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EU MARKET SURVEY 2004




Stationery items, office
and school supplies
EU MARKET SURVEY 2004



  STATIONERY ITEMS, OFFICE AND
        SCHOOL SUPPLIES

                                      Compiled for CBI by:

                                   Discovery Interior Trading
                                         in collaboration with
                                             Mrs. Y. Netto

                                           October 2004



                       DISCLAIMER CBI MARKET INFORMATION TOOLS
Although the content of its market information tools has been compiled with the greatest care, the
Centre for the Promotion of Imports from developing countries (CBI) is not able to guarantee that the
information provided is accurate and/or exhaustive, and cannot be held liable for claims pertaining to
use of the information.

In the case of the market publications, neither CBI nor the authors of the publications accept
responsibility for the use which might be made of the information. Furthermore, the information shall
not be construed as legal advice. Original documents should, therefore, always be consulted where
appropriate. The information does not release the reader from the responsibility of complying with any
relevant legislation, regulations, jurisdiction or changes/updates of same.

In the case of the Internet tools, CBI aims at minimising disruption caused by technical errors.
However, CBI cannot guarantee that its service will not be interrupted or otherwise affected by
technical problems. CBI accepts no responsibility with regard to problems incurred as a result of using
this site or any linked external sites.

The information provided is aimed at assisting the CBI target group, i.e. exporters and business support
organisations (BSOs) in developing countries. It may, therefore, not be used for re-sale, the provision
of consultancy services, redistribution or the building of databases, on a commercial basis. For
utilization of the CBI market information tools by the CBI target group on a non-commercial basis, the
condition applies that CBI is referred to as the source of the information. All other use is prohibited,
unless explicitly approved in writing by CBI.

Photo courtesy: Discovery Interior Trading



                                                                                                      1
Table of Contents
                                 EU Market Survey
                                    -- annual update --


REPORT SUMMARY                                                 4

INTRODUCTION                                                   7

PART A: EU MARKET INFORMATION                                   9
1 PRODUCT CHARACTERISTICS                                      10
  1.1 Product Groups                                           10
  1.2 Customs/Statistical Product Classification               11
2 INTRODUCTION TO THE EU MARKET                                12
3 CONSUMPTION / INDUSTRIAL DEMAND                              14
  3.1 Market size                                              15
  3.2 Market segmentation                                      20
      3.2.1 Market segmentation by product                     20
      3.2.2 Market segmentation by user                        26
  3.3 Consumption patterns and trends                          30
      3.3.1 Demographic trends                                 30
      3.3.2 Social & Cultural trends                           31
      3.3.3 Technical trends                                   34
      3.3.4 Economic trends                                    35
4 PRODUCTION                                                   36
  4.1 Production per product group                             37
5 IMPORTS                                                      41
  5.1 Total imports                                            41
  5.2 Imports by product group                                 46
  5.3 The role of the developing countries                     53
6 EXPORTS                                                      56
7 TRADE STRUCTURE                                              59
  7.1 EU trade channels                                        59
      7.1.1 Types of intermediaries                            61
      7.1.2 Stationery retailers                               64
  7.2 Distribution channels for developing country exporters   67
8 PRICES                                                       69
  8.1 Price development in the stationery market               69
  8.2 Sources of price information                             73
9 REQUIREMENTS FOR ACCESS                                      74
  9.1 Non-tariff trade barriers                                74
  9.2 Tariffs and quotas                                       80




                                                                    2
PART B: EXPORT MARKETING GUIDELINES: ANALYSIS AND STRATEGY                                             83
10 EXTERNAL ANALYSIS                                                                                   85
   10.1 Market developments and opportunities                                                          85
   10.2 Competitive analysis                                                                           87
   10.3 Sales channel assessment                                                                       88
   10.4 Logistics                                                                                      89
   10.6 Price Structure                                                                                90
   10.7 Examples: Product Profiles                                                                     94
11 INTERNAL ANALYSIS                                                                                   97
   11.1 Product standards/ quality, Production capacity, Product design & development
        and Unique selling points                                                                      97
   11.2 Logistics                                                                                      98
   11.3 Organisational Structures                                                                      99
   11.4 Marketing and sales                                                                            100
   11.5 Financing                                                                                      101
   11.6 Capabilities                                                                                   103
12 DECISION MAKING                                                                                     104
   12.1 SWOT and situation analysis                                                                    104
   12.2 Strategic options & objectives                                                                 104
13 MARKETING TOOLS                                                                                     106
   13.1 Matching products and the product range                                                        106
   13.2 Building up a relationship with a suitable trading partner                                     107
   13.3 Drawing up an offer                                                                            108
   13.4 Handling the contract                                                                          110
   13.5 Sales promotion                                                                                112

APPENDICES                                                                                             115
1 DETAILED HS CODES                                                                                    115
2 DETAILED IMPORT STATISTICS                                                                           118
3 DETAILED EXPORT STATISTICS                                                                           132
4 USEFUL ADDRESSES                                                                                     135
  4.1 Standards organisations                                                                          135
  4.2 Sources of price information                                                                     136
  4.3 Trade associations                                                                               138
  4.4 Trade fair organisers                                                                            139
  4.5 Trade press                                                                                      141
  4.6 Important stationery buying groups                                                               142
  4.6 Other useful addresses                                                                           144
5 LIST OF DEVELOPING COUNTRIES                                                                         145
6 LIST OF ACP COUNTRIES                                                                                146
7 LIST OF GSP COUNTRIES                                                                                147
8 REFERENCES                                                                                           148




This is a new CBI publication with a new format and contents. It partially replaces the CBI, EU Market survey
and EU Strategic marketing guide “Stationery items, office and school supplies” published April 2003.



                                                                                                                3
REPORT SUMMARY

This survey profiles the EU market for stationery items, office and school supplies, referred to
throughout this report as stationery. The emphasis of this survey lies on those products which are of
importance to suppliers based in developing countries. The product groups discussed in this survey
include: envelopes, paper-based products, writing & drawing instruments, storage & filing products,
office & desk accessories, presentation & planning materials, greeting cards and bags & briefcases.
Note that these products groups are not the only products which could offer chances for exporters in
developing countries. The major national markets of Germany, United Kingdom, France, Italy, Spain,
the Netherlands and Belgium are highlighted. Readers should, however, note that the size of a market
is not the only determinant of its attractiveness for an exporter. Other determinants, such as per capita
consumption and an easily accessible distribution structure, could make certain country markets very
attractive. On that basis, for example, the Scandinavian countries could be attractive for exporters in
developing countries.

Part A of this survey includes statistical market information on consumption, production, trade and
trade structure and requirements for access. As an exporter, you will need this information in order to
formulate your own market and product strategies. Part B of this survey contains export-marketing
Guidelines, a practical handbook for exporters engaged, or wishing to engage, in exporting stationery
to the European Union.

Consumption
The stationery market in the reviewed countries is a mature and reasonably stable market only growing
0.6 percent between 2001 and 2002 reaching a value of € 9,641 million at manufacturers’ selling price
(MSP), equivalent to € 15,318 million at user buying price (UBP) excl. VAT). It should be noted that
greeting cards and bags & briefcases are not included in this figure, because statistics concerning these
markets are not compiled by the research agency MPA International.

Germany is by far the biggest stationery market of the reviewed countries. In 2002, the Germany
market accounted for a value of € 2,812 million at MSP, followed by the United Kingdom (€ 2,244),
France (€ 1,645), Italy (€ 1,083), Spain (€ 964) and the Benelux (€ 851). The stationery market can be
segmented in to three different types of users, professional, Small office and Home office (SoHo) and
private users. Each segment has its own specific requirements (see § 3.2.2) and the SoHo market,
particularly, is growing due to the trend to outsourcing and sub-contracting in the EU business
environment.

Production
Over the last decade, the stationery market has become increasingly competitive, caused by the
maturity of the market and the increasing pressure of low-cost imports deriving from low-cost
countries. In order to survive, economies of scale were of vital importance and this, in turn, has led to
take-overs, mergers and restructurings.

Imports
In 2002, the total import of stationery of the EU-15 remained stable for the second year in a row. That
year, imports accounted for a value of € 9,947 million. Apparently, the stagnation of the economy in
2001 had its influence on the import of stationery. The United Kingdom is the leading importer,
accounting for 18.8 percent of the total value imported into EU countries, followed by France (16.1%),
Germany (15.5%), Italy (9.6%), Belgium (8.2%), The Netherlands (7.1%), and Spain (6.6%).

In 2002, bags & briefcases (32.6%) formed the leading import product group, followed by office &
desk accessories (24.8%), writing & drawing instruments (15.3%), paper-based products (15.0%),
storage & filing products (4.9%), envelopes (4.1%), greeting cards (2.7%) and presentation &



                                                                                                       4
planning materials (0.6%). In 2002, developing countries accounted for 26.7 percent of the EU-15
import up from 23.1 percent in 1998. In 2002, the United Kingdom was the largest import of
stationery from developing countries followed Germany and France

In the Bags & Briefcases imports, developing countries hold the strongest positions, accounting for
34.9 percent of the total EU-15 imports in terms of value. In the envelopes and office & desk
accessories imports, the position of developing countries is relatively weak, accounting for only 1.5
and 8 percent of total EU-15 imports in terms of value. For additional information on the shares of
developing countries we refer to paragraph 5.3 and Appendix 2

Export
The EU-15 is home to several of the biggest stationery exporting countries in the world, like Germany
France and Italy. In 2002, the EU-15 countries together exported € 10,072 million of stationery. In
2002, the EU-15 countries accounted for 58.3 percent of this export. The largest exporter of stationery
in the EU-15 was Germany. Germany accounted for 22.8 percent of the total exported value in 2002.
Other key exporting countries were Italy (19.2%), France (18.1%), the United Kingdom (10.4%) and
Belgium (8.9%). The main products exported by EU-15 countries are Office & Desk Accessories
(28.1% of total EU exports), followed by Bags & Briefcases (28.0%), Paper-based products (17.3%),
Writing & Drawing Instruments (15.3%), Envelopes (4.4%), Storage & Filing products (3.9%),
Greeting cards (2.4 %) and Presentation & Planning materials (0.5%). For additional information we
refer to Appendix 3

Overview
In the figure below, we have presented a graphic summary of chapters 3 to 6. The size of each circle
represents the size of the market in terms of consumption. As can be seen in this figure, Germany
together with the United Kingdom are the leading markets in terms of consumption size. On the
horizontal axis, lies the trade balance, which is the difference of the export minus the import. Of the
seven countries discussed in this survey, only United Kingdom and Spain do not have a positive trade
balance and are therefore net importers of stationery. The vertical axis represents the percentage of the
import deriving from developing countries. In the figure below, the horizontal axis crosses the vertical
axis at 26.7 percent, indicating that the EU-countries on average import 26.7 percent of their total
import from developing countries.

Graphic summary Chapters 3-6: Market attractiveness on basis of market size, import share deriving
from developing countries, trade balance and consumption growth in terms of value 2001-2002
    United Kingdom                               40%
                                                           % of import from DC




     growth -0.3%
                                               38%
                                      Spain
                                   growth 3.3% 36%
                                                 34%
                                                                                                                   Italy
                                                                                                   Germany
                                                 32%                                                            growth 0.8%
                                                                                                 growth -0.9%
                                                 30%   Benelux
             Trade balance in € million          28% growth 1.1%

                                                 26%
         -1,000   -800    -600    -400    -200         -                         200   400        600     800   1,000
                                                 24%
                                                                                      France
                                                 22%
                                                                                   growth 1.6%
                                                 20%
                                                                                          Source: Eurostat & MPA International




                                                                                                                              5
As can be seen, the United Kingdom, together with Spain, Germany and Italy, import more than the
EU-15 average from developing countries. In 2002, 36.9% of the United Kingdom’s imports came
from developing countries. When looking at the variables in this figure, the upper-left corner
represents the most attractive stationery markets for developing countries in terms of import share and
trade balance. Secondly, come the countries in the upper-right quadrant, Germany and Italy. However
the positive trade balance indicates that these countries are in possession of a strong home production
base, making them comparatively less easy to access. In the figure we have also mentioned the market
growth of the countries reviewed. Spain together with France, are the star performers, growing
respectively 3.3% and 1.6% in 2002.

