The COVID-19 pandemic has brought about unprecedented changes in the way businesses operate. One of the industries most impacted is office supplies as remote or hybrid work devastated revenues during the pandemic. In 2023, 30% of office work is still being performed at home. This has resulted in a permanent change in the way businesses procure and pay for office supplies.
Hybrid Workspaces and Office Supply Spend
The pandemic has resulted in many organizations adopting a hybrid workspace model, where employees split their work hours between working from home and the office. This has led to a significant reduction in spend on office supplies as employees demand has shrunk. According to a survey conducted by the Institute of Supply Management, 47% of respondents reported a decrease in office supply spend since the start of the pandemic. Across CCM’s clients the average spend dropped by 56% and has only recently begun to increase.
CCM’s data indicates that, in the last quarter of 2022, office supply spend had returned to approximately 75% of pre-pandemic levels. Based on our discussions with clients, we anticipate growth of office supply spend will slow and spend will not return to 2019 levels until at least 2028.
Another trend that has emerged as a result of the pandemic is increased decentralization. With employees working remotely, the traditional centralized procurement process for office supplies may no longer be effective. Employees are now purchasing office supplies on their own using corporate credit cards or personal cards, making it difficult for organizations to track and manage their spend effectively. The rise of Amazon Business has also played a significant role in the decentralized spending trend, as employees can now purchase office supplies directly from the platform using their corporate accounts.
Total Spend Assessment
To effectively manage office supply spend, organizations need to have a clear view of their total spend across all payment and sourcing channels. A recent report by Accenture found that many organizations are only tracking around 50% of their total office supply spend. By bringing together all payment and sourcing channels, organizations can get a complete view of their spend and identify areas where they can reduce costs.
Opportunities for Custom Programs
The rise of decentralized spending and hybrid workspaces has created an opportunity for organizations to develop custom programs to leverage their full office supply spend for cost reductions, while providing convenience and value to employees. Organizations can partner with office supply vendors to create custom catalogs and pricing structures that align with their procurement policies. By offering a centralized platform for purchasing office supplies, organizations can better track and manage their spend while providing employees with a convenient and user-friendly purchasing experience.