Copy & Printer Paper

INDUSTRIAL CODES

NAICS: 32-2121 Paper (except Newsprint) Mills, 32-2233 Stationary Product Manufacturing

SIC: 2621 Pulp and Paper Mills and Manufacturers, 2678 Stationary, Tablets, and Related Products

NAICS-Based Product Codes: 32-21211 through 32-21213491 and 32-22331 through 32-2233691

PRODUCT OVERVIEW

Early surfaces used to convey words or images included clay tablets, palm leaves, snake skins, and tortoise shells. The inner bark of the papyrus plant and the skin of animals also provided a support used to proclaim the laws of the land, carry the sacred word, and declare love. Or war. The more common papyrus plant and animal parchment are not in the strictest sense true papers. But they were widely used as such.

The papyrus plant was plentiful in the marshlands of the Nile River Valley. Egyptians cleaned its bark, wove strips evenly side by side, and pressed them to produce a flat writing surface. Animal skins were plentiful in Europe. Early Europeans cleaned and stretched animal skins to create parchment. Sheepskin was preferred. Parchment paper was used in Europe for more than one thousand years.

True paper is made from pulped plant fiber mixed with water, screened, drained, and dried. The paper from pulp method is 2,000 years old. It is generally attributed to Ts'ai Lun, a private councilor in the court of Emperor Ho Ti in southern China around 110 AD. Ts'ai Lun beat hemp, cotton rags, and mulberry trees into a watery pulp. Thinly spread pulp was left on the frame to dry, resulting in a flat writing surface.

News of paper made from pulp spread to the west a thousand years later, but Europeans preferred parchment. Knowledge—and the writing used to convey it—was in the purview of the Church. Only within the Church did living conditions allow monks the time to carefully copy manuscripts using calligraphy. Around 800 AD, monks used parchment for the 680 page Book of Kells, a religious manuscript with intricate calligraphy surrounded by magnificent decoration. Parchment was deemed the only fit support to carry sacred words and images. Paper from pulp was for pagans. As a result, its use spread slowly through Europe.

Italians became the first adopters of paper from pulp. By 1250 Italians were European leaders in paper from pulp and dominated the European paper market for 100 years. The French began producing paper from pulp around 1350. Germany contributed to the spread of paper from pulp another 100 years later when, around 1450, a German named Johann Gutenberg invented the letterpress.

Letterpress printing involves a reusable cast metal alphabet that can be arranged into paragraphs, locked in place, inked, and pressed onto paper. Gutenberg's first large-scale project was, not surprisingly, religious. For two years he assembled the moveable type to print 200 copies of a 2-volume bible that sold in Frankfurt in 1455. Roughly fifty Gutenberg bibles survive in spectacular condition due to the consistently high quality of paper from pulp used.

Gutenberg is commonly accepted to be one of the inventors that revolutionized the written word and eventually the entire world. Within 50 years, 2,500 Gutenberg presses were in use in Europe. The availability of the letterpress for printing replaced the need to carefully copy manuscripts using calligraphy. Printed material became more available. Literacy increased. The printing press took knowledge—and the printing used to convey it—out of the hands of the church. It also established a direct relationship between papermakers and printing press owners. Press operators needed a consistent supply of high quality paper, and were the main purchasers of paper. Individual businesses and homes purchased relatively little paper.

For the 300 years that followed Gutenberg's 1450 revolutionary invention, the production of paper made from cotton rags boiled and pounded into pulp was an art practiced by individuals. European papermakers modified the oriental method of drying pulp on the frame. A 1568 woodcut by Jost Amman is the earliest known image that depicts the process of making paper from pulp. The woodcut shows an individual craftsman working over a large, round, wooden, waist high vat. He is pulling a screen surrounded by a wooden frame through the pulp to form one sheet of paper. The screened frame, or mould, captures the pulp and lets water drain, allows the craftsman to express the sheet off the mould, and then return to the vat to make another sheet. The woodcut also shows that early paper producers needed a paper press to squeeze water from sheets to hasten drying time, and an apprentice helper. The vat, the mould, the press, and the apprentice allowed the paper artisan to make an unlimited number of sheets from a single wooden frame.

In the early years of the 1700s, a shortage of cotton rags affected papermaking. The cotton rag shortage lasted for about 150 years. The critical shortage contributed to a view of paper as rare, expensive, and valuable. It was not a common household product to be tossed into the trash. An anonymous poem from the 1769 Boston Newsletter demonstrates the importance of cotton rags for papermaking through rhyming:

Rags are as beauties which concealed lie, but when in paper, how it charms the eye! Pray save your rags, new beauties to discover, For of paper, truly, everyone's a lover. By the pen and press such knowledge is displayed As wouldn't exist if paper were not made.

