Staples’ Strategic Plan to Accelerate Growth

by Nate Hunter

Framingham, MA — To accelerate growth, Staples plans to integrate its retail and online business, reorganize operations, change leadership and restructure international operations.


Framingham, MA — Staples, Inc., the world’s largest office products company and second largest internet retailer, is embarking on a strategic plan to better serve the needs of its customers and accelerate growth. Staples will integrate its retail and online offering, increase investment in its online businesses, reorganize its operations, implement leadership changes, initiate a multi-year cost savings plan, and restructure its international operations.

“Our vision is to establish Staples as the single-source product authority for millions of businesses,” says Ron Sargent, Staples’ chairman and chief executive officer.

To accelerate growth, Staples is significantly expanding its assortment beyond office supplies to better serve the needs of business customers. To help fund these investments in growth, Staples is initiating a multi-year cost savings plan, which is expected to generate annualized pre-tax cost savings of approximately $250 million by the end of fiscal year 2015.

To support growth and better address the changing needs of its customers, Staples announced the combination of its U.S. Retail and businesses under the leadership of Demos Parneros. Joe Doody will continue to lead Staples’ North American Contract and businesses, and will assume leadership of supply chain and customer service operations in North America. Parneros and Doody will continue to report to Ron Sargent.

Staples plans to reduce retail square footage in North America by approximately 15% by the end of fiscal year 2015. As part of this plan, Staples expects a total of approximately 30 net store closures and 30 store downsizings and relocations in North America during fiscal year 2012.

Staples also hopes to reduce the complexity and improve the profitability of its European operations. The company plans to close 45 stores and several sub-scale delivery businesses in Europe by the end of fiscal year 2012, and also announced a leadership change in its European operations. Staples has appointed John Wilson as president of Staples Europe.

“John has a strong knowledge of our industry and a proven track record of improving performance which uniquely positions him to lead our European organization,” says Sargent. Wilson will be based in Amsterdam and replace Rob Vale, who is retiring as planned after leading Staples’ European operations over the past 3 years.

As a result of these actions, Staples expects to record pre-tax cash charges in the range of $145 million to $195 million by the end of fiscal year 2012. Additionally, Staples expects to record a pre-tax non-cash charge in the range of $790 million to $850 million for the impairment of goodwill and other assets within its European retail and catalog businesses during the third quarter of 2012. Staples is continuing to explore additional operational and strategic opportunities for its European operations.

Staples is also pursuing the sale of its European Printing Systems business and is rebranding its Australian business as it continues to move toward one global brand.

As a result of these activities, as well as its ongoing cash dividend program, Staples plans to return more than $1 billion of cash to stakeholders during fiscal year 2012.

“We are focusing on our biggest opportunities, aligning our organization to address the needs of our customers, and reducing exposure to our weakest businesses,” Sargent says. “This puts us in a much stronger position to drive long term sales and earnings growth.”

Staples operates in 26 countries throughout North and South America, Europe, Asia and Australia. The company is headquartered outside Boston. For more information, visit






SOURCE: Staples, Inc.

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