Required pre-reading: This article assumes that you have read the LHTS AB fictitious company description. It explains the company’s operations, procurement model, systems, stakeholders and strategic priorities. From this point, the reader is expected to understand the general LHTS AB context.

Pens, notebooks, folders and copy paper are inexpensive compared with motors, electronics or transport. This does not mean the category should be ignored.

When thousands of employees buy low-value products through many suppliers, the organisation can spend more time processing transactions than it saves through price negotiations. Uncontrolled product variety also creates waste, unnecessary deliveries and weak purchasing data.

This worked example shows how LHTS AB develops a proportionate category strategy for office supplies and stationery. The strategy focuses on demand control, catalogue buying, transaction efficiency, sustainable product specifications and reliable delivery.

Training note: This is a fictitious LHTS AB case created for procurement training. It uses real public information about the relevant external market, combined with invented internal company data, stakeholders and supplier situations.

External data retrieved: 30 July 2026.

The LHTS AB business context

LHTS AB employs approximately 10,850 people and operates manufacturing, engineering, sales and service activities across 43 countries.

This category-strategy example covers the company’s European operations. The scope includes the nine European manufacturing and assembly sites, the Linköping headquarters and selected European sales and service offices.

Approximately 7,900 employees have regular access to office supplies. Their requirements differ.

Engineers and project teams use notebooks, whiteboard materials and document folders. Production and warehouse employees need labels, markers and controlled workplace supplies. Service teams use forms, notebooks and shipping materials. Corporate functions mainly require basic desk products and copy paper.

The category has limited direct influence on LHTS products. However, it affects administrative efficiency, employee experience, waste, purchasing compliance and the workload of local buyers and accounts-payable teams.

Category scope and baseline: where LHTS AB is today

Category definition

The category includes:

writing instruments;
notebooks, pads and sticky notes;
copy and writing paper;
folders, binders and document wallets;
envelopes;
staplers, hole punches, tape and scissors;
whiteboard and presentation supplies;
labels and basic identification materials;
stamps and selected personalised stationery;
desk organisation products; and
delivery of approved office-supply products.

The category excludes:

printers and managed print services;
toner and printer consumables;
information-technology accessories;
packaging used for LHTS products;
production consumables;
furniture;
promotional merchandise;
personal protective equipment; and
specialised laboratory or engineering supplies.

These boundaries prevent unrelated products from entering an agreement designed for low-value, standard office items.

Fictitious internal baseline

All internal figures below are fictitious training data.

Baseline measure	Current LHTS AB position
Annual European category spend	SEK 18.9 million
Employees with access to office supplies	Approximately 7,900
Active suppliers	74
Purchase orders per year	Approximately 9,600
Supplier invoices per year	Approximately 10,400
Spend through approved catalogues	54%
Spend with the five largest suppliers	63%
Active product numbers purchased	Approximately 4,800
Products representing 80% of spend	310
Average order value	SEK 1,970
Orders below SEK 500	29%
Next-day or urgent deliveries	18%
Products with verified environmental criteria	37% of spend

Spend by subcategory

Subcategory	Annual spend
Copy paper and paper products	SEK 5.1 million
Writing instruments and markers	SEK 3.2 million
Notebooks, pads and sticky notes	SEK 2.8 million
Folders, binders and filing products	SEK 2.3 million
Labels and identification materials	SEK 2.1 million
Desk and presentation supplies	SEK 1.8 million
Envelopes, stamps and personalised products	SEK 1.0 million
Freight and small-order charges	SEK 0.6 million
Total	SEK 18.9 million

The current purchasing model

Most sites have one preferred office-supply distributor, but local agreements were negotiated independently. Smaller offices often purchase through local retailers or online marketplaces.

The current catalogue contains too many similar products. For example, LHTS employees can select from:

46 blue ballpoint pens;
31 black permanent markers;
38 notebook types;
27 varieties of sticky notes; and
19 types of standard A4 document folder.

Some variation is justified. Production markers, archival pens and engineering notebooks may require specific performance. Most differences, however, reflect personal preference rather than a business requirement.