In 1850 a German solved the cotton rag shortage problem when he devised a new paper from pulp method that used a readily available renewable resource: the trees in Germany's forests. Wood was chipped, beaten with water into a pulp, screened, drained, and dried. Two years later an Englishman perfected the use of woodpulp by adding chemicals that hastened the wood pulping process. Since then, chemists, scientists, and artists have tweaked the pulping process. Wood for paper is pulped through a combination of thermo, mechanical, and chemical processes. Mass production of paper emerged from Germany and America because trees were plentiful. The dominant definition of modern paper became paper from woodpulp. By the turn of the 1900s, modern paper from pulped wood began to overtake paper from pulped cotton.

Modern paper is made from the cellulose in wood fiber. All plants contain cellulose so any plant can be used to make paper including hemp, straw, or marsh plants like cattails. Good pulp has long cellulose fibers to facilitate interlocking. Sheets are strong because cellulose is hydrophilic. When cellulose pulp is screened and drained, the deposited layer of water-loving cellulose fibers dries into strong sheets because the water affinity is so great it pulls the fibers tightly together during the drying process. Pressing helps.

Copy and printer paper

Generically known as multi-purpose paper, copy and printer paper is used in laser and digital copiers and printers to generate words and images. Affordable copy and printing machines became widely available in the 1980s, coincidental to the invention of the computer and the Internet, which together are seen as comparable to Gutenberg's revolutionary letterpress because they also changed how knowledge was disseminated. Affordable printers let consumers—not the church and not printing press owners—create documents with the words and images of their choice. More people used more copy and printer paper in more places, including businesses and homes.

Copy and printer paper is usually white. The standard size is 8 1/2 by 11 inches. This is referred to as letter size. Copy and printer paper is also available in 8 1/2 by 14 inches, a size known as legal. Less popular but available is 11 by 17 inches, a size commonly called tabloid. The paper used in copy and printer equipment is a high grade product, but not considered premium paper. Paper grade is determined by weight, brightness, opacity, and texture.

Paper weight

The numbers that refer to a paper's weight are based on the weight of a 500-sheet ream of 17 by 22 inch paper. Standard copy and printer paper weight is 20 pounds, pegged to the weight of a 500-sheet ream of 17 by 22 inch paper. These sheets are converted by cutting into quarters to produce four 500-sheet reams of letter size sheets. Therefore, one 500-sheet ream of standard 20 pound paper weighs five pounds.

Brightness rating

The numbers used to rate the brightness of paper range from 80 to 113. Higher numbers represent brighter paper. Brightness is a measurement of how well light is reflected from the paper. High brightness is valued because it gives good contrast between the ink and paper. Paper mills control whiteness by adding minerals and dyes. Newspaper appears yellow next to the bright white of copy paper.

Opacity

Opacity is a measure of transparency. High opacity paper is not easily penetrated by light. Low opacity paper allows light to pass through, making it translucent. Opacity is influenced by weight and brightness. Standard 20 pound copy and printer paper is not translucent, but it is also not good for two-sided printing because light passes through, letting ink show from the other side.

Texture

The texture of paper is a factor of fineness and coarseness. Standard 20 pound copy and printer paper is valued for its smooth surface. Laser copiers and printers require smooth paper because they use heat and toner to print words and images. Digital printers jet water-based ink off the print head and onto the paper. They benefit from textured paper that facilitates drying and reduces bleeding.

Paper is available in a wide range of weights, brightness, opacity, and textures. Sales of the equipment that uses copy and printing paper are increasing. Predictions are for paper sales to continue to increase.

MARKET

Put the call for a paperless society on hold. Even though in the early 1990s, visionaries promised a paperless society due to the availability of the Internet and electronic communication, North Americans still churn out more than 1.2 trillion sheets of copy and printer paper every year. According to Consumer Reports, the availability of affordable printers explains why Americans now use twice as much copy and printer paper as they did in 1985. According to a 2005 article in Geographical, at the height of the dotcom boom between 1995 and 2000, the world's largest manufacturer of copy and printing paper (Canada) almost doubled its exports. Geographical estimates that e-mail caused copy and printer paper use to increase by 40 percent during that era.

