Workplace360: Can you walk us through from your first role at Superstat to leading the business today?
Alex Dunn: I first joined Superstat in 1994 on a summer job after returning from university abroad, completely skint. My father had founded the business with Chris Collinson, whom I already knew, and I went in as his office junior. I loved it – especially organising Superstat’s first little conference in the marketing suite at Spicers.
After finishing my degree, I returned to organise the next year’s conference and on my second day back, Chris asked if I wanted a proper job and I said yes. That was the interview process and I’ve been here ever since.
For 20 years, I worked alongside Chris as he grew the business into a genuine success story, with my father, Ivan, supporting behind the scenes as Chairman. Chris retired in 2016 and now we are a board of three directors – Karly Haley, Richard Lockley and me.
W360: What is the current ownership structure?
AD: Superstat is privately owned. I hold the majority of shares in conjunction with Karly and Richard. Karly has held her shares for as long as I’ve held mine and Richard’s stake is in the process of being finalised.
W360: Thinking back to 1994, when you were in the office making tea, how has the group evolved over the past three decades?
AD: The group grew out of a local OP wholesaling business run by Chris and my father. They noticed that when dealers joined buying groups, a lot of their spend just vanished. To cut a long story short, they started engaging with those buying groups, attending their exhibitions and it worked well.
At the time, most large groups focused on bigger dealers, leaving a gap to support the smaller end of the market. Superstat began by targeting relatively small dealers, but within just a year or two, we had more than 100 members, some turning over millions.
The essence of what we do remains unchanged: bringing dealers and suppliers together to grow the business, putting the dealer first, supporting their growth and encouraging them to use our initiatives and work with our suppliers. Those principles have endured for 30 years.
What has changed over the years is that we no longer try to do too much, but when we decide to do something, we really do it properly.
W360: How many dealers are currently on board?
AD: Over 200.
W360: Is that moving in any particular direction?
AD: No, it’s bizarrely holding very steady. There is some consolidation, as you know, but we signed a new dealer just last week.
W360: You mentioned that the group’s original objectives have remained consistent over the past 30 years. What are the main focus areas today when engaging with dealers?
AD: The big one is sustainability. We’ve just launched our eco offering and that’s attracting a lot of attention.
W360: Is it in addition to a standard programme or something you’re just rolling out?
AD: We’ve been rolling it out slowly and presented it at the conference with some of the dealers that are piloting it with us.
Dealers are telling us they feel there is a lot of talk going on around this issue within the industry, but that they need something tangible to show their customers right now. They also want to work towards being greener and genuinely making a difference, but you can’t change your whole business overnight.
Our solution provides a recognised standard without demanding an onerous amount of time or money to chuck at it straightaway.
W360: Any other strategic priorities?
AD: Much of our focus is on new product areas, introducing new suppliers and providing support with marketing and sales training in those categories.
W360: What would you say is the rate of decline in consumption of what we’d call traditional OP?
AD: Between 5-10%, although some categories are seeing double-digit declines.
W360: Are your dealers managing to fill that gap and if so, which adjacent categories are proving popular within the Superstat universe?
AD: Overall, they’ve plugged those gaps – and some have done fantastically well. A few haven’t, but on the whole, topline sales have remained steady. Dealers are constantly adapting and heading off in different directions. Furniture is a major growth area and some have really pushed into workwear and PPE, as well as catering and hygiene. Print remains a strong seller for certain dealers and at our recent conference, I spoke to a couple having great success in AV.
W360: What were some of the highlights from your recent conference? How was the mood and what were you hoping to convey?
AD: First and foremost, it was just an absolute joy – the mood was extremely positive, attendance was excellent and feedback from both dealers and suppliers was fantastic. We had a brilliant speaker who inspired everyone, but the most impactful sessions were when dealers themselves were at the centre of discussions. Peer-to-peer learning is far more powerful than anything I or a supplier could present.
Of course, not everyone attended. Some dealers are very hands-on, so even a single driver being unavailable can mean the managing director has to step in. Others might have preconceptions about these kinds of events – worrying about what to wear or not knowing anyone. But once they attend, they see how welcoming and enjoyable it is, and how valuable it is to take time out to think about their business.
The main objective is to provide a friendly environment where dealers and suppliers can come together and spend a day thinking, learning and sharing experiences and inspiration. Dealers that attend really hand-picked themselves and were focused on growing their business, exploring new product areas and making the most of the support on offer.