The attractiveness of an export market is not solely determined by the factors discussed in the
overview. Factors like trade structures, consumer preferences and tastes are also very important for
successful export marketing. An exporter should also note the different requirements laid down in
legislation and restrictions of the export market. In Chapter 9 of this survey, the requirements of
access are discussed.

Opportunities and threats
Because of the increasing competition in the stationery market, it is difficult for manufacturers,
especially small-scale ones, to retain a profitable share of the EU markets. Although the developing
countries’ share of EU-15 imports is growing, it should be noted that this growth is partly due to
outsourcing by Western manufacturers on the one hand and a number of large manufacturers mainly
based in low-wage countries.

Because the stationery market can be characterised as a relatively stable and mature market,
innovation of product and design is therefore the keyword. Therefore, we think that there are good
opportunities for companies in developing countries, which can offer innovative products at good
quality against competitive prices and which can also meet other market requirements such as quality
assurance, reliability in delivery, environmental aspects and working conditions. In, for example, the
handmade segment of the stationery market there are substantial opportunities for manufacturers in
developing countries

Up-to-date information on trends and developments is therefore more important than ever. Overseas
companies that want to tap into the EU market have to be aware of the market developments.
International and domestic trade fairs, exhibitions and visits to shops in the export country offer
valuable information and provide opportunities to build good relationships with importers and
retailers.

This survey offers you a framework for deciding whether or not to export to the European Union and,
if you decide to do so, provides you with leads and guidelines to assist your decision-making
regarding which products and markets to focus on. For information on current CBI Programmes,
training & seminars, and on how to download market information and CBI News Bulletins, please
refer to CBI’s internet site “www.cbi.nl”.




                                                                                                     6
INTRODUCTION

This CBI survey consists of two parts: EU Market Information and EU Market Access Requirements
(Part A), and Export Marketing Guidelines (Part B).

                                           Market Survey

                                           Part A
                    EU Market Information and Market Access Requirements

     EU Market Information (Chapters 1-8)            EU Market Access Requirements (Chapter 9)
             Product characteristics                         Quality and grading standards
         Introduction to the EU market               Environmental, social and health & safety issues
          Consumption and production                       Packaging, marking and labelling
              Imports and exports                                  Tariffs and quotas
                Trade structure
                     Prices

                                           Part B
                       Export Marketing Guidelines: Analysis and Strategy

        External Analysis (market audit)                    Internal Analysis (company audit)
                  (Chapter 10)                                        (Chapter 11)
            Opportunities & Threats                              Strengths & Weaknesses
                                               Decision
                                               Making
                                             (Chapter 12)

                                    SWOT and situation analysis:
                                    Target markets and segments
                             Positioning and improving competitiveness
                            Suitable trade channels and business partners
                   Critical conditions and success factors (others than mentioned)
                                    Strategic options & objectives
                                         Export Marketing
                                             (Chapter 13)

                                Matching products and product range
                                  Building up a trade relationship
                                        Drawing up an offer
                                       Handling the contract
                                          Sales promotion

Chapters 1 to 8 of Part A profile the EU market for “Stationery items, Office and School supplies”
hereafter called stationery. The emphasis of the survey lies on those products, which are of importance
to developing country suppliers. The major national markets within the EU for those products are
highlighted. Furthermore, statistical market information on consumption, production and trade, and
information on trade structure and opportunities for exporters is provided. Chapter 9 subsequently
describes the requirements which have to be fulfilled in order to get market access for the product
sector concerned. It is, furthermore, of vital importance that exporters comply with the requirements of
the EU market in terms of product quality, packaging, labelling and social, health & safety and
environmental standards.


                                                                                                        7
After having read Part A, it is important for an exporter to analyse target markets, sales channels and
potential customers, in order to formulate export marketing and product strategies. Part B therefore
aims to assist (potential) exporters from developing countries in their export-decision making process.

After having assessed the external (Chapter 10) and internal environment (Chapter 11), the (potential)
exporter should be able to determine whether there are interesting export markets for his company. In
fact, by matching external opportunities and internal capabilities, the exporter should be able to
identify suitable target countries, market segments and target product(s) within these countries, and
possible trade channels to export the selected products (Chapter 12).

Chapter 13 subsequently describes marketing tools which, can be of assistance in successfully
achieving the identified export objectives.

The survey is interesting for both starting exporters as well as exporters already engaged in exporting
(to the EU market). Part B is especially interesting for more experienced exporters starting to export to
the EU and exporters looking for new EU markets, sales channels or customers. Starting exporters are
advised to read this publication together with the CBI’s Export planner, a guide that shows
systematically how to set up export activities and the interactive tool on the CBI website “Export
marketing plan”.




                                                                                                       8
PART A
EU MARKET INFORMATION AND MARKET ACCESS
REQUIREMENTS




                                          9
1       PRODUCT CHARACTERISTICS

This survey analyses the market for Stationery items, Office and School supplies” in the European
Union. Stationery items, office and school supplies cover a wide range of products used for
administrative work in the office and at school, for private use at home as well as for creative
purposes. In order to provide insight into the diverse applications of stationery items, office and school
supplies, we have distinguished eight product groups, which we deem of interest for exporters in
developing countries. One should note that these products groups are not the only products which
could offer chances for exporter in developing countries. The selected product groups are the
following:

    •   Paper-based products
    •   Envelopes
    •   Storage & Filing products;
    •   Writing & Drawing instruments;
    •   Presentation & Planning materials;
    •   Office & Desk accessories;
    •   Greetings cards
    •   Bags & Briefcases

The product sectors covered in this market survey are discussed in 1.1 below. This survey does not
include software and electrical office equipment like faxes, computers, printers, etc. Office furniture is
also not included in this survey, for information concerning this topic we refer to the CBI survey
“Domestic Furniture”. Leather goods, like leather organisers, and maps are also not included in this
survey. For information concerning these products we refer to the CBI survey “Leather goods”.
Furthermore, office paper, for copiers and laser printers, is excluded from this survey.


1.1      Product groups
In this paragraph, we will give a short definition of the eight product groups included in this survey.

Paper-based products
Paper-based products include all paper items: writing pads, exercise books, memo & refill pads,
duplicate and analysis books, notebooks, account books, diaries, wrapping paper and calendars.
Envelopes and greetings cards are excluded from this segment, since these are dealt with separately.

Envelopes
This segment includes different types of envelopes, which are used to pack documents or other
products, which are sent by mail generally through postal services. Envelopes are available in different
sizes and types, like, for example, window, self-seal, padded, booklet, square, open-end, two-way
remittance, strip 'n grip, priority mail, payroll envelopes.

Storage & filing products
This segment includes different types of filing products, which are used to save and store documents,
like: Manila files, soft plastic filing, suspension filing, ring binders, lever arch files, archival filing,
indexes and dividers.

Writing & Drawing Instruments
This segment includes all sorts of products which consumers use to write, mark, draw or paint.
Stationery in this product group includes: pencils, ballpoints, rollerballs, gift pens, fountain pens,
fibre-tipped pens, plastic-tipped pens, crayons, highlighters, markers, and refills. Erasers, correction
aids, pencil sharpeners and brushes of many types and qualities are also included in this product group.


                                                                                                          10
Presentation & Planning materials
This segment includes planning boards, wall boards, white boards, flipcharts & accessories, calendars
and year planners. These products are often used to give a presentation.

Office & Desk accessories
The segment Office & Desk accessories includes many products, like, adhesive tapes, paper and card
adhesives, sticky notes, letter- and pen trays, scissors, pins, clips, fasteners, staplers, staples, staple
extractors, punches, guillotines, trimmers, letter trays/racks and waste bins. Artistic materials like
charcoal, graphite-pens, oil- and watercolour paints, as well as painting accessories such as frames and
paint brushes are included in this product group.

Greeting Cards
The segment Greeting Cards includes Christmas cards, New Year cards, Valentine cards, birthday
cards, graduations cards, change of address cards, marriage cards, etc. Generally cards are used to post
a message to a friends, acquaintances, etc.

Bags & Briefcases
The segment Bags & Briefcases includes: briefcases, attaché cases, school bags, computer trolleys,
laptop bags and rucksacks.


1.2      Customs/ Statistical products classification
The nomenclature for statistics within the Europe Union does not specify stationery as such. The
trading classification systems used were unified by the introduction of a new, worldwide coding
system introduced on January 1, 1988. This system is called the Harmonized Commodity Description
System (HS) and was developed by the World Customs Organisation (WCO). The system comprises
about 5,000 commodity groups; each identified by a six-digit code, arranged in a legal and logical
structure and is supported by well-defined rules to achieve uniform classification. More than 177
countries and economies use the system as the basis for their customs tariffs and for the collection of
international trade statistics. WCO has introduced some alterations to the HS and these are included in
the combined nomenclature as of January 1, 2002. After the six-digit code, countries are free to use
further subheadings. An 8-digit system is used in the trade data of Eurostat. Most codes, however, end
with two zeros, i.e. effectively only using six digits. In some countries, ten digits are even occasionally
used.

Table 1.1 Harmonised System (HS) classification stationery
 Product group                                                  Heading HS codes
 Paper-based products                                           4820, 4821, 4903, 4910
 Envelopes                                                      4817
 Storage & Filing products                                      4819, 4829, 8304, 8305
 Writing & Drawing instruments                                  3213, 4016, 9603, 9608, 9609
 Presentation & Planning materials                              9610
 Office & Desk accessories                                      3506, 3926, 8213, 8214,, 8305, 8441, 9608
 Greeting cards                                                 4817
 Bags & Briefcases                                              4202
                                                                                           Source: Eurostat

In order to make this market survey/guide operational the survey has been limited to describe the
above selected product groups. The HS classification given in Table 1.1 differs in some degree from
the product groups mentioned in paragraph 1.1. This is caused by the fact that the information used in
this market survey is obtained from a variety of different sources. Therefore, extreme care must be
taken in the qualitative use and interpretation of quantitative data. This puts limitations on in-depth
interpretation of trade figures and of the possible relationships between import and export figures on
the one hand and consumption figures on the other hand. For a more detailed list of product groups,
please refer to Appendix 1.



                                                                                                         11
2       INTRODUCTION TO THE EU-MARKET

The European Union (EU) is the current name for the former European Community. Since 1 January
1995, the EU has consisted of 15 member states. Ten new countries joined the European Union in
May 2004; those so-called ‘accession’ countries are Poland, Lithuania, Estonia, Latvia, Hungary, the
Czech Republic, Slovenia, Slovakia, Malta and Cyprus. According to Eurostat, the EU has grown
from 15 countries with 379,6 million residents to 25 countries with approximately 450 million
residents. Negotiations are in progress with a number of other candidate member states.

Table 2.1: Population and GDP of EU countries, 2002
 Countries/category                              Population               Age 15-64    GDP (€ billion)
   Germany                                       83.3 million                  68%               2,206
   France                                        59.8 million                  65%               1,556
   United Kingdom                                59.8 million                  66%               1,485
   Italy                                         57.7 million                  67%               1,416
   Spain                                         40.1 million                  68%                 836
   The Netherlands                               16.0 million                  68%                 417
   Belgium                                       10.3 million                  66%                 315
                                                                            Source: World factbook, 2003

Within Western Europe – covering 15 EU countries, Iceland, Liechtenstein, Norway and Switzerland
– more than 20 million enterprises are active, made up mostly of small and medium-sized enterprises
(SME’s). In 2000, the average turnover per enterprise of SME’s and large enterprises amounted to €
600,000 and € 255 million respectively.

EU Harmonisation
The most important aspect of the process of Table 2.2: Overview15 EU-Countries, 2002
                                                           Population      379.6 million
unification (of the former EC countries), which affects
                                                           Area            31,443,000 km2
trade, is the harmonisation of rules in the EU             Density         83 people per km2
countries. As the unification allows free movement of      Languages       11 (excl. dialects)
capital, goods, services and people, the internal          GDP/capita      21,023
borders have been removed. Goods produced or               Currencies      €, UK£, DKr., SKr.
imported into one member state can be moved around         Exchange        € 1 = US$ 1.21
between the other member states without restrictions.
A precondition for this free movement is uniformity in the rules and regulations concerning locally
produced or imported products. Although the European Union is already a fact, not all the regulations
have yet been harmonised. Work is in progress in the fields of environmental pollution, health, safety,
quality and education. For more information about harmonisation of the regulations, visit
AccessGuide, CBI’s database on non-tariff trade barriers at “www.cbi.nl/accessguide”.