At the paper mill and in the paper industry, copy and printer paper is called uncoated freesheet. Uncoated freesheet product shipments were $8.1 billion in 2002, part of the $41.2 billion per year paper industry, according to a U.S. Census Bureau report titled "Paper, Except Newsprint Mills, Manufacturing: 2002." This $8.1 billion is consumed by commercial printers, large and small businesses, and individual consumers with home offices. Some estimate that approximately $4.0 billion reaches the small business and home office market.

Uncoated freesheet is shipped from the mill in three major categories. In order of market size they are: (1) bond freesheet, (2) other writing paper, and (3) cover and text papers. Each represents approximately one-third of the uncoated freesheet industry as can be seen in Figure 70.

Bond freesheet had a product shipment value of $2.9 billion in 2002, down from $3.5 billion in 1997 or a decline of 16 percent. Bond is a term historically used to refer to 100 percent cotton content paper that has been generalized to mean premium paper. Bond freesheet is shipped from the mill in two formats: bond writing paper or form bond paper in rolls. Approximately three-quarters is bond writing paper, and one-quarter is form bond paper in rolls. Both showed decline between 1997 and 2002. The decline in form bond paper in rolls was notable. That class was down 35 percent. Fewer preprinted forms are made from premium quality bond paper. Forms are more often made available on the Internet, in an electronic format ready to be printed by the end user.

The category "other writing paper" represented just over one-third of the market, 34.4 percent in 2002. Since 1997, mills have been making more of this category of paper and it is growing in importance to the industry. In 1997, other writing paper accounted for 18 percent of freesheet product shipments; by 2002 it had grown to represent 30 percent. Other writing paper had a product ship-ment value of $2.8 billion in 2002, up from $2.1 billion in 1997, an increase of 32 percent. Other writing paper is shipped in four formats. The major format is paper for communication or copying, comprising approximately 90 percent of shipments. Paper for communication or copying had a product shipment value of $2.1 billion in 2002, up from $788 million in 1997, an increase of 156 percent. The other three classes are: (1) technical and reproduction paper, (2) writing tablets, and (3) ledger, onionskin, and wedding paper.

Cover and text paper is the category that makes up the final third of this sector of the market. Production of this category is declining. It includes envelope paper and stock for coating. Cover and text paper had a product shipment value of $2.4 billion in 2002, down from $3.3 billion in 1997, a decline of 28 percent.

"I have seen the future and it is 81/2 by 11," Chris Harrold of Mohawk Paper Mills, Inc., in Cohoes, New York, joked with colleagues. For 500 years, paper makers focused on large printers who fueled the demand for paper because, like Gutenberg, they had the printing presses upon which to use it. Harrold's comment was a reference to the need for the paper industry to forge a closer relationship with small businesses and individual consumers with home offices, a market that had for 500 years purchased relatively little paper. Demand is beginning to be driven by a different type of user in the computer age—the user of small, affordable copiers and printers, as evidenced by the 156 percent increase in paper for communication or copying, an uncoated freesheet category characterized primarily by reams of 8 1/2 by 11 inch letter size sheets.

Only one uncoated freesheet product category is growing: paper for communication or copying. It grew by 30 percent annually between 1997 and 2002. According to Conservatree, a nonprofit organization within the paper and environmental fields, copy and printer papers have higher profit margins than other types of papers. According to Print Week, copy and printer papers are the only segment of the industry that has seen double-digit growth in recent years. The driving force behind this growth in freesheet paper shipments is laser and digital copying and printing equipment used by small businesses and individual consumers in small home offices. This high margin, high growth category is predicted to continue to expand.

According to the July 2006 edition of Pulp & Paper, the trend is toward more home use of copy paper. Purchasing Magazine reported in around the same time that paper mills in the U.S. had instituted five price increases on a quarter-to-quarter basis for copy and printing paper in 2005 and 2006. Producers of uncoated freesheet paper pushed for higher prices to offset their rising costs for fibers, energy, and chemicals.

After slowing in 2000 through 2003, the industry as a whole began to see recovery in 2004. That year, the Pulp & Paper Products Council in Canada reported that copy and printing paper shipments in North America, by weight, rose 4.7 percent to 28.1 million tons.

