Distributor United Stationers steps up its focus on online services

July 29, 2014 11:33 AM

United Stationers Inc., a distributor of office and industrial supplies to businesses, is focusing more on e-commerce to generate revenue.

The company’s net sales for the second quarter rose a modest 3.6% year over year, to $1.320 billion from $1.274 billion. That included $8.2 million in Q2 online sales gained from the May acquisition of online tools merchant CPO Commerce,  No. 256 in the Internet Retailer Top 500, which ranks companies on their annual web sales.

Much of the United Stationers’ increase in total sales, however, comes from sales to client resellers that sell through their own e-commerce sites. Sales to those companies increased about 20% year over year in Q2, though United Stationers doesn’t break out the amount of sales to those resellers. “Our sales to online [reseller] customers accelerated, growing nearly 20% during the second quarter, which is a good indication that our strategy is on target,” president and CEO Paul Cody Phipps said during a conference call with stock analysts last week.

Indeed, a key part of the company’s growth strategy, Phipps said, is “winning the shift to online” sales among resellers. Another part of that strategy is providing another increasing revenue stream: providing e-commerce technology and fulfillment services to its clients that sell online. “We make others run well online,” adds vice president of marketing Diane Hund.

Hund notes that United Stationers provides both e-commerce technology and warehousing and fulfillment services to some resellers, while providing only warehousing and fulfillment to others. 

To increase its ability provide such technology and services to clients, United Stationers in the second quarter expanded its team of e-commerce professionals and continued to invest in e-commerce technology and services, including the production of more digital product content and web content delivery services.

United Stationers also reported for the second quarter and six months ended June 30:

● Q2 net income of $33.33 million, down 3.9% from $34.67 million a year earlier;

● First-half net sales of $2.574 billion, up 1.9% from $2.525 billion;

● First-half net income of $55.19 million, up 13.7% from $48.54.

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