Can someone explain how to make a sorted list with mail merge?

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Here is the Microsoft explanation of what I want to create, but I can't seem to figure out how to make it work.
http://support.microsoft.com/kb/294686#2

Basically what I want is a mail merge from an excel sheet that has more than one row per record (maybe not the best wording, but here is what I have):

**Excel List**
Vendor_______Stock______Name
Vendor 1_____12345______Item 1
Vendor 1_____23456______Item 2
Vendor 2_____34567______Item 1
Vendor 2_____45678______Item 2
Vendor 2_____56789______Item 3
Vendor 2_____67890______Item 4
Vendor 3_____98765______Item 1
Vendor 3_____65432______Item 2

And here is what I want:

**Mail Merge**
Vendor 1
12345 - Item 1
23456 - Item 2

----Page Break----

Vendor 2
34567 - Item 1
45678 - Item 2
56789 - Item 3
67890 - Item 4

----Page Break----

Vendor 3
98765 - Item 1
65432 - Item 2

Each vendor has a different number of items.
 

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