Ecommerce is the new trend and rightly so! Many entrepreneurs have hit the million-dollar mark, all through some innovative thinking, clever marketing and a winning product.
The growth of any business depends on a lot of factors. One of the key factors in the process is to find out the need of the market at the very initial stage of the business. A business that fills a need is both sustainable and profitable.
A winning product, yes, that is what can catapult you into immediate ecommerce success. There are INNUMERABLE products and solutions all being touted as the ‘NEXT BIG THING’. So how do you then decide which niche to get into?
Like we said above,
“A business that fills a need is both sustainable and profitable”.
A great niche for your ecommerce store is office supplies. Wait what? Yes. Let us explain.
There is a huge demand for office supplies across the world. Think about it?
Table of Contents
I. Why Office Supplies? Why Online?
From students to entrepreneurs, from corporate spaces and co-working spaces to home-offices, the demand for office supply is everywhere. The business model for this sector is expandable.
You can start to sell office supplies, then include computers and printer and gradually foray into the field of office furniture too. The office supply market is only growing bigger and bigger!
The global office supply market is expected to reach USD 273.9 billion by the end of 2024 from USD235.3 billion in 2018.
The expansion of ecommerce has opened many growth options for the office supply industry. In an era of online sales and purchase, the manufacturers and retailers of office supplies are using their capabilities in the digital market and are taking this business sector to another level.
The top players in the market of office supplies are shifting their sales strategy from brick and mortar stores to online stores. The online office supply stores are marked with a boom in their sales right now. All the market researches are predicting further growth in the business of office supplies in the coming years.
Staples, the second-largest office supply company in the world is channelizing its business to the online model after reducing the number of its brick and mortar stores.
They closed their under performing stores and focused more on online subscriptions. The strategy resulted in $24.4 billion as their earnings despite a lesser number of brick and mortar stores.
II. Office Stationery Online vs. Retail Stores
As children big office and school supplies stores fascinated us. But the emergence and growth of ecommerce have changed the business models for many industries and the office supplies industry is no different. The focus on online stores has increased and the profits are also increasing by leaps and bounds.
According to this report, Office Depot, a leading American office supply company, had its retail division income as $9 million in the second quarter of 2019 as compared to $22 million in the second quarter of 2018.
During the second quarter of 2019, the company closed 39 stores and the quarter with a total of 1320 stores in the retail division.
Thanks to the timely investments made by Office Depot in their ecommerce platform, the company has been seeing a year over year growth of revenues despite witnessing a low in their retail income.
The online business led to an operating income of $86M in the second quarter of 2019 as compared to $67M in the second quarter of 2018, an increase of 28%.
Encouraging? These statistics indicate the growth trend in the online business of office supplies. Get on it now!
III. Product Segmentation
Office supplies have a broad spectrum of products to offer. You can’t stock all of them! Also, if you are just starting your business, it is good to have an effective business plan for your inventory. All items do not create equal revenues.
Office supplies products can be segmented into three categories.
- School and Office supplies: School and office supplies make 45% of the total office supply sales.
- Office equipment (computers, photocopiers, fax machines): This segment amounts to 24% of the total sales.
- Computer paper and stationery: A very important segment, comprises 23% of the total revenue.
You can start with all the three segments with a wide selection of products and pick and choose or you can start with one segment and expand your product catalog later with other segments.
IV. Ink and Toner Cartridge Online Market
A product that needs a special mention here is “ink and toner cartridge”. They are always in demand and form a large part of the office supplies market.
In a study, Technavio covered the emerging trends that impact the global markets and contribute to the rise and fall of the market.
Technavio specifically pointed out toner cartridges as a part of the growing demand for computer/printer supplies. Let’s discuss why this industry of ink and toner cartridges is getting so much attention from market analysts.
The world is seeing an era of industrial automation and IT integration. With these changes in the market, the demand for computers, printers and related commodities is bound to increase. To fill this need, companies are increasingly manufacturing cartridges.
According to Recycler, in 2013, the global market for toner was $2.91B and is expected to reach the figure of $4.33B by 2020. The market is big and the demand is here to stay. The most needed and expensive product in this industry, printer ink, had a market size valued at $16.46B in 2016.
This market is growing and the figure itself summarizes the importance of printer ink among all the office supplies. There is an increase in the sale of ink cartridges in the field of labelling and packaging.
The credit goes again to ecommerce which gives a lot of business to the packaging and labelling industry. Also, there is a lot of concern raised about the environmental hazards due to used cartridges. Companies now prefer cartridge refills and that itself is a market to watch out for.
V. How to market an office supply store online
Now that we have understood the value of the office supply industry, let’s get to work. Setting up an ecommerce store is not rocket science! But in saying that it can be a tad confusing.
There are too many options vis-a-vis platform, payment gateway, accounting apps, etc available which makes it is difficult to choose one right for you.
To make your business profitable, it is important to understand the marketing process of this sector.
The right platform
A good start can do wonders for your business. Choose the right platform to start your online store. Select what is practical, financially viable and is dependable when the traffic to your store increases.
A good design
An essential start is to design your store well. A detailed layout of products and their description is crucial to good customer experience. You want visitors on your store to find products they’re looking for easily. The navigation has to be flawless.
Use quality images
Choose eye-catching, good quality images to attract customers to your products. There is no substitute for this. Online stores do not have the ‘touch and feel’ factor of physical stores. The images you use convey the ‘look’ of the product.
Target the right buyer
Choose the right market segment and market aggressively. Households, schools, corporates, small businesses, government offices, etc. form an expansive market to sell office supplies. Target and retarget.
Automation is the keyword for digital marketing these days. A good choice of automated software will cover multi-channel marketing and will save your time, energy and resources.
VI. Customer Care and Retention
Office supplies do not last forever, and that is the sustainability of this niche! The industry flourishes on recurring demand. Paper, cartridge, posted, clips, pens, etc. get exhausted and need to be purchased from time to time.
Once a product is sold, your customer will come back either to buy more products from your online store or to refill their stock from the previous purchase.
Whether they come back to you or go someplace else, is dependant on your customer care, after-sales service and retention plan.
Recycle programs and related incentives bring back your customers, eg., recycling old cartridges. Under the Staples ink recycling program, customers receive $2 back as rewards per cartridge.
Keep your customers happy with reward points, loyalty programs, gift coupons, etc. and enjoy continuous sales. A happy customer will return to you and will keep your registers ringing.
VII. Key Takeaways
To sum up, the office supply industry is a profitable business. Use your wisdom to:-
- Get winning products
- Choose the best selling platform
- Tweak your marketing strategy
- Concentrate on customer care and retention
The future of office supply stores is to get online. All the big giants are shifting their focus to ecommerce stores and selling online. We at VARStreet say, get in on this trend that unlike other trends is here to stay!
Why? Because who needs just one pen all their lives!