The category also creates a disproportionate number of transactions. Products worth less than SEK 500 frequently generate a requisition, purchase order, delivery, receipt and invoice.

The cost of purchasing and processing the item can therefore approach or exceed the value of the product itself.

Main baseline problems

The category team identifies five weaknesses.

Excessive product choice: Employees can select hundreds of interchangeable items.

Fragmented buying channels: Forty-six percent of spend occurs outside approved catalogues.

Low order values: Small orders create avoidable delivery and transaction costs.

Weak environmental evidence: Products are sometimes described as “green” without a recognised label, product specification or supporting data.

Limited demand visibility: Supplier and product descriptions differ between countries, making consumption difficult to compare.

The category strategy must address these problems before concentrating on price negotiation.

The external supply market

The supply market has low entry and switching barriers

Standard office supplies can be purchased from national distributors, international business-supply companies, specialist paper merchants, retailers and online platforms.

For most products, supply risk is low. Pens, folders, paper clips and notebooks are available from several manufacturers and distributors. Substitution is normally possible without a long technical qualification.

The main exceptions are:

personalised printed products;
labels connected to internal processes;
products with specific archival or chemical requirements;
items used in production environments; and
products integrated into a supplier-managed stock system.

For LHTS, the market structure supports competition. It does not justify maintaining intensive strategic relationships with many stationery manufacturers.

Digitalisation is reducing graphic-paper demand

European demand for graphic paper continues to decline as organisations use digital documents and workflows.

The Confederation of European Paper Industries reported that apparent paper and board consumption in its member countries decreased by an estimated 2.2% in 2025. Graphic-paper demand fell by 7.9%, while overall European paper and board production declined by 1.5%. The figures are preliminary and should not be interpreted as a direct forecast of office-paper prices. They do show a continuing structural change in the market. CEPI’s preliminary statistics for 2025 provide the industry data.

Declining demand does not guarantee steadily falling prices. Paper mills may close machines or change production to packaging grades. Energy, pulp, transport and capacity decisions can continue to affect prices even when total consumption falls.

LHTS should therefore reduce unnecessary demand but avoid assuming that digitalisation alone will produce lower unit prices.

Environmental labels can provide verifiable criteria

The EU Ecolabel covers graphic paper used for writing and printing. Its criteria address fibre sourcing, energy-efficient manufacturing, emissions to air and water, restricted substances and waste management.

A separate EU Ecolabel product group covers printed paper, envelopes, stationery-paper products, wrapping paper and paper carrier bags. The current criteria for that group are valid until 31 December 2028. The European Commission’s paper-product page describes the relevant product groups and criteria.

LHTS can use the EU Ecolabel or equivalent independently verified criteria in its catalogue requirements. It should not require one label when equivalent evidence can demonstrate the same performance, unless local procurement rules and the sourcing approach allow it.

The objective is reliable evidence, not simply adding an environmental logo to the product description.

Paper is highly recyclable, but purchasing choices still matter

The European Paper Recycling Council reported a European paper recycling rate of 75.1% for 2024. The measure covers paper products including graphic paper, packaging and tissue. It is a market-wide result, not proof that every office product purchased by LHTS will be collected and recycled.

LHTS must still consider:

whether products contain mixed materials;
whether plastic covers, metal components or adhesives prevent easy separation;
whether the paper can enter the site’s recycling stream;
whether employees dispose of it correctly; and
whether confidential paper requires secure destruction before recycling.

Recyclability should therefore be considered together with reduced consumption and suitable recycled content.

Deforestation due diligence is becoming more relevant

The EU Deforestation Regulation covers selected commodities and derived products, including certain pulp and paper products. The exact obligation depends on the product’s customs classification and the company’s role in placing it on or exporting it from the EU market.

Following amendments adopted in 2024 and 2025, the regulation is scheduled to apply from 30 December 2026 for large and medium operators. It will apply from 30 June 2027 for other micro and small operators, with a different date for small operators already covered by the EU Timber Regulation. The European Commission’s regulation overview provides the current implementation dates.