Copy and printing paper products are classic nondurable consumer goods. Nondurable goods are purchased for immediate or almost immediate consumption and have a life span ranging from minutes to three years. Nondurable goods are destroyed by their use so consumers need to repeatedly replenish their supply throughout the year. For instance, the average U.S. office worker uses 10,000 sheets of copy and printer paper per year. Since paper is sold in reams of 500 sheets, that equates to 20 reams per year. One ream of International Paper's Hammermill brand Copy Plus 20 pound paper is 2 inches thick. In one tall stack, 10,000 sheets of standard copy paper weighs 100 pounds.

The nondurable consumer goods market is characterized by a large variety of affordable products to tempt consumers. For example, one ream of Domtar Copy 20 pound paper is $2.99. Because of the combination of high margins and double-digit growth, copy and printer paper products are available in a wide range of weights, brightness, opacity, and textures. The explosion of offerings includes specialty laser paper, inkjet paper, and photo paper. The combination of a large variety of affordable products results in price competition among manufacturers to gain market share. Brand loyalty for copy and printer paper is seen as generally low because consumers view it as an undifferentiated commodity and buy on price.

KEY PRODUCERS/MANUFACTURERS

The top North American manufacturers of copy and printer paper control approximately 70 percent of the market. According to Market Share Reporter 2007, the top three uncoated freesheet manufacturers in North America are Domtar Corporation (34%), International Paper (25%), and Boise Cascade, LLC (10%).

Boise Cascade, LLC

With its paper headquarters in Boise, Idaho, Boise Cascade, LLC is the third largest manufacturer of uncoated freesheet paper in North America. It employs close to 10,000 workers and owns four paper mills located in International Falls, Minnesota; St. Helens, Oregon; Wallula, Washington; and Jackson, Alabama. A recycling plant in Jackson, Alabama, de-inks 300 tons per day of used copy and printer paper for use in recycled-content papers. Boise Cascade, LLC, was formed in 2004 when Madison Dearborn Partners purchased the paper and wood products (and building materials distribution) businesses from Boise Cascade Corporation, which is now known as OfficeMax, Inc. Since the 2004 change of ownership, one key strategy of Boise Cascade, LLC has been to focus on copy and printer paper used in businesses and homes. This reflects a new orientation toward the consumer and away from commercial printers. In 2007, for the fourth consecutive year, Boise Cascade will conduct online voting to allow business and home consumers to determine the design for its limited edition holiday themed carton for its Boise X-9 multi-use copy paper.

Boise-branded copy and printer papers are two: X-9 (available in 16, 20, and 24 pound weights, 92 brightness, letter, legal, tabloid sizes) and X-9 PLUS (20 pound weight, 96 brightness, letter, legal, tabloid sizes, designed as a high-end paper for offices with multiple machines). Boise-branded laser paper lines are called Everyday Laser, Presentation Laser, Enhanced Color Copier Paper, Glossy Color Laser, and Cover. Boise-branded inkjet paper is called Presentation Inkjet. Boise branded recycled copy and printer paper lines are made with a minimum 30 percent post-consumer fiber and have names evocative of nature: Aspen, Aspen 50, and Aspen 100. Colored papers are sold in a variety of weights under Boise-branded lines MP Colors and MP Brites.

Domtar Corporation

Headquartered in Montreal, Canada, with its operational headquarters in Fort Mill, South Carolina the mammoth Domtar Corporation employs nearly 14,000 people in North America. It is the largest papermaker in North America, controlling one-third of the U.S. production of uncoated freesheet paper. Since its acquisition of Weyerhaeuser Company in March 2007, it is the second largest uncoated freesheet producer in the world. The newly merged Domtar operates 16 uncoated freesheet mills in North America with a total annual capacity of 5.2 million tons of paper. Paper comprises most of Domtar's sales (77%). The rest are from its distribution unit (13%) and lumber (9%) from five sawmills. It focuses on designers, commercial printers, publishers, and converters. EarthChoice is its newest brand consisting mostly of premium papers. In an attempt at greenwashing (appearing environmentally-friendly while doing just the opposite), Domtar re-labeled old standards Nekoosa Bond, Nekoosa Linen, and Nekoosa 25% Cotton under the EarthChoice umbrella and introduced EarthChoice Office Paper, a Forest Stewardship Council-certified multi-function paper. The multi-platinum recording group Barenaked Ladies released their 2006 album with CD covers printed on Domtar Earth Choice paper. Domtar also manufacturers copy and printer papers for the home and the office.

Papers for the home include the Domtar-branded lines Recycled Copy, Copy, Hots, Laser, Pastel, Premium Inkjet, and Premium Laser. Paper products for the office include the Domtar-branded lines Copy, Colors, Microprint Coated Laser, Microprint Color Copy, Microprint Digital Publishing Text, Microprint Ink Jet, Microprint Laser, and Multi-System Ultra (designed for all office machines).

