OfficeMax 2012 Annual Report Download - page 18

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XII // 2012 OFFICEMAX®ANNUAL REPORT // ROAD TO SUCCESS // RETAIL
Retail Business
If we were to call out a specific “shining star” of
our Retail business, our in-store services would
be it. And by focusing our efforts to improve these
services even more in 2013, our hope is that the
customer experience—specifically those of our
small business customers—will be even better.
Our Mexico operations, which include 90 stores
featuring a range of high-tech products, continue
to be a bright spot within the Retail sector.
Within the U.S., we drove positive growth in our
furniture and supplies categories, as sales
struggled within the challenged technology
category. During the important Back-to-School
season, our core categories performed well.
According to a third-party report, which uses
panel data, OfficeMax was the only office
superstore to post season-over-season share
growth during this particularly competitive time
of year.
Although our day-to-day Retail execution has
improved, we are addressing continual
industry-wide structural challenges through
three specific initiatives.
First, we are working a plan to reduce our U.S.
retail total square footage by approximately 15%
from the beginning of 2012 through the end of
2015 in order to improve the productivity of our
store base. These reductions are being executed
through a three-pronged approach of closing
unprofitable stores, relocating stores, and
downsizing stores to a smaller footprint.
Second, we continue to focus on our innovation
efforts, which include looking for new categories to
replace declining ones in our stores. A particular
emphasis is being placed on high-margin services
to build on our strong-performing OfficeMax Print
Center and Ctrlcenter®; and in 2013, we’re
launching many value-added services targeting our
small business/home office customers, including
MiMedia cloud storage and Go Daddy® web
services. We will also introduce innovative new
format prototype stores in 2013 aimed at improving
the overall customer experience.
Third, in order to address challenges in the
technology sector—and particularly in PCs—
we have reset our go-to-market strategy. We are
narrowing our focus even more sharply on the
business customer and providing an appropriate
level of technology product selection while
prudently managing inventory risk and enhancing
profitability. To this end, we are refining our
assortments to address customer requirements for
the consumption versus creation of information.
We will also enable our store associates to provide
valuable solutions to our small business customers
by significantly increasing training to meet
their needs.
While we face some challenges in the Retail
segment, we are confident in the plan, people
and level of determination we have in order to
advance on the Road to Success in 2013.
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