Duque Stationery Expansion Strategy

This assignment evaluates the feasibility of Duque Stationery expanding its operations into Germany and Belgium. It analyzes market trends, customer preferences, and competitor analysis within these regions. The report also examines Duque's current pricing strategy and suggests improvements to enhance customer satisfaction and loyalty. Additionally, it proposes strategies for product diversification and marketing efforts to successfully penetrate the German and Belgian stationery markets.

Report for Duque Papetiers Gros
Date: Dec 19th, 2017

TABLE OF CONTENTS
1. INTRODUCTION.................................................................................................................1
2. ANALYSIS OF ISSUES FOR DUQUE PAPETIERS GROS.................................................2
2.1 An Overview of the Wholesale Stationers Market in Germany.........................................2
2.2 Annual Spending on Writing/Drawing Materials per Capita.............................................2
2.3Analysis of Duque’s last three financial years of sales data (2015-2017)...........................4
2.4 Feasibility of Expanding to Germany & International Standards.......................................6
2.5 Costs of a New Building.....................................................................................................8
2.6 Mean Value of Orders.........................................................................................................9
2.7 Customer satisfaction........................................................................................................10
3. CONCLUSION.......................................................................................................................11
4. REFERENCES.......................................................................................................................13
5. APPENDICES........................................................................................................................14
Appendix 1..............................................................................................................................14

Report for Duque Papetiers Gros 2017
1. INTRODUCTION
German stationery sector has developed and introduced new products or services as per the
consumer habits as well as preferences. The present report is based on Duque Papetiers Gros
which offer s stationery products and services to local schools and small shops and offices.
Product base of Duque includes printers, office furniture etc. Such business unit has built up
its effectual image at marketplace and known for the trustworthiness as well as reliability.
Now, Duque owner is planning to expand France based business operations into other
countries such as Germany. In this, report will highlight the trends exists in Germany in
relation to the stationery products or services. It also depicts the trend of annual spending on
writing / drawing materials in the context of seven European countries.
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Report for Duque Papetiers Gros 2017
2. ANALYSIS OF ISSUES FOR DUQUE PAPETIERS GROS
2.1 An Overview of the Wholesale Stationers Market in Germany
Association of German Stationery Brands revealed in their report that total turnover of
Germany’s stationery market inclined 3.5% significantly within 2014 and 2015. During this
time period, domestic demand pertaining to the stationery products or services grew by 2.5%.
Further, demand from abroad, in relation to the stationery products or services, also increased
by 5% between 2014 and 2015. In the year of 2015, 70% major stationery brands of Germany
enjoyed increasing sales pattern or trend. Along with this, German stationery brands have built
their effectual image in both Germany and overseas. In against to the private labels,
particularly writing instruments have gained high level of market share.
Further, in Germany, approximately 2200 companies are operating in the stationery
sector. Among them, half of the companies, including wholesalers who involved in selling
papers, office supplies as well as writing instruments have turnover less than €500000. Now,
due to the mergers and exit of the companies number of wholesalers related to the stationery
sector declined (Schmidt, 2016). However, scope of wholesalers has widened in the current
times as they place emphasis on selling products directly to the commercial customers without
any intermediaries such as retailer. On the basis of economic condition assessed, sales of the
companies which are operating in the stationery sector of Germany expected to incline by
3.5%. However, due to the international economic and monetary turmoil it is highly difficult to
make appropriate and reliable estimation about the sales of stationery products and services.
2.2 Annual Spending on Writing/Drawing Materials per Capita
By doing research, it has assessed that German stationery industry is highly growing
and well positioned or established. Report presented by the Trade Association for Office
Supply and Writing Materials shows that total turnover of the industry accounted for more than
€14.8 billion per annum. This is highly equal or similar to the spending of each individual such
as €182 per year. From assessment, it has found that spending of the customers in relation to
writing and drawing material accounted for €35.3 (Schmidt, 2016). Hence, Germany has
attained second position in the category of spending for stationery products and services over
other countries in the EU. The below mentioned bar chart presents that annual spending per
capita for drawing materials accounted for €35.2 & 28.3 in relation to the EU countries like
France & Germany. Hence, for enhancing annual spending of customers regarding writing and
drawing material Duque needs to make focus on promotional aspects and online selling of
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Report for Duque Papetiers Gros 2017
products and services. Further, data published by HBS clearly presents that as compared to the
last decade number of pupils declined by 11.9%. This in turn negatively impacts demand for
writing as well as drawing material and thereby revenue.
