Staples Launches Omnichannel Store Format, But It May Need A New Idea

Staples (NASDAQ:SPLS) is experimenting with what it calls "omnichannel" stores with a smaller footprint and in-store inventory, a heavier emphasis on small-business services, and free delivery for orders from e-commerce kiosks, the office-supply chain said on Thursday (June 20).

The first of the new stores are in Norwood, Mass., and Dover, Del., and are being pitched as a better way for Staples customers to get the best of both in-store and online worlds. Eventually 45 of the retailer's 1,500 stores will be converted to the new format.

But the new 12,000-square-foot Staples stores are remarkably similar to OfficeMax's (NYSE:OMX) 8,000-square-foot "Business Solutions Center" format, which OfficeMax began piloting with a store in Milwaukee in April. Both store formats are chopped down from a 24,000-square-foot standard store, carry a relatively small selection of products in-store (around 8,000 at Staples, 4,000 for OfficeMax) and devote a large chunk of the floor space to meeting areas, customer business lounges and small-business services.

That's not really a case of Staples following OfficeMax—it's just that both chains are looking for ways to cut back on the real-estate costs that have been murder on brick-and-mortar retailers trying to compete with Amazon and other pure-play e-tailers. The concept—smaller stores, smaller selection, online ordering from the catalog—isn't complicated. The difference is in the details. That's also where the difference between success and failure will come.

That's where the Staples "omnichannel" concept falls a little flat. After all, ordering an item online that's not on a store's shelves is already available at any Staples store. Ordering kiosks are fine, but you don't need to walk into a store to order online. The Internet isn't a novelty that will pull customers in. And customers don't care about omnichannel as a buzzword—they already buy that way, as Staples' current 58-to-42-percent instore/online sales split clearly demonstrates.

That doesn't mean the new Staples store format won't work. It just suggests Staples may need a little something more—and another round of rethinking—for these small format stores. Calling them omnichannel isn't likely to impress anyone.

For more:

- See this Internet Retailer story
- See this Staples news release

Related stories:

Staples Will Shrink 39 Canadian Stores
OfficeMax Tries To Cut Its Floor Space, But The Mix May Be Wrong
Office Depot To Customers: Wait An Hour

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