Report: Analysing German Market Expansion for Duque Papetiers Gros

This report analyzes the potential for Duque Papetiers Gros, a wholesale stationery company, to expand its business into the German market. The report begins with an overview of the German wholesale stationers market, highlighting its importance and growth factors, including the high annual spending on stationery materials. It then presents a graph illustrating annual spending on stationery materials across European countries, comparing per capita spending. The analysis includes a correlation coefficient analysis of sales data, forecasting future sales trends. Furthermore, the report evaluates the pros and cons of expanding into Germany, assessing mortgage costs for a potential building. The analysis also provides insights into improving consumer satisfaction and responsiveness. The conclusion summarizes the findings and provides recommendations for the company's expansion strategy, incorporating the application of statistical techniques to support the decision-making process.

Analysing Information and
Data for Problem Solving

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Giving an overview of German's wholesale stationers market........................................1
TASK 2............................................................................................................................................2
2.1 Representation of graph to show annual spending on stationery materials in Europe.....2
TASK 3............................................................................................................................................3
3.1 Providing analysis of sales on the basis of financial data................................................3
TASK 4............................................................................................................................................6
4.1 Expansion on business in Germany..................................................................................6
TASK 5............................................................................................................................................7
5.1 Assessing mortgage cost of building................................................................................7
TASK 6............................................................................................................................................8
6.1 Providing mean value of orders........................................................................................8
TASK 7............................................................................................................................................8
7.1 Level of consumer satisfaction.........................................................................................8
TASK 8..........................................................................................................................................10
CONCLUSION....................................................................................................................10
REFERENCES..............................................................................................................................10

INTRODUCTION
Expansion plays as essential role in business so that more profits can be attained. The
present report deals with Duque Papetiers Gros which is planning for operating in German seeing
immense benefits in the nation. Various statistics techniques are applied to provide advice
whether to expand business or not. Advices are given to increase responsive rate of respondents
so that adequate information can be gathered. Moreover, graphs are shown for analysing
financial data of sales of firm.
TASK 1
1.1 Giving an overview of German's wholesale stationers market
The wholesale market of Germany is quite essential for the country as it help to garner
good overall income to the nation and as such, GDP increases up to high extent. This is evident
from the fact that writing materials are heavily used in Germany which means that annual
spending of nation is high as compared to other countries of Europe (Li and et.al, 2017). Total
annual turnover of the stationery market is €14.8 billion which is the main reason of growth of
Germany. Moreover, almost €35.2 is spent on writing materials by the customers and as such, it
marks and ranks the nation on second number across European Union (EU).
In contrary to this, due to the effect of digitisation prevailing quickly across the world,
product of writing materials such as document folders have suffered much decline in past years.
This has affected wholesale stationers market quite adversely (Tomé and et.al, 2018). The main
reason of growth of market is that wholesaler sells products directly to customers without
involving any retailers. By implementing this strategy, wholesalers earn good amount of revenue
as expenses are reduced up to high extent. In relation to this, seeming increasing growth and
profit of stationers, big pharmaceutical firms have expanded and diversified their businesses to
garner profits from this sector as well. In addition to pharmaceutical firms, supermarkets and
hypermarkets have also started selling stationery products to customers so that good quantum of
profits may be effectively generated. Thus, it can be said that stationery market of Germany has
ample of growth for business.
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TASK 2
2.1 Representation of graph to show annual spending on stationery materials in Europe
Pictorial presentation of data help to interpret results in the best possible way. The below
graph shows spending of customers in various countries of Europe annually on the basis of per
capita income. This is evident from the graph that among the highest spending nations,
Switzerland is ranked among the first nation of 35.5 spending on writing materials. On the
second position comes Germany which has annual spending of 35.2 slightly below Switzerland
securing next position (Chen, Wang and Raine, 2017). The third rank is given to Austria which
has annual spending of per capita of 35 euros. This marks third position of the country among the
highest spending nations in European Union (EU) countries. On the next position is France
which spending of almost 28.3 on annual basis among the European nations. Fifth rank is given
provided to Slovenia having difference of 7.9 with that of France and annual spending is €20.4.
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 on writing materials
Moreover, analysis of spending of nations provided that on sixth position is Italy which
has total spending of almost 18.6 annually marks the sixth rank. Seeming forward to the list of
European nations, seventh rank has been provided to Slovakia having much difference of
spending from earlier ranked nation with spending of €9.8. This implies that spending of
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Slovakia is less as compared to Italy. Eighth position is imparted to Hungary having total of
€9.6. While, ninth position is secured by Spain having annual spending of 8.9 and next position
is provided to Poland having 8.5, second last position is provided top Croatia having spending of
7.9 and last rank is given to Czech Republic spending of €7.6.
TASK 3
3.1 Providing analysis of sales on the basis of financial data
A)
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B) Mixed pie chart
C) Scatter diagram and correlation coefficient
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Illustration 2: Mixed pie chart

Interpretation-
The above diagram represents correlation coefficient which is carried out. Correlation is
useful technique of statistics which represents relationship among two variables. This technique
was developed by Pearson which is useful for businesses. By analysing sales data of Duque
Papetiers Gros, it can be said that sales of the business is good. This is evident from the fact that
correlation coefficient has been calculated and value is 0.73 which clearly shows positive and
strong relationship among two variables. Value should not be less than -1 as it represents
negative correlation between the same (Liu, Chen and Li, 2018).
It can be further interpreted that sales of Duque Papetiers Gros is increasing moderately
and it is overall good. It will be profitable for expanding business in Germany as forecasted by
sales data and resultant correlation coefficient. The value obtained is quite close to 1 and it is
representing positive correlation as if one factor will increase, the same effect will be seen on
another factor forecasted by correlation method (Correlation Coefficient: Simple Definition,
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Illustration 3: Scatter diagram

