Staples, Inc. (SPLS) extended its decade long partnership with Albany-based CommerceHub, by entering into a multi-year contract. With this deal, the office supply retailer will be able to expand its customer reach by utilizing CommerceHub’s platform to expand merchandise assortments, locate new product sources and for seamless delivery of products.
With this wide range of services the company considers CommerceHub to be an asset that will play a significant role in maintaining successful operations.
Moving on, this Zacks Rank #3 (Hold) company has taken up various initiatives to battle softness in the office supplies industry as well as rising competition, especially from retailers like Amazon (AMZN), Office Depot, Inc. (ODP) and United Stationers Inc. (USTR).
The company’s endeavors include effective merchandising, increasing customer awareness, enhanced online features, expanding offerings beyond office supplies and store refurbishing, apart from initiating a cost reduction program. The company plans to close nearly 225 stores across North America by 2015.
In the third quarter of 2014, the company shuttered 31 stores. Going forward, the company intends to close 170 stores in fiscal 2014 as against 140 projected earlier. Also, Staples initiated a cost reduction program to achieve pre-tax cost savings of about $500 million annually by fiscal 2015, with majority of savings expected to come from retail store closures, supply chain, labor optimization and customer service.
Though the initiatives are in the right direction, it will take time for these to pay off as turnaround strategies are often time-consuming.
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