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09/26/2012

Staples Closes 60 Stores, Seeks $250M in Savings by 2015

Staples yesterday announced a new strategic growth plan that will accelerate the growth of its online businesses, restructure its internal organization and reduce its retail square footage in North America by 15% by the end of fiscal 2015. The retailer projects these changes will produce approximately $250 million in pre-tax cost savings during this period.

Immediate actions include accelerating the closings of 15 North American stores this year, creating 30 net store closings and 30 store downsizings/relocations for fiscal 2012. Staples also plans to shutter 45 European stores this year.

Staples will use the savings to increase investment in its online and mobile channels, expanding its digital assortments beyond office supplies to better serve the needs of business customers with product categories such as facilities and break room supplies, copy and print and technology products.

"Our vision is to establish Staples as the single-source product authority for millions of businesses," said Staples CEO Ron Sargent in a statement. "We are building on the strengths that are the foundation of our success by focusing on five key priorities: accelerate growth in the online businesses; fully integrate retail and online; improve retail store productivity; restructure our International Operations; and return cash to stakeholders."

Organizationally, the retailer will combine its U.S. Retail and Staples.com businesses under the leadership of Demos Parneros. Joe Doody will continue to lead Staples North American Contract and Quill.com businesses and will assume leadership of supply chain and customer service operations in North America.

Staples had $5.5 billion in sales in Q2 of 2012, which ended July 28, a 5.5% decrease over the same period the previous year. Comp store sales for North America declined 2% during this time. Globally, Staples ranks second only to Amazon in online sales.

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