Monetary unit: Euro
On 1 January 1999, the Euro became a legal currency within twelve EU member states: Austria,
Belgium, Finland, France, Germany, Greece, Italy, Ireland, Luxembourg, The Netherlands, Spain, and
Portugal. In 2002, circulation of euro coins and banknotes replaced national currency in these
countries. Denmark, United Kingdom and Sweden have decided not to participate in the Euro.

The most recent trade statistics quoted in this survey are from the year 2002. In this market survey, the
Euro (€) is the basic currency unit used to indicate value.

Statistics
Trade figures quoted in this survey must be interpreted and used with extreme caution. The lion’s
share of information derives from research agencies, such as Euromonitor, Eurostat, Mintel,
Datamonitor, MPA International and KeyNote. Furthermore, information from different articles has



                                                                                                      12
been used to broaden the view of the market. Other methods used to collect information are trade
interviews with importers and retailers of stationery products, store checks and desk research. Because
of the variety of sources used, extreme care must be taken in the qualitative use and interpretation of
the quantitative data in this survey.

The collection of data regarding trade flows has become more difficult since the establishment of the
single market on 1 January 1993. Until that date, trade was registered by means of compulsory
customs procedures at border crossings, but, since the removal of the intra-EU borders, this is no
longer the case. Statistical bodies like Eurostat cannot now depend on the automatic generation of
trade figures. In the case of intra-EU trade, statistical reporting is only compulsory for exporting and
importing firms whose trade exceeds a certain annual value. The threshold varies considerably from
country to country, but it is typically about € 100,000. As a consequence, although figures for trade
between the EU and the rest of the world are accurately represented, trade within the EU is generally
underestimated.

Furthermore, the information used in this market survey is obtained from a variety of different
sources. Therefore, extreme care must be taken in the qualitative use and interpretation of quantitative
data, throughout the text, as also in comparisons of different EU countries with regard to market
approach, distribution structure, etc. For more information on the EU market, please refer to the CBI’s
manual “Exporting to the European Union”.

Survey
This survey profiles the EU market for stationery, in which seven selected markets within the EU are
highlighted. The selection is based on a quantitative and qualitative comparison of consumption and
imports/exports of the EU countries, as will be further explained in the following chapters of this
survey. The countries selected for this survey are Germany, United Kingdom, France, Italy, Spain, The
Netherlands and Belgium, which are the largest countries in the EU, when it comes to consuming and
importing stationery. One should however note that total market size is not the only determinant for
conducting successful export. Other determinants like per capita consumption and an easily accessible
distribution structure could make less populous countries, i.e. the Scandinavian countries, very
attractive for exporters in developing countries. It is therefore important for exporters not to focus
solely on the market size of the large countries.

When speaking about the EU, the ten so-called accession countries are not included in the information
given. Because information concerning the accession countries (Poland, Lithuania, Estonia, Latvia,
Hungary, the Czech Republic, Slovenia, Slovakia, Malta and Cyprus) is not richly available, it is
difficult to give a thorough analysis concerning these markets. This survey therefore only sparsely
deals with these countries.

Note that the figures used in this survey can differ substantially from the figures presented in the
preceding survey CBI survey: “Stationery items, office and school supplies, April 2003”. This is
mainly caused by the fact that other sources of information are used. Note also that most of the figures
given in Chapter 3 are given in Manufacturer Selling Prices (MSP) instead of consumption figures.




                                                                                                     13
3       CONSUMPTION

This chapter presents a general overview of the stationery market, highlighting the countries and
products specified in Chapters 1 and 2. The consumption figures given however are not available for
all the separate product groups. The information used in this chapter is largely based on the reports of
MPA International, Datamonitor, Euromonitor and KeyNote. All these research agencies have
conducted some sort of research on the stationery market in Europe (for more information, we refer to
Appendix 8. Furthermore, various articles published by different institutes are used. The information
from these sources can, however, include consumption data of products that are beyond the scope of
this survey, whilst they exclude consumption data of articles that may be relevant. Therefore, the
information in this chapter is not unequivocal. Because of the different sources of information, some
assumptions are made concerning the given information.

The total market figures include the following products: office paper, paper-based products,
envelopes, storage & filing products, writing & drawing instruments, presentation & planning
materials and office & desk accessories. This selection is largely based on a selection made by MPA
International. The products group Greeting Cards and Bags & Briefcases are not reflected in this
figure. The total figure also includes the product group Office Paper (includes copier/laser grades, top
quality writing- and specialist inkjet papers) which is beyond the scope of this survey. Besides it
should be mentioned that the MPA International statistics concerning the paper-based products do not
include products like calendars, diaries, photo albums, etc. Therefore, some additional information
regarding these product groups will be given based on information from Euromonitor. Furthermore, it
should be noted that the figures from MPA International are given at manufacturer selling prices
(MSP) and users buying price (UBP). The first indicates the price at which manufacturers sell their
products to resellers, like wholesalers. The latter is the price at which the eventual user buys the
product (i.e. a net price, which is not necessarily the price at which it is marketed; it does not include
any VAT). One should note that the mark up between the MSP and the UBP is an accumulation of
different product ranges. The mark up between different product groups can differ substantially.
Caution should therefore be applied when using these mark ups.

The figures regarding the product group Greeting Cards originate from Datamonitor are given at retail
selling price (RSP) and include all taxes. Furthermore, it must be noted that figures concerning the
Greeting Cards product group are not available for each country covered in this survey. Information is
only available for Germany, France and the United Kingdom. Regarding Bags & Briefcases, no
statistical information is available.

Figure 3.1: Reviewed stationery markets, Segmentation by Country and by Product: % Share by Value,
            2002

                                                                     Presentation
                                                                      & Planning
                                                                       materials    Envelopes
                Benelux                                                 13.8%        15.8%
                 9.0%                                       Office &
                                 Germany                                                    Paper based
                                                              Desk
           Spain                  29.2%                                                      products
                                                           accessories
           10.0%                                                                               4.9%
                                                              8.6%
            Italy                                          Storage &
           11.2%                                             Filing
                                                           products
                                                            12.4%                          Office
                                                                    Writing &              paper
              France             United                             Drawing                29.7%
              17.1%             Kingdom                           Instruments
                                 23.4%                               14.8%




                                                                                                          14
Source: Datamonitor, 2003
Unfortunately, the MPA International information does not provide data concerning the entire EU.
This chapter, therefore only deals with the consumption of the following countries: German, the
United Kingdom, France, Italy, Spain, and the Benelux. Unfortunately, MPA International does not
make a distinction between the Netherlands, Belgium and Luxembourg.


3.1      Market size
The market for stationery in the reviewed countries is a mature and reasonably stable only growing 0.6
percent between 2001 and 2002 reaching a value of € 9,641 million at manufacturers’ selling price
(equivalent to € 15,318 million at user buying price), according to MPA International. As can be seen
in figure 3.1, Office Paper is the largest stationery product group, accounting for a 30 percent share of
the stationery market, equivalent to a value of approximately €2,868 million at manufacturers’ selling
price (€ 4,140 million at user buying price). On the vertical axis of figure 3.2, you will find the import
development in value in the year 2002. As can be seen, the office paper market grew by 3.1 percent in
2002, making it the fastest growing of the product groups represented in figure 3.2. The horizontal
axis gives a prediction of the market growth between 2002 and 2006. Again, the office paper market is
forecast to see the largest growth and expected to increase by almost 20 percent in size, between 2002
and 2006, whereas the writing & drawing instrument market is predicted to grow by only 2.5 percent
in the same period.

Germany is by far the biggest stationery market, accounting for 29 percent of the consumption of the
reviewed countries. At a considerable distance, we find the United Kingdom (23%), France (17%),
Italy (11%), Spain (10%) and Benelux (9%).

Figure 3.2: European Stationery market: relative attractiveness (excl. greeting cards) based on
            € value at Manufacturers’ selling price
                              4%

                                                                                            Office paper
                                         3%

                                         2%
   % growth 2002




                                                                   Office & Desk
                                         1%                         accessories
                                                                     Storage & Filing
                                                                         products
                                         0%
             - 10%               - 5%       0%               5%              10%               15%           20%
                                                                             Presentation
                                        - 1%                                  & Planning
                   Paper based                                      Envelopes materials
                     products           - 2%   Writing & Drawing
                                                   instruments

                                        - 3%
                                                 % prognosis growth 2002 - 2006


 Circle size based on                                          Books & pads € 473 million at MSP (€828 million at UBP
 Manufacturer selling price, 2002
                                                               Office paper € 1,512 million at MSP (€ 2,070 million at UBP)

                                                                                            Source: MPA International, 2003


The economic downturn that affected Europe in 2001, saw many stationery segments declining in
value between 2001 and 2002. As can be seen in figure 3.2 only the Office paper (+3.1 percent) and
the Office & Desk accessories (+1.1 percent) markets grew in terms of value. The other stationery


                                                                                                                              15
markets all showed a minor decline in value terms. The Paper-based product market showed the
biggest decline, in 2002 this market dropped by 2 percent. Because of the declining school population
and increasing computerization, this decline is forecast to continue in the near future, according to
MPA International. We should, however, note that the MPA International figures do not include all the
products selected in this segment (for more information we refer to § 3.2). The office paper market is
forecast to grow by 19.4 percent towards 2006 (horizontal axis). The other product segments reflected
in figure 3.2 are forecasted to grow only marginally.

Germany                                           Figure 3.3: The German Stationery market:
As noted earlier, Germany is by far the biggest                Segmentation, % Share, by value, 2002
stationery market in Europe, accounting for 29                     Presentation
percent of the consumption of the reviewed                          & Planning
countries. The German stationery market was                          materials   Envelopes
affected by the weak economy. In 2002, the                            18.7%        13.5%
                                                                                          Paper based
German stationery market performed well below                                               products
average dropping by 0.9 percent to a value of €            Office &                           4.6%
2,812 million at MSP. This drop can be explained             Desk
by declining market prices, which was due to the          accessories
increasing dominance of discounters in the                   7.5%
German retail market, (source: Euromonitor). Due                                           Office
                                                             Storage &
to this development, the German stationery market                                          paper
                                                               Filing
is a highly competitive marketplace.                         products                      28.3%
                                                                          Writing &
                                                                13.8%
In 2002, only the Office Paper and the Office &                            Drawing
Desk accessories markets showed a positive                               Instruments
development, growing respectively by 3.6 and 1.0                            13.6%
percent.
                                                                                 Source: MPA International
The Presentation & Planning Materials market showed the biggest decline of the segments reflected,
dropping by 6.1 percent, to € 527,0 million at MSP. All the other segments, with the exception of
Envelopes, showed a minor decline. The Envelope market remained stable at a value of € 380,0
million at MSP. The Greeting Cards segment accounted for a value of € 624,0 million at retail selling
price (RSP), (source: Datamonitor). According to Euromonitor, the Paper-based products market in
Germany grew by 2.9 percent to a value of € 879 million in 2002.

United Kingdom
                                                  Figure 3.4: The British Stationery market:
The United Kingdom is the second stationery                    Segmentation, % Share, by value, 2002
market in size, accounting for 23 percent of the
                                                                      Presentation
consumption of the reviewed countries. As in
                                                                       & Planning
Germany, the British stationery market was
                                                                        materials
affected by the weak economy. In 2002, the                                          Envelopes
                                                           Office &      12.0%
British stationery market declined by 0.3 percent                                    19.6%
                                                             Desk
representing a value of € 2,250 million at MSP.           accessories
                                                            9.0%                               Paper based
Of the different stationery segments, the Writing                                               products
& Drawing Instrument market performed the                Storage &                                4.7%
worst, dropping by 3.7 percent. The remaining              Filing
                                                         products
stationery market segments remained relatively
                                                           11.6%
stable, only developing marginally. A note must
be made concerning the commercial envelopes                     Writing &
                                                                                           Office
market, which accounts for a value of € 441,0                    Drawing
                                                                                           paper
million at MSP. This puts the British envelopes                Instruments                 29.4%
                                                                  13.7%
market well ahead of the German market. The
Greeting Cards market shows a similar picture.
According to Datamonitor, the British greetings                              Source: MPA International


                                                                                                         16
card market is worth approximately € 1,700 million at retail selling price (RSP), which puts the British
greetings card market well ahead of the France and even the German market.

