Stationary and Office Supplies
There are approximately 580 active stores selling stationary and office supplies in Israel. There are a number of major chains in the industry: Office depot operates 27 stores, Kravitz operates 40 stores, and Arta opertes approximately 15 stores.
Existing types of businesses are:
- Stores selling stationary and office supplies- these stores are usually located at city centers, malls, and commercial or trade areas.
- Diverse stores selling stationary alongside many other products such as textbooks, toys, gifts, etc. these stores are usually located in small neighborhoods and are based on private clientele.
- High seasonality is reflected in significant disparity in sales especially at stores that also sell textbooks and school supplies. At stores targeted for the business segments, an increase in corporate customer sales is usually evident towards the end of December.
- High chain activity in the industry by corporations such as Office Depot, Grafitti, Kravitz, etc.
Customers: Defining the Target Market and its Size, Market segmenting
Target market includes the general population, segmented according to the following criteria:
- Business customers- In recent year corporations are increasingly purchasing office supplies in bulk from a single vendor.
- Private customers purchase equipment and supplies for personal use.
- Large retail chains (such as Office Depot, Graffiti, and Kravitz).
- Stationary and office supply stores targeted to the private or business sector.
- Large supermarkets offer school supplies especially around “back to school” season.
- Internet- large chains and vendors specializing in the business sector offer various purchasing options via the internet.
There are many active vendors in the industry, selling a range of products, quality, and prices. Vendors in the industry are local manufacturers and importers, although in recent years import has increased from cheap countries in South Asia and Turkey.
Marketing resources may be divided according to type of customer.
Great importance is credited to store’s location, correct use of promotional sales, advertisement in local or national press, local advertisement by using flyers. Stores selling brand names sometimes benefit from manufacturer advertisement on additional media. Franchise stores benefit from cooperative chain marketing.
Use of catalogs, internet sites for online orders, direct marketing, or email.
Factors Affecting Success:
- Location of the store and density of competitors in the area
- Uniqueness and selection
- For the corporate market, incorporation of additional products such as furniture or office kitchenette supplies
Employees in the industry are usually non-professionals, although it is preferable that store manager and sales representatives have previous experience.
- Furniture- including shelves (in the store and storage area), display shelves.
- Cash register (or computer to include inventory management), telephone and fax.
- Store remodeling- separating the store into a selling area, display area, and storage area
- Initial inventory- initial inventory investment is high, as the aspiration is to present a wide variety and a variety of models for each product sold.
Industry revenue and profitability
Yearly revenue per working business and typical profit percentages depend on the store’s characteristics, location, reputation, price levels, and product quality. Percentages of raw revenue:
- At stationary and office supply stores selling mainly to large corporations and institutions: 20-25%
- At stationary and office supply stores selling mainly to private customers: 31-35%.
- At small stationary stores- 34-38%
Typical Terms of Payment
- Private customer sales are conducted in cash, check, or credit cards. Occasionally, business owners allow the customer to pay with a postponed check or in installments.
- Business customers- formal credit terms are EOM+30 to EOM+60 but in actuality, due to considerable competition, customer credit terms are better.
Business insurance (for content and inventory), third party insurance, employer’s liability insurance, and loss of income insurance. In addition to the above, an insurance agent should be consulted in regards to the need for additional insurance.
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