Strategic Report: Duque Papetiers Gros' Expansion into Germany

This report analyzes the feasibility of Duque Papetiers Gros, a French stationery organization, expanding into the German market. It provides an overview of the German wholesale stationers market, including annual spending per capita and market trends, highlighting increasing demand for writing and drawing materials despite digitalization. An analysis of Duque's sales data from 2015-2017 identifies product performance and potential areas of focus. The report also addresses international standards, costs associated with a new building, mean order values, and strategies for enhancing customer satisfaction. It concludes with recommendations for Duque to successfully enter and compete in the German stationery market, emphasizing quality, innovation, and targeted customer engagement. Desklib provides access to similar solved assignments and study resources for students.

DUQUE PAPETIER GROS

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)..........................................3
2.4 Feasibility of Expanding to Germany & International Standards......................................................5
2.5 Costs of a New Building....................................................................................................................7
2.6 Mean Value of Orders........................................................................................................................8
2.7 Customer Satisfaction........................................................................................................................8
3. Conclusions............................................................................................................................................10
4. References..............................................................................................................................................11

LIST OF FIGURES
Figure 1: Annual spending per capita..........................................................................................................3
Figure 2: Analysis of three financial years..................................................................................................4
Figure 3: Mixed pie chart.............................................................................................................................4
Figure 4: Scattered diagram.........................................................................................................................5