The British paper-based products market grew 3.5 percent to a value of € 526 million, according to
Euromonitor.

France
France is the third largest market; accounting for
17 percent of the consumption of the reviewed Figure 3.5: The French Stationery market:
countries. Like Germany, cheap imports and the              Segmentation, % Share, by value, 2002
rising share of discounters, hypermarkets and                     Presentation
superstores have put increasing pressure on                        & Planning
prices in the France stationery market. In 2002,         Office & materials
                                                                               Envelopes
the French stationery market grew by 1.6                   Desk      10.0%
                                                                                 19.2%
percent largely due to the positive developments       accessories
in the segment Office Paper. In 2002, the Office           8.6%
Paper market grew by 3.9 percent to a value of €     Storage &                          Paper based
498,5 million at MSP. In 2002, the value of the        Filing                            products
total French stationery market amounted to €          products                             5.5%
1,651 million at MSP.                                  10.5%

In 2002, the Storage & Filing market increased                 Writing &
by 2.1 percent to € 173,5 million at MSP. The                   Drawing                      Office
French Writing & Drawing Instrument market                    Instruments                    paper
increased by 0.6 percent. This can be explained                  16.1%                       30.2%
by the increasing demand for fashionable
writing instruments, which countered the                                          Source: MPA International
increasing penetration of PC’s and the Internet,
(source: Datamonitor). The other markets
developed only marginally.

According to Euromonitor, the Greeting Card sector is relatively underdeveloped in France, in
comparison with the United Kingdom. In 2002, the French greeting card market accounted for a value
of € 607,0 million, which is slightly lower than the German market, (Source: Datamonitor).

Italy                                           Figure 3.6: The Italian Stationery market:
Like the other markets highlighted, the                     Segmentation, % Share, by value, 2002
development of the Italian stationery market is
very marginal. In 2002, the market grew by 0.8
                                                                  Presentation
percent to a value of € 1,083 million at MSP.
                                                                   & Planning
The Italian stationery market is becoming                           materials  Envelopes
increasingly competitive, mainly caused by the                                         Paper based
                                                                     12.9%       10.2%
high number of domestic manufacturers and                 Office &                       products
multinationals present in the Italian market.              Desk                           6.5%
                                                            accessories
                                                              10.1%
As in Germany, the office paper market was the
star performer in 2002, growing by 4.0 percent
to a value of € 308,5 million at MSP. The                    Storage &
                                                                                                 Office
Presentation and Planning Materials market                     Filing
                                                                                                 paper
                                                             products
grew by 2.6 percent to € 140,0 million at MSP.                                                   28.5%
                                                               14.0%
The Writing & Drawing Instrument market,                                   Writing &
relatively important, accounted for 17.8 percent                            Drawing
of the Italian stationery market. In 2002, it grew                        Instruments
by 1.6 percent to a value of € 192.5 million at                              17.8%
MSP. The Office & Desk Accessories market                                        Source: MPA International


                                                                                                             17
grew by 1.9 percent to a value of € 109,5 million at MSP.

Another notable development concerns the Envelopes market, which dropped by 8.3 percent to € 110
million at MSP. Regarding the Greeting Card market, no information is available.

Spain                                             Figure 3.7: The Spanish Stationery market:
The Spanish stationery market was the star                     Segmentation, % Share, by value, 2002
performer of the countries highlighted in this
                                                                    Presentation
survey. In 2002, the Spanish stationery market
                                                                     & Planning
grew by 3.3 percent to an amount of € 964 million                      materials Envelopes
at MSP. According to MPA International, the                             13.7%      12.0% Paper based
Spanish stationery has not been affected by the             Office &
                                                                                           products
weak economy as much as the countries in the                  Desk                          4.6%
Northern part of Europe. This was partly due to            accessories
the lower maturity of some of the stationery                  9.4%
product markets.
                                                              Storage &
                                                                Filing                         Office
Of the stationery segments highlighted, the                   products                         paper
Presentation & Planning Materials market was the                13.5%                          31.9%
top performer in Spain, and increased by 9.1                           Writing &
percent to an amount of € 132,0 million at MSP.                        Drawing
Another fast growing market was the Office Paper                     Instruments
market, growing by 6.8 percent to a value of €                          15.0%
307,5 million at MSP.                                                              Source: MPA International

The Paper-based products market dropped by 6.4 percent to € 33,1 million at MSP, this can be
explained by the ongoing computerization in Spain, partly caused by the high priority ICT
development has within the Spanish government. The Storage & Filing Products market and Office
and Desk Accessories market grew respectively by 3.6 and 3.4 percent. Information concerning the
Greeting Card market is not available.

Benelux
The Benelux stationery market is the smallest Figure 3.8: The Benelux Stationery market:
stationery market distinguished in this survey, the         Segmentation, % Share, by value, 2002
market accounts for only 9 percent of the                          Presentation
consumption of the reviewed countries. Like most                    & Planning
                                                        Office & materials
European countries, the Benelux economy was                                     Envelopes
                                                          Desk        11.0%
strongly affected by the global economic                                          18.1%
                                                       accessories
downturn. However, despite this development, the
                                                          8.3%
stationery market which increased by a small 1.1                                        Paper based
percent in 2002, reached a value of € 871 million    Storage &                            products
at MSP.                                                Filing                              4.0%
                                                            products
Like France, the growing consumption of office               10.0%
paper accounted for the major part of the growth.
                                                                Writing &
In 2002, this market grew by 3.8 percent. Other                  Drawing                    Office
markets which increased in 2002 were the Office                Instruments                  paper
& Desk Accessories market and the Presentation                    14.5%                     34.1%
& Planning market, both however, only growing
marginally. The Writing & Drawing Instrument
market, together with the Paper-based products
                                                                             Source: MPA International
market, showed the biggest decline, dropping by
1.6 and 1.4 percent respectively.




                                                                                                         18
According to Euromonitor, the Dutch and Belgium Paper-based product markets grew by respectively
5.3 and 3.0 percent, to a value of € 102,5 and € 72,1 million.

Western-Europe versus Eastern-Europe
In this section we will discuss the differences between the Western European and Eastern European
stationery markets. Because information on the Eastern European stationery market is not richly
available, we will only give some highlights concerning these markets. In this section we will
therefore only note developments concerning the stationery markets of Poland, Czech Republic,
Hungary and Slovakia. They, however, can be used as an indication for the other Eastern European
countries. In figure 3.9 an overview of the difference between the Western European and Eastern
European markets is reflected. It concerns an accumulation of the private consumption of both
personal stationery as well as the writing instruments; office consumption is not reflected in the
figures. Therefore extreme care must be taken when comparing these figures with the MPA
International data.

Because the Western European stationery market is a reasonably steady and mature market, the rivalry
amongst the market players like distributors and manufacturers is becoming increasingly fierce.
Expanding into the Eastern European markets offers the chance to extend their businesses. The
accession of these countries to the European Union and their massive growth potential makes these
markets even more attractive. Many Western companies have entered Eastern Europe to benefit from
these developments. Office Depot, for example, has opened stores in both Poland and Hungary. As a
manufacturing base the Eastern European countries are also very attractive for West European
companies (see also chapter 4).

Figure 3.9: Western and Eastern European Stationery market: relative attractiveness based on €
            consumption of personal stationery and writing instruments
                           25%
                                                                                                        Czech Republic

                           20%                          Hungary
          % growth 2002




                           15%
                                                                     Slovakia
                                                               Norway
                           10%
                                Netherlands    France
                            Sweden                                                            Poland
                            5%
                                              Finland
                          Belgium                       United Kingdom
                                    Germany
                            0%
                              0%                 20%                     40%                 60%                     80%
                           -5%
                                                                  % growth 1998 - 2002


     Circle size based on                                                Slovakia stationery market € 29,4 million
     Manufacturer selling price, 2002
                                                                         German stationery market € 1,7 billion


                                                                                                                  Source: Euromonitor

According to publications of Office Products International, the Eastern European stationery market is
in a growing phase. As can be seen in the figure 3.9, the four Eastern European countries Poland,
Hungary, the Czech Republic, and Slovakia all show considerable growth, whereas the Western
European countries all show much smaller growth. Especially the stationery market in the Czech


                                                                                                                                  19
Republic grew by gigantic proportions. In 2002, this market grew more 22 percent and between 1998
and 2002, the market almost doubled in size. The size of these Eastern European markets however,
remains quite small in comparison with the markets in Western Europe. The Slovakia stationery
market accounts for a value of € 29,4 million, whereas the German market accounts for a value of €
1,703 million.


3.2      Market Segmentation
This is divided into two sections. The first section, paragraph 3.2.1 will highlight the developments in
the different product groups discussed in Chapter 1. The figures given in this paragraph are based on
research by MPA International. These figures, however, exclude some stationery products like for
example calendars, diaries and artistic materials. Therefore, some additional information on these
products is giving. Paragraph 3.2.2 gives a segmentation by the different users groupings which can be
distinguished in the stationery market, namely professional business users, schools & universities,
SoHo users and private users. In this paragraph the distinct characteristics and preferences regarding
these different product groups will be discussed.


3.2.1 Market segmentation by product
In the stationery market we can make a general distinction between two types of stationeries, namely
commodity and specialty stationeries. Commodities are generally products that customers perceive to
be exactly the same, brand awareness and preference are generally low. Envelopes, paper, notebooks,
storage & filing products can, for example, be regarded as commodities. According to research by
McKinsey, the product price, consistent level of product quality, service quality and on-time delivery
are the most important purchase criteria in this segment. In the case of specialty stationery, the user
regards the product as special and is prepared to go through substantial trouble to obtain it. Quality,
branding and design are important purchasing criteria for these products. Specialty products must be
able to satisfy consumer status. In case of the stationery market, special luxurious writing instruments,
calendars and leather diaries can be regarded as specialties. This specialty segment offers important
potential for manufacturers in developing countries. Specially crafted, handmade products like, for
example, leather organisers and writing pad covers, are very popular in the EU. Stationery given away
as a gift makes up an important share of the specialty segment.

In the following section of this chapter we will discuss the products highlighted in Chapter 1

Envelopes
The Envelopes market in the reviewed countries dropped 1 percent and accounts for a value of € 1,512
million at MSP in 2002. The increasing use of e-mail and the internet and a decline in writing letters is
pressuring the envelopes usage, thus to MPA International. Despite this pressure, the Envelope market
is estimated to grow slightly to approximately € 1,590 million in 2006, indicating a growth of
approximately 5 percent, (Source: MPA International). According to the European envelope
manufacturers association, the per capita consumption of envelopes in Western Europe is running at
around 300 envelopes per year. In Eastern Europe the consumption is much lower, Poland for example
consumes around 60 envelopes per capita per annum.

There are numerous different types and sizes of envelopes. Most popular are the window envelopes
and self-seal envelopes. The latter includes a protective peel-off strip over the adhesive flap. In
general, the commercial envelopes market is increasingly being standardized mainly to assisting
national postal services in the automated selection and sorting machinery, (source: Euromonitor.
Special ISO norms exist on the size of envelopes, namely the ISO 216 Series C. In some countries
there are however different sizes of envelopes in circulation, mainly in France and the United
Kingdom. The weight and quality of the paper used making the envelopes vary per market, thus
affecting pricing. Because envelopes are generally considered to be a commodity, private- and white
label products play a significant role in this market segment.



