Staples

Sit Coco Sit. Good dog. In t Staples was founded 39 years ago in 1986 in Brighton, Massachusetts by Thomas Stenberg, Leo Kahn, and Myra Hart. The idea of creating a national chain of large office supply stores came to Thomas Stenberg back in 1985 when he was working on a project for a different business and he needed a printer ribbon and he couldn't find any local dealers that were open because it was the 4th of July holiday. Since the first Staples store opened in 1986 in Brighton, Massachusetts they've now grown to 860 stores in the United States with 40 warehouse and fulfillment centers. They do have a presence in Canada as well but I had a hard time figuring out exactly how many stores they have in Canada. Staples started with backing from a few private equity firms including Bain Capital and the co-founder of Bain Capital Mitt Romney actually served on the company's board of directors for 15 years. Over the years Staples has acquired several other smaller office supply related businesses but I t Staples has tried to acquire Office Depot a few times. The first time happened in 1996 and during that attempt at acquisition the Federal Trade Commission actually stepped in and said no you're not doing that's going to create a monopoly when it comes to office supply stores. They then tried to acquire Office Depot again in 2015 and again the Federal Trade Commission said no you can't do that. A few years after that second failed acquisition office Depot Staples was purchased by Sycamore Partners in 2017 for $6. 9 billion. $1. 6 of that was funded as equity but the remaining a little over $5 billion was raised as debt. Also during that purchase Sycamore Partners took the Staples company and split it into three independently managed and capitalized entities and those would be the Staples business to business. The Staples retail locations in the US and the Staples retail locations in Canada and all three of those entities share the name Staples. The leveraged buyout back in 2017 is actually one of the reasons why I decided to do a video covering Staples because t Another reason is just because I kind of enjoy office supply stores. They are always kind of weird to walk around and t When I came into t It's a scent of paper and ink maybe a touch of ozone from the laser printers and copiers over in the business center. It's a smell that's definitely unique to office supply stores and they all have t If I walked you into an office supply store blindfolded and didn'tell you what kind of store it was that we walked into and I asked you what it was just from the smell you would probably be able to tell that was an office supply store. Getting back on the subject of the Sycamore acquisition of Staples remember that I mentioned the acquisition was for $6. 9 billion and only $1. 6 billion of that was funded as actual equity. Well just a few years later in 2019 Sycamore partners was able to recoup most of that $1. 6 billion investment. They accomplished t 4 billion of that debt against its owners T It also increased the debt that Staples is carrying to just under $7 billion total. That was six years ago so at two years later in 2021 even with all of that debt Staples tried for a that offer was just rejected though even before the FTC had to step in again. Now just about a year ago in June of 2024 Staples was able to refinance all of that debt that they had w That refinancing last year has basically kicked the can down the road to 2029 where $2. 375 billion will be due and that brings us today where we're in a Staples store looking at a really dirty display model for a mechanical keyboard. They really should clean that's ugh. I used the term kick the can down the road for the refinancing because that really does feel Revenues at Staples stores have been declining over the years and why is there a Nintendo sign here over the print cartridges? Did they ever sell Nintendo stuff at Staples? Because that's weird. Here's a look at the software section and this used to be a big section at Office supply stores It's just Microsoft Office and anti-virus stuff and that's the problem with the Office supply industry in general. Offices just use a lot less supplies. A lot offices have switched to becoming paperless which means you know they would have filing cabinets with filing folders and dividers all full of paper and now a lot of those things that they would buy at an office supply store are all just one $15 th T I've been in an Office Max recently and it was kind of the same story. There was really nobody else in there. From what I understand Staples business to business sales business is doing better than their retail locations and I t I do like that you can buy Christmas cookies though in Staples in the middle of the s Those butter cookies I usually only see during Christmas time in stores. As far as customers who don't own businesses and may just come to Staples to maybe purchase a specific color of printer paper for a school project or something I feel They do have a lot of back to school and supplies for teachers here specifically as well. Although I do know some teachers and I never hear them mentioning shopping for t Unfortunately teachers have to dip into their own pockets for a lot of that kind of stuff so I think they try and find the cheapest deal they can find for that kind of stuff in places Now I did purchase something while I was here I really I also saw the famous Staples Easy button. I had forgotten about t Overall I would say that t Now we are going to head out of t So here's footage that I filmed of a Staples store five years ago when I was originally working on a video because I had found out that Staples was carrying a large amount of debt and at the time a lot of it was going to be coming up due soon. However since then they were able to pull off that refinancing that I talked about earlier and kind of push things off to 2029 but I thought this five-year-old footage would still be useful in this video because we can kind of get an idea of what Staples looked Unless somet If they're not able to pay that over two billion dollars that is due then I don't see that there's going to be any way for them to do another refinancing and then kick t Here'somet Those aren't really necessary anymore and just Now because Staples was split into those three entities where one of them is the B2B side of the business that side of the business seems to be doing better than the retail store business so even if all of the Staples stores close I don'there just won't be stores called Staples anymore it'll strictly be office supply delivery and business to business sales. It's kind of interesting to see t Now according to my notes t We can also kind of see some inflation because in 2020 those cookies are 4. 99 but in the earlier footage that was from a few weeks ago they were 6. 29. It's also interesting to see in this older footage that there'still some color in the store Now here'something I didn't see in the store when I was there a few weeks ago but was here in 2020 is they had a whole section of Martha Stewart branded office supplies that stapler is awesome may not be a red swing line but I do It always gets me to look at the price of some of these ink cartridges and this was five years ago and some of those sets are over a hundred dollars and even back then they had the cameras and monitors making sure that you weren't stealing ink cartridges and Shaq was in staple stores all the way back in 2020 and I think that's a life-size cardboard cutout so I had Mark go stand next to it because Mark's about six foot three Based on t I t As always everyone Want to see your name here? Head on over to patreon. com slash retail archaeology to find out how you can help support the channel. If you