Staples Case Study
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Staples Inc.
The idea of Staples started off with a very easy problem to fix. Thomas Stemberg was trying to print off a business plan when his printer ribbon all of a sudden broke on the Fourth of July holiday (About Staples). ” It was the Fourth of July weekend, 1985, and Toms regular supplier, a local stationery store, was closed for the holiday” (About Staples). After driving around for hours trying to find a store that carried his printer ribbon and trying to find a store that was open Stemberg knew he could create something big.
Thomas Stemberg was an expert in the supermarket industry before being fired from his executive position in 1985. After being fired Stemberg searched for a new market to indulge in. Stemberg then initiated the idea of a store that would sell office supplies to smaller businesses. Stemberg wanted to provide everything a small business would need with the ease of convenience and low prices. Stemberg found out threw customer research, that most small business owners didnt keep track of how much they spend on office supplies for their business. Stemberg found that small businesses were paying “40% more then large corporations” were on office supplies (Bowman, 2001). To try and spread this message to the general public Stemberg knew that he would have to invest in marketing.
Staples official opened its first store in Brighton, Massachusetts in 1986. Staples has more then “1,700 stores in the US, Canada, and five other countries” (Bramhall). Staples has been expanding very rapidly by either building new staples stores or accruing stores by buying them out. Staples has stores in France, Italy, Spain, Belgium, China, United Kingdom, Denmark, Austria, US, and Canada (Bramhall). Staples employed 65,078 employees in 2005 (Bramhall). Staples is projected to make 16 billion dollars in sales in 2006 (Bramhall).
In the future Staples has plans on to expanding further into more of Europe, and Asia. They want to expand more in China but are waiting to buyout and acquire larger office supply stores. Their goal is to have continued growth in the offices supply industry.
Staples mission statement is to, “develop and implement Supply Chain Management practices that create a sustainable competitive advantage and position Staples as the leader in all business sectors in which we compete” (About Staples).
Staples has had a few different slogans to help its marketing strategies. Its first slogan was “Yeah, weve go that” (Encyclopedia). That slogan has scents been retired and they have adopted a new slogan scents. The new slogan is “That was easy” (Encyclopedia). With that slogan Staples has made television commercials that are every eye catching. They use a large red push button that has the word “easy” written on it.
Staples old marketing strategy was to have low prices and variety. They figured that customers only cared about how much an item cost and, if there was a variety of the product. With the emergence of many competitors their strategies had to soon shift. Their strategies changed from low price and variety of product to help full customer service and a faster occurrence.
Staples did a lot of research to find out what the customers wanted in their stores. Staples was amazed to find out that price was not one of the top ten concerns that customers had. The customers wanted all of the shelves to be stocked with all the basic supplies. They didnt want the store to be “out of stock of most commonly used supplies,” (Bramhall). The customers also wanted useful sales employees. They wanted employees to help them out if they had a question or concern about something they did not understand. The customers also wanted to be able to find the supply they were looking for fast and easy. They didnt want to be in the store for a long period of time trying to find one item that they needed.
Staples believe that their main reason for being successful is because they are diversified. Diversity is very important to any company. As I have learned in classes before this course, that top companies in their industry are diversified in not only threw employees but throughout their industry as well. Staples has a divers employment, and this helps them become successful. “We wanted to make sure that diversity and inclusion was a cornerstone, part of the DNA of this company” (Staples seeks diverse techies in IT and engineering, 2006). Another reason Staples is successful is because they focus on the customers needs. Instead of asking what the customer wants they will watch a customer in the store and watch what they do. By doing this they found out that the majority of their sales come from small-business and home-office owners.
A constraint that Staples has is the shortage contract sales. Staples does not have a very good grip on contract sales outside of North America. Office Depot hade more revenue then Staples does in contract revenue sales and that is a constraint for Staples.
One of the internal strengths for Staples is that it is one of the top small business suppliers in the world. Staples sells an assortment of office products ranging from office furniture to PDAs. Staples has 18 stores throughout Europe and North America. Staples keeps gaining market share every year. “The company continues to gain market share, taking part of it from direct competitors and part from the large number of independent suppliers” (Sivy, 2006),
Another internal strength for Staples is brand name recognition. “The company also measures its brand awareness on a regular basis, and Sargent said its name recognition is currently at 98%” (Out of the box). In order to help keep their name recognition they ran a super bowl ad.
An internal weakness for Staples is the shortage of contract sales. Staples does not have a lot of contract sales compared to its leading competitors. Some would consider this a opportunity because it has room to expand on it but I feel that because Staples is so far behind its competitors that it is a weakness for them.
I think another weakness for Staples is small stores existence. With the addition of more and more copy cat businesses popping up every year the market is becoming larger and it becomes harder for Staples to grab more of that market share. This is why the target market is beginning to like the smaller store layout better. The reason why the target market is beginning to like the smaller store design is because the trend has changed to a fast paced shopping. Customers now a day want to be in and out of the store. They dont want to spend a lot of time in