                                                                                                      20
Paper-based products
This segment includes a wide variety of products; it is therefore difficult to give precise statistical
information concerning the market size. According to MPA International, the paper-based products
market is worth approximately € 473,0 million at MSP. This figure includes the following products:
exercise books, memo refill pads, duplicate and triplicate books, manuscript books and analysis books.
The segmentation of the market based on MPA International statistics is reflected in figure 3.10. As
can be seen, exercise books make up more than a third of the market
                                                       Figure 3.10: The Paper based market, Segmentation,
In figure 3.11 you can find the consumption of                      % Share, by value, 2002
paper-based products, according to Euromonitor.
The Euromonitor statistics include all paper items                          Analysis
like writing pads, printing paper, transparents,                             books
envelopes, notebooks, account books and diaries.                              11%
                                                                                                      Exercise
Office supplies are excluded from the Euromonitor               M anuscript                            books
statistics. As can be seen, Germany is by far the                 books                                 35%
largest market for paper-based product.                            14%
Unfortunately, information regarding Italy and
Spain is not available.                                       Duplicate &
                                                               Triplicate
According to MPA International, the paper-based                 books
market is forecast to decline because of the                      9%
maturity of the market and the increasing                                               M emo &
computerization trends. The paper-based products                                        Refill pads
market is being subjected to increased competition                                         31%
from products like the internet and cd-roms,
(Source:     Euromonitor.     This     development
especially affects the duplicate and triplicate book                                   Source: MPA International
segments, (Source: MPA International.

Because the educational market is an important segment in this market, the declining school
population in most European countries has also contributed to negative forecasts of this market. MPA
International estimates that this market will decline by about 5 percent towards 2006. Because low
prices are a prime purchasing consideration in this market, private-label products, often imported from
Asia, are gaining market share, mainly in the exercise and correspondence book market.

In some niches, quality is also an important consideration. The educational market, for example,
requires the opacity of a page to be sufficient to permit writing on both sides of the paper, according to
Euromonitor. Other interesting stationery products, which are not reflected in the figures of MPA
International, are wrapping paper, diaries, organisers and photo albums. In these segments the prices
are under pressure because of the increasing importance of private label.

An important threat to paper-based products is the development of information technology products,
like electronic organisers and other gadgets, in which data can be stored electronically. However,
despite this threat, the demand for these products is expected to grow.




                                                                                                                 21
Figure 3.11 Consumer expenditures of paper-based products (per year in €), in the EU, 2000-2002

         Slovakia       17.0
                                                                                                              2000
         Hungary           50.3
                                                                                                              2001
   Czech Republic          55.0                                                                               2002
          Poland
                               57.0


          Finland       14.9
         Norway          27.0
          Sweden         34.0
         Belgium                72.1
      Netherlands                     102.5
      Switzerland
                                       120.8
           France                                   215.3
  United Kingdom                                                          526.2
        Germany                                                                                               879.3

                    -          100            200       300   400   500      600         700       800       900      1,000


                                                                                                   Source: Euromonitor

Writing & Drawing Instruments
In 2002, the consumption of Writing & Drawing Instruments in the reviewed countries represented a
value of almost € 1,420 million at MSP. According to MPA International, the Writing & Drawing
Instrument market is a mature market which is largely driven by innovation and new product
introduction. Manufacturers are coming up with new, unusual design shapes and colours to boost their
sales. Due to this, the market is forecast to grow very little in the near future. According to estimates
made by MPA International, the European Writing & Drawing Instrument market will represent a
value of 1,456 million at MSP in 2006, which indicates an increase of only 2.5 percent compared to
today’s market size.

According to Paperworld, the Writing & Figure 3.12: The Writing & Drawing instrument market,
Drawing Instrument market is becoming more              Segmentation, % Share, by value, 2002
polarised, in particular the writing instruments
market. The low-price segment is suffering
from increasing price pressure. Due to cheap                   Refills
                                                                       Other Pencils
imports, gel-ink pens and rollerballs are under                 5%
                                                     Correction         4%    14%
increasing price pressure. Products in the               aids
higher segments are following the high quality           9%
trend. In this segment, handmade and             Highlighters
unconventional materials like amber and              5%                              Ballpoints
leather are expected to be very popular,            M arkers                           20%
(Source: Paperworld).                                  8%
                                                                     Fibre &
In general, the Writing Instrument market is                        plastic tip
                                                                       pens
dominated by international brands, like                                                                  Fountain
                                                                        7% Rollerballs   Gel ink
Sanford and Bic. However, low-priced private                                    7%                        pens
                                                                                          pens
label products, deriving mainly from Asia, are                                             8%
                                                                                                           13%
increasingly making inroads into the European
market. This development has, in turn, led to
increasing pressure on existing price levels.                                            Source: MPA International
This is particularly evident in the commodity



                                                                                                                          22
segment of the Writing & Drawing Instruments market.

As can be seen in figure 3.12, ballpoints and pencils together account for the majority of the market.
Also fountain pens remain popular, when it seemed they were likely to be replaced by the ballpoint;
this is partly due to the popularity of these pens as a status symbol and a fashion accessory. The
category ”Others” includes erasers (2%), pencils sharpeners (1%) and rulers (1%).

Nowadays, writing instruments made of translucent materials are very popular. Ergonomic design is
also a major consideration for writing instruments, according to TDC trade. Soft holding zones, angled
writing points and gel technology offer users a high degree of comfort. Note that these trends can vary
from year-to-year.

Other interesting stationery items, which are not reflected in the Writing & Drawing Instrument
figures of MPA International are the artistic materials, with include brushes, paint, crayons, pastel,
glues and other sorts of products which can be used for artistic and hobby purposes (see also § 3.2.2.).
The lion’s share of these products is made for school-age children, with the remainder going to
professional users. According to Euromonitor, the artists’ material market in France is approximately
€ 21.1 million. Unfortunately information regarding other European markets is not available.

Writing & drawing instruments are sold in a number of ways. Instruments designed for private use or
as personal gifts are generally purchased in the retail market. Alternatively, writing & drawing
instruments may be bought by businesses for employees' use or to be given away either as promotional
gifts or as employee incentives. However, they are more often regarded as giveaways than simply as
writing instruments for the promotion market.

Storage & Filing products                           Figure 3.13: The Storage & Filing product market,
In 2002, the consumption of storage & filing                     Segmentation, % Share, by value, 2002
products in the reviewed counties accounts for
approximately € 1,192 million at MSP. According                          Indexes &
to MPA International, this market is relatively                           Dividers
                                                                                       M anila files
stable and mature. The private/own label                         Archival 10%             22%
penetration in this segment is high and is expected               filing
to increase; explained by the fact that these                      10%
products are generally considered to be
commodities.                                              Ring binders
                                                                11%                              Soft Plastic
Sales in this sector are greatly related to office                                                   files
paper demand. Digital storage of data is                                                            14%
                                                                  Suspension
considered to be the main threat in this sector.
                                                                     files
However, the use of technologies like computers
                                                                     11%            Lever arch
rather boosts sales of office paper than the reverse.                                 files
According to MPA International, this market is                                        22%
expected to grow to be worth € 1,271 million at
MSP in 2006. The increasing SoHo sector (see §
3.2.2) is also an important sales driver in this                               Source: MPA International
sector.

Although this segment is rather stable and considered to be a market with little innovation, there is one
notable development. Due to the increasing use of these products in the private and SoHo sector, there
is a trend towards more brightly-coloured products and finishes, according to MPA International.




                                                                                                        23
Office & Desk accessories
The market for Office & Desk Accessories in the Figure 3.14: The Office & Desk Accessories market,
                                                               Segmentation, % Share, by value, 2002
reviewed countries accounted for a value of € 827
million at MSP in 2002. This segment includes                            Rubber
both commodities as well specialty stationeries.                       bands, Pins,
As can be seen in figure 3.14, paper & card                   Scissors Clips, etc. Waste bins
adhesive account for almost a quarter of this                    4%                   2%      Adhesive
                                                                           4%
                                                          Punches
market. According to MPA International, the                                                    tapes
                                                              5%
Office & Desk Accessories market is a mature         Letter trays
                                                                                                21%
market, where the volume demand is stable.               6%
Innovation and product styling are the two main        Guillotines
market drivers. Price competition is increasing due    & Trimmers
to the increasing share of private and white label          6%
products and imported products deriving from                                                     Paper &
                                                             Staplers,
low-wage countries. The Office & Desk                                                             Card
                                                            Staples &
Accessories market is forecast to grow to a value                                               adhesives
                                                          Stapleextrac
of € 872 million at MSP in 2006, (Source: MPA                                                     22%
                                                                tors        Repositiona
International).                                                13%            ble notes
                                                                                 17%
The increasing SoHo sector triggers the demand
for more fashionable office & desk accessories.
                                                                              Source: MPA International
The trends in colours and design of these more
fashionable products mainly derive from the home
decoration market.

The premium items in this segment are often designed for professional use and often have a more
classical design and more traditional colours.

Presentation & Planning materials                    Figure 3.15: The Presentation & Planning materials
This segment includes planning boards, wall                       market, Segmentation, % Share, by value,
boards, white boards, flipcharts & accessories,                   2002
calendars and year planners. According to MPA                                    Planning
International, the consumption of presentation &                     Flipcharts
                                                                                 boards &
planning materials in the reviewed markets                                &
                                                                                   Year
accounts for approximately € 1,343 million at                        Accessories
                                                                                  planner
MSP in 2002, indicating a decline of 0.9 percent                                    3%
                                                                         6%
with the preceding year. This decline is mainly              Wallboards
due to a weak economic climate which affected                                                   Stock
                                                                7%
business confidence and hence investments in                                                   diarries
these sort of items. Professional users are the main                                             49%
purchasers of these products, next to schools.
According to MPA International, the increasing
trend towards more business presentations is the
                                                                   Stock
main growth driver in this segment. It is forecast
                                                                 calenders
that this market will grow to a value of
                                                                   35%
approximately € 1,440 million in 2006, indicating
a growth of 8.2 percent over the figures for 2002.
                                                                               Source: MPA International
The development towards electronic products like beamers used in business presentations is
considered to be the main threat. This development in turn offers a chance for manufacturers of
screens, which could benefit from the development towards more electronic products. According to
MPA International, these products are often used in tandem with the traditional presentation products.
Like many other stationery markets, the presentation material sector is increasingly being penetrated
by cheaper own-label products, often imported from low-wage countries in Asia and Eastern Europe.
This in turn has driven down average market prices.


                                                                                                      24
Greeting Cards
According to Datamonitor, the European Greeting Cards market was worth € 5,100 million at RSP in
2002. As the European market continues to mature, pricing is becoming more important. According to
Euromonitor, the internet is a fierce competitor to the greeting card industry. E-cards and E-mail are
gaining in popularity in comparison with the traditional cards, due to their convenience and speed.
However, despite the increasing popularity of the internet, greeting cards are still popular in Europe.
This popularity is mainly due to innovative power of the card industry. According to Euromonitor,
greeting card publishers have created many new markets, expanding on the concept of Christmas, New
Year, Valentine’s Day, birthdays, graduations, changes of address, marriages and many other
occasions, thereby contributing to this success. At the premium-end of the market there is an
increasing demand for more sophisticated printing techniques and handmade cards, (Source:
Euromonitor). Nowadays, cards are available in a lot of different shops, mostly marketed as cheap
impulse purchases to boost sales.

According to a study by TNS Impulse, a British research agency, the greeting card market can be
divided into three main groups: everyday cards, Christmas/ New Year cards and seasonal cards. The
everyday cards market accounts for 59.6 percent of the market, and the largest card giving occasions
are birthdays, anniversaries, Get Well cards, Friendship cards, and Sympathy cards. Christmas and
New Year cards account for 27.2 percent of the market. The remaining share is made up by the
seasonal card market. In this market Valentine’s Day is a leading card-giving occasion, other
occasions are Mother’s Day, Father’s Day and Easter.

The most important trade fair for greeting cards is the Birmingham Springfair in the United Kingdom.

Bags & Briefcases
This group consists of products like backpacks, shoulder bags, bags, mini backpacks for younger
children and briefcases made of materials like leather, polyester, nylon, PVC, PU and canvas.
According to the Hong Kong Trade Development Council (TDC) many bags & briefcases are moving
away from black towards more fashionable bright and funky colours. In addition, new fabrics and
materials, like micro-fleece grid fabric, crinkle nylon/polyester, suede, skin etc., are being introduced.
Unfortunately, no quantitative information is available regarding the bags and briefcases market;
therefore only some qualitative information will be given.