LHTS should not assume that every pen, notebook or finished stationery product is covered. Procurement, Sustainability and Legal must determine the relevant product codes and obligations.

The practical category response is to require suppliers to identify manufacturers, fibre sources and applicable due-diligence information for relevant paper products.

Delivery packaging is subject to new European rules

The EU Packaging and Packaging Waste Regulation entered into force on 11 February 2025 and generally applies from 12 August 2026. It covers packaging and packaging waste and introduces requirements intended to reduce unnecessary packaging and improve circularity. The European Commission’s packaging page explains the timing and overall framework.

Office-supply deliveries often contain small quantities in oversized boxes, plastic air cushions or separate parcels. LHTS should therefore consider packaging efficiency, consolidated delivery and returnable transport solutions when evaluating distributor services.

Stakeholders and business requirements

Office supplies have many users but should not require a large category team.

Stakeholder	Main requirement and decision role
Global Category Manager for Indirect Goods	Owns the category strategy, sourcing and supplier governance
Procurement Operations	Manages catalogues, supplier onboarding and user support
European site buyers	Validate local requirements and implement the agreement
Workplace and office managers	Define service requirements and local stock arrangements
Production and warehouse representatives	Identify justified specialist markers, labels and workplace products
Sustainability	Defines environmental evidence and reporting requirements
Finance	Validates baseline, transaction cost and realised benefits
Information Technology and Coupa team	Supports catalogue integration and purchasing controls
Legal and Compliance	Reviews contracts, claims and applicable regulatory provisions
Employees and requisitioners	Use the approved catalogue and provide practical feedback

Stakeholder tensions

Employees value choice and may prefer familiar brands. Procurement wants a smaller standard catalogue.

Local offices want rapid delivery for every request. Sustainability and Finance want fewer deliveries and higher order values.

Sites sometimes regard small purchases as unimportant. Procurement Operations sees the cumulative cost of thousands of low-value transactions.

The category manager should not form a large committee to debate individual pens. The business sponsor approves the category principles, while Procurement Operations manages products within those agreed rules.

Category assessment

Kraljic position

The Kraljic portfolio matrix considers supply risk and business impact.

Standard office supplies belong primarily in the routine or non-critical quadrant:

annual spend is low compared with LHTS direct-material categories;
common products are available from many suppliers;
substitution is generally easy;
product failure rarely creates a serious business interruption; and
processing cost can be more important than purchase price.

This position has a clear strategic implication.

LHTS should simplify the purchasing process, reduce administrative effort and automate compliance. It should not devote the same supplier-management resources used for semiconductors, motors or critical logistics.

Some items require separate treatment.

Segment	Category assessment	Management approach
Standard catalogue products	Routine	Automate and simplify
Copy and writing paper	Routine with sustainability exposure	Standardise specifications and evidence
Production labels and specialist markers	Leverage or bottleneck, depending on use	Qualify alternatives and control specifications
Personalised stationery	Routine but administratively complex	Central templates and limited suppliers
Emergency local purchases	Routine exception	Controlled purchasing channel

Main opportunities

The category team identifies six opportunities:

Reduce product variety.
Move demand into one guided catalogue.
Consolidate deliveries.
improve environmental specifications and evidence.
simplify invoice processing.
remove unnecessary or obsolete demand.

The largest opportunity is not a dramatic unit-price reduction. It is lowering the total cost of buying and using the category.

The target position and category strategy

LHTS will move to a catalogue-led European model with a small standard assortment, one primary distributor and controlled local exceptions.

1. Create a core catalogue

The category team will reduce the active assortment from approximately 4,800 products to:

250 core European products;
up to 150 approved country-specific products; and
a controlled specialist catalogue for production labels, technical markers and other justified requirements.

The core catalogue will contain one default product for each common need and a limited number of alternatives where there is a real functional difference.

For example, the catalogue may offer:

one standard blue ballpoint pen;
one refillable premium pen for justified roles;
one permanent industrial marker;
one whiteboard marker set;
two standard notebook sizes; and
a small selection of folders based on capacity and document type.

Brand preference will not be a sufficient reason to add a product.

