Napa Auto Parts 2015 Annual Report Download - page 14

Products. The Office Products Group distributes technology products and consumer electronics including
storage media, printer supplies, iPad, iPhone and computer accessories, calculators, shredders, laminators, cop-
iers, printers, fitness bracelets and digital cameras; office furniture including desks, credenzas, chairs, chair mats,
office suites, panel systems, file, mobile and storage cabinets and computer workstations; general office supplies
including desk accessories, business forms, accounting supplies, binders, filing supplies, report covers, writing
instruments, envelopes, note pads, copy paper, mailroom and shipping supplies, drafting and audiovisual sup-
plies; school and educational products including bulletin boards, teaching aids and art supplies; healthcare prod-
ucts including first aid supplies, gloves, exam room supplies and furnishings, cleaners and waste containers;
janitorial and cleaning supplies; safety supplies; disposable food service products; and breakroom supplies
including napkins, utensils, snacks and beverages. S. P. Richards has return privileges with most of its suppliers,
which have protected the Company from inventory obsolescence.
While the Company’s inventory includes products from nearly 700 of the industry’s leading manufacturers
worldwide, S. P. Richards also markets products under its nine proprietary brands. These brands include: Spar-
co™, an economical line of office supply basics; Compucessory®, a line of computer accessories; Lorell®, a line
of office furniture; NatureSaver®, an offering of recycled products; Elite Image®, a line of new and remanufac-
tured toner cartridges, premium papers and labels; Integra™, a line of writing instruments; Genuine Joe®, a line
of cleaning and breakroom products; Business Source®, a line of basic office supplies available only to
independent resellers; and Lighthouse, a brand of janitorial and cleaning products offered through the GCN busi-
ness. The Company’s Impact and Malt businesses also offer an additional series of proprietary brands including
ProGuard®and ProMax®that are product based and solution-specific oriented. Through the Company’s
FurnitureAdvantage™ program, S. P. Richards provides resellers with an additional 16,000 furniture items made
available to consumers in 7 to 10 business days.
Segment Data. In the year ended December 31, 2015, sales from the Company’s Office Products Group
approximated 13% of the Company’s net sales, as compared to 11% in 2014 and 12% in 2013. For additional
segment information, see Note 10 of Notes to Consolidated Financial Statements beginning on page F-1.
Competition. The office products distribution business is highly competitive. In the distribution of its
product offering to resellers, S. P. Richards competes with many other wholesale distributors, as well as with
certain manufacturers of office products. S. P. Richards competes primarily on product offerings, service,
marketing programs, brand recognition and price. Further information regarding competition in the industry is set
forth in “Item 1A. Risk Factors — We Face Substantial Competition in the Industries in Which We Do
Business.”
ELECTRICAL/ELECTRONIC MATERIALS GROUP
The Electrical/Electronic Materials Group, operated as EIS, Inc. (“EIS”), a wholly-owned subsidiary of the
Company, is headquartered in Atlanta, Georgia. EIS distributes materials to more than 20,000 electrical and elec-
tronic manufacturers, as well as to industrial assembly and specialty wire and cable markets in North America.
With 49 branch locations in the United States, Puerto Rico, the Dominican Republic, Mexico and Canada, EIS
distributes over 100,000 items including wire, cable and connectivity solutions, insulating and conductive
materials, assembly tools and test equipment. EIS also has seven light manufacturing facilities that provide cus-
tom fabricated parts and specialty coated materials.
Effective April 1, 2015, EIS acquired Connect Air International, Inc. (“Connect Air”) headquartered in Seat-
tle, Washington. Connect Air is a leading North American specialty distributor of low-voltage wire and cable
used in building applications, primarily HVAC (heating, ventilations and air-conditioning), security and fire
alarm systems. Connect Air has six sales offices and warehouses across the United States and is expected to
generate annual revenues of approximately $30 million.
Distribution System. The Electrical/Electronic Materials Group provides distribution services to OEM’s,
motor repair shops, specialty wire and cable users in market segments such as Telecom, Marine, Security and
Industrial, as well as a broad variety of industrial assembly markets. EIS actively utilizes its e-commerce Internet
site to present its products to customers while allowing these on-line visitors to conveniently purchase from a
large product assortment.
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