With the trend of globalization and e-commerce, people are increasingly working out from the office,
according to the Hong Kong Trade Development Council (TDC). Because of this development, bags
for carrying laptops and computer trolleys are increasingly in demand. In addition, highly-
compartmentalized briefcases are designed to act as mobile offices, to assist doing business out of the
office, with ease and more convenience, (Source: TDC trade).

As can be seen in paragraph 3.3, women are becoming increasingly important for the European
workforce. To benefit from this development, an increasing number of bag & briefcase manufacturers
are designing and producing lines specially adapted for women. In addition, some new lines targeted
at women feature special sections for toiletries, cosmetics, shoes and other items that enable female
travelers to travel more conveniently.

The health issue is becoming increasingly important, especially in the bag market for children.
According to research, children in Europe have to carry heavy school bags, risking back pain and
spinal disorders. Ergonomics is an import issue. New ergonomic designs redistribute the weight of the
bag so that less stress will be placed on the users' back, arms and shoulders. Bags designed for children
come in a wide variety of styles with bright colours. Licensing is also often used in the children
segment. Bags featuring, for example, movie characters like Winnie the Pooh, Mickey Mouse,
Paddington Bear and more recently Harry Potter and Bob the Builder, are very popular with children
and young school-goers.




                                                                                                       25
Fashion, regarding style and colours in the bags & briefcases market, is generally closely aligned with
the trend in the fashion industry. This especially applies to the handbag segment, where leading
manufacturers like Louis Vuitton, Salvatore Ferragamo, Gucci, Prada and, Miu Miu are the trend-
setters.

The weight of the product is also important; since most people prefer lighter weight bags & briefcases.
Therefore production skills developed in other lightweight industries such as clothes, plastic, etc. are
often used. More information regarding leather bags & briefcases can be found in the CBI survey
“leather goods”.


3.2.2 Segmentation by user
In the preceding section we have discussed the segmentation by product. In this paragraph we will
make a distinction between the different segments in the stationery market. General we can distinguish
between three main market segments, i.e.:

    •   Professional (business) users,
    •   Small office and Home office users (the so called SoHo)
    •   Private users.

The professional user segment includes medium-size offices with 10 -50 employees and large offices
with more than 50 employees. The SoHo segment includes small offices with from 1- 10 employees
and home offices employing 1 to 3 people. This segment also includes teleworkers working for an
employer, or on a freelance basis, from home. The private users, includes stationery sold for domestic
use and includes sub-segments like children, teens, students, etc.

According to a Euromonitor study of the French market, business users (including SoHo users)
account for approximately 54 percent of total stationery sales (excl. greeting cards). The public
administrations account for 17 percent and schools and private users account for approximately 29
percent of the stationery sales. Information concerning the other markets is not available.

Professional users
According to Eurostat there were 11,5 million enterprises active in the EU, over 85 percent of these
companies have less than 10 employees of which the vast majority is found in the service industry.
These companies employ 25 percent of the total EU workforce. Large companies with more than 250
employees only account for 0.5 percent of the companies in EU, but they employ 30 percent of the EU
workforce. These larger companies are mainly situated in the industry sector.

Figure 3.16: Number of enterprises and persons in the EU employed broken down by size-class, 2000 (%
             share of total)
                    50-249      250+
                     pers.      pers.                            250+             1-9 pers.
         10-49     employed   employed                           pers.            employed
          pers.      2.2%       0.5%                           employed            25.1%
        employed                                                37.0%
         11.4%


                                                                                        10-49
                                                                                         pers.
                                                               50-249                  employed
                                 1-9 pers.                      pers.                   20.4%
                                 employed                     Employed
                                  85.9%                        17.6%



