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Introduction Nearly 500 paper merchants of all sizes are part of the industry today. Over the years, many changes have occurred in the paper distribution business. Mergers, acquisitions, consolidations, warehouse closings, and technological advancements have had a major impact on how paper distribution is conducted. Despite sweeping changes in the merchant community, research indicates that the paper merchant still plays an important role in the paper industry and its influence over customers. InfoTrends’ recent white paper entitled, Paper Merchants Redefine Their Role, provides a comprehensive review of the paper merchant channel. The report includes profiles of major merchants as well as a section on paper merchant stores. Paper Merchants Influence Customer Decisions According to the report, NPTA (National Paper Trade Association) research indicates that paper merchants influence specific brand decisions up to 45% of the time. Generally, research has found that three out of four paper distributors felt that they have at least some influence over their customers’ selection of brands and products. 17% reported having no influence in the customer’s decision. Merchants recommend brands that perform well and are readily available in desired sizes and finishes. Since printers do not have time to research and shop brands, printers rely on their paper merchant to provide technical information and recommendations, often based on what the merchant has heard from other printers. As a result, paper manufacturers need to work cooperatively with the merchants to build brand loyalty and provide full disclosure on products to ensure a higher chance of the products being recommended by the merchants and used by the customer. Merchants Remain a Major Channel for the Mills For the past six years, InfoTrends has conducted a cut-size shipment survey circulated among all the major paper mills. With a very high response rate covering nearly 90% of the market, the mills have indicated that the merchants remain a major channel for the mills but are beginning to lose share to other channels, including mass merchants, office supply superstores, contract stationers, and warehouse clubs. Contract stationers, local office stationery dealers, and IP specialists have been lumped into the office supply dealer channel in the chart below. Most of the growth in this category can be attributed to contract stationers. Figure 1: Paper Mills’ Shipments by Channel
Paper mills recognize the importance of the paper merchant. Merchants are one of the main links in the supply chain from the paper mills to the end-user. Customers using paper merchants rely on their expertise and knowledge in choosing the best substrates for their printing jobs. However, customers’ requirements are becoming more complex, and merchants need to adapt to serve these changing demands. Merchants face tremendous challenges, especially with technology-based products. To keep current with the market, merchants need to adapt and sell products required by technology. For now, digital paper is a small but growing trend. Five years from now, the market for technology papers will be very different with the equipment base growing due to lower acquisition costs, particularly for small businesses. The preceding is an excerpt from InfoTrends’ report entitled “Paper Merchants Redefine Their Role” The complete document is available immediately. To learn more about the report or to make a purchase, visit our online store or contact Nicole Shown at +1 , ext. 207 or . Copyright © 2006 InfoTrends. All rights reserved. Reproduction or reuse of InfoTrends materials is strictly prohibited without prior written consent. If you are interested in referencing InfoTrends’ content, please submit your request to . |