W360: The industry is at a bit of a tipping point and needs to show a collective movement towards new opportunities. If vendors are relatively new to our sector, you want them to see an engaged reseller base.
AD: I don’t disagree. We had a number of suppliers in what we call new product areas. They’re not new to most dealers, but I keep an eye on whether they’re getting value from the event and what the engagement has been like for them – because for some, it isn’t an obvious fit. Some are ex-OP, so they know the trade; but for others, it’s a whole new world.
I’d say all the suppliers, vendors and exhibitors were blown away by the level of engagement because for them it’s a high-quality audience of owners and decision-makers in the room who are all genuinely there to seek out new opportunities to grow their business.
W360: Talking about engagement, can you walk us through some of the services the group offers? Is it one size fits all?
AD: Our approach is very much a menu and we don’t dictate anything to anyone. Most dealers tell us they need help with something. Some members might only use one initiative that’s useful to them and that’s fine. Even if only 50 out of 200 use a particular service, that counts as a success. We take the time to find out what that thing is. It could be our sustainability programme, sales training or even our catalogue.
W360: I take it that’s not a full line catalogue?
AD: No, it’s a short-range in an A5 format with a good, better and best selection, offered either street-priced or unpriced. About 50 dealers still use it, roughly split 50:50 between the two pricing options.
W360: I suppose Amazon drives a lot of pricing. Does it come up in conversation much with dealers?
AD: Amazon is definitely taking business from our dealers, although it’s hard to quantify. We’ve tested buying office stationery from Amazon and the pricing and service vary wildly when orders are fulfilled by different vendors. So independent dealers have plenty in their armoury to compete with Amazon when it comes to service.
W360: Amazon Business has been very much focused on FTSE 250 companies and other large public procurement organisations. Are you concerned it might move further down the funnel into SMEs, which are presumably the heartland of your dealers’ trade?
AD: I’m sure Amazon is already eating into that segment significantly and it will only continue to do so. It’s hard to know exactly what is happening.
However, my take is that if Amazon Business is focusing on the top end of the market while also cleaning up at the bottom, supplying microbusinesses and individuals, there’s still a middle ground of SMEs in the 20-50 office worker bracket where independent dealers traditionally have a lot to offer.
W360: Your compatriots at Nemo Office Club run a ‘buy local’ campaign. Do you think there’s scope for a wider industry initiative?
AD: Yes, I don’t see why not – we’d certainly support something like that.
W360: Returning to online, what’s your view on the digital capabilities of your members?
AD: They all have e-commerce platforms – many have had them for some time. But, as with all SME businesses, there’s a wide spectrum of digital marketing expertise.
Some are naturally brilliant at social media, while others tell us they struggle to find the time when there are other things they could be doing that give a more measurable result. Being hands-on, owner-managed businesses, even something such as sending a weekly email to existing customers can be a challenge to maintain consistently.
W360: Presumably you offer a service that tailors this or manages it for them?
AD: Yes – we provide a ‘done-for-you’ service, tailored to how much the dealer wants it personalised to their business. Social media posts and email marketing are sent out come rain or shine, with consistent timing and branding. There are clear economies of scale, so it can be delivered very cost-effectively.
Some business owners are hesitant to get involved in social media marketing because they don’t know where to start. With a platform and a track record of posts being shared for them, they can contribute more easily. If they’ve got news or something personal to share, they’re not going in cold and risking a post that might look out of place.
W360: How many of your dealers take up that service?
AD: Funnily enough, about 50.
W360: And the rest?
AD: A very small percentage handle it themselves, and at a really high level, but many dealers tell us they struggle for consistency – whether it’s sending out a regular email or posting on social media. They’re always busy and it’s often a job that gets pushed to the bottom of the pile.
W360: How are these businesses staying afloat? If they’re not communicating with customers, somebody else will be.
AD: I agree that the bigger companies especially are relentless in their marketing and smaller independents are not always as consistent. But some tell us they look at what gets churned out and think they’d rather not do anything at all than put something out that doesn’t represent their personality. It’s something that we can help with: we want to give dealers ‘big company’ consistency in their marketing communications, but at the same time, you’ve got to preserve the individual identity of each dealer.
W360: Are there any standout success stories across your dealer network that you highlight to prospective members considering joining or switching allegiances?
AD: Absolutely. The most inspirational stories are where a dealer has focused on a new market or product area and really gone all in. Without naming names, the successful ones are investing to some extent in time, stock or expertise and taking it very seriously – and getting very good at it.