2. Use sustainable products as the default

The catalogue will default to products with relevant environmental evidence where suitable products are available at a reasonable total cost.

Requirements may include:

EU Ecolabel or equivalent evidence for relevant paper products;
recycled content;
verified responsible fibre sourcing;
refillable writing instruments;
replaceable components;
reduced use of mixed materials;
products supplied without unnecessary individual packaging; and
clear disposal instructions.

LHTS will avoid vague requirements such as “eco-friendly.” Every mandatory claim must have a defined verification method.

A recycled product will not be selected automatically if it performs poorly and causes higher consumption. Fitness for use remains part of the evaluation.

3. Appoint one primary European distributor

LHTS will competitively select one primary distributor able to serve the European locations in scope.

The distributor will provide:

an integrated Coupa catalogue;
local-language product descriptions;
transparent product and delivery pricing;
controlled substitutes;
consolidated invoicing;
product-level environmental data;
usage reporting;
agreed delivery schedules; and
end-user support.

A secondary purchasing channel will remain approved for continuity and for locations where the primary distributor cannot provide a compliant service.

This is not a strategic partnership requiring extensive executive governance. It is a preferred-supplier arrangement with clear service levels and proportionate performance management.

4. Consolidate orders and deliveries

Standard offices will receive one planned delivery per week. Larger production sites may receive two scheduled deliveries where consumption justifies it.

Urgent next-day delivery will require a defined business reason. The category manager will review repeated urgent orders because they may indicate poor planning or an unsuitable stock level.

LHTS will introduce minimum order values by site or cost centre where appropriate. Small employee orders will be combined before transmission to the supplier.

Frequently used production and workplace items may be held in controlled local stock points. The supplier may replenish these using agreed minimum and maximum levels.

The purpose is to reduce:

transport movements;
packaging;
delivery handling;
invoices; and
employee time spent receiving small orders.

5. Use guided buying and automatic controls

The Coupa catalogue will present approved products first and hide non-approved alternatives.

Users who search for a non-standard product will see the approved substitute or an explanation of the exception process.

The purchasing system will control:

catalogue access;
approval thresholds;
cost-centre coding;
personalised-product approval;
non-catalogue requests;
delivery addresses; and
reporting data.

A low-value category should become easier to buy correctly than incorrectly.

6. Introduce a proportionate commercial model

The commercial evaluation will use a representative market basket covering approximately 80% of forecast spend.

The agreement will define:

net prices for the core basket;
discounts or margins for non-core products;
delivery charges and minimum-order rules;
personalised-product pricing;
catalogue and reporting services;
payment terms;
price-review timing; and
treatment of product substitutions.

Core-product prices will normally be fixed for 12 months.

For paper products, a transparent review mechanism may be used if market volatility makes a longer fixed period unreasonable. The mechanism must identify the affected products, reference basis and timing. A paper-price movement will not justify an automatic increase for pens, staplers or other unrelated products.

Price decreases must be treated consistently with increases.

7. Control substitutions

Distributors sometimes replace unavailable products with alternatives. An uncontrolled substitution can introduce a higher price, lower environmental performance or a product that does not meet the user requirement.

The contract will classify substitutions as:

permanently approved equivalents;
temporary equivalents requiring notification;
products requiring LHTS approval before shipment; and
products that may not be substituted.

The supplier must not use a shortage to move users permanently to a more expensive product without approval.

8. Manage exceptions without recreating fragmentation

A local exception will be permitted when:

a legal or regulatory requirement applies;
a production process requires a specific product;
a language or format cannot be met by the core catalogue;
the primary distributor cannot serve the location; or
the total business case supports a different solution.

Each material exception will have an owner, reason and review date.

Emergency purchases may use an approved purchasing card or local marketplace channel. These transactions will remain visible and subject to spend limits.

9. Apply light-touch supplier governance

Procurement Operations will review operational performance monthly. The Category Manager will hold a formal supplier review twice per year.

The review will cover:

catalogue accuracy;
delivery performance;
substitutions;
price compliance;
environmental data;
packaging;
user issues; and
agreed improvement actions.

