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1CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Rick BuckleyPresident Facility Supplies
Corporate Express US Analyst Meeting Denver – 12-13 September 2007
2CXP Analyst and Investor Meeting Denver – 12-13 September 2007
“Safe Harbour” Statement under the Private Securities Litigation Reform Act of 1995
Statements included in this press release, which are not historical facts are forward-lookingstatements made pursuant to the safe harbour provisions of the Private Securities LitigationReform Act of 1995 and the Securities Exchange Act of 1934.
Such forward-looking statements are made based upon management’s expectations and beliefs concerning future events impacting Corporate Express and therefore involve a number of uncertainties and risks, including, but not limited to industry conditions, changes in product supply, pricing and customer demand, competition, risks in integrating new businesses, currency fluctuations, and the other risks described from time to time in the Company’s filings with the US Securities and Exchange Commission, including the Company’s Annual Report on Form 20-F filed with the Securities and Exchange Commission on March 9, 2007. As a result, the actual results of operations or financial conditions of the Company could differ materially from those expressed or implied in such forward-looking statements. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made.
The Company undertakes no obligation to update publicly or revise any forward-looking statements.
3CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Facility Supplies Market
• Large Market $24.8 Billion US
• Growing–Increased importance on clean & healthy environment
• Competitive Landscape– Largely, small to mid sized Independents– Regional Distributors– Buy side & Marketing Distribution Groups– Limited National Distributors – FS is just add on component to primary business– OP competitors sell FS at convenience level– Most suppliers lack sophistication in systems and distribution– Little interest shown on improving supply chain management
• Customer Interest– Understanding costs and control– Increasing productivity – labor and turnover costs high– Training for cleaners– Safe, green, housekeeping supplies– Increasing interest in the supply chain
• Movement toward Green and Sustainable housekeeping from Government, Educational, and Healthcare Markets
4CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Corporate Express - History in FS
2007 • Distributing Coastwide Lab chemicals nationally• Built laboratory in Colorado• Expanded FS sales personnel• Developed Strategic Account FS Team
2006• Coastwide Labs acquired • FS Business President hired• Hired dedicated Category Manager• Developed FS Purchasing Team• First FS enhanced DC opened
2005• First FS acquisition made• First Strategic Account win
2004• Published first CE FS catalog and hired Facility Supplies Specialists • Developed direct vendor relationships
5CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Why Facilities for CE?
• Current FS distributors do little to address supply chain costs
• No dominant FS competitors in Strategic Account market
• CE electronic order system well beyond industry
• Not dependent on OP to earn significant FS business– Microsoft, Boeing, Best Buy, US Air
• Infrastructure largely in place
6CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Infrastructure - Largely in Place
• Customers – No special set up required for existing clients– Billing already established– Reporting data all collected
• E-Way & eCommerce Ordering– Same system– Additional products easily added
• Warehousing/Occupancy– Just another line or box– Some modifications being made in new buildings
Recessed floors in chemical storage room Aerosol cages Higher ceilings for more vertical storage Training & product demonstration centers
• Delivery– Most product goes out on standard vehicles – Some larger vehicles being acquired for bulk deliveries
• CEC– Added FS training modules– Developed FS Specialties/Chemicals Group
• OP Sales Team– Creates interest at customer level - allows for faster access for FS Specialist
7CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Value Proposition for Facilities
To use Corporate Express’ well developedsupply chain management expertise to assist
customers in lowering the cost of facility supplies procurement, provide outstanding service, and deliver solution based products that promote
sustainability, our environment, and are safe for the people who use them.
8CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Why CE for FS Buyers?
• Reduces Supply Chain Costs– One source to contact– Electronic ordering system– Fewer receivings– Consistent paperwork– One invoice– Detailed reporting– Just in Time Product reduces
Storage Damage Obsolescence Shrinkage
– Managed relationship reduces time spent with multiple vendors
• Standardized Products help manage Risks – Key in FS• Full product and service offering for targeted businesses• Able to deliver Green & Sustainable products to meet objectives
9CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Single Accountable Source for Business Needs
One Accountable Source
Leverage with other Lines of Business
Office Products
CEBI Doc & Print Management
CE Promotional Marketing
Facility Supplies
The Customer
10CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Chemicals & Floor Pads
Waste Containers, Carts, Signage, Mops, etc
Towels and Tissue, Soap
Towels and Tissue
Hand Soaps
Key Supplier Partners in Market
Chemicals
Chemicals
Can Liners
Supplier partners historically control channel;protective of current distribution
Trend toward Private Label, especially in Chemicals
11CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Facility Supplies Category Mix
Industry Average Mix
12CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Key Categories & Product Mix for Industry
Chemicals – 34%
• Disinfectants• Glass Cleaners• Multi-purpose Cleaner• Floor Strippers & Waxes• Carpet Cleaners• Soaps – Hand• Dilution Centers
Paper – 30%
• Towels – Rolls & Folded• Tissue – Facial & Toilet• Wipers• Napkins• Feminine Hygiene
13CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Key Categories & Product Mix for Industry (cont.)
Equipment – 8%
• Vacuums• Buffers• Floor Cleaners• Service
Liners – 8%
• Trash Bags
Facility Supply General – 11%
• Mops, Brooms, & Buckets• Waste Containers & Baskets• Signage & Carts• Floor Mats• Gloves
Break Room – 8%
• Plates, Cups, & Utensils
14CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Acquisition of Coastwide Labs
• Acquired 16 months ago
• Well respected “Thought Leaders” in the industry
• Innovator in designing cleaning chemicals; since 2004 focused on safe (Green) and Sustainable products
• Developed a complete line of Products called Sustainable Earth (SE)– High performing products as good or better than traditional products
most generally used– Safe for the people using them and those that come in contact with the
chemicals– Designed to be planet friendly and promotes sustainability throughout
it’s development, distribution, use, and disposal– Priced to be no more that conventionally used chemicals
• Sustainable Earth very successful differentiator
15CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Sustainable Earth Chemical Line
• Research and Testing Lab in Colorado
• Sustainable Earth launch Q4• Extensive training for Facility
Supplies Sales Team• Targeted markets focused on
Environmentally sensitive products– Strategic customers with Sustainable
initiatives– Building Service Contractors – Education – Healthcare– Retail– Government – Federal, city, county,
state
16CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Sustainable Earth Launch Support
• SE Websitehttp://www.sustainable-earth.com/
• Ads placed in Trade Journals
• Featured in BusinessWeek article
• Brochures, training materials, product catalogues and sales support material completed
• Presence at major trade shows(ISSA – International Sanitary Supply Assn) with direct marketing to key attendees
17CXP Analyst and Investor Meeting Denver – 12-13 September 2007
Facility Supplies Value to CE
• Facility Supplies represents relatively high revenue growth opportunities for CE while leveraging existing infrastructure and client relationships.
• Sustainable Earth enhances Corporate Express’ environmental conscience to our associates, the communities in which we operate, and our clients.