International Paper

Headquartered in Stamford, Connecticut, International Paper is the second largest manufacturer of uncoated, freesheet paper in North America. It is a global paper company with manufacturing operations in the United States, Europe, Latin America, and Asia. With annual sales in the $22 billion range, the company employs approximately 60,000 people worldwide. In the United States, International Paper operates 18 mills. International Paper's products are focused on professional printers and converters as well as the home and office users. In addition, International Paper operates an extensive private label program. International Paper's Hammermill brand paper products were featured on "The Office," a television comedy that takes a painfully funny look at the "Dunder Mifflin" paper supply company in Scranton, Pennsylvania. In a September 2006 episode of the Emmy-winning comedy series, Hammermill was featured when the starring character, Michael (Steve Carell) attended a paper industry trade show.

International Paper makes Hammermill brand paper designed for business and home use in product categories including copy paper and multi-purpose paper. It sells specialty inkjet and laser printer paper. It also has color copier paper, cover paper, and card stock. International Paper is detailed in the Current Trends section of this essay by way of demonstrating the explosion of offerings in this high-margin, high-growth category of uncoated freesheet paper.

MATERIALS & SUPPLY CHAIN LOGISTICS

The Census Bureau reported that in 2002 the U.S. paper manufacturing industry used $15.1 billion worth of materials to produce $41.2 billion worth of products. While the Census Bureau reports on product shipments by category, it does not break down the value of material inputs buy these same product categories and therefore, one is left with only industry-wide figures for materials consumed. The value of all materials used in manufacturing paper in the United States declined by 14 percent between 1997 and 2002, from $17.6 billion to $15.1 billion. Industry-wide shipments declined as well, but by a smaller 10.9 percent. The majority of the materials used to produce paper are organic and inorganic chemicals; woodpulp purchased from paper mills; and pulpwood bolts and logs.

Copy and printer paper products require the same inputs as all other paper. To make the light, white, and bright sheets of paper needed for copy and printer paper products, pure white pulp is needed. Higher grade pulp is commonly made by a combination of thermal, mechanical, and chemical pulping processes. Thermal steam is used to soften wood particles before mechanically pulping them. For high-grade paper, the wood particles are chemically treated before entering the pulper. As a result, the pulp is very white and bright, properties suited to copy and printer paper manufacture.

Industry-wide spending for organic and inorganic chemicals decreased 20 percent between 1997 and 2002, from $3.9 billion to $3.1 billion. The industry decreased its spending in every chemical class purchased, save for chalk. Chalk is an inorganic chemical also known as calcium carbonate used in papermaking as a filler and a pigment. Spending for chalk increased 6 percent over the period from $262 million to $278 million. Because opacity is valued, calcium carbonate is added to pulp to increase opacity by reducing transparency and thus the amount that ink can be seen through the paper.

The top three chemicals purchased, in order of 2002 expenditures, are starch, clay, and chalk, inorganic chemicals used primarily to improve paper strength. Starch is used at the wet end of the papermaking process to improve strength and at the dry end as a sizing. Clay is added during the pulping stage to fill in pores of wood fiber to create strong paper. Among all chemicals needed, the industry decreased spending the most for chlorine, caustic soda, and titanium dioxide.

Chlorine purchases decreased 73 percent from $82 million in 1997 to $23 million in 2002. Chlorine is used primarily to make pulp white. Caustic soda purchases decreased 54 percent from $248 million in 1997 to $113 million in 2002. Caustic soda is known by scientists as sodium hydroxide and by laypeople as lye; it is used to hasten pulp cooking and to make pulp white by removing impurities known as lignin. Titanium dioxide is a lustrous, lightweight, pure white pigment used to boost whiteness. Industry-wide purchases of titanium dioxide decreased 39 percent from $366 million in 1997 to $200 million in 2002.

All pulp—whether thermo, mechanical, or chemical—is yellowish because wood fiber is yellow. Color is controlled by adding dye to correct the yellowish tint. For example, violet dye absorbs green and red reflected light, reducing yellowness. Because whiteness is highly valued, paper mills also use fluorescent whitening agents. Also known as optical brightening agents, they absorb ultraviolet light and reradiate it as blue light. This explains why the high-grade paper appears bluish. For example, Boise Cascade, LLC, emphasizes that its Boise branded X-9 and X-9 PLUS feature an enhanced blue-white shade.