W360: For a dealer that decides to focus heavily on a new product area, what value does Superstat offer?
AD: In any new product area, we often help by connecting dealers with relevant suppliers – those with quality products, strong service and the right profile within the supply chain. Dealers could research this themselves, but having relationships already in place, with deals and terms set up, can be a real shortcut.
We also provide marketing support, which over the past two years has focused on different product areas. We can help dealers market these areas effectively. Specialist sales training is another key area. A lot of sales training can be very product focused and forget to teach people how to sell.
Our priority is first to provide a sales process – a technique and approach for being more successful – and then tailor it to a new product area. It’s about combining a solid sales process with targeted product knowledge.
W360: Who at Superstat is tasked with becoming a guru in these adjacent product categories?
AD: It’s very much a team effort. Whoever manages a particular supplier relationship will drive that side, with our sales training expert researching the area, working with the supplier and bringing the training up to our Sales Academy standard. Product knowledge is important, but getting the sales process right is the key. Giving people too much detail on a product can almost be a bad thing.
W360: I guess content is pretty key to expanding the dealer community into different product categories and opportunities.
AD: Totally. It’s an area we’re immensely proud of. We create our content in-house, designed to engage consumers in a way that grabs attention without being overly salesy. We don’t lead with products or special offers. Offers have their place and may feature further down a communication, or not at all; but we lead with original content created weekly, tailored as much as needed to a dealer’s business.
We have an in-house style and see very low unsubscribes, with open rates well above the industry standard. Part of that comes from having good data – it comes directly from the dealers. These are actual customers and prospects, not purchased lists. For example, we send out 35,000 emails a week to real people who buy workplace supplies, with content we hope is genuinely worth reading, rather than saying, “Punched pockets are now just £1.99.”
W360: I get those emails as a consumer and wonder why they are still pumping out all that stuff.
AD: I’ve had that debate with a lot of people over the years. They’ll say, “Well, the promotional email I sent had more success than yours,” and it’s hard to argue – the sales spike is there in the stats. But that’s not what we’re trying to achieve. We want to enhance the relationship between the dealer and the consumer – to position them as businesses that people want to deal with and as helpful experts, perhaps in a particular area.
W360: No one’s going to get rich driving the price down on punched pockets.
AD: No, but that’s the kind of thing some focus on.
W360: Let’s talk about some of your supplier connections. Obviously, you’ve got a quite tight one with Exertis Supplies.
AD: We’d known the late Tim Holmes for decades, going back to his time at ACCO Brands. We stayed in touch while he was at Lyreco and then as he moved to Exertis Supplies. Quite frankly, when Spicers went under, we had a conversation with Tim. We’d been looking to do something, but we had a solus arrangement with Spicers which I didn’t feel we could just breach or walk away from.
W360: Does Exertis’s no-frills model inhibit dealers to some extent or is it just a fact of life that they’re using multiple wholesalers now, given the expansion into adjacent categories?
AD: I don’t think it limits them. Over-duplicating traditional OP isn’t the right approach – especially when there are another 60,000 SKUs they could be selling, depending on which tangent they pursue. Dealers decide where to buy and many of our members use VOW as their main supplier.
W360: So, Exertis recently got a new managing director and new owners. Does that give you any sleepless nights?
AD: I’ll be honest – it was a bit of a shock. While both changes are perfectly understandable, having them happen simultaneously raised an eyebrow. That said, wholesalers have traditionally changed hands over the decades and that’s rarely sinister unless there’s something fundamentally wrong with the organisation – which, of course, has happened in the past.
We really liked Andrew Beaumont as the previous Managing Director and had a great rapport with him, but we also really like his replacement, Matt [Balcombe]. He seems like a great guy and definitely brings a certain energy to the role.
W360: How would you like to see Exertis evolve under the new Aurelius ownership?
AD: The new premises at Elland give Exertis the opportunity to get more involved in what we call newer product areas and dealers are very receptive to that. There’s now room to move, improve service and add extras – such as pick-and-wrap – which our members have come to expect. One thing I would say about Exertis is that when it commits to something, it really does it properly – under-promising and over-delivering.
W360: What’s your view – and that of your dealer members – on the size of evo Group and, more importantly, its diversified channel model?
AD: Some dealers object to buying from a competitor or competing with their supplier – however you want to frame it. Others take a more pragmatic approach, focusing on the supply proposition in front of them at that moment.
W360: While we’re on the topic, there’s also the move from vendors to D2C – whether through branded stores on Amazon or their own e-commerce sites. Are your dealer customers getting disillusioned by that?
