Business Expansion Report: Duque Papetiers Gros in German Market

This report provides a comprehensive analysis of Duque Papetiers Gros' potential for business expansion in Germany. It begins with an overview of the wholesale stationery market in Germany, drawing on data from MPA International and highlighting key trends such as the aging population and digitalization. The report then delves into the annual spending on writing and drawing materials per capita, analyzing production, export, and import data. An in-depth examination of Duque's financial performance over the past three years (2015-2017) is presented, including sales data analysis and forecasting for 2018 and 2019. The report also evaluates the pros and cons of expanding into Germany, calculates the cost of a new building, and analyzes customer satisfaction levels. It offers recommendations for improving customer responsiveness through surveys and feedback collection. Finally, the report includes calculations of the mean value of orders and provides insights into how Duque Papetiers Gros can successfully expand its business operations in the German market. The report also suggests international standards like ISO 26000 and ISO 45001 for business expansion.

Summative assessment
Duque Papetiers Gros

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Overview of wholesale stationery market in Germany.........................................................1
TASK 2............................................................................................................................................3
1.2 Annual Spending on Writing/Drawing Materials per Capita ...............................................3
TASK 3............................................................................................................................................4
1.3 Analysis of Duque’s last three financial years of sales data (2015-2017) ...........................4
APPENDIX......................................................................................................................................5
TASK 4............................................................................................................................................7
1.4 Business expansion in Germany...........................................................................................7
TASK 5............................................................................................................................................8
1.5 Cost of new building.............................................................................................................8
TASK 6............................................................................................................................................9
1.6 Mean Value of orders............................................................................................................9
TASK 7............................................................................................................................................9
1.7 Customer satisfactions..........................................................................................................9
TASK 8..........................................................................................................................................10
1.8 CONCLUSION...................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Business expansion is necessary for the firm in order to achieve the desired goals and
objectives. The report will cover the Duque Papetiers Gros engaged in stationary business.
Planning to expand the business in Germany will be covered. Data matrix and report outlines in
order to provide suggestions towards business expansion will be discussed. Calculation of mean
and standard deviation to see the ratings of consumers on the basis of provided products and
services. Responsive rate increasing recommendations are also discussed.
TASK 1
1.1 Overview of wholesale stationery market in Germany
It can be said that the most crucial source used for the research in stationery market is
reports from MPA international which is a research agency and specialised in conducting
research and information in stationary markets effectively. The European stationary and office,
school supplies market is expected to increase in the current period. The total turnover of the
whole industry is more than €14.8 billion per year, which is equal to each individual spending
more than €182 annually. About €35.2 of it is spent only on writing and drawing materials,
which ranks Germany second in terms of spending for stationery among the countries in the
European Union (EU). It can be said according to the 2007 research that the EU countries
especially the Eastern and Central Europe are growing faster day by day. The other markets in
Germany and UK, France and Italy are going down. Below is a table provided which shows the
consumption of stationary market supplies in EU and individual country.
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Figure 1 Number of business in office and stationary retail markets in Germany 2002-2015
Source: Number of office and stationery retailers in Germany 2002-2015
From the above data analysis it can be concluded that there are number of stationaries
and offices retail and market sector in Germany from 2002 to 2015. 5,200 offices, a decrease
from the past year which was 5,440 firms effectively. There are three main trends which has an
impact on stationary sales in Germany such as ageing population than in the past with few
number of school age children. This will affect the demand of stationary products in schools
which is a traditional business. The common elements of stationary such as pen and pads which
are also easy to display cannot be found in shops easily. The third main trend is the digitalization
in the schools and classroom. Moving towards the new technology has a significant impact on
stationary firms in Germany effectively.
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TASK 2
1.2 Annual Spending on Writing/Drawing Materials per Capita
It can be said that the turnover is changing vastly within the market of office and
stationaries. Tow out of three Germany major pharmacy has taken lead into stationary markets
and they are expanding their business activities in term of products. There are some super
markets also taken places for stationary items that it is taking significant share of market from
special dealers. The E-commerce department is also growing towards stationary industry
effectively. A total 17% share of stationary products E-commerce market share is emerging now.
