OfficeMax 2010 Annual Report Download - page 22

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Segments
The Company manages its business using three reportable segments: OfficeMax, Contract (“Contract
segment” or “Contract”); OfficeMax, Retail (“Retail segment” or “Retail”); and Corporate and Other. The
Contract segment markets and sells office supplies and paper, technology products and solutions, office furniture
and print and document services directly to large corporate and government offices, as well as to small and
medium-sized offices through field salespeople, outbound telesales, catalogs, the Internet and, primarily in
foreign markets, through office products stores. The Retail segment markets and sells office supplies and paper,
print and document services, technology products and solutions and office furniture to small and medium-sized
businesses and consumers through a network of retail stores. Management reviews the performance of the
Company based on these segments. We present information pertaining to each of our segments and the
geographic areas in which they operate in Note 14, “Segment Information,” of the Notes to Consolidated
Financial Statements in “Item 8. Financial Statements and Supplementary Data” of this Form 10-K.
Contract
We distribute a broad line of items for the office, including office supplies and paper, technology products
and solutions, office furniture and print and document services through our Contract segment. Contract sells
directly to large corporate and government offices, as well as to small and medium-sized offices in the United
States, Canada, Australia, New Zealand and Puerto Rico. This segment markets and sells through field
salespeople, outbound telesales, catalogs, the Internet and, primarily in foreign markets, through office products
stores. Substantially all products sold by this segment are purchased from outside manufacturers or from industry
wholesalers. We purchase office papers primarily from Boise White Paper, L.L.C., under a 12-year paper supply
contract entered into at the time of the Sale. (See Note 15, “Commitments and Guarantees,” of the Notes to
Consolidated Financial Statements in “Item 8. Financial Statements and Supplementary Data” of this Form 10-K
for additional information related to the paper supply contract.)
As of the end of the year, Contract operated 44 distribution centers in the U.S., Puerto Rico, Canada,
Australia and New Zealand as well as four customer service and outbound telesales centers in the U.S. Contract
also operated 53 office products stores in Canada, Hawaii, Australia and New Zealand.
Contract sales for 2010, 2009 and 2008 were $3.6 billion, $3.7 billion and $4.3 billion, respectively.
Retail
Retail is a retail distributor of office supplies and paper, print and document services, technology products
and solutions and office furniture. In addition, this segment contracts with large national retail chains to supply
office and school supplies to be sold in their stores. Our retail office products stores feature OfficeMax ImPress,
an in-store module devoted to print-for-pay and related services. Our Retail segment has operations in the United
States, Puerto Rico and the U.S. Virgin Islands. Our Retail segment also operates office products stores in
Mexico through a 51%-owned joint venture. Substantially all products sold by this segment are purchased from
outside manufacturers or from industry wholesalers. As mentioned above, we purchase office papers primarily
from Boise White Paper, L.L.C., under a 12-year paper supply contract we entered into at the time of the Sale.
As of the end of the year, our Retail segment operated 997 stores in the U.S. and Mexico, three large
distribution centers in the U.S., and one small distribution center in Mexico. Each store offers approximately
11,000 stock keeping units (SKUs) of name-brand and OfficeMax private-branded merchandise and a variety of
business services targeted at serving the small business customer, including OfficeMax ImPress. In addition to
our in-store ImPress capabilities, our Retail segment operated six OfficeMax ImPress print on demand facilities
with enhanced fulfillment capabilities as of the end of the year. These 8,000 square foot operations are located
within some of our Contract distribution centers, and serve the print and document needs of our large contract
customers in addition to supporting our retail stores by providing services that cannot be deployed at every retail
store.
Retail sales for 2010, 2009 and 2008 were $3.5 billion, $3.6 billion and $4.0 billion, respectively.
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