AD: I think it’s just part of what the internet brings and there’s not a lot you can do about it. Dealers have never relied on the exclusivity of their products – it’s always been a commoditised range – and it’s not how they distinguish themselves.
W360: What are your thoughts on collaboration between dealer groups?
AD: We have good relationships with our competitors and work with them in certain areas, particularly where collaboration benefits both dealers and suppliers. It’s a bit like a dealer group on a grander scale and we’re up for that where it makes sense.
I do quite like the element of competition, though, and having more dealer groups adds differentiation in the market.
W360: What’s your view on the Office Friendly and Integra merger for the industry as a whole?
AD: Honestly, what I think is not important. If their members feel it’s a good idea and benefit from it, then good luck to them. As I said, I quite like having other groups around.
W360: Do you think we’re going to see more consolidation, now that two of the five dealer groups have joined forces?
AD: There will be more, whether that’s at the dealer, dealer group or wholesaler level. But dealers are agile and well placed to make micro changes on a daily basis. They have a track record of succeeding despite macroeconomic trends and headwinds that aren’t in their favour.
So yes, there will be change and consolidation, but our membership is resilient. They’ve proven time and again that it’s not wise to write them off, as many people have over the time I’ve been doing this.
W360: What about BPGI? We don’t hear much about it anymore – is it still relevant and important?
AD: It’s still relevant to us as it’s a bit like a buying group model but on a larger scale. While there’s a clear benefit for our members, we’ll certainly continue to support it. It’s also been a way for me to get to know other people doing the same job, whether in the UK or abroad. I hesitate to call it networking, but it’s about having those conversations with peers.
W360: Sticking with consolidation, I guess it’s inevitable that some dealers in your group, given their age profile, are starting to consider their exit. What role does Superstat play as a dealer owner nears retirement?
AD: We’ve been helping dealers with acquisitions for 30 years and have probably seen anywhere from 50 to 100 go through. Generally, our dealer owners are quite youthful, so they’re more likely to be acquisitive than looking to sell. But it’s not always about age or retirement – I was talking to a dealer recently who’s looking to emigrate and start afresh abroad and ultimately wants to sell the business.
It’s invariably a win-win situation. The selling dealer realises value for the heart and soul they’ve put into the business; while it’s an excellent growth opportunity for the buyer, who might bolt on £500,000 or £1 million worth of sales – the equivalent of gaining a large number of new customers.
W360: Thinking about the future, what are the main challenges facing the independent dealer channel?
AD: Some of this we’ve already touched on, such as the decline in traditional OP, but also a flat economy and certainly people’s working habits. That decline in volume has been ongoing for years, although it’s probably been masked to some extent by price inflation, with turnover maintained artificially to some extent.
The government is busy working to reduce the rate of inflation, so my concern would be a combination of an ongoing reduction in volumes, coupled with price deflation. That could really hit turnover and cause a problem that we can’t solve quickly – another reason for us to be robust in growing new areas.
W360: Challenges aside, you came away fairly buoyed by the conference you ran. What was driving that enthusiasm?
AD: It’s hard to pinpoint exactly – perhaps just a sense of camaraderie that comes from taking time out of the day-to-day to reflect on what you’ve achieved and what you want to achieve next. Talking to like-minded people about what works and what hasn’t, engaging with suppliers who are there to grow their business and help you with yours – and, of course, having a bit of fun along the way.
There was a real energy in the room that reinvigorates your belief in this industry and the dealer channel we operate in. You look around and think, “Actually, this isn’t all that bad.”
W360: If it’s not all that bad, I guess you’ll be sticking around a little longer. What are the biggest lessons you’ve learned since taking the top role?
AD: I once read a quote, and to paraphrase: “As a managing director, I want to try to be of some help and not a total hindrance to the team around me.”
W360: Don’t get in the way of your team.
AD: At the end of the day, someone’s got to make the decision, but it’s important to involve everyone and let them have their say. I won’t be here forever and there are younger people coming through. I was reading about The Entertainer – the founder is retiring and handing over control of the business through an employee ownership trust. That’s something I’d love to do: create a future for members, suppliers and the internal team who operate Superstat. That would be amazing.
Another lesson I’ve learned is that the people actually doing the job are best placed to find the solutions – not the manager. Personally, I still want to take this business to another level, develop the offering to customers, scale the business and provide an exciting future for the team around me.
W360: Sounds good. Thanks, Alex.
