And if you have been noticing a shortage of nifty pens in your workplace, it's not your imagination. The company says sales in its contract segment fell 18.4% to $953.9 million, as struggling businesses cut back on spending--while sales in its retail segment dropped 9.7% to $929.2 million, which reflects a 13.6% tumble in same-store sales. For the full year, it says same-store sales declined 10.8%. And despite cutting ad spending, reducing payroll and lowering other expenses, gross margins also fell.

Sales are continuing to soften in the early part of this year. "Total sales to date in 2009 have declined slightly greater than the 14.3% we experienced in our fourth quarter, and we anticipate sales will decline on a year-over-year basis for full year 2009," it says.

The Napierville, Ill.-based company continues to look for ways to stand out from such competitors as Staples and Office Depot, and recently announced that it is testing a small-store format, called Ink Paper Scissors, in three locations in the Seattle area.

While most office supply stores are big-box-sized and a shopping destination, these 1,500- to-2,000-foot stores are designed to tempt on-the-go shoppers. "Convenient access to the basic supplies and services that most people need is the name of the game with 'Ink Paper Scissors'," the company says in its release on the new stores. "It's about getting in and getting out fast when you need to pick up a ream of paper, get an ink cartridge, make a few copies or pick up some school supplies for the kids."

Stores stock about 2,000 of the most popular OfficeMax items, including ink and toner, paper, pens, pencils, binders, filing supplies, labels, mailing envelopes, shipping supplies and calendar/planners, as well as self-serve copy services.

And it also recently announced a partnership with Peter Walsh, an organizational expert, who is working with the company to launch a line of products after this spring. Walsh's workspace organizational tips will appear in catalogs, mailers, and in-store signage.

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