Latest prototype bolsters OfficeMax brand identity

DSN Retailing Today, May 23, 2005 by Mike Troy

Differentiation. It has been the buzzword among office superstore operators since awakening to the fact that their core customer base--small business and home office power users--had a hard time telling the difference between OfficeMax, Office Depot and Staples.

It's not hard to understand why. Their stores are roughly the same size and offer a similar product mix comprised of basic office supplies, technology products, computer peripherals, furniture and access to a significantly expanded assortment via catalogs or the Internet. The lack of differentiation didn't become a pressing concern until the late 1990s when the three major retailers increasingly began competing head-to-head with one another.

In the case of OfficeMax, the solution was to achieve differentiation through a format known as Millennium 8.0. With a prototype size of 20,000 square feet, the Millennium 8.0 design is several thousand square feet smaller than earlier prototypes, a change that was enabled by the ability of OfficeMax to more efficiently replenish stores. The company completed the build out of a modern distribution center network several years ago and in so doing gained the ability to operate stores with leaner inventories.

Prior to completion of the DC network, OfficeMax relied on vendor shipments to each store. That required stores to be larger and contain fixtures with greater holding capacity to accommodate safety stock. The result was a warehouse look that was outdated. With supply chain considerations no longer the driving force behind store design, OfficeMax was able to create a concept that is more attractive and easy for customers to shop while improving store-level operations and financial returns.

The store still contains four core departments of copy and print services, basic supplies, technology and furniture, but they are easier to locate thanks to a center power aisle that bisects the store and provides space from promotional products. On one side of the aisle are tall gondolas that contain basic office supplies such as writing instruments, presentation products and organizers. Customers are able to easily locate products thanks to large signs identifying the assortments in each aisle.

On the other side of the store, low-profile fixtures contain a wide assortment of technology products such as digital cameras, computer peripherals and document shredders. The low fixture heights serve a dual purpose since they allow OfficeMax employees to see customers in need of assistance and also discourage theft.

A limited assortment of furniture is offered in the rear corner of the store with an emphasis on chairs. The department is clearly visible from the entrance thanks to a large sign affixed to a side wall.

In the opposing corner at the front of the store is the copy and print department where customers can make their own copies or have an OfficeMax associate help them with more specialized needs.

The entire concept is tied together with a color scheme that emphasizes blue and yellow primary signage with touches of red, all of which serves to reinforce in the minds of customers that this is an OfficeMax store.

OFFICEMAX

2004 SALES*: $4.48 billion

NUMBER OF STORES: 935

Source: Company reports

* For fiscal year ended Dec. 31, 2004