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Office Depot, Inc. Message Board

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  • odplong odplong Aug 11, 1999 12:57 PM Flag

    This is amazing!

    VKNG is still the major mail order force in
    Europe (associates in the UK tell me that SPLS's Quill
    launch over there was pretty uninspiring in terms of
    customer service) and ODP is still strong internationally.
    Whilst it would have perhaps been encouraging to see ODP
    take a position in Germany and leverage VKNG's
    dominance there, SPLS and ODP still do not compete at a
    retail level in any of these 3 markets (Germany, Holland
    and Portugal).

    It's a big (bad) world and if
    ODP continues to steer clear of SPLS (on a pure
    retail level) internationally, the short term effect to
    ODP is negligible. The way I see it at the moment,
    SPLS has established a great base in Europe... but
    their UK experiences have been costly and Germany has
    been challenging. It's worth remembering that over
    there the retail landscape is very different to the
    USA, and even more different to Germany. I would be
    interested to see what the analysts (DLJ excepted) make of
    the news given that office superstores + Europe
    haven't yet equalled profit. And also given that these
    stores have been sold once already in the last year (by
    Metro to a Deutsche Bank led group of investors). Hot
    potato or good business by the Germans?

    Long term
    however, one must question how long ODP can ignore
    Europe's 2 largest office supplies markets (Germany and
    UK) from a retail perspective. If I were Mr Fuente, I
    would be going all out to acquire a similar
    competition-free established international presence. The Coles
    Myer owned Officeworks chain in Australia springs to
    mind. Market dominant, well-established, similar
    culture and language, and another VKNG
    stronghold.

    But what do I know - almost every stock I own has
    tanked recently!

    Good luck to all - could be a
    long ride.

 
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