Could Amazon Business Take Over Office Depot B2B Operations?

Could Amazon Business Take Over Office Depot B2B Operations?

Amazon Business could take over Office Depot B2B operations. This may lead to the $6 billion Staples/Office Depot merger being approved by the FTC.

New rumours are circulating that Amazon Business could take over Office Depot B2B operations. This may lead to the $6 billion Staples/Office Depot merger being approved by the FTC. Share prices in both Staples and Office Depot were up following details of the potential deal with Amazon being reported in the New York Post as the FTC hearing on the Staples/Office Depot began on Monday 21st March.

Although Amazon has its own distribution centres it is thought that it would also use Office Depot’s corporate accounts to push its new office supply business. It is also in line to make a bid for another office supply business W.B Mason.

Is Amazon Business a Major Force in the Office Supplies Industry

U.S. Federal Trade Commission

One of the key questions for the FTC is whether the federal judges see Amazon as a major force in the office supplies industry?

With the FTC hearing on the potential Staples/Office Depot merger now in full swing, one of the key questions is whether the federal judges see Amazon as a major force in the office supplies industry?

Prentis Wilson, Vice President of the Amazon Business unit has been questioned by the FTC. He has stated that Amazon has no large corporate customers, did not stock shelves and often did not bid for a customer’s business.

This stance is in line with the FTC’s argument that Amazon cannot give the same level of service as Staples and Office Depot.

Amazon Business is starting to respond to some demands from corporate customers, including;

  • Allowing companies to approve purchases by their employees
  • Enabling companies to pay via invoice
  • Responding to requests for bids in a “limited way”

Wilson told the FTC that Amazon Business; “does not negotiate contracts with large business customers.” He also stated that Amazon was not the primary supplier to any company with revenue over $250 million.  However he did state that Amazon has plans to compete in the corporate office supplies segment in a few years’ time.

Judge Is Keen for FTC and Staples to Come to an Agreement

As the FTC hearing continues, Judge Emmet Sullivan has encouraged the FTC and Staples to come to an agreement. This may conclude with the Staples/Office Depot merger getting approval on the basis that the FTC monitors prices for a two year period.

The case continues and the Office Supplies Blog will keep you updated with proceedings here on the blog and on twitter.

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Sam Rose