Office Depot
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[Comprehensive business Analysis: Office Depot] |
Background
Office Depot was founded in 1986 by F. Patrick Sher, Stephen Dougherty and Jack Kopkin in Boca Raton, Florida. The three envisioned a warehouse style store that could offer office supplies at discounted prices. The first store was opened in October in Fort Lauderdale. It was immediately successful and before the year was over, two more stores were opened in Florida. While Office Depot was one of the first companies to tap into this new market, they were not the only ones. Rivals, Staples and Office Club, both opened their first stores within three months of Office Depot. All had the same basic strategy: Buy products directly from manufacturers rather than wholesalers and offer them at lower costs than conventional retailers. Each company was started in a different corner of the country and each found the market to be promising.
It was soon obvious to Office Depot that this market had a lot of potential, the next step was growth. In 1987, seven more stores were opened in Florida and Georgia. Unfortunately, CEO Pat Sher was unable to see the company grow to what it is today. He died of Leukemia about a year after the opening of the first store. He was soon replaced by David Fuente and the company continued its growth. Fuente’s plan was to open as many stores as quickly as possible. He did not want to wait around and see how things played out. So far, all of the stores had generated profits, so he wanted to establish as much dominance in the market as they could before imitators could establish themselves. The next year the company expanded into Kentucky, North Carolina, Tennessee and Texas. Then in 1989 and 1990 the company opened at least 50 new stores each year.
In 1988, the company went public and had an initial offering of 6 million shares at $3.33 per share. The company was the first of the three main competitors to turn a profit for three consecutive quarters. Much of that had to do with
[Comprehensive business Analysis: Office Depot] |
Background
Office Depot was founded in 1986 by F. Patrick Sher, Stephen Dougherty and Jack Kopkin in Boca Raton, Florida. The three envisioned a warehouse style store that could offer office supplies at discounted prices. The first store was opened in October in Fort Lauderdale. It was immediately successful and before the year was over, two more stores were opened in Florida. While Office Depot was one of the first companies to tap into this new market, they were not the only ones. Rivals, Staples and Office Club, both opened their first stores within three months of Office Depot. All had the same basic strategy: Buy products directly from manufacturers rather than wholesalers and offer them at lower costs than conventional retailers. Each company was started in a different corner of the country and each found the market to be promising.
It was soon obvious to Office Depot that this market had a lot of potential, the next step was growth. In 1987, seven more stores were opened in Florida and Georgia. Unfortunately, CEO Pat Sher was unable to see the company grow to what it is today. He died of Leukemia about a year after the opening of the first store. He was soon replaced by David Fuente and the company continued its growth. Fuente’s plan was to open as many stores as quickly as possible. He did not want to wait around and see how things played out. So far, all of the stores had generated profits, so he wanted to establish as much dominance in the market as they could before imitators could establish themselves. The next year the company expanded into Kentucky, North Carolina, Tennessee and Texas. Then in 1989 and 1990 the company opened at least 50 new stores each year.
In 1988, the company went public and had an initial offering of 6 million shares at $3.33 per share. The company was the first of the three main competitors to turn a profit for three consecutive quarters. Much of that had to do with