Amazon. com Inc.Office Depots aggressive Internet strategy has also generated twice the e-commerce sales of its rival Staples Inc. Office Depot prepare Analysis Strengths * Strong private label product line appends sales nationally and internationally. * Large, diverse customer base (individuals, small business , and large businesses) both nationally and overseas. * Company transitioning to smaller store format will increase presence in high growth markets. * As a direct result of negative economy, company has shuttered underperforming stores. * Cash liquid business with total assets of over four- billion dollars U.S. Weaknesses * Little opportunity for real growth in U. S. market due to over-saturation. * Increases in competition in U. S. products market, feature with a reliance on low profit- margin electronics. * Due to the downturn of the economy coupled with continued nationally high unemployment rates sales, profits, and both(prenominal) business markets have diminished. * Accusations of overcharging Government Contract customers have been made public. Opportunities * capital spent on office equipment and related items increasing among small and speciality businesses. Increased ability to enter into more densely populated areas, spot also reducing costs. * Increased opportunitie s of acquisitions due to strong cash reserves. * change magnitude line of private label products geared towards green technology. Threats * The global fiscal downturn. * High unemployment, coupled with an increase in office vacancies, compounded by low consumer confidence results in decreased spending. * grim cost/low quality imported equipment and products can lead to quality related issues. * Low switching costs increases competition and can lead to price wars.