1. Introduction
French organization, Duque Papetiers Gros is seeking to move in German stationery market to expand
the business, operations and profitability. Stationery market is the growing market in several countries
and successfully contributing to the economy. The report will discuss the statistical and descriptive data
about the German stationery market and determine the trends and potential to establish the business in
Germany. It will also discuss how annual spending per capita is increasing and supporting the national
economy. The increase and scope of the writing and drawing material will be discussed along with
analysis of the three financial years. Feasibility for a business in Germany and international standards on
the stationery business will be discussed. Also cost of new building and mean value of the orders will be
calculated through the Microsoft Excel. Customer satisfaction will be discussed along with the points to
improve.
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2. Analysis of Issues for Duque Papetiers Gros
2.1 An Overview of the Wholesale Stationers Market in Germany
The German stationery market is the growing market for the stationery products. There is turnover of
€14.8 billion per year for the office supply and writing material. Individual in the country has the annual
spending of €182 on the stationery products whereas €35.2 is dedicated to the purchase of the writing
material. 70% of the stationery organizations have determined the increasing sales in the year 2015.
Also according to Association of German Stationery Brands, the organization can achieve the same
increasing growth in nearby future (MGCC report, 2016). In comparison of the previous year, the
domestic demands of the stationery products have increase by 2.5% whereas internal market has
increased demand of 5%. According to the official statistics, the country has 2200 organizations those
are providing the services to the customers (Stationery Industry, 2018). However, the customers are only
inclined to the well known brands only for the higher quality of products in their prices.
Trends and potentials
German stationery market has earned reputation in the domestic and internal market with the
manufacturing and sales of the stationery products. The organizations with stationery products have
increasing share in the national market or economy. However, the paper and documents are decreasing
in demands because of increasing digitalization. However, the increasing demand of office supplies and
writing instruments has increased the share of the products in market to 5%. According to HBS, the
organizations with stationery products can improve the product quality and enhance the revenue in the
upcoming years (MGCC report, 2016). Also, only a few numbers of the businesses are dominant in the
market so that new organizations have potential to reach the customers with innovations, low prices and
high quality.
2.2 Annual Spending on Writing/Drawing Materials per Capita
From the analysis of the stationery market in Germany, it can be said that the products with paper and
document files are decreasing because of the digitalization and increasing use of the mobile devices.
However, the demand of the writing and drawing material is increasing in the country. Educational
sectors and offices are using writing and drawing materials for the operations and learning purpose.
From the analysis, it can be said that Germany is the second country in the European Union in which
individual has annual spending of €35.2 for the writing and drawing material (Rickert et al, 2017). The
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first position is acquired by Switzerland which has annual spending per capita equals to €35.5. It can be
observed that there is not a big difference in both countries and Germany can lead the industry in future.
Figure 1: Annual spending per capita
Annual spending on the per capita for the stationery market has been decreased in various products. For
example, office supplies, papers, furniture and printer cartridge. However, the increasing use of the
writing and drawing material is support the national economy and increasing the market share. In
comparison of the year 2014, annual spending is increased to 2% in year 2015 (Triola, 2013). In year
2016, the spending has been increased further to 0.3% and it is expected that in the next few years, the
annual spending might reach to the increase of 5% in comparison of the today. However, the
digitalization is the threat for the growth and sustainability.
2.3Analysis of Duque’s last three financial years of sales data (2015-2017)
Duque has received the changes in the financial outcome during the several years of the business. The
analysis of the previous three years has been given below in which popular products and their sales are
noted. Also the totals and other details have been calculated with the help of the Microsoft Excel tool:
Excel sheet
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Figure 2: Analysis of three financial years
According to the analysis, it can be said that general office supplies and printer cartridge are reduced to
the demands whereas low cost printers, shredders and paper based products are stable in the demand.
However, the writing and drawing materials are increased in demands (Triola, 2013). With the year
2017, it can be said that the organization can focus on the manufacturing of the writing and drawing
material.
Mixed pie chart
The mix pie chart for the products shows the analysis of the three financial years. It shows the various
products and their share in the market for the revenue. It helps to analysis the stabilities and increase in
the particular products.
Figure 3: Mixed pie chart
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Scatter diagram
From the analysis, it can be said that sales in the year 2016 and 2017 are increasing for most of the
products whereas the some products are stable to deliver the revenue. With the analysis of the financial
data of the year 2017, it can be said that the year 2018 and 2019 can achieve the more profitability for
the office furniture, paper shredder and other products those are stable in their demands in market.
However, the most of the profitability has root in the manufacturing and distribution of the writing and
drawing materials.
Figure 4: Scattered diagram
2.4 Feasibility of Expanding to Germany & International Standards
Table 1: Pros and cons
Should I expand my business to Germany & Belgium?
Pros Score/10 Cons Score/10
The countries have less
competition and dominants in
market.
8 Few dominants in market has
constraints to reach the end
customers
6
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Marketing being oriented to the
software so that traditional selling
approaches are being absolute.
9 Digitalization has reshaped the
stationery business and
organizations
7
Customers preferring products
and services those are creative
and innovative for them.
7 Internal business rules and
implications
7
Peoples are moving toward more
annual spending on specific
products.
8 It is complex to balance the cost
and quality for the customers
8
Belgium has price oriented
market whereas German
customers are seeking for quality
in the products.
8 Unique ways and offers are
required to attract the customers
7
Both countries have lower tax
rates but ensure high stability of
the market.
7 Strategies are not applicable if the
organization is willing to use
Germany as the distribution
country for the international
business.
6
Cost to manufacture or distribute
the product is low because of
lower cost on the labour.
9
Up growing sales and customer
interest.
7
Total Score 63 out of 80 Total Cons 41/60
Average Pros 7.8 Average Cons 6.8
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Application of international standards
To achieve the stable business operations, it is essential for the organization to implement rules and
regulations. Such regulations and standards can help the organization to achieve the community
satisfaction and improve the adaptability of the business. Some of the major standards with their
applications are:
ISO 85: It is designed to ensure that the papers are being designed with the material not harmful for the
health and the environment. For example, it ensures proper ratio of the plastic in the paper to make them
disposable. It ensures paper technology is also suitable for the environment and cannot be used in the
harmful manner.
ISO 9001 and ISO 14001: It has goal to support the business functions for the easy execution. For
example, the standard has goal to manage the internal communication and data sharing. It also
implicates the policies and regulations for the smooth business operations. It helps to control the
competition and manage the industry wide relationship (Tarí et al, 2012).
ISO 4046: This standard is used to justify the nature and usability of the products and services.
According to the standard, the organization has to clarify the product usability and cautions to use the
products or services. In the stationery business, the organization has to determine the use of the paper or
other products along with guide to use them.
2.5 Costs of a New Building
The organization has planned to invest the amount of €200,000 for the new building where the amount
is payable as instalments of 30 years with the interest rate of 10%. The organization can use the
CUMIPMT function in the Microsoft Excel to analyse the data and determine the actual cost of the
building after the all payments. For example, the function has requirements of the principle amount,
interest rate and the instalments for the repayments. With the above parameters, it can be said that the
organization has to pay €430,184.86 as interest over the long time of 30 years whereas the organization
has to pay total amount of €630,184.86 to close the deal.
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However, the organization has approach that instalments can be paid in the starting of the month rather
than to pay annually. In this manner, total interest rate will be divided among the months and it becomes
8.3%. The organization has to pay €1509.57 as interest and then to pay total amount of €342,061.54
with interest.
2.6 Mean Value of Orders
To calculate mean values of orders, it is essential to use the Microsoft Excel as it can select the fifty
random orders and then determine the mean values with the help of the average function. With Excel the
organization can reduce the errors and improve the performance to calculate the average values.
However, the CEO of the organization assumes that mean value of the 50 orders is equal to the €230.
Also the standard deviation is about €43. Average can be defined as the total of the orders divided by the
total number of the orders. At other side, standard deviation can be calculated as the difference of the
two consecutive orders and then the average of the differences among the orders. However, it is possible
that the orders collected for the calculation might vary in the values and it is not essential that each time
deviation or the average meet to the same values. However, in the most of the cases, it can be said that
the mean values of the orders is near to the estimated value because the orders are fixed and rarely
change for the values.
2.7 Customer Satisfaction
The organization can focus on the customer satisfaction to deliver more reliable and robust services. To
enhance the services and support to the customers, the organization can apply the following
recommendations in the questionnaire:
 Rather than to attach the files containing the questionnaire, the organization can use inbuilt
questionnaire or its link in the mail so that customers can easily answer the questions. Another
approach is to prompt the customers to feed the opinions when they are purchasing the product
or using the services. Digital approaches can be used to enhance the customer interest in the
business improvements (Hill and Brierley, 2017).
 The responses to the organization can be improved with the on-desk questionnaire as it ensures
the files are submitted in faster and reliable manner.
Answer analysis
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Average functions can be used to analyse the data. However, the points for the customer services and
product quality are effective but the organization has to focus on the product prices to sustain and retain
in the market because competition is high.
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