Feasibility Report: Duque Papetiers Gros Expansion in German Market

This report assesses the feasibility of Duque Papetiers Gros expanding into the German stationery market. It begins with an overview of the German market, highlighting its profitability and consumer spending on stationery items. The report analyzes per capita spending in European nations, with Germany ranking high. Sales data from the past three financial years are analyzed using scatter diagrams, correlation coefficients, and trend analysis to forecast future performance. The report also includes a feasibility table, cost computations for a new building, and an analysis of order mean values. It further addresses customer satisfaction, recommending improvements to questionnaire response rates and presenting descriptive statistics. The conclusion emphasizes the market's potential for growth and profit, making it suitable for Duque Papetiers Gros' expansion plans. The report also includes the relevant ISO standards for social responsibility and risk management.

REPORT ON DUQUE
PAPETIERS GROS

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Overview of German market of Wholesalers of stationery........................................................1
TASK 2............................................................................................................................................2
Identifying annual spending on stationery items on per capita of European nations..................2
TASK 3............................................................................................................................................3
Conducting analysis of data of sales of recent three financial years of business........................3
..........................................................................................................................................................4
..........................................................................................................................................................4
TASK 4............................................................................................................................................6
Identifying German market feasibility for the business..............................................................6
TASK 5............................................................................................................................................7
Computation of costs of new building for organisation..............................................................7
TASK 6............................................................................................................................................8
Analysing mean value of orders..................................................................................................8
TASK 7............................................................................................................................................9
Satisfaction of customers............................................................................................................9
TASK 8..........................................................................................................................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Expansion decision-making is significant for business for accomplishing desired
objectives. Present report that deals with Duque Papetiers Gros which is planning to expand to
Germany seeking higher growth. Report will throw light on Wholesaler German market.
Moreover, statistical methods such as correlation coefficient will be applied for gaining
efficiency in the market. Furthermore, trend analysis for the future would also be conducted for
assessing whether firm could gain profits or not. Mean value of orders along with computation of
cost of new building will be made. Report will also discuss ways for increasing responsive rate
of participants to questionnaire.
TASK 1
Overview of German market of Wholesalers of stationery
The German stationers market is highly profitable as people spend a lot on products of
stationery which helps businesses to earn good amount of revenue in the best manner possible.
writing and drawing materials are used in excess by German people making it profitable to
businesses. It can be assessed from the market research that annual turnover of stationers market
amounts at €14.8 billion signifying healthy profits being attained by organisations. It can be
further analysed that €35.2 is spent alone by Germany per capita basis by people suiting need for
business to expand quite effectively. The profitable sector has direct and positive impact on GDP
of the country benefiting whole economy (Pettegree, 2016).
On the other side, due to technological advancement, many businesses have registered
decrement in sales revenue. Less usage of paper and writing materials have decreased profits.
However, it continues to dominate the market as intermediaries are not involved. Due to this,
wholesalers directly sale items to customers and intermediaries' cost is saved and more profits
can be attained in a better manner (Mucciarelli, 2017). Seeking the ample of opportunities
available in the stationers market, pharmaceutical businesses have entered in the market for
diversifying their businesses. Furthermore, supermarkets and hypermarkets can also be observed
leading from the front for gaining share in the market. Thus, it can be said that German's
Wholesale stationers market is much profitable for Duque Papetiers Gros for accomplishing
growth so that profits can be attained in a better way.
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TASK 2
Identifying annual spending on stationery items on per capita of European nations
The pictorial presentation is quite beneficial for analysing complex data in effective
manner which can be understood quite effectually. The graph has been prepared showing annual
spending on writing and stationery commodities by several European countries. It can be
interpreted from the graph that among the European nations, Switzerland has major number of
spending totalled to €35.5 making highest among all. This shows that income is much spent on
stationery items by people of country. On the next position is Germany with total amount of
€35.2 which becomes second highest nation in terms of spending.
Switzerland
Germany
Austria
France
Slovenia
Italy
Slovakia
Hungary
Spain
Poland
Croatia
Czech Republic
0 5 10 15 20 25 30 35 40
Spending in €
Illustration 1: Annual spending by European countries on stationery items
Third position is secured by Austria having €35 below Germany and fourth rank is
garnered by France having spending of €28.3 on stationery products. While, next position that is
fifth one is gained by Slovenia with €20.4 making more difference of margin in comparison to
France. On the other hand, Italy is ranked €18.6 on annual basis as per capita of money spent on
stationery products. Major difference is found in Slovakia having amount of €9.8 behind Italy.
It can be analysed that eight rank has been gained by Hungary with spending of €9.6.