                                                                                                     26
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Survey stationery 2012

  • 1. EU MARKET SURVEY 2004 Stationery items, office and school supplies
  • 2. EU MARKET SURVEY 2004 STATIONERY ITEMS, OFFICE AND SCHOOL SUPPLIES Compiled for CBI by: Discovery Interior Trading in collaboration with Mrs. Y. Netto October 2004 DISCLAIMER CBI MARKET INFORMATION TOOLS Although the content of its market information tools has been compiled with the greatest care, the Centre for the Promotion of Imports from developing countries (CBI) is not able to guarantee that the information provided is accurate and/or exhaustive, and cannot be held liable for claims pertaining to use of the information. In the case of the market publications, neither CBI nor the authors of the publications accept responsibility for the use which might be made of the information. Furthermore, the information shall not be construed as legal advice. Original documents should, therefore, always be consulted where appropriate. The information does not release the reader from the responsibility of complying with any relevant legislation, regulations, jurisdiction or changes/updates of same. In the case of the Internet tools, CBI aims at minimising disruption caused by technical errors. However, CBI cannot guarantee that its service will not be interrupted or otherwise affected by technical problems. CBI accepts no responsibility with regard to problems incurred as a result of using this site or any linked external sites. The information provided is aimed at assisting the CBI target group, i.e. exporters and business support organisations (BSOs) in developing countries. It may, therefore, not be used for re-sale, the provision of consultancy services, redistribution or the building of databases, on a commercial basis. For utilization of the CBI market information tools by the CBI target group on a non-commercial basis, the condition applies that CBI is referred to as the source of the information. All other use is prohibited, unless explicitly approved in writing by CBI. Photo courtesy: Discovery Interior Trading 1
  • 3. Table of Contents EU Market Survey -- annual update -- REPORT SUMMARY 4 INTRODUCTION 7 PART A: EU MARKET INFORMATION 9 1 PRODUCT CHARACTERISTICS 10 1.1 Product Groups 10 1.2 Customs/Statistical Product Classification 11 2 INTRODUCTION TO THE EU MARKET 12 3 CONSUMPTION / INDUSTRIAL DEMAND 14 3.1 Market size 15 3.2 Market segmentation 20 3.2.1 Market segmentation by product 20 3.2.2 Market segmentation by user 26 3.3 Consumption patterns and trends 30 3.3.1 Demographic trends 30 3.3.2 Social & Cultural trends 31 3.3.3 Technical trends 34 3.3.4 Economic trends 35 4 PRODUCTION 36 4.1 Production per product group 37 5 IMPORTS 41 5.1 Total imports 41 5.2 Imports by product group 46 5.3 The role of the developing countries 53 6 EXPORTS 56 7 TRADE STRUCTURE 59 7.1 EU trade channels 59 7.1.1 Types of intermediaries 61 7.1.2 Stationery retailers 64 7.2 Distribution channels for developing country exporters 67 8 PRICES 69 8.1 Price development in the stationery market 69 8.2 Sources of price information 73 9 REQUIREMENTS FOR ACCESS 74 9.1 Non-tariff trade barriers 74 9.2 Tariffs and quotas 80 2
  • 4. PART B: EXPORT MARKETING GUIDELINES: ANALYSIS AND STRATEGY 83 10 EXTERNAL ANALYSIS 85 10.1 Market developments and opportunities 85 10.2 Competitive analysis 87 10.3 Sales channel assessment 88 10.4 Logistics 89 10.6 Price Structure 90 10.7 Examples: Product Profiles 94 11 INTERNAL ANALYSIS 97 11.1 Product standards/ quality, Production capacity, Product design & development and Unique selling points 97 11.2 Logistics 98 11.3 Organisational Structures 99 11.4 Marketing and sales 100 11.5 Financing 101 11.6 Capabilities 103 12 DECISION MAKING 104 12.1 SWOT and situation analysis 104 12.2 Strategic options & objectives 104 13 MARKETING TOOLS 106 13.1 Matching products and the product range 106 13.2 Building up a relationship with a suitable trading partner 107 13.3 Drawing up an offer 108 13.4 Handling the contract 110 13.5 Sales promotion 112 APPENDICES 115 1 DETAILED HS CODES 115 2 DETAILED IMPORT STATISTICS 118 3 DETAILED EXPORT STATISTICS 132 4 USEFUL ADDRESSES 135 4.1 Standards organisations 135 4.2 Sources of price information 136 4.3 Trade associations 138 4.4 Trade fair organisers 139 4.5 Trade press 141 4.6 Important stationery buying groups 142 4.6 Other useful addresses 144 5 LIST OF DEVELOPING COUNTRIES 145 6 LIST OF ACP COUNTRIES 146 7 LIST OF GSP COUNTRIES 147 8 REFERENCES 148 This is a new CBI publication with a new format and contents. It partially replaces the CBI, EU Market survey and EU Strategic marketing guide “Stationery items, office and school supplies” published April 2003. 3
  • 5. REPORT SUMMARY This survey profiles the EU market for stationery items, office and school supplies, referred to throughout this report as stationery. The emphasis of this survey lies on those products which are of importance to suppliers based in developing countries. The product groups discussed in this survey include: envelopes, paper-based products, writing & drawing instruments, storage & filing products, office & desk accessories, presentation & planning materials, greeting cards and bags & briefcases. Note that these products groups are not the only products which could offer chances for exporters in developing countries. The major national markets of Germany, United Kingdom, France, Italy, Spain, the Netherlands and Belgium are highlighted. Readers should, however, note that the size of a market is not the only determinant of its attractiveness for an exporter. Other determinants, such as per capita consumption and an easily accessible distribution structure, could make certain country markets very attractive. On that basis, for example, the Scandinavian countries could be attractive for exporters in developing countries. Part A of this survey includes statistical market information on consumption, production, trade and trade structure and requirements for access. As an exporter, you will need this information in order to formulate your own market and product strategies. Part B of this survey contains export-marketing Guidelines, a practical handbook for exporters engaged, or wishing to engage, in exporting stationery to the European Union. Consumption The stationery market in the reviewed countries is a mature and reasonably stable market only growing 0.6 percent between 2001 and 2002 reaching a value of € 9,641 million at manufacturers’ selling price (MSP), equivalent to € 15,318 million at user buying price (UBP) excl. VAT). It should be noted that greeting cards and bags & briefcases are not included in this figure, because statistics concerning these markets are not compiled by the research agency MPA International. Germany is by far the biggest stationery market of the reviewed countries. In 2002, the Germany market accounted for a value of € 2,812 million at MSP, followed by the United Kingdom (€ 2,244), France (€ 1,645), Italy (€ 1,083), Spain (€ 964) and the Benelux (€ 851). The stationery market can be segmented in to three different types of users, professional, Small office and Home office (SoHo) and private users. Each segment has its own specific requirements (see § 3.2.2) and the SoHo market, particularly, is growing due to the trend to outsourcing and sub-contracting in the EU business environment. Production Over the last decade, the stationery market has become increasingly competitive, caused by the maturity of the market and the increasing pressure of low-cost imports deriving from low-cost countries. In order to survive, economies of scale were of vital importance and this, in turn, has led to take-overs, mergers and restructurings. Imports In 2002, the total import of stationery of the EU-15 remained stable for the second year in a row. That year, imports accounted for a value of € 9,947 million. Apparently, the stagnation of the economy in 2001 had its influence on the import of stationery. The United Kingdom is the leading importer, accounting for 18.8 percent of the total value imported into EU countries, followed by France (16.1%), Germany (15.5%), Italy (9.6%), Belgium (8.2%), The Netherlands (7.1%), and Spain (6.6%). In 2002, bags & briefcases (32.6%) formed the leading import product group, followed by office & desk accessories (24.8%), writing & drawing instruments (15.3%), paper-based products (15.0%), storage & filing products (4.9%), envelopes (4.1%), greeting cards (2.7%) and presentation & 4
  • 6. planning materials (0.6%). In 2002, developing countries accounted for 26.7 percent of the EU-15 import up from 23.1 percent in 1998. In 2002, the United Kingdom was the largest import of stationery from developing countries followed Germany and France In the Bags & Briefcases imports, developing countries hold the strongest positions, accounting for 34.9 percent of the total EU-15 imports in terms of value. In the envelopes and office & desk accessories imports, the position of developing countries is relatively weak, accounting for only 1.5 and 8 percent of total EU-15 imports in terms of value. For additional information on the shares of developing countries we refer to paragraph 5.3 and Appendix 2 Export The EU-15 is home to several of the biggest stationery exporting countries in the world, like Germany France and Italy. In 2002, the EU-15 countries together exported € 10,072 million of stationery. In 2002, the EU-15 countries accounted for 58.3 percent of this export. The largest exporter of stationery in the EU-15 was Germany. Germany accounted for 22.8 percent of the total exported value in 2002. Other key exporting countries were Italy (19.2%), France (18.1%), the United Kingdom (10.4%) and Belgium (8.9%). The main products exported by EU-15 countries are Office & Desk Accessories (28.1% of total EU exports), followed by Bags & Briefcases (28.0%), Paper-based products (17.3%), Writing & Drawing Instruments (15.3%), Envelopes (4.4%), Storage & Filing products (3.9%), Greeting cards (2.4 %) and Presentation & Planning materials (0.5%). For additional information we refer to Appendix 3 Overview In the figure below, we have presented a graphic summary of chapters 3 to 6. The size of each circle represents the size of the market in terms of consumption. As can be seen in this figure, Germany together with the United Kingdom are the leading markets in terms of consumption size. On the horizontal axis, lies the trade balance, which is the difference of the export minus the import. Of the seven countries discussed in this survey, only United Kingdom and Spain do not have a positive trade balance and are therefore net importers of stationery. The vertical axis represents the percentage of the import deriving from developing countries. In the figure below, the horizontal axis crosses the vertical axis at 26.7 percent, indicating that the EU-countries on average import 26.7 percent of their total import from developing countries. Graphic summary Chapters 3-6: Market attractiveness on basis of market size, import share deriving from developing countries, trade balance and consumption growth in terms of value 2001-2002 United Kingdom 40% % of import from DC growth -0.3% 38% Spain growth 3.3% 36% 34% Italy Germany 32% growth 0.8% growth -0.9% 30% Benelux Trade balance in € million 28% growth 1.1% 26% -1,000 -800 -600 -400 -200 - 200 400 600 800 1,000 24% France 22% growth 1.6% 20% Source: Eurostat & MPA International 5
  • 7. As can be seen, the United Kingdom, together with Spain, Germany and Italy, import more than the EU-15 average from developing countries. In 2002, 36.9% of the United Kingdom’s imports came from developing countries. When looking at the variables in this figure, the upper-left corner represents the most attractive stationery markets for developing countries in terms of import share and trade balance. Secondly, come the countries in the upper-right quadrant, Germany and Italy. However the positive trade balance indicates that these countries are in possession of a strong home production base, making them comparatively less easy to access. In the figure we have also mentioned the market growth of the countries reviewed. Spain together with France, are the star performers, growing respectively 3.3% and 1.6% in 2002. The attractiveness of an export market is not solely determined by the factors discussed in the overview. Factors like trade structures, consumer preferences and tastes are also very important for successful export marketing. An exporter should also note the different requirements laid down in legislation and restrictions of the export market. In Chapter 9 of this survey, the requirements of access are discussed. Opportunities and threats Because of the increasing competition in the stationery market, it is difficult for manufacturers, especially small-scale ones, to retain a profitable share of the EU markets. Although the developing countries’ share of EU-15 imports is growing, it should be noted that this growth is partly due to outsourcing by Western manufacturers on the one hand and a number of large manufacturers mainly based in low-wage countries. Because the stationery market can be characterised as a relatively stable and mature market, innovation of product and design is therefore the keyword. Therefore, we think that there are good opportunities for companies in developing countries, which can offer innovative products at good quality against competitive prices and which can also meet other market requirements such as quality assurance, reliability in delivery, environmental aspects and working conditions. In, for example, the handmade segment of the stationery market there are substantial opportunities for manufacturers in developing countries Up-to-date information on trends and developments is therefore more important than ever. Overseas companies that want to tap into the EU market have to be aware of the market developments. International and domestic trade fairs, exhibitions and visits to shops in the export country offer valuable information and provide opportunities to build good relationships with importers and retailers. This survey offers you a framework for deciding whether or not to export to the European Union and, if you decide to do so, provides you with leads and guidelines to assist your decision-making regarding which products and markets to focus on. For information on current CBI Programmes, training & seminars, and on how to download market information and CBI News Bulletins, please refer to CBI’s internet site “www.cbi.nl”. 6
  • 8. INTRODUCTION This CBI survey consists of two parts: EU Market Information and EU Market Access Requirements (Part A), and Export Marketing Guidelines (Part B). Market Survey Part A EU Market Information and Market Access Requirements EU Market Information (Chapters 1-8) EU Market Access Requirements (Chapter 9) Product characteristics Quality and grading standards Introduction to the EU market Environmental, social and health & safety issues Consumption and production Packaging, marking and labelling Imports and exports Tariffs and quotas Trade structure Prices Part B Export Marketing Guidelines: Analysis and Strategy External Analysis (market audit) Internal Analysis (company audit) (Chapter 10) (Chapter 11) Opportunities & Threats Strengths & Weaknesses Decision Making (Chapter 12) SWOT and situation analysis: Target markets and segments Positioning and improving competitiveness Suitable trade channels and business partners Critical conditions and success factors (others than mentioned) Strategic options & objectives Export Marketing (Chapter 13) Matching products and product range Building up a trade relationship Drawing up an offer Handling the contract Sales promotion Chapters 1 to 8 of Part A profile the EU market for “Stationery items, Office and School supplies” hereafter called stationery. The emphasis of the survey lies on those products, which are of importance to developing country suppliers. The major national markets within the EU for those products are highlighted. Furthermore, statistical market information on consumption, production and trade, and information on trade structure and opportunities for exporters is provided. Chapter 9 subsequently describes the requirements which have to be fulfilled in order to get market access for the product sector concerned. It is, furthermore, of vital importance that exporters comply with the requirements of the EU market in terms of product quality, packaging, labelling and social, health & safety and environmental standards. 7
  • 9. After having read Part A, it is important for an exporter to analyse target markets, sales channels and potential customers, in order to formulate export marketing and product strategies. Part B therefore aims to assist (potential) exporters from developing countries in their export-decision making process. After having assessed the external (Chapter 10) and internal environment (Chapter 11), the (potential) exporter should be able to determine whether there are interesting export markets for his company. In fact, by matching external opportunities and internal capabilities, the exporter should be able to identify suitable target countries, market segments and target product(s) within these countries, and possible trade channels to export the selected products (Chapter 12). Chapter 13 subsequently describes marketing tools which, can be of assistance in successfully achieving the identified export objectives. The survey is interesting for both starting exporters as well as exporters already engaged in exporting (to the EU market). Part B is especially interesting for more experienced exporters starting to export to the EU and exporters looking for new EU markets, sales channels or customers. Starting exporters are advised to read this publication together with the CBI’s Export planner, a guide that shows systematically how to set up export activities and the interactive tool on the CBI website “Export marketing plan”. 8
  • 10. PART A EU MARKET INFORMATION AND MARKET ACCESS REQUIREMENTS 9
  • 11. 1 PRODUCT CHARACTERISTICS This survey analyses the market for Stationery items, Office and School supplies” in the European Union. Stationery items, office and school supplies cover a wide range of products used for administrative work in the office and at school, for private use at home as well as for creative purposes. In order to provide insight into the diverse applications of stationery items, office and school supplies, we have distinguished eight product groups, which we deem of interest for exporters in developing countries. One should note that these products groups are not the only products which could offer chances for exporter in developing countries. The selected product groups are the following: • Paper-based products • Envelopes • Storage & Filing products; • Writing & Drawing instruments; • Presentation & Planning materials; • Office & Desk accessories; • Greetings cards • Bags & Briefcases The product sectors covered in this market survey are discussed in 1.1 below. This survey does not include software and electrical office equipment like faxes, computers, printers, etc. Office furniture is also not included in this survey, for information concerning this topic we refer to the CBI survey “Domestic Furniture”. Leather goods, like leather organisers, and maps are also not included in this survey. For information concerning these products we refer to the CBI survey “Leather goods”. Furthermore, office paper, for copiers and laser printers, is excluded from this survey. 1.1 Product groups In this paragraph, we will give a short definition of the eight product groups included in this survey. Paper-based products Paper-based products include all paper items: writing pads, exercise books, memo & refill pads, duplicate and analysis books, notebooks, account books, diaries, wrapping paper and calendars. Envelopes and greetings cards are excluded from this segment, since these are dealt with separately. Envelopes This segment includes different types of envelopes, which are used to pack documents or other products, which are sent by mail generally through postal services. Envelopes are available in different sizes and types, like, for example, window, self-seal, padded, booklet, square, open-end, two-way remittance, strip 'n grip, priority mail, payroll envelopes. Storage & filing products This segment includes different types of filing products, which are used to save and store documents, like: Manila files, soft plastic filing, suspension filing, ring binders, lever arch files, archival filing, indexes and dividers. Writing & Drawing Instruments This segment includes all sorts of products which consumers use to write, mark, draw or paint. Stationery in this product group includes: pencils, ballpoints, rollerballs, gift pens, fountain pens, fibre-tipped pens, plastic-tipped pens, crayons, highlighters, markers, and refills. Erasers, correction aids, pencil sharpeners and brushes of many types and qualities are also included in this product group. 10
