The University will shut down a $2.5 million in-house distributor of office and paper products by April 15, an official said yesterday.

The move, designed to trim costs and take advantage of increased competition among private vendors, was revealed in a January memo sent to all University offices.

Harvard University Stores (HUS) Manager Michael L. O'Hara said yesterday he was notified in January of the decision to close HUS, which is a subsidiary of the Harvard Purchasing Department. A campus purchaser and distributor of copying machine supplies, paper products and lab supplies for 40 years, HUS last year was subject to a departmental review.

In an interview yesterday, O'Hara would not comment further on his office's closure beyond giving the April target date. But in a January 17 memo issued to all offices, Purchasing Director William F. Valentine said the decision to close HUS was made for reasons of cost and efficiency.

"Harvard University, as an urban campus, has access to a wide variety of qualified vendors who can provide the University with competitive prices and timely delivery," the Valentine memo states. "As a result, I have concluded that there is no longer a need for maintaining an on-campus Stores operation. Therefore, Harvard University Stores will begin phasing out operations immediately."

Joan Looney, the assistant director of purchasing, said that in the future "all the departments will be buying from vendors directly." Until direct contacts are established with private vendors, however, departments have been instructed to ask purchasing personnel for assistance, the memo states.

According to O'Hara, HUS was established by the University about 40 years ago to supply the campus with paper and office products. O'Hara said that HUS is a "cost-recovery" organization, meaning that it does not generate profits, but functions simply to facilitate purchasing.

Department purchasing officials interviewed yesterday said it is unclear what effect the move will have on individual office expenses, workloads or efficiency.

"How this new system is going to work, it's too early to say," said Koenraad Geebels, assistant financial officer for the Graduate School of Education.

Geebels said that his office primarily purchases pre-printed paper products such as vouchers and invoices from HUS.