Seems that Staples is headed to becoming the CDW for small business. It will be interesting to how CDW responds; if they do.
I had a small business; so, whenever I see a small business owner or an entrepreneur, I usually ask a lot of questions about their business. I still hear that the banks are gumming it all up. Credit lines have been slashed and there still is [practically] no new credit available to small businesses. Unfortunately, small businesses feed the the economy and will fuel the recovery.
So, what’s my point? With Staples targeting the small business IT market at this time, will they have the perseverance and forethought to stay the course until that segment recovers? Right now, small businesses just don’t have the cash. Even if they do, the owners are still in “survival mode” so they are hording it for a rainy day. Staples’ value proposition has to show that the Staples solution/package is cheaper (not just better) than having your sister’s kid doing it out of her basement. The devil will be in the details.
Now if Staples does hold out for the long haul and presents a “win-win” package, then buy their stock.
Staples seeks bigger role in IT services
Retailer is creating a new business unit
By Patrick Thibodeau
February 16, 2010 06:13 AM ET
Computerworld – Staples Inc., the Framingham, Mass.-based retailer with 1,872 stores in North America, is expanding its IT services capabilities in a move that will take it right inside the data center.
The company has been working deliberately in recent years to expand its services capabilities. In 2006, Staples bought Thrive Networks, a managed services provider, and in 2008 it acquired Corporate Express, a supplier of office products to businesses and institutions, for $4.8 billion. The new unit, Staples Technology Solutions, “is the combined entity of those two groups,” said Joe Kalinowski, the vice president of finance for the technology solutions unit.
Staples, which has 91,000 employees, reported total net sales last quarter of $6.5 billion. “Technology was a logical extension…,” said Kalinowski.
Staples officials said they’re aiming for all sizes of clients with consulting services, data center services such as disaster recovery and data center media management. The company also has printer management services and has built its own software for managing operations.
From the Thrive Networks acquisition, Staples developed managed services for smaller firms of less than 250 employees, though some large customers use the services, too, said Jim Lippie, vice president of Staples Network Services.
The company, which has 3,000 clients, runs a 24-by-7 network operations center that can offer managed services for all major small-business technologies, including the Linux and Macintosh operating systems. Staples can install agents on hardware to monitor performance and dispatch people for on-site work.
Bob Laliberte, an analyst at the Enterprise Strategy Group in Milford, Mass., said Staples’ printer services are already reaching into large enterprises, while many of its other services are aimed at SMBs, including customers with whom it already has supply contracts. “I think they are looking at this as an extension of their brand and services,” he said.
Staples sees local resellers and IT services shops as its primary competitors.
Patrick Thibodeau covers SaaS and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov or subscribe to Patrick’s RSS feed . His e-mail address is email@example.com.
Read more about servers and data center in Computerworld’s Servers and Data Center Knowledge Center.
It seems like a natural growth progression for Staples. I’m sure that there will be some challenges arising from combining different cultures, however overall a very good move for this Retailer Giant.
Good luck Joe!