(Source: Schmidt, 2016)
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Report for Duque Papetiers Gros 2017
2.3Analysis of Duque’s last three financial years of sales data (2015-2017)
1. Sales assessment
In appendix 1, sum formula has been used for the determination of total sales revenue.
Along with this, for evaluating growth which takes place in the sales revenue over the year’s
trend has also been assessed. Table mentioned in the appendix clearly reflects that in the year
of 2016, 10.30% growth has assessed. However, in 2017, sales revenue of Duque declined by -
2.20%, from €182000 to €178000 respectively. Hence, Duque needs to make focus on cost
control and promotional aspects for enhancing sales. Further, in 2017, the main reason behind
declining overall revenue is falling sales pattern of printer cartridges and general office
supplies. Thus, for the maximization of sales and profit margin Duque needs to undertake
effectual measure or action.
2. Pie chart
14%
15%
10%
14%
16%
15%
16%
12%
13%
10%
15%16%
15%
18%
Pie Graph
printer cartridges
general office supplies
low-cost printers
office furniture
shredders
paper-based supplies
writing/drawing materials
3.
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Report for Duque Papetiers Gros 2017
2014.5 2015 2015.5 2016 2016.5 2017 2017.5
155,000.00
160,000.00
165,000.00
170,000.00
175,000.00
180,000.00
185,000.00
165,000.00
182,000.00
178,000.00
f(x) = 6500 x − 12929000
R² = 0.534810126582278
Total sales (in €)
Total sales (in €)
Linear (Total sales (in €))
Correlation tool of statistics helps in measuring relationship among two variables. In
other words, correlation measure helps in assessing movement of one variable when changes
take place in other (Zheng and et.al., 2017). Graphical presentation shows that both the
variables such as year and sales revenue are correlated with each other but moderately. Hence,
it can be stated that as year passes, sales revenue will increase significantly.
4. Sales trend evaluation
For the year of 2018:
€6500 (x) + €162000
= €6500 (4) + €162000
= €188000
For the year of 2019:
€6500 (x )+ €162000
= €6500 (5) + €162000
= €194500
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Report for Duque Papetiers Gros 2017
2.4 Feasibility of Expanding to Germany & International Standards
a. Pros and cons assessment
Evaluation of pros and cons: In the context of European countries like Germany and Belgium
Outcome of pros and cons evaluation presents that Duque should make focus on
expanding business operations in Germany and Belgium. Moreover, results of evaluation
exhibits that net score of evaluation implies for 4. Considering this, it can be mentioned that
benefits that expansion plan provides are higher in comparison to the cons. Hence, referring the
evaluation of positives and negatives Duque can develop sound framework that helps in
attaining success in the European countries such as Germany and Belgium.
b. Stating international standards with which Duque needs to adhere
From evaluation, it has found that there are several global standards with which Duque
needs to adhere while expanding business operations European countries like Germany and
Belgium such as:
 Occupational health & safety (ISO 45001): On the basis of such international standard,
Duque needs to make proper arrangements for the health and safety of personnel that
avoids injuries or accidents at workplace.
 Social responsibility (ISO 26000): As per ISO 26000, Duque is accountable to perform
activities in a socially responsible manner. Thus, in the context of operations in
Belgium and Germany, firm needs to perform ethically and a transparent way that
directly contributes in the health as well as welfare of society.
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Report for Duque Papetiers Gros 2017
 Environmental management (ISO 14000): Stationery sector and environmental
aspects are highly associated with each other. In accordance with ISO 14000, business
unit needs to perform activities in such a manner that places less negative impact on
environmental aspects (International Organization for Standardization, 2018). Thus,
for complying with such standard Duque needs to make focus on alternative ways that
can be used for performing activities in an eco-friendly manner.
 Quality management (ISO 9000): This standard shows that firm needs to maintain
appropriate quality of the products or services which in turn meets customer
requirements to a great extent.
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Report for Duque Papetiers Gros 2017
2.5 Costs of a New Building
a. Monthly cost computation of 30-years repayment mortgage
Repayment mortgage Period 30 years
Debt payment Total loan amount /
Discounting factor
¿ € 200,000/({[(1+0.10)30 ]−1 }/[0.10(1+.10)30
= € 200,000/9.42
= € 21215.85
Monthly repayment amount € 21215.85 / 12
= €1767.98
b. Monthly cost when interest rate is applied each month
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Report for Duque Papetiers Gros 2017
2.6 Mean Value of Orders
In this, for the determination of average order value Z score has been calculated. Hence,
absolute value of Z provides deeper insight about the distance which takes place between raw
and population mean in terms of standard deviation (Lazar, 2017).