While, Spain has gained next position as spending is below Hungary ie €8.9. Poland comes on
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next rank with spending of €8.5. Croatia comes then having spent of €7.9 and last to this list
comes Czech Republic with spending of €7.6 showing that Duque Papetiers Gros could
effectively gain profits by expanding to Germany as it is second-most spending nation on
stationery.
TASK 3
Conducting analysis of data of sales of recent three financial years of business
A) Data of sales
B) Mix pie chart
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C) Scatter diagram and correlation coefficient
Interpretation-
It can be analysed that scatter diagram, correlation coefficient are being taken out for
Duque Papetiers Gros for analysing sales data based on past performance. Moreover, future
performance is also analysed which will provide company with higher amount of growth leading
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to achievement of expansion goals in the best manner possible. Correlation technique is being
used in order to determine relationship between variables found under topic and through this, it
becomes easier for analysing work in better manner.
Correlation coefficient has been developed by Pearson for analysing variables in a better
manner (What is Correlation Coefficient. 2018). It can be assessed that sales from past years
have been good for Duque Papetiers Gros which highlights that firm will be able to make good
quantum of profits even in Germany. Correlation coefficient has generally two types namely
positive and negative correlation. Value when comes more than 1, positive correlation exists and
when less than 1 comes negative correlation prevails. In above table, 0.73 is attained meaning
that positive correlation exists.
The revenue of firm has been good in recent years and is increasing at a moderate rate.
This signifies that sales will be achieved in the future up to a major extent (Kassler, 2016).
Correlation of sales data obtained is 0.73 highlighting that increase in one variable will have
increment in other. Thus, it can be said that business will be able to attain benefits quite
effectually in German market.
Trend Analysis
Equation is taken from scatter diagram and for next two years, forecast is made.
2018 sales
Y = 6500 x + 162000
Y = 6500 * 4 + 162000
= 188000
2019 sales
Y = 6500 * 5 + 162000
= 194500
Thus, healthy sales would be accomplished in next two years as it is highlighted by trend
analysis. It can be analysed that sales will be incremented up to a major extent.
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TASK 4
Identifying German market feasibility for the business
A) Conducting feasibility table
Expansion of business to Belgium & Germany?
Pros Score/10 Cons Score/10
Increased satisfaction of
customers 3 Increased funding needs 1
Enhanced sales 2 More expenditures 2
Up scaled operations 2
Total Pros 7 Total Cons 3
Average Pros 3.5 Average Cons 1.5
It can be analysed from the above report that firm should expand to market of Germany
in order to attain benefits with ease. This is already evident from the fact that Germany comes to
second position in terms of spending on writing materials in the best manner possible. Duque
Papetiers Gros is planning for making its operational activities in Germany seeking ample of
growth in the market making it favourable for firm.
Sales of last three financial years provide clarity that firm will be able to attain higher
productivity as growth in the market is good (Bell, 2017). It can be analysed table that there are
more pros of expansion to Germany. Some of are increased satisfaction to customers and
increment in sales revenue in the best manner possible which will be accomplished by firm with
ease. Furthermore, operational level of business activities would be upscaled leading to more
profits to company. It is also clarified that average pros comes out to 3.5 and of cons is 1.5. This
has been achieved by getting 7 score out of 10 for merits and remaining for cons.
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On the other hand, demerits can also be assessed which firm will face in Germany. These
are more requirement for capital as it will up scale its business which will cater to more need of
funds. While, another demerit is of increment in expenses (Heller, 2015). However, it can be
analysed from feasibility table that firm will be able to enhance its profits in Germany in a better
manner.
B) Complying with International Standards
ISO 45001- Social responsibility-
The ISO states that business is needed to comply with social responsibility when
undertaking the operations in effective manner. It provides that societal welfare must be taken
into account without being harming society (Günther, 2016).
ISO 31000- Management of risk-
This ISO standard implies that protection should be provided to employees working at
the workplace as uncertain events might happen in business at any time. Hence, protection needs
to be imparted to them.
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TASK 5
Computation of costs of new building for organisation
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TASK 6
Analysing mean value of orders
For assessing mean value, hypothesis needs to be formulated which is formed below-
H0- There is no significant difference between sample mean and order mean
H1- There is significant difference between sample mean and order mean
z test has been applied,
z = (x – μ) / σ
= 240 - 230 / 43
= 0.23
It can be analysed that 5 % significance level has been taken for accepting or rejecting
hypothesis. The null hypothesis is being accepted as there is no difference among variables under
study. The value obtained is more than 0.5 accepting null hypothesis. It has been arrived by
taking normal distribution curve. This means that normal mean population is being taken and
thus, test is applied.
TASK 7
Satisfaction of customers
A) Improving questionnaire responsive rate
It can be analysed that respondents are not answering questionnaire and responsive rate is
poor. It is advised that purpose and objective behind the questionnaire need to be communicated
to people for getting desired rate to questionnaire (Weinberger, 2017). The questions should be
to-the point and no personal questions should be asked which can harm sentiments of people up
to a major extent. Furthermore, it is recommended to provide precise questionnaire to
participants so that they may get attracted in a better manner and answer them all. Thus,
responsive rate can be increased with the help of implementation of such ways.
B) Descriptive statistics
Descriptive Statistics CUST SERVICE QUAL P&S SALES PRICE
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STAFF VALUE
2 2 3 3
2 4 3 4
3 3 3 1
4 2 4 2
4 4 2 3
3 2 4 1
3 3 2 2
4 4 4 2
2 3 1 2
3 3 1 1
3 3 3 4
2 3 4 3
4 3 2 2
4 4 4 1
2 3 2 3
4 4 3 2
4 4 3 3
3 3 3 2
4 2 3 2
3 3 2 2
Mean (Value) 3.15 3.1 2.8 2.25
Standard Deviation
(Value) 0.8127277009 0.7181848465
0.9514531
822
0.9104654
68
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