Industry-wide spending for purchased woodpulp fell by almost one-third between 1997 and 2002, from $4.1 billion to $2.8 billion. Manufacturers purchase woodpulp from two sources. The largest expenditure is for woodpulp obtained at the market rate from other paper mills. The other source is woodpulp produced at affiliated mills. Expenditures for woodpulp purchased at the market rate decreased 50 percent, from $3.3 billion in 1997 to $1.7 billion by 2002. Expenditures for woodpulp produced at affiliated mills increased 30 percent from $890 million to $1.1 billion. This was, in part, the result of industry consolidation as well as the movement of manufacturing off shore.

Industry-wide spending for pulpwood bolts and logs decreased 11 percent between 1997 and 2002, from $3.0 billion to $2.6 billion. Pulpwood bolts and logs are generally classified as either softwood or hardwood. Softwoods are integral in the making of high-grade paper products. In order of expenditure value, softwoods are classified as southern pine; chips, slabs, cores, and other mill residues; softwoods such as Douglas Fir and Jack Pine; spruce and true fir; and hemlock. The expenditure for softwoods was $1.5 billion in 2002. Spending in all softwood categories decreased, save for one. Douglas Fir and Jack Pine spending more than doubled, from $123 million to $259 million, an increase of 111 percent. Softwoods are known by laypeople as conifers. Conifers like spruce, fir, pine, balsam, and hemlock are preferred because they are fast growing, plentiful, easy to grind into pulp, and produce long fibers. Long fibers are favored for chemical pulp that needs to be bleached to high brightness and whiteness, qualities especially valued in the production of copy and printer paper products.

Hardwood pulpwood bolts and logs, along with chips, slabs, cores, and other mill residues, are also consumed. Industry-wide spending for hardwood products decreased 20 percent between 1997 and 2002, from $1.5 billion to $1.2 billion.

Paper mills use packaging materials as another raw material, after chemicals, woodpulp, and pulpwood bolts and logs. Packaging materials are used to prepare packages and cartons for letter, legal, and tabloid size reams of copy and printer paper for shipment through the distribution channel. Industry-wide spending for all packing material was $1.2 billion in 2002. The types of packaging products used include paperboard containers, boxes, and corrugated paperboard; packaging paper and plastics film; and glues and adhesives.

DISTRIBUTION CHANNEL

The distribution channel for copy and printer paper is characterized by vertical integration. The top three North American manufacturers of uncoated freesheet are each vertically integrated. Boise Cascade, LLC has 30 distribution locations in North America. Domtar has more than 80 paper distribution facilities in North America. International Paper owns xpedx, which has more than 250 distribution branches located primarily in the United States. The distribution channel is changing, with less emphasis on large commercial printers—which had been the focus of the industry for more than 500 years—and a new focus on individual businesses and homes.

As a result, the distribution channel for copy and printer paper is broadening. It is becoming characterized by a large number of smaller buyers. Multichannel Merchant reported in March 2007 that office supply catalogs are no longer sent only to large businesses, but also to small businesses and homes. The availability of affordable printers created a significant increase in the number of active buyers. According to New York-based list brokerage services firm ParadyszMatera, the names of 8.9 million 12-month buyers from office supply merchants were available for rent or exchange during the fourth quarter of 2006, up nearly 18 percent from the fourth quarter of 2005. The available active buyers list is only a portion of potential buyers within the distribution channel for copy and printer paper. For instance, the largest office supply merchant, Staples, does not sell its client lists.

Staples tops the distribution channel for copy and printer paper, which is dominated by office products superstores. Office Products International reported in 2005 that the vast majority of small and medium-sized businesses buy their copy and printer paper from the top three office products superstores, in this order: Staples, Office Depot, and OfficeMax. In a study conducted by Lyra Research among paper buyers from businesses of up to 99 employees, 75 percent of respondents purchased paper from the top three. Other distribution channel outlets included the mass market retail/warehouse club channel (Costco, Sam's Club, Wal-Mart), Boise Office Solutions, xpedx, and Corporate Express.

The distribution channel for copy and printer paper is characterized by purchase incentives. Office supply companies typically offer either free shipping or a gift with purchase. Both were equally popular, with each offered by 36 percent of catalogs received by ParadyszMatera. A typical incentive is "buy two cases of copy paper, get the third free." From 2004 to 2006, 47 percent of office supply catalogs received by ParadyszMatera offered a gift with purchase as an incentive to buy. Common types of gifts offered were bags (such as Staples' business attaché with laptop holder) and electronics (such as Amsterdam Printing & Litho's MP3 player).