Null hypothesis (HO): There is no significant difference in the mean value of
expected and actual order value.
Alternative hypothesis (H1): There is a significant difference in the mean value
of expected and actual order value.
Considering alpha value for the selection and rejection of hypothesis: 0.05
On the basis of above mentioned alpha value, alternative hypothesis
is true and accepted when p<0.05 and vice versa.
Interpretation: Tabular presentation shows that Z score or value is greater than the
standard limit such as 0.05. It gives clear indication that null hypothesis is true over alternative
one. Hence, result of evaluation presents that statistically mean values of expected and actual
order value do not differ significantly. Hence, it can be mentioned that average order values are
similar under both the categories actual and budgeted or potential.
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Report for Duque Papetiers Gros 2017
2.7 Customer satisfaction
a. Suggesting ways that can be undertaken for making improvement in survey responsive rate
Duque conducts survey every December for getting information about the needs, wants
and expectations of customers. However, respondents who fill questionnaire completely
accounts for less than five percentage which is not good. Moreover, in the lack of having
appropriate information Duque would not be in position to make suitable changes in the
existing offerings (Ways to improve survey response rate, 2018). Thus, for the purpose of
making improvement in the responsive rate it is suggested to Duque that emphasis needs to be
placed on communicating the benefits of survey to the respondents. Further, researcher should
also convey to the respondents about the manner in which their feedback will be considered
while developing strategies. In addition to this, by ensuring respondents regarding privacy of
information served researcher of Duque can incline survey responsive rate significantly.
b. Descriptive statistics
Evaluation of descriptive statistics: Results of descriptive statistics present that out of 20,
average responses imply that level customer services, quality of the products and sales staff of
Duque is highly good. Median and mode, in the category of customer services and sales staff,
account for 4 respectively. Considering this, it can be depicted that 50% value of data set
presents that customer services and sales staff of Duque is excellent. However, mean value
1.95 exhibits that customers rated products or services of Duque, under the criteria of price /
value, as fair. It entails that majority of the customers do not believe that Duque offers quality
stationery products or services at reasonable prices. Hence, for evolving high level of
satisfaction among the customers and covert the same into loyalty firm needs to make focus on
cost control.
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Report for Duque Papetiers Gros 2017
3. CONCLUSION
From the above report, it has been articulated that stationery industry of Germany is well
positioned and attractive from the purpose of expansion. Hence, Duque would become able to
enhance both customer base and profit margin by exploring operations in Germany. It can be
seen in the report that for attaining success in Germany Duque needs to make focus on product
quality and diversification strategy. Besides this, it can be inferred that spending level of
customers are high in the context of writing or drawing material. Further, it can be stated that
expansion plan pertaining to business operations in Germany and Belgium prove to be more
beneficial for Duque. It can be presented from evaluation that Duque needs to make focus on
revising or modifying its existing policy framework. On the basis of such aspect, by setting
competitive prices of the stationery product Duque would become able to attract more
customers. It can be revealed from the evaluation that through offering incentive and
communicating motives behind survey associated response rate can be enhanced to a great
extent.
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Report for Duque Papetiers Gros 2017
4. REFERENCES
Books and Journals
Lazar, N. A., 2017. Statistical Analysis of Functional Magnetic Resonance Imaging Data.
In Handbook of Research on Applied Cybernetics and Systems Science (pp. 103-114). IGI
Global.
Zheng, J. and et.al., 2017. LD Hub: a centralized database and web interface to perform LD
score regression that maximizes the potential of summary level GWAS data for SNP
heritability and genetic correlation analysis. Bioinformatics. 33(2). pp.272-279.
Online
Schmidt, T., 2016. Germany – A Potential Stationery Market. [pdf]. Available through:
<http://www.malaysia.ahk.de/fileadmin/ahk_malaysia/Perspectives/MGC047-
Mar.Apr16_iPAD.pdf>.
International Organization for Standardization. 2018. [Online]. Available through: <
https://www.iso.org/home.html>.
Ways to improve survey response rate. 2018. [Online]. Available through:
<https://surveyanyplace.com/improve-survey-response-rate/ >.
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Report for Duque Papetiers Gros 2017
5. APPENDICES
Appendix 1
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