Figure 1 Annual spending for writing and drawing materials per capita
Writing Instruments Production Change Export Change 2 Import Change 3
Fountain Pen 45 4.07 103.01 9.04 9.05 -7.8
Ball point pen 103.06 2 173 4.03 97.08 2.03
Rollerball pen 164.08 3.09 72.03 4.06 47.02 14.03
Tipped pen 183.02 3.03 205.08 3.05 50.09 9
Technical pen 1.08 12.05 0 0 0 0
Mechanical pencils 11.3 -2.06 1808 -16.08 5.08 -15
pencils 0 0 102.07 7.07 40.01 14.06
Total 509.07 3.02 675.07 4.06 252.03 6.05
Figure 2 Data Research
Source: German ministry of statistics
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The Germany market towards stationary is in a great demand and also driven by
investments provided by private and commercial customers. The GDP growth rate in 2015 raised
by 1.7% which was a great reason of strong economic performance in Germany. One of the
major factor affecting the market of stationary business in Germany is the low birth rate that it
affects the number of people or population within country. In order to improve the business of
office and stationary market within Germany some industry players needs to adjust their new
market demands and also consistently improvement in products and services. This will help them
to cope up with changing environment of business. It is very crucial for the firm to remain
innovative in order to overcome the challenges and stay connected to the business.
Based on such conditions it is expected that the market of stationaries in Germany will
increased by 3.5% in terms of their turnovers in 2016. It is difficult to make exact estimation that
all the firms are affecting by the international economy and monetary turmoil.
TASK 3
1.3 Analysis of Duque’s last three financial years of sales data (2015-2017)
Product item 2015 Sales
(€)
2016
Sales
(€)
2017
Sales
(€)
printer cartridges 25000 26000 22000
general office supplies 25000 27000 23000
low-cost printers 15000 18000 18000
office furniture 25000 25000 27000
shredders 25000 29000 29000
paper-based supplies 25000 27000 27000
writing/drawing
materials 25000 30000 32000
Total Sales 165000 182000 178000
Figure 3 Sales Data
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Figure 4 Formula
APPENDIX
C) Correlation coefficient
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Figure 5 Computation of correlation coefficient

Interpretation:
It can be said from the above analysis that the sales is increasing every year effectively.
The moderate correlation and coefficient sales prevails between 0.25-0.75. The correlation
method was develop by Pearson and it shows the relationship among two variables. The method
is used in the linear regression. This will help to demonstrate that the sales will be increased for
the Duque Papetiers Gros in upcoming years and also shows the relationship of positive
correlation between variables effectively. If the correlation coefficient take place in more than
0.4 than it is showing the positive interaction between variables effectively and efficiently.
The calculation shows that correlation coefficient comes to 0.73 which is approximately
near to 1. This shows the increasing in variables that other variables will be changed in the same
manner of increasing. The value describe the strong relationship between these two variables.
Forecasting trend for 2018 and 2019
Trend for 2018
Y = 6500 * 4 + 162000
= 188000
Trend for 2019
Y = 6500 * 5 + 162000
= 194500
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Thus, it can be said that the sales will increase for the firm in the year 2018 and 2019.
The trend of 2018 will be 188000. Apart from this, the trending sales for the year 2019 will be
194500 which is increasing presently. So the sales will increase in the upcoming next years for
the firms effectively and efficiently.
TASK 4
1.4 Business expansion in Germany
Expansion of business in Germany and Belgium?
Pros Score/10 Cons Score/10
Customer satisfaction 4 Capital requirement 2
More revenue 2 Incurring costs 1
High scale of business 2
Total Pros 8 Total Cons 3
Average Pros 2.7 Average Cons 1.5
It can be said that the Germany has very high spending on stationary materials which is
explained in the graph. Thus, German will be the best option for Duque Papetiers Gros in order
to expand the business activities. Sales will be increased for the firm which is beneficial for the
firm and the firm will able to improve their profitability. Stationary market of Germany is
generating estimates revenues for the firm which is also beneficial for European country
effectively. It can be said that the Germany has second highest rankings in the stationary and
office sector that it is good for the firm in order to expand their business activities. Wholesale
stationary market sector is wide and also the products and services is provided easily and
effectively to the customers in the market.
In addition to this, Germany is not suitable for the firm in order to expand their activities
there. The main reason behind that is capital investments which will be required for doing
business in Germany. But in order to achieve the better growth and share in the market the firm
has to expand their business in Germany.
