Transcript Cartridge World 2009

Cartridge World
Prepared for:
Best in France
12 May 2009
Orla Liston I Richie Carroll I Jason Poulsen I Atsushi Saito I Olga Fedorova
Cartridge World
Company
Constraints
French Benefits
Closing
When did it come to France
- Came to France in 2003, but originated in Australia in 1991.
What's its business
-Remanufacturing of ink and toner cartridges for consumer printing
-Sale of compatible cartridges and printing accessories
-Refill of empty ink cartridges for inkjet printers, laser printers, fax machines and
photocopiers with top quality, brand-specific ink and toners.
What are its key figures (world sales, French sales, profits, market
share etc.)
-It currently has close to 18% of the worldwide ink cartridge market (Revenue)
-Sold nearly 60 million ink jet cartridges and 10 million laser cartridges in France in 2007.
-World’s fastest growing ink refilling retailer in the $60 billion printer cartridge industry
Note: Only 22% of cartridges are refilled in Australia, 27% in the USA and 15% in the UK.
Company Products
Company
Constraints
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Closing
Senario1: Import and sell
Senario2: Produce in France
• FC2: Store, Factory, Negotiation, Tax
• VC1 - VC2 = Transportation, and products are small
• Estimating FC2 and VC2 might be difficult  Hidden cost
Company Products
Company
Constraints
French Benefits
• Don’t produce products in France—
Import and resell
• Their cost
– Fix cost: Store
– Variable cost: Labor, Transportation,
Cartridge parts
Closing
Clientele
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Who are the company's clients?
-Consumers and SME Worldwide
-+1600 stores in +45 countries
What are their expectations?
-Network of sites
-Cater to local needs both in Australia and Internationally
-Provide competitive prices on superior products
How will a French presence help or hurt the company's
ability to satisfy client demands?
-Necessary to access French speaking clients
-Provide more tailored service in France
-France is one of the largest European markets
Why it Came to France
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Company approach to international growth
-1600+ stores in more than 45 countries, with an average of 4 Cartridge
World franchises being opened EACH WEEK!
-French Federation of Franchises; 130+ stores in France.
Where else did it consider?
-It is currently growing hugely worldwide, so it has considered and
located in many other countries apart from France.
Why was France a key target location
-Owner for Europe had worked in France and UK so was familiar with
France and how business was done here—very comfortable move
Company Values
Company
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Closing
What are the core values of the company?
Efficiency
Integrity
Pride
Customer
Satisfaction
What values may not fit with perceived French values?
Efficiency
Principle Constraints
Company
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Closing
What are the principle constraints the
company foresaw before coming to France?
-Social Protection: very strong protective labor laws—protects
employees
Very challenging to fire employees
Easy to get in trouble for something if you don’t know the
system well
-Higher Taxes
-High Risk of Strike
-Shorter Work Week: only 35 hours per week
Surprises?
Company
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Closing
Did they discovery any others once they arrived?
•Not that bad because they are a franchisor that hires French
people
-The French understand their own system
•Mostly challenging for the executives
-Top-down problem not bottom-up problem
-Executives from American schools and American business style
-Very to the point and don’t like to waste time
-Hard to find franchisors that can handle/understand American
system
-Management to hire people well-versed in both cultures/bilingual
Worst Constraints
Company
Constraints
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Which are the worst constraints?
-35 Hour work week
-Taxes are higher here
How do these constraints differ with their
other locations?
Longer work hours in US and other Western
cultures, similar to home country of
Australia
Closing
Losses?
Company
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Did the local subsidiary lose projects to other
countries because of these constraints?
-No; Cartridge World franchised all over Europe, over
1,600 stores in 45 countries
-Franchisor, generally not hiring other non-French
people to work in France—with the exception of
management above the franchisees and below the
executives
-Franchising in different nations makes a lot of sense
Adaptations
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What kinds of adaptations did/is the company making to its
people management systems?
-Try to deal with the differences
-Hiring fully bilingual people
-Hiring English speakers so as to help communication
-Hiring those who can understand differences working in different countries,
and between Europe and non European differences
Key Benefits
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What are the key benefits of being in France?
-High quality of infrastructures
-High labor productivity per hour (as a % of the US level)
-High quality of life in France
-France is 5th largest economy in the world
-Location benefits for expanding throughout European market
Closing
General Advice
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What advice do you offer to other companies in this
sector concerning use of France as a location?
Take time to think about things before starting
Get very good consults (someone who is used to setting up companies in France
Make a very detailed contract for the employees
We’d Like to Thank
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Isabelle Eloy
Finance Controller
[email protected]
01.58.46.15.63
Closing
Questions?
Company
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Closing