Office Depot Closing 112 Stores

Tough times hit Office Depot, which is planning to close 112 stores, 33 distribution centers, and say goodbye to 2,200 employees.

Office Depot may not carry the commercial weight of consumer electronics retailers like Best Buy or Wal-mart, but the company moves plenty of technology gear and accessories…and certainly isn’t exempt from the current tough economic climate. Office Depot has announced that as part of a strategic review, it plans to close some 112 “underperforming” stores in North America over the next three months, and in the process shut down some 33 distribution centers and say goodbye to about 2,200 employees. And additional 14 stores will be shut down throughout 2009 as leases expire or other lease arrangements get worked out.

Industry watchers generally reacted positively to the announcement, noting that the changes will give the company some additional short-term liquidity. Office Depots changes will cost between $270 and $300 million, they should improve 2009 cash flow by reducing expenses. However, the shakeup may not be enough to give it a leg up on competitors like Staples and mass-merchandisers.

The company plans to open 20 new locations in 2009, down from the 40 new locations it had previously planned for the year.

The underperforming locations to be closed are in the central U.S. (45), the northeastern U.S. and Canada (40), the western U.S. (19), and the southern U.S. (8).