STATIONERY NEWS: How did you get into the office products industry - and how long have you been associated with Mitsubishi Pencil?
DAVID RICHARDSON: I joined JA Davey Pty Ltd in January 1980 as a sales representative in their Sydney office. Among other things, I promoted digital clocks to various office products customers, one of the largest being Ancol.
JA Davey became agents for Mitsubishi Pencil Co. Japan in November 1982 and we subsequently launched the uni-ball brand in Australia. I became state manager and director moving to Melbourne as sales director in 1990.
STN: What's been the main factors behind the successful association between the Australian business and its parent company?
DR: Following the successful establishment of the uni brand and to consolidate the Australian business during a period of supplier rationalisation, Mitsubishi Pencil was established in 1999. The business is a 50:50 joint venture between Mitsubishi Pencil Co. Japan and JA Davey Pty Ltd. Since that time, Mitsubishi Pencil Australia has consistently grown as a subsidiary company of Mitsubishi Pencil Co. Japan.
STN: From a sales perspective, how has the business changed over the past 35 years in relation to your dealings with the various channels - e.g. dealer groups, corporate contract companies and retailers?
The number of dealer groups has grown and their membership now includes the majority of independent office supply dealers. The groups, in the main, have become more professional in the range of services and support available to their members. Our business has kept pace with their changes and while we operate as a single category supplier the dealer groups remain a very important part of our operation.
One of the significant areas of change was the establishment of corporate contract stationers. Evolving through the consolidation of several larger independent dealers they grew by the acquisition of many small-to-medium-sized dealers.
This changed the face of the commercial channel forever.
Aggressive negotiations resulted in reduced margins across the industry on both suppler and dealer sides. Many independent dealers joined banner groups as they saw some safety in numbers.
In-stock catalogues became a strategic sales tool and home brand and private label products grew significantly. Success in this channel was essential to maintain and grow market share. The financial difficulties of 2008 had a profound effect on this channel and in recent years most contract stationers have undertaken major re-structures.
For many years, the newsagencies held a large share of the stationery market. In recent years, price competition, reduced foot traffic (as newspaper and magazine sales fall) and some regulatory changes to gambling revenue are some of the issues they face.
Sales in the newsagency channel have certainly slowed.
On the other hand, the rise of the office superstore has been successful with keen pricing, customer service, a large range of core products and keen promotional offers such as the back-to-school campaign. The success of this retail format has revived the retail market outside the chain store and grocery channels.
STN: You probably have been to more trade shows than you can remember - how important are they what are you observations of the merits of the various events, both local and overseas?
DR: For many years trade shows were an essential part of our sales strategy, both as an exhibitor and visitor. Each year at Frankfurt Paperworld our new products were announced and through various customer meetings new catalogue lines were negotiated and promotional schedules confirmed.
Customer and exhibitor attendance declined from 2009, however, recent signs are promising and this fair could return it’s previous position of importance. The cost of exhibiting in local trade shows for a small return has seen them fall away as a sales strategy. Other promotional methods and the representation by local sales forces has seen the need for these shows diminish.
STN: What do you see as the main challenges for the "core" office products suppliers in the years ahead?
DR: Traditional or core office products face several issues. In the writing instrument category new electronic technology is reducing the number of pens used in commercial activities. This situation compels manufacturers to develop new technologies and design products for new or niche markets outside the commercial area.
Grey market and unauthorised supply channels are a concern for all brand suppliers. This practice reflects poorly on the industry and opens the door for copy and counterfeit products to enter the country with the inevitable consequences for those involved.
STN: Finally, what are you plans for the future?
DR: While still keeping a limited involvement with the organisation I will be concentrating my activities on more leisurely projects, family and travel. National accounts and marketing manager, Michael Vancam, will take on more responsibilities and Jon McBriar will cross from JA Davey Pty Ltd to take on several national responsibilities as a director.