Formula, Easy Steps, 2018). This is evident from the fact that if correlation value comes to more
than 0.4, it means that there is strong relationship among variables. This means that sales data
and positive correlation clarifies that business is in upward trend and sales are moderately
increasing up to high extent. This shows effectiveness of firm to garner good profits and can
easily expand its reach out of French border to Germany in search of enhanced profits.
D) Forecasting trend for future
Considering the above equation of scatter diagram, trend for next years such as for 2018
and 2019 can be easily forecasted with much ease.
Sales trend of 2018
Y = 6500 * 4 + 162000
= 188000
Sales trend of 2019
Y = 6500 * 5 + 162000
= 194500
It can be analysed that sales of firm will be increased from year to year. The trend shows
that sales in 2018 will be 188000 and in 2019 will be 194500. This means that performance of
business will be maximised too much extent.
TASK 4
4.1 Expansion on business in Germany
A) Table
Should I expand my business to Belgium & Germany?
Pros Score/10 Cons Score/10
Increased level of customer
satisfaction 3 More capital 2
Maximum revenue 3 Increased in costs 1
Increased scale of firm 2
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Total Pros 8 Total Cons 3
Average Pros 2.7 Average Cons 1.5
Interpretation-
It can be analysed that German is the biggest spending nation on stationery materials and
businesses have ample of benefits. Due Papetiers Gros can easily expand to Germany as it will
help firm to inject sales and good quantum of profits can be garnered. It is already discussed in
above overview of German's stationers market having good growth of businesses and annual
spending on stationery products is more in EU. This is the main reason for expanding operations
in the nation. The above table represents pros and cons for the firm whether it should expand its
reach to other country or remain in France only (Matsunaga and et.al, 2017). It can be analysed
that pros of expanding business is more ranked as compared to cons of the same.
The benefits are increased customer satisfaction, enhanced revenue and high scale of
business. Due Papetiers Gros will be able to satisfy people as spending capacity of German
people paves the way for enhanced revenue leading to more customer satisfaction. This will help
firm to formulate diversified paper and stationery products so that it can be sold to commercial
customers for office use and as such, scale of business will eventually increased. However, there
are cons of expanding business in Germany such as increased requirement of funds or capital and
addition in expenditures. Diversifying and expanding usually leads to incurring more expenses
but these are rated low as compared to positives of the same.
B) Complying with international standards
 ISO 45001- Social responsibility
It implies that welfare of society may be maintained by the firm.
 ISO 31000- Risk management
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Company must replace existing standards and implement effective standards for employees to
overcome uncertainties.
TASK 5
5.1 Assessing mortgage cost of building
A) Monthly mortgage cost
Time = 30 years
r = Interest rate
By using formula,
= Amount of loan / Discounting rate
= 200000 / ({[(1 + 0.10) ^ 30] – 1} / [0.10 (1 + 0.10) ^ 30])
= 200000 / 9.42
= 21215.85
Monthly payment
= Amount/ 12
= 21215.85 / 12
= 1767.8
B) Re-calculate cost on monthly basis
N = 360
r= 10 % interest / 12
= 0.00833/ month
= 200000 / ({[(1 + 0.00833) ^ 360] – 1} / [0.00833(1 + 0.00833) ^ 360])
= 200000 / 113.99
= 1754.55
The above mortgage cost to be fulfilled by firm to expand in Germany.
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TASK 6
6.1 Providing mean value of orders
Hypothesis Testing
H0 = No significant difference between sample mean and order mean value
H1 = Significant difference between sample mean and order mean value
Implementing z test,
z = (x – μ) / σ
= 240-230/43
= 0.23
It can be analysed from the given significance level of 5 %, null hypothesis is accepted as
value of z score test is more than 0.5. It has been arrived at 0.5910 which implies that there is no
significant difference between two variables (Compagnino, Romano and Zuccarello, 2017). The
value of z score test has been calculated by applying normal distribution curve. This means that z
test is used by taking normal mean population.
TASK 7
7.1 Level of consumer satisfaction
A) Suggesting ways to improve responsive rate
The business has received very low response from customers and responsive rate is less
than 5 %. It is required to improve respondents interest so that firm may analyse customer's
perception in effective way. It is advised to firm that it should provide short questionnaires to
respondents so that they may answer the same within stipulated time and as such, responsive rate
can be increased. The respondents should be told about main purpose behind collecting
information through questionnaires and surveys (Liou, Sotirelis and Gjerloev, 2017). This way
respondents will answer questionnaires with much ease. Moreover, some incentives should be
offered when full questionnaire is provided by them. Implementing these ways, responsive rate
can be maximised quite easily.
B) Providing descriptive statistics
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Statistics CUST_SERV QUAL_P&S
SALES_STAF
F PRICE_VALUE
3 3 3 3
3 3 3 2
4 4 4 2
4 3 4 1
2 3 2 2
4 4 4 2
4 3 4 2
4 3 4 2
2 3 2 2
4 3 4 1
4 3 4 2
4 3 4 2
4 3 4 2
4 3 4 1
2 3 2 2
4 3 4 2
4 4 4 2
3 3 3 3
4 3 4 2
3 3 2 2
Mean
Value 3.5 3.15 3.45 1.95
Standard 0.7608859103 0.3663475485 0.8255779475 0.5104177855
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