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International standards
1. ISO 26000- Social responsibility
The standard will help to deal with operational activities within the firm towards the
welfare of society.
2. ISO 45001- Occupational health and safety
Health and safety of workers should be provided by the firm in order to manage the
operations in safe manner.
TASK 5
1.5 Cost of new building
A) Cost of monthly mortgage calculation
T = 30 years
r = rate of interest on mortgage
Repayment of loan
= Loan amount / discounting factor
= 200000 / ({[(1 + 0.10) ^ 30] – 1} / [0.10 (1 + 0.10) ^ 30])
= 200000 / 9.42
= 21215.85
For calculating monthly payment, formula is
= Repayment amount / 12
= 21215.85 / 12
= 1767.98
B) Interest applied and re-calculate monthly cost
N = 30 / 12
= 360
r = 10 % interest rate / 12
= 0.00833 per month
= 200000 / ({[(1 + 0.00833) ^ 360] – 1} / [0.00833(1 + 0.00833) ^ 360])
= 200000 / 113.99 = 1754.55
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Thus, it can be said that 1754.55 is the mortgage cost which should be fill by the business
in order to expand their operational activities in German and will provide effective and quality
services and products in order to meet the requirements and demands of customers in the market.
TASK 6
1.6 Mean Value of orders
Testing of Hypothesis
Null hypothesis –It can be said that there is no difference between orders or mean value of orders
and sample mean
Alternative hypothesis –In this there is a significant difference between these mean value of
orders and sample mean
Performing z score test
Formula,
z = (x – μ) / σ
= 240 – 230 / 43
= 0.23
This can be certified that the null hypothesis is valued by Z and it is more than 0.5. The
value Z score test from the table is 0.5910 which shows that there is no significant difference
between these two variables effectively and efficiently. In case the value of Z will decrease to
0.5, than it would be stated that there is some difference between these two. In respect to this, the
values are obtained by the use of normal distribution curve effectively.
TASK 7
1.7 Customer satisfactions
Suggestions to improve responsive rate: Surveys will help to improve this situation in a
concise way. If the customers are not tend to reply then the process should not be used.
Responsive rates can be increased by the firm by telling other respondents about the purpose and
aim of why the information is required by the firm. Utilisation of feedbacks obtained from
surveys will help Duque to increase the responsive rates in an effective and appropriate manner.
The use of jargon will decrease the customer response as they are not able to understand the
concept of questions. According to this, there should be open question and answer provided by
the firm in order to receive the feedbacks from customers. This will also help them by providing
valuable feedbacks and comments from customers in the market. Customer satisfaction can be
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increased by delivering quality and effective products and services. By implementing these tips
and suggestions the company is able to increase their responsive rats by 5% effectively.
B) Descriptive statistics
CUST_SERV QUAL_P&S SALES_STAFF
PRICE_VAL
UE
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 3.5 3.15 3.45 1.95
Standard
Deviation 0.7608859103 0.3663475485 0.8255779475
0.510417785
5
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It can be concluded from the above divisions that prices are treated fairly and effectively
according to the ratings and as compared to other ratings. Thus, firm is able to reduce their prices
in order to achieve the excellent ratings in sales.
TASK 8
1.8 CONCLUSION
It can be concluded from the above report that the firm is able to maximise its
profitability and sales. It is also able to expand its business activities in Germany that the country
is growing day by day in the field of stationary sectors. The current trend of the Germany market
is also increasing which will help firm to increase their activities and operational effectiveness
within country. The charts and diagrams will help to understand that the market of Germany is
increasing and firm has good chance to expand their business in the sector of stationary. This
will increase the sales for them and maximise their profits as well.
Moreover, hypothesis is carried out which states that there is no significant level of
difference between variables. Furthermore, mean and standard deviation is calculated which
shows that customers should be satisfied by reducing prices.
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REFERENCES
Books and Journals
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Online:
Correlation Coefficient: Simple Definition, Formula, Easy Steps, 2018 [Online] Available
Through:<http://www.statisticshowto.com/probability-and-statistics/correlation-
coefficient formula/>
Germany statistics 2015. Number of office and stationery retailers in Germany 2002-2015.
[Online]. Available through:<https://www.statista.com/statistics/500176/office-and-
stationery-retailers-germany/>
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