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Office Depot OfficeMax logos

Combine the nation’s second-biggest and third-biggest office supply stores, and what do you get? The nation’s second-biggest office supply store.

When you look at it that way, the merger of Office Depot and OfficeMax, announced today, doesn’t sound quite so revolutionary. Staples is still bigger than both, and they all face competition from other office-product suppliers like Amazon and Walmart. But the deal does raise some questions about how customers will be affected.

The biggest unanswered question right now, is exactly which store’s name, layout, coupon policy and perks program will survive, and which will fade away – or whether elements of both will be merged into something new. In announcing the deal, the two companies called it a “merger of equals” and said details like the company’s name would be sorted out later.

Soon after the announcement was made, OfficeMax sent an email to members of its MaxPerks Rewards program. In it, the company reassured members that “your MaxPerks rewards are secure,” noting that the merger would likely not be complete until the end of 2013. Until then, OfficeMax customers can continue to earn and use MaxPerks rewards. Office Depot customers can do the same with that store’s Worklife Rewards program.

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Both programs are similar, in that they offer store credit in exchange for certain purchases – buy this product, or this dollar amount of products, now and get credit for another purchase later. There are nuances to each, though, and customers will be eager to learn which will become a part of a combined Office Depot-OfficeMax rewards program. MaxPerks, for example, can be “rolled”, and used to purchase other items that will earn you more MaxPerks. Not so with Worklife Rewards. With MaxPerks, you have to spend a total of $500 before you get 5% back, while Worklife Rewards gives you a percentage back on nearly every purchase.

There are no answers yet, as to which aspects of which program will stay in a combined company. It will take a while to get into that level of detail, since the company hasn’t even settled on a name, after all. For now, they’re just speaking in generalities that don’t say a whole lot: “Customers will benefit from enhanced offerings across multiple distribution channels and geographies.”

One thing is considered likely – store closings. If you live in an area where there’s an Office Depot and an OfficeMax nearby, it’s safe to assume only one of them will still be around in a year or two. “Clearly, you can’t make this deal work unless you close a bunch of stores,” one analyst told Reuters. Ironically, he adds, the company that the combining stores are trying to beat, could benefit the most. “Staples will clearly benefit from just having fewer stores to compete with.”

And with only two office supply giants competing instead of three, there may be less incentive for them to offer generous rewards programs – or low prices – at all. That’s likely to be a concern of the Federal Trade Commission, which may have to decide whether too few competitors in the office supply marketplace will provide too few choices for consumers. In fact, in 1997 the FTC objected to a proposed merger between Staples and Office Depot – and a judge agreed it would likely lead to higher prices.

But that was 16 years ago, well before the internet and big-box retailers were a serious threat to office supply stores’ business. So, no matter what form the sales, coupon policies and rewards programs take in a combined Office Depot-OfficeMax, you can probably expect to continue getting plenty of deals. The money-losing stores may not be able to afford to do it all – but considering all the competition, they can’t afford not to.

One Comment

  1. Pingback: ¿Es el servicio al cliente un factor determinante en la fidelidad del consumidor?

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