OfficeMax gives WA schools market top marks

OFFICE school supply companies are experiencing huge growth despite the collapse last year of Wooldridges, with national stationery supplier OfficeMax Australia due to open a new distribution centre near Perth Airport.

OfficeMax has reported a surge in its business growth in Western Australia this year on the back of increased demand fuelled by the state’s approach, which enables companies to market school supplies directly to parents.

OfficeMax managing director Charles Agee said he was enthusiastic about the company’s prospects in the state’s growing school supply market.

“Our business in WA quadrupled this year - a massive amount of growth for us,” Mr Agee told WA Business News.

The new distribution centre is expected to create up to 150 jobs and be operational by September. OfficeMax is an Australia-wide stationery, office and paper supplier and a recent entrant to WA.

Wooldridges collapsed last year after its receivers were unable to claw back a $48.5 million debt, leaving 90 people out of work.

The collapse came after the long-running family business was acquired by private equity interests, which pursued east coast expansion.

Mr Agee said the market was growing in WA irrespective of the collapse of Wooldridges and that OfficeMax “was on a growth trajectory anyway”.

Marketing directly to parents was a key challenge facing the industry because, traditionally, suppliers had dealt with schools, Mr Agee said.

He said it was an innovation WA had pioneered in Australia. He expected more schools to ask parents to buy their children’s stationery and he forecast other states would adopt the WA model.

Stock inventory levels were a problem when dealing directly with parents because most placed their orders just before the school term started, Mr Agee said.

This created uncertainty for suppliers and made it difficult to predict a relevant product range.

Mr Agee said OfficeMax had made the investment in WA because of its remoteness and the difficulties with overnight stock replacements from the eastern states.

He also said he remained optimistic about the publishing industry’s shift to digital text- books and expected the traditional model of publisher and distributor to remain.

This flies in the face of changes seen in other parts of the publishing industry, with some publishers choosing to market e-books directly to consumers through online stores.

There is also strong demand from customers for products that are environmentally friendly, such as pens made out of plant fibres and recycled paper products.

“We think we have a social responsibility that we have a range of products that meet environmental certification and attributes,” Mr Agee said.

Rival national school supply company Campion Education has also been encouraged by good growth, last year reporting a threefold increase in revenue. It is aiming to gain a bigger slice of the market in WA.