Quarterly executive meetings and complex innovation programmes are unnecessary unless the category or supplier relationship changes materially.

Action plan and implementation

Phase	Main activities	Accountable owner	Timing
Baseline	Clean spend, supplier and product data	Category Manager	Months 0–2
Demand analysis	Identify common products, duplicates and local requirements	Procurement Operations	Months 1–3
Catalogue design	Define core, country and specialist catalogues	Category Manager	Months 2–4
Sustainability criteria	Define product evidence, packaging and reporting requirements	Sustainability	Months 2–4
Market engagement	Test distributor coverage, systems and service models	Category Manager	Months 3–5
Competitive sourcing	Issue request for proposal and evaluate market basket	Procurement	Months 5–7
Contracting	Finalise pricing, service levels and substitution controls	Procurement and Legal	Months 7–8
Catalogue integration	Load products, workflows, coding and user guidance into Coupa	Procurement Operations	Months 8–10
Pilot	Implement at Linköping, Kassel and Brno	Regional Procurement	Months 10–11
European rollout	Move remaining locations and close old catalogues	Site Buyers	Months 11–14
Optimisation	Remove low-use products and adjust stock and delivery frequency	Category Manager	Months 15–18

Existing stock should be used before new standard products are introduced. LHTS should not discard usable pens, paper or folders merely to create immediate visual standardisation.

Local agreements will be closed or allowed to expire according to their contractual terms. Supplier-master records and catalogues will be updated to prevent continued ordering from inactive arrangements.

Measures and review

KPI	Definition	Owner	Management purpose
Catalogue compliance	Percentage of category spend through approved catalogues	Procurement Operations	Reduce uncontrolled buying
Core-product utilisation	Percentage of catalogue spend using the core assortment	Category Manager	Control product variety
Average order value	Total order value divided by number of orders	Site Procurement	Reduce small transactions
Orders per 100 employees	Number of orders relative to active users	Category Manager	Compare demand behaviour between sites
On-time, complete delivery	Orders delivered complete on the agreed date	Supplier	Maintain service reliability
Invoice first-pass match	Invoices matched without manual correction	Accounts Payable	Reduce process cost
Verified sustainable spend	Spend meeting approved environmental evidence requirements	Sustainability	Improve responsible purchasing
Packaging per delivery	Supplier-reported delivery-packaging volume or weight	Supplier and Sustainability	Support delivery consolidation and waste reduction

Benefit logic

The fictitious business case targets a net annual improvement of SEK 3.2 million after full implementation.

The estimated value comes from:

better core-product prices;
removal of duplicate and premium products;
fewer delivery charges;
fewer purchase orders and invoices;
increased catalogue compliance; and
reduced paper and stationery consumption.

Finance will validate purchase-price savings and process benefits separately.

A lower number of purchase orders can create real productivity value, but it should not automatically be reported as a cash saving. The category manager must explain whether capacity is released, external cost is removed or employee time is redirected.

What future buyers should learn from this example

A low-spend category can still create high process cost.
Routine categories should be simplified and automated rather than over-managed.
Demand control often creates more value than negotiating a lower price for every product.
Sustainability requirements must be specific and supported by verifiable evidence.
Supplier consolidation only works when users can easily access the approved channel.
Product choice should reflect business needs, not unlimited personal preference.
A category strategy should use different levels of governance for different business impacts.

Conclusion

The LHTS AB office-supplies strategy replaces fragmented local purchasing with one guided European catalogue, a small core assortment and a primary distributor.

The strategy does not attempt to turn stationery into a strategically important supplier relationship. Instead, it applies the management approach appropriate for a routine category.

LHTS will reduce product variation, combine deliveries, improve catalogue compliance and introduce verifiable environmental requirements. Specialist products and local needs remain possible through a controlled exception process.

The objective is straightforward: employees should receive suitable supplies with little administrative effort, while LHTS controls total cost, waste and purchasing data.

That is the difference between negotiating stationery prices and managing the office-supplies category.

Category Strategy Example – Office Supplies and Stationery at LHTS AB