KEY USERS

Key users of large amounts of copy and printer paper tend to be businesses such as law firms, health care providers, manufacturers, accounting firms, civic/nonprofit groups, retailers/wholesalers, marketing/advertising agencies, and architects. Office workers use more than non-office workers. Key users of lesser amounts of copy and printer paper are individual consumers who have inkjet or laser printers.

Schoolchildren are another audience for copy and printer paper. Copy and printer paper is used in preschool as a means to communicate with parents. Teachers continue to funnel paper to schoolchildren with assignments and notes to parents. Many schoolchildren go to college. During college, they have both the time and the need to search the Internet. Printed material drives traffic to cyberspace and, once there, the information available drives people to print. This reinforces what will be for many a lifelong connection between fiber space and cyberspace.

ADJACENT MARKETS

All products made with wood are a potential adjacent market to the market for copy paper as they are alternative uses for the raw material needed to produce paper. As the demand for wood used in construction increases, the pressure on the commodity price is increased. This, in turn, influences the raw materials cost for paper mills and pushes the price of paper up.

Printers, copiers, and the inks and toners required to operate them are all adjacent markets to the market for copy paper. The toner used in most printers and copiers is stored in disposable cartridges that need to be replenished frequently. The toner business is an fact a lucrative one and some low-end printers are sold at a break-even point, or even at a loss, in order to generate a stream of ongoing toner replacement sales for that machine into the future. Dealing with the increasing quantity of printed paper being generated by printers and copiers in homes and businesses leads to another market adjacent to copy and printer paper, the market for paper shredders. Because users of copy and printer paper may worry about privacy and the increased threat of identify theft, the paper shredder is becoming a device seen commonly in offices of all sizes, from small home offices to large corporate centers.

Successful people appear to use less copy and printer paper because they more efficiently use advanced digital technology. Bill Gates explained, in an article he wrote in 2006 for Fortune, that he does not use much copy and printer paper in his office. "On my desk I have three screens, synchronized to form a single desktop. I can drag items from one screen to the next. Once you have that large display area, you'll never go back, because it has a direct impact on productivity. The screen on the left has my list of e-mails. On the center screen is usually the specific e-mail I'm reading and responding to. And my browser is on the right-hand screen. This setup gives me the ability to glance and see what new has come in while I'm working on something, and to bring up a link that's related to an e-mail and look at it while the e-mail is still in front of me."

RESEARCH & DEVELOPMENT

Paper scientists continually tweak the blends of chemicals, woodpulp, pulpwood bolts and logs, and machine specifications to perfect office paper products. Researchers study the effects of different combinations of paper weight, brightness, opacity, and texture.

R&D within the industry resulted in erasable paper. Scientists at Xerox's Research Centre of Canada invented a way to print temporary documents. Images lasted for one day. The technology could lead to a significant reduction in paper use. Researchers developed compounds (similar to inks) that change color upon absorption of a certain wavelength of light and gradually fade to nothing in 16 to 24 hours. The paper can be reused.

R&D efforts also resulted in antibacterial paper. Domtar introduced such paper in January 2007. New York-based Gould Paper is the first wholesaler to market this Domtar product. Treated with a silver compound, the paper also guards against odors and the growth of fungus, mold, and mildew. Lab tests demonstrated a 99 percent reduction of methicillin resistant Staphylococcus aureus, a type of staph infection resistant to certain antibiotics. Domtar is targeting health care providers and government offices as the natural customer base for these antibacterial paper products.

CURRENT TRENDS

The combination of high margins and double-digit growth rates have stimulated the spread of copy and printer paper products available in a wide range of weights, brightness, opacity, and textures. The explosion of offerings includes specialty laser paper, inkjet paper, and photo paper.

In the coming years, even more combinations of paper weight, brightness, opacity, and texture will be available. One trend that is seen now and expected to continue is the use of color in printing. Papers designed to take color require greater weight with higher brightness ratings so colors will really pop, and higher opacity so inks from the other side will not show through. Notable is the wide range of specially-designed copy and printing paper; it is now available in gloss levels in the range glossy, semi-gloss, semi-matte, and matte. Glossy paper is commonly used for printing photographs. The demand for paper suitable for color is on the rise.