  • 12. Presentation & Planning materials This segment includes planning boards, wall boards, white boards, flipcharts & accessories, calendars and year planners. These products are often used to give a presentation. Office & Desk accessories The segment Office & Desk accessories includes many products, like, adhesive tapes, paper and card adhesives, sticky notes, letter- and pen trays, scissors, pins, clips, fasteners, staplers, staples, staple extractors, punches, guillotines, trimmers, letter trays/racks and waste bins. Artistic materials like charcoal, graphite-pens, oil- and watercolour paints, as well as painting accessories such as frames and paint brushes are included in this product group. Greeting Cards The segment Greeting Cards includes Christmas cards, New Year cards, Valentine cards, birthday cards, graduations cards, change of address cards, marriage cards, etc. Generally cards are used to post a message to a friends, acquaintances, etc. Bags & Briefcases The segment Bags & Briefcases includes: briefcases, attaché cases, school bags, computer trolleys, laptop bags and rucksacks. 1.2 Customs/ Statistical products classification The nomenclature for statistics within the Europe Union does not specify stationery as such. The trading classification systems used were unified by the introduction of a new, worldwide coding system introduced on January 1, 1988. This system is called the Harmonized Commodity Description System (HS) and was developed by the World Customs Organisation (WCO). The system comprises about 5,000 commodity groups; each identified by a six-digit code, arranged in a legal and logical structure and is supported by well-defined rules to achieve uniform classification. More than 177 countries and economies use the system as the basis for their customs tariffs and for the collection of international trade statistics. WCO has introduced some alterations to the HS and these are included in the combined nomenclature as of January 1, 2002. After the six-digit code, countries are free to use further subheadings. An 8-digit system is used in the trade data of Eurostat. Most codes, however, end with two zeros, i.e. effectively only using six digits. In some countries, ten digits are even occasionally used. Table 1.1 Harmonised System (HS) classification stationery Product group Heading HS codes Paper-based products 4820, 4821, 4903, 4910 Envelopes 4817 Storage & Filing products 4819, 4829, 8304, 8305 Writing & Drawing instruments 3213, 4016, 9603, 9608, 9609 Presentation & Planning materials 9610 Office & Desk accessories 3506, 3926, 8213, 8214,, 8305, 8441, 9608 Greeting cards 4817 Bags & Briefcases 4202 Source: Eurostat In order to make this market survey/guide operational the survey has been limited to describe the above selected product groups. The HS classification given in Table 1.1 differs in some degree from the product groups mentioned in paragraph 1.1. This is caused by the fact that the information used in this market survey is obtained from a variety of different sources. Therefore, extreme care must be taken in the qualitative use and interpretation of quantitative data. This puts limitations on in-depth interpretation of trade figures and of the possible relationships between import and export figures on the one hand and consumption figures on the other hand. For a more detailed list of product groups, please refer to Appendix 1. 11
  • 13. 2 INTRODUCTION TO THE EU-MARKET The European Union (EU) is the current name for the former European Community. Since 1 January 1995, the EU has consisted of 15 member states. Ten new countries joined the European Union in May 2004; those so-called ‘accession’ countries are Poland, Lithuania, Estonia, Latvia, Hungary, the Czech Republic, Slovenia, Slovakia, Malta and Cyprus. According to Eurostat, the EU has grown from 15 countries with 379,6 million residents to 25 countries with approximately 450 million residents. Negotiations are in progress with a number of other candidate member states. Table 2.1: Population and GDP of EU countries, 2002 Countries/category Population Age 15-64 GDP (€ billion) Germany 83.3 million 68% 2,206 France 59.8 million 65% 1,556 United Kingdom 59.8 million 66% 1,485 Italy 57.7 million 67% 1,416 Spain 40.1 million 68% 836 The Netherlands 16.0 million 68% 417 Belgium 10.3 million 66% 315 Source: World factbook, 2003 Within Western Europe – covering 15 EU countries, Iceland, Liechtenstein, Norway and Switzerland – more than 20 million enterprises are active, made up mostly of small and medium-sized enterprises (SME’s). In 2000, the average turnover per enterprise of SME’s and large enterprises amounted to € 600,000 and € 255 million respectively. EU Harmonisation The most important aspect of the process of Table 2.2: Overview15 EU-Countries, 2002 Population 379.6 million unification (of the former EC countries), which affects Area 31,443,000 km2 trade, is the harmonisation of rules in the EU Density 83 people per km2 countries. As the unification allows free movement of Languages 11 (excl. dialects) capital, goods, services and people, the internal GDP/capita 21,023 borders have been removed. Goods produced or Currencies €, UK£, DKr., SKr. imported into one member state can be moved around Exchange € 1 = US$ 1.21 between the other member states without restrictions. A precondition for this free movement is uniformity in the rules and regulations concerning locally produced or imported products. Although the European Union is already a fact, not all the regulations have yet been harmonised. Work is in progress in the fields of environmental pollution, health, safety, quality and education. For more information about harmonisation of the regulations, visit AccessGuide, CBI’s database on non-tariff trade barriers at “www.cbi.nl/accessguide”. Monetary unit: Euro On 1 January 1999, the Euro became a legal currency within twelve EU member states: Austria, Belgium, Finland, France, Germany, Greece, Italy, Ireland, Luxembourg, The Netherlands, Spain, and Portugal. In 2002, circulation of euro coins and banknotes replaced national currency in these countries. Denmark, United Kingdom and Sweden have decided not to participate in the Euro. The most recent trade statistics quoted in this survey are from the year 2002. In this market survey, the Euro (€) is the basic currency unit used to indicate value. Statistics Trade figures quoted in this survey must be interpreted and used with extreme caution. The lion’s share of information derives from research agencies, such as Euromonitor, Eurostat, Mintel, Datamonitor, MPA International and KeyNote. Furthermore, information from different articles has 12
  • 14. been used to broaden the view of the market. Other methods used to collect information are trade interviews with importers and retailers of stationery products, store checks and desk research. Because of the variety of sources used, extreme care must be taken in the qualitative use and interpretation of the quantitative data in this survey. The collection of data regarding trade flows has become more difficult since the establishment of the single market on 1 January 1993. Until that date, trade was registered by means of compulsory customs procedures at border crossings, but, since the removal of the intra-EU borders, this is no longer the case. Statistical bodies like Eurostat cannot now depend on the automatic generation of trade figures. In the case of intra-EU trade, statistical reporting is only compulsory for exporting and importing firms whose trade exceeds a certain annual value. The threshold varies considerably from country to country, but it is typically about € 100,000. As a consequence, although figures for trade between the EU and the rest of the world are accurately represented, trade within the EU is generally underestimated. Furthermore, the information used in this market survey is obtained from a variety of different sources. Therefore, extreme care must be taken in the qualitative use and interpretation of quantitative data, throughout the text, as also in comparisons of different EU countries with regard to market approach, distribution structure, etc. For more information on the EU market, please refer to the CBI’s manual “Exporting to the European Union”. Survey This survey profiles the EU market for stationery, in which seven selected markets within the EU are highlighted. The selection is based on a quantitative and qualitative comparison of consumption and imports/exports of the EU countries, as will be further explained in the following chapters of this survey. The countries selected for this survey are Germany, United Kingdom, France, Italy, Spain, The Netherlands and Belgium, which are the largest countries in the EU, when it comes to consuming and importing stationery. One should however note that total market size is not the only determinant for conducting successful export. Other determinants like per capita consumption and an easily accessible distribution structure could make less populous countries, i.e. the Scandinavian countries, very attractive for exporters in developing countries. It is therefore important for exporters not to focus solely on the market size of the large countries. When speaking about the EU, the ten so-called accession countries are not included in the information given. Because information concerning the accession countries (Poland, Lithuania, Estonia, Latvia, Hungary, the Czech Republic, Slovenia, Slovakia, Malta and Cyprus) is not richly available, it is difficult to give a thorough analysis concerning these markets. This survey therefore only sparsely deals with these countries. Note that the figures used in this survey can differ substantially from the figures presented in the preceding survey CBI survey: “Stationery items, office and school supplies, April 2003”. This is mainly caused by the fact that other sources of information are used. Note also that most of the figures given in Chapter 3 are given in Manufacturer Selling Prices (MSP) instead of consumption figures. 13
  • 15. 3 CONSUMPTION This chapter presents a general overview of the stationery market, highlighting the countries and products specified in Chapters 1 and 2. The consumption figures given however are not available for all the separate product groups. The information used in this chapter is largely based on the reports of MPA International, Datamonitor, Euromonitor and KeyNote. All these research agencies have conducted some sort of research on the stationery market in Europe (for more information, we refer to Appendix 8. Furthermore, various articles published by different institutes are used. The information from these sources can, however, include consumption data of products that are beyond the scope of this survey, whilst they exclude consumption data of articles that may be relevant. Therefore, the information in this chapter is not unequivocal. Because of the different sources of information, some assumptions are made concerning the given information. The total market figures include the following products: office paper, paper-based products, envelopes, storage & filing products, writing & drawing instruments, presentation & planning materials and office & desk accessories. This selection is largely based on a selection made by MPA International. The products group Greeting Cards and Bags & Briefcases are not reflected in this figure. The total figure also includes the product group Office Paper (includes copier/laser grades, top quality writing- and specialist inkjet papers) which is beyond the scope of this survey. Besides it should be mentioned that the MPA International statistics concerning the paper-based products do not include products like calendars, diaries, photo albums, etc. Therefore, some additional information regarding these product groups will be given based on information from Euromonitor. Furthermore, it should be noted that the figures from MPA International are given at manufacturer selling prices (MSP) and users buying price (UBP). The first indicates the price at which manufacturers sell their products to resellers, like wholesalers. The latter is the price at which the eventual user buys the product (i.e. a net price, which is not necessarily the price at which it is marketed; it does not include any VAT). One should note that the mark up between the MSP and the UBP is an accumulation of different product ranges. The mark up between different product groups can differ substantially. Caution should therefore be applied when using these mark ups. The figures regarding the product group Greeting Cards originate from Datamonitor are given at retail selling price (RSP) and include all taxes. Furthermore, it must be noted that figures concerning the Greeting Cards product group are not available for each country covered in this survey. Information is only available for Germany, France and the United Kingdom. Regarding Bags & Briefcases, no statistical information is available. Figure 3.1: Reviewed stationery markets, Segmentation by Country and by Product: % Share by Value, 2002 Presentation & Planning materials Envelopes Benelux 13.8% 15.8% 9.0% Office & Germany Paper based Desk Spain 29.2% products accessories 10.0% 4.9% 8.6% Italy Storage & 11.2% Filing products 12.4% Office Writing & paper France United Drawing 29.7% 17.1% Kingdom Instruments 23.4% 14.8% 14
  • 16. Source: Datamonitor, 2003 Unfortunately, the MPA International information does not provide data concerning the entire EU. This chapter, therefore only deals with the consumption of the following countries: German, the United Kingdom, France, Italy, Spain, and the Benelux. Unfortunately, MPA International does not make a distinction between the Netherlands, Belgium and Luxembourg. 3.1 Market size The market for stationery in the reviewed countries is a mature and reasonably stable only growing 0.6 percent between 2001 and 2002 reaching a value of € 9,641 million at manufacturers’ selling price (equivalent to € 15,318 million at user buying price), according to MPA International. As can be seen in figure 3.1, Office Paper is the largest stationery product group, accounting for a 30 percent share of the stationery market, equivalent to a value of approximately €2,868 million at manufacturers’ selling price (€ 4,140 million at user buying price). On the vertical axis of figure 3.2, you will find the import development in value in the year 2002. As can be seen, the office paper market grew by 3.1 percent in 2002, making it the fastest growing of the product groups represented in figure 3.2. The horizontal axis gives a prediction of the market growth between 2002 and 2006. Again, the office paper market is forecast to see the largest growth and expected to increase by almost 20 percent in size, between 2002 and 2006, whereas the writing & drawing instrument market is predicted to grow by only 2.5 percent in the same period. Germany is by far the biggest stationery market, accounting for 29 percent of the consumption of the reviewed countries. At a considerable distance, we find the United Kingdom (23%), France (17%), Italy (11%), Spain (10%) and Benelux (9%). Figure 3.2: European Stationery market: relative attractiveness (excl. greeting cards) based on € value at Manufacturers’ selling price 4% Office paper 3% 2% % growth 2002 Office & Desk 1% accessories Storage & Filing products 0% - 10% - 5% 0% 5% 10% 15% 20% Presentation - 1% & Planning Paper based Envelopes materials products - 2% Writing & Drawing instruments - 3% % prognosis growth 2002 - 2006 Circle size based on Books & pads € 473 million at MSP (€828 million at UBP Manufacturer selling price, 2002 Office paper € 1,512 million at MSP (€ 2,070 million at UBP) Source: MPA International, 2003 The economic downturn that affected Europe in 2001, saw many stationery segments declining in value between 2001 and 2002. As can be seen in figure 3.2 only the Office paper (+3.1 percent) and the Office & Desk accessories (+1.1 percent) markets grew in terms of value. The other stationery 15
  • 17. markets all showed a minor decline in value terms. The Paper-based product market showed the biggest decline, in 2002 this market dropped by 2 percent. Because of the declining school population and increasing computerization, this decline is forecast to continue in the near future, according to MPA International. We should, however, note that the MPA International figures do not include all the products selected in this segment (for more information we refer to § 3.2). The office paper market is forecast to grow by 19.4 percent towards 2006 (horizontal axis). The other product segments reflected in figure 3.2 are forecasted to grow only marginally. Germany Figure 3.3: The German Stationery market: As noted earlier, Germany is by far the biggest Segmentation, % Share, by value, 2002 stationery market in Europe, accounting for 29 Presentation percent of the consumption of the reviewed & Planning countries. The German stationery market was materials Envelopes affected by the weak economy. In 2002, the 18.7% 13.5% Paper based German stationery market performed well below products average dropping by 0.9 percent to a value of € Office & 4.6% 2,812 million at MSP. This drop can be explained Desk by declining market prices, which was due to the accessories increasing dominance of discounters in the 7.5% German retail market, (source: Euromonitor). Due Office Storage & to this development, the German stationery market paper Filing is a highly competitive marketplace. products 28.3% Writing & 13.8% In 2002, only the Office Paper and the Office & Drawing Desk accessories markets showed a positive Instruments development, growing respectively by 3.6 and 1.0 13.6% percent. Source: MPA International The Presentation & Planning Materials market showed the biggest decline of the segments reflected, dropping by 6.1 percent, to € 527,0 million at MSP. All the other segments, with the exception of Envelopes, showed a minor decline. The Envelope market remained stable at a value of € 380,0 million at MSP. The Greeting Cards segment accounted for a value of € 624,0 million at retail selling price (RSP), (source: Datamonitor). According to Euromonitor, the Paper-based products market in Germany grew by 2.9 percent to a value of € 879 million in 2002. United Kingdom Figure 3.4: The British Stationery market: The United Kingdom is the second stationery Segmentation, % Share, by value, 