Office Depot and Alibaba team up to tap small and medium businesses

Office Depot on Monday teamed up with Alibaba Group Holdings Ltd to launch a co-branded e-commerce website, seeking to tap into the opportunities of selling to small and medium-sized businesses in the United States.

The office supplies provider said the partnership would give Alibaba access to Office Depot's 10 million customers and 1,800 sales agents.

Also, Office Depot's customers will get access to Alibaba's global network of over 150,000 suppliers to find more product options or a reputed manufacturer to produce their goods, the companies said in a joint statement.

The deal is aimed at cutting delivery time and giving small and medium-sized U.S. businesses opportunities to sell beyond the United States through Alibaba.com.

Under the partnership, Office Depot will direct its business customers to the Alibaba wholesale trade website whenever they're looking for products other than office supplies. Customers using the online marketplace will also be able to have their products delivered via Office Depot's fulfillment network.

The tie-up will therefore open up possibilities for businesses dealing in a wide range of different products and services, not only office supplies. 

MarketWatch cited John Caplan, head of Alibaba's North American B2B business, who outlined the opportunities presented by the collaboration with the example of "a kayak designer who orders office supplies through Office Depot and has a relationship with one of the store’s salespeople."

"Under the partnership, that business owner will be introduced to Alibaba.com’s manufacturing offerings, which may help if the small business wants to branch out into designing canoes as well. The Alibaba.com platform lets business owners search for verified manufacturers, negotiate prices with them and ultimately make payments," he explained. 

The partnership comes as Office Depot struggles to boost sales amid stiff competition from e-commerce giant Amazon.com Inc. It is now focussing on selling business services to its customers, rather than relying on its traditional business of selling office supplies.

Office Depot shares were up 10 percent at $3.9 (2.9 pounds), while shares of Alibaba were up 1.3 percent at $186.35 in premarket trading.