Agenda

1. State of WA GA Workshop April 22, 2010 Save time and money when ordering office supplies, paper and toner

2. Agenda • Office Depot Team Introductions • Hard Cost – Ways to save on product costs • Soft Cost – Ordering efficiency • Sustainability • Q & A • Vendors - Optional

3. Hard Cost – Ways to save on product costs • Essentials, Non Essentials and Exception Items • EssentialsOriginal Now Office Supplies 1049 1251 Ink/Toner 99 186 Paper 17 86 Marked with • Non Essentials – Items that are on the contract but discounted from the categories manufactures list price. Example: Writing instruments are priced at 65% off list price. List price $1.00 – your price $0.35. • Exception Items – Exempt from the category discounts and are priced at a discount from Office Depot’s public website. These items are reviewed monthly per the contract.

4. Hard Cost – Ways to save on product costs

5. Hard Cost – Ways to save on product costs • Sourcing Options • Kent Warehouse – 15,000 items stocked and delivered next day and able to check availability online. • Wholesaler - Additional 15,000 items stocked and delivered next day most of the time. Availability is marked Available* online. • Virtual Warehouse – Product that comes straight from the manufacturer to help save cost. Less than 2% of state sales comes from VW. Most of the product is toner and technology items. • Direct from Manufacturer (Special Order) – Not carried in our warehouse or wholesaler. Example: Large Outdoor Industrial Garbage Cans. Delivered 7 – 14 business days once order is placed. Please contact your Account Manager. • Tech Depot– Office Depot’s technology division • Dedicated Account Manager – Sean Raby Example: Customer (DSHS) wanted quote for headset and lifter. • Lowest quote from other companies was $225.00 just for the headset. • Our price from Tech Depot was $211.15 with headset and lifter. • They ordered 114 for a total savings of $13.85 per unit with a total savings of $1,578.90 not including the savings from the lifter.

6. Hard Cost – Ways to save on product costs • Minimum Delivery Fee • Orders under $50.00 pre-tax will have a $9.95 small order handling fee attached. • In the past 12 months 36.5% of the orders were under $50 • Volume Discounts • Volume discounts are given for stocked items only. 1% = $250.99 – $450.99 2% = $451.00 – $999.99 3% = $1,000.00 and above Example of greater than $50 order Example of less than $50 order

7. Hard Cost – Ways to save on product costs • Store Purchases • Emergency Purchasing • P-Card • Ensure Agency P-Card is linked so discount is applied • Track purchases online • Store Purchasing Card (SPC) • Bills to Account Billing • Track purchases online

8. Hard Cost – Ways to save on product costs • Original Equipment Manufacturer vs. Remanufactured • OEM – Original Equipment Manufacturers cartridges are made by HP, Canon, Lexmark, or other original manufacturers. They are usually manufactured using a combination of new and recycled parts at factories throughout the world • Remanufactured – “REMAN” cartridges are those that have been remanufactured for another use. Remanufacturing process involves disassembling, cleaning, refilling toner, replacing appropriate components, print testing and repackaging Note: Office Depot REMAN toners comes with a 100% No-Risk Quality Guarantee to perform to your complete satisfaction.

9. Hard Cost – Ways to save on product costs • Standard Yield vs. High Yield • A Model – Standard Yield Cartridge • X Model – High Capacity Cartridge - can reduce cost per page by up to 35% over standard yield • Dual Pack – Dual Pack – on average dual packs cost 10% less than their stand-alone counterparts • Examples: HP 42A • SKU 992280 - $154.37 • Cartridge yields up to 10,000 pages • $0.0154 per page • HP 42X • SKU 975384 - $232.99 • Cartridge yields up to 20,000 pages • $0.0116 per page • 24.54% Savings from 42A • HP 42XD • SKU 522810 - $387.04 • Cartridge yields up to 20,000 pages per cartridge • $0.0096 per page • 16.94% Savings from 42X and 37.32% from 42A

10. Hard Cost – Ways to save on product costs

11. Soft Cost – Ordering Efficiency • Processing Cost Reduce number of orders by 14,807 and save the State of WA an additional $1,480,700

12. Soft Cost – Ordering Efficiency You can build an order and place it when you are ready. This will help you create orders above $50.00, take advantage of the order size incentive and decrease order processing costs. • Step 1: At checkout you can place your order on hold by selecting the “Put this order on hold.” This will reserve the inventory for 5 working days. How to build your order for efficiency

13. Soft Cost – Ordering Efficiency • How to build your order for efficiency – Continued • Step 2:When you return back to continue ordering. Select “Order Tracking” under My Account menu • Step 3:Open your held order by clicking on the “Order Number” • Step 4:Click on the “Modify Order” button • Step 5:Click on the “Continue Shopping” button. This will bring you back into the shopping process. You can check out when completed or return back to Step 1 to put your order back on hold to continue building at a later date.

14. Soft Cost – Ordering Efficiency • Order Entry • Ecommerce = 90.6% of all orders placed • Telephone/Fax = 5.2% of all orders placed • Store Purchases = 4% of all orders placed • Special Orders = Less than 1% of all orders placed • Online Ordering • Singe Item Search • 6 Digit Office Depot SKU • Manufacturer Number • Item Description • Order by Item Number • Custom Shopping List

15. Soft Cost – Ordering Efficiency • Order Tracking under My Account • View On Hold Orders • Recent Orders • Place Returns • View POD • Reorder Items • Bill Management • Quickly access your account summary and detailed billing information to determine what is paid and what is outstanding • Search for invoices by date, due date, purchase order, ship to location or transaction type • Drill down into invoice activities , including payments, credits and adjustments • View print or export your invoices using a variety of formats • Pay your invoices online using multiple options • Pay one or multiple invoices at a time in one simple transaction • You can dispute an invoice online and receive a tracking number to follow its progress

16. Soft Cost – Ordering Efficiency • EFT vs. P-Card • Electronic Funds Transfer • Receive a 1% discount for paying by EFT • Receive an additional 1% discount for paying EFT, Net 10 • P-Card • Reduce Agency processing cost – Please see handout • No additional discounts are given with P-Card transactions • Most P-Cards have their own rebate program

17. Soft Cost – Ordering Efficiency

18. Sustainability • 731 Sustainable items on the 09205 contract essentials list • April 2006 – March 2007 = 9.5% Recycled spend • April 2009 – March 2010 = 51% Recycled spend • Office Depot offers more than 6,500 products with environmental attributes and certifications. This includes over 4,500 items with recycled content, over a thousand energy efficient technology and lighting products, and hundreds of items certified to be made with safer chemicals • New Website:  As part of its Earth Day 2010 program, Office Depot has created a new website at www.officedepotgrowgreener.com and is encouraging people to submit their own ideas on how they are growing greener.  For each green idea submitted, Office Depot will plant a tree with the goal of planting 4,000 trees by the end of May.

19. Sustainability - Attributes REDUCED ENERGY & CARBON EMISSIONS REDUCED WASTE AND PRESSURE ON RESOURCES

20. 12 cases (1/mth) virgin 8.5x11 … requires approx. 1 ton of wood…which requires approx 8 trees Sustainability 12 cases 30% recycled 8.5x11…requires approx. 5/8 ton of wood…which requires approx 5 trees 12 cases 100% recycled 8.5x11…requires approx. 0 ton of wood…which requires 0 trees

21. Sustainability – Carbon footprint 3 days 5 days a week 1 day

22. Sustainability