Staples To Buy Office Depot For $6.3 Billion

An anonymous reader writes: Today Staples announced plans to buy Office Depot in a deal worth $6.3 billion. This is a huge consolidation within the office supply industry. Office Depot and OfficeMax were the second- and third-biggest suppliers when they merged in 2013. Adding those to the enormity of Staples would effectively bring the U.S. under a single office supply chain. "The move is expected to draw scrutiny from the Federal Trade Commission, though regulators have been increasingly willing to approve retail mergers in light of burgeoning e-commerce competition. ... This isn't the first time Staples has tried to buy Office Depot. In 1997, the FTC derailed Staples' acquisition of its rival as anticompetitive. By 2013, though, the agency's view had shifted. When the FTC allowed Office Depot to buy OfficeMax, it said the advent of online retailing ensured competition in the market for office supplies. Consumers today also rely more heavily on big-box chains such as Wal-Mart Stores Inc. for office products, the commission said."

Comments

Re:Great

[MightyYar]

How so? There is a lot of competition in this space. In the Northeast you are probably familiar with WB Mason, which does not use the retail store model. If you are a consumer, Walmart sells toner for most home printers (and obviously paper as well). For businesses, there are plenty of "Dunder Mifflins" out there. Costco, Sam's Club, etc. And then there is the explosion of internet-only office supply companies.

Re:Next RadioShack

[Primate Pete]

As I recollect, Staples does huge business with small and medium companies, mostly on a delivery basis. Having been in their stores, I doubt walk-in customers are a large part of their revenue. One potential outcome here would be for Staples to close its retail locations (they suck) so that that the better-stocked Office Depot can handle individual/walk-in customers while the Staples brand focuses on the B2B market via internet & delivery.

That said, I don't have a good feeling about the decrease in the number of office supplies stores near my home, which WILL decrease my options.

Re:Great

[darkmeridian]

I am a small business owner, and I have to say that this is not the case. The Internet is the great equalizer. I can buy toner and paper online from NewEgg, Amazon, Costco, W.B. Mason, or Walmart. If Staples decided to jack up the prices, then I'd simply order somewhere else. I don't like splitting up my vendors, either. If I order toner and paper from one company, then I'm usually going to take my coffee and other stationery business somewhere else. The vendors all know this so they're always trying to use paper as a loss-leader to get your business on the other items.