International Paper's Hammermill brand paper products are a good example of the explosion of copy and printer paper offerings. Besides specialty laser paper, inkjet paper, and photo paper, Hammermill-branded copy paper includes Tidal MP (20 pound weight, 92 brightness, value-priced, multi-purpose paper in letter and tabloid size) and Copy Plus (20 pound weight, 92 brightness, workhouse paper in letter, legal, and tabloid size).

International Paper's Hammermill-branded multi-purpose paper includes Fore MP (20 and 24 pound weights, 96 brightness, letter, legal, and tabloid sizes as well as 3-hole punched, designed for newsletters, reports, manuals), Multipurpose (20 pound weight, 96 brightness, letter size only, designed to run efficiently through all office machines), Premium Multipurpose (24 pound weight, 96 brightness, letter size only, a heavy paper), and OfficeOne Business Gloss (32 pound weight, 96 brightness, letter size only, coated on both sides for laser and digital images).

International Paper's specialty copy and printer paper includes Hammermill Inkjet (24 pound weight, 96 brightness, letter size only, uncoated but with a special surface to enhance ink absorption and maximize drying), Hammermill Laser (24 pound weight, 96 brightness, letter size only, smooth surface designed for heat of laser process), and Hammermill Laser Print (24, 28, and 32 pound weight, 96 brightness, letter, legal, and tabloid sizes and 3-hole punch, a premium paper designed for both monochrome and color printing), Hammermill Color Laser Paper (26 pound weight, 98 brightness, letter size only, designed for 2-sided color printing), and Hammermill Color Laser Gloss Paper (32 pound weight, 90 brightness, letter size only, coated on both sides for 2-sided color printing).

International Paper also makes Hammermill-branded Color Copy Paper (28 and 32 pound weights, 98 brightness, letter, legal, tabloid, ledger size), Color Copy Cover (60, 80, and 100 pound weights in letter, tabloid and 18 × 12 inches), and Color Copy Gloss (32 pound weight, 90 brightness, in letter tabloid and 18 × 12 inches, designed for high speed color laser printers, not suitable for inkjet printers).

Other products include Hammermill-branded color Copy Gloss Cover (80 pound weight), Cover (67 pound), and Card stock (110 pound). International Paper also makes Hammermill Pastels in 20 pound weight, with a 30 percent recycled content, available in pastels such as blue, canary, cream, golden rod, gray, green, lilac, pink, salmon, and turquoise. Hammermill Fore MP also comes in 16 pastel colors (20 and 24 pound weight, 30 percent recycled, in letter, legal, and ledger size). Available colors are blue, buff, canary, cherry, cream, goldenrod, gray, green, ivory, orchid, lilac, peach, pink, salmon, tan, and turquoise.

TARGET MARKETS & SEGMENTATION

One important and influential target market for paper makers are graphic designers. Printed material has to compete with all the other media, including electronic media. Graphic designers influence decisions regarding the purchase of paper as well as other materials. They can encourage the use of higher-quality premium paper at heavier weights and more unique textures.

Paper makers also target those who are concerned about environmental issues. Environmental ethics remain important, since paper is a perennial problem for environmentalists. Some mills have become certified to ISO 4001 production standards, which take into account energy consumption and emissions, as well as recycled properties. Most mills provide products that sport a green certification. Four different certification levels are offered by the Forest Stewardship Council (FSC). The basic certification is FSC. It means the FSC-certified fiber content in the paper, even though virgin, comes from operations that comply with the Forest Stewardship Council's sustainable forestry practices.

The FSC Pure Material seal denotes paper made with 100 percent FSC material from an FSC-certified forest. The paper product with the Pure Material seal has been sold and/or processed by an FSC chain-of-custody certified company. The FSC Mixed Pulp seal denotes paper made from any combination of FSC-certified forests, company-controlled sources, and/or recycled material. Company-controlled sources are controlled in accordance to FSC standards. They exclude illegally harvested timber, wood from forests where high conservation values are threatened, and/or practices that violate civil and traditional rights, or wood from areas that have been converted from natural forest to plantations. The FSC Recycled seal denotes products that contain 100 percent post-consumer waste material.

RELATED ASSOCIATIONS & ORGANIZATIONS

American Forest and Paper Association, http://www.afandpa.org

Conservatree, http://www.conservatree.com

National Paper Trade Association Alliance, http://www.gonpta.com

National Resources Defense Council, http://www.nrdc.org

Wisconsin Paper Council, http://www.wipapercouncil.org

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see also Copiers, Premium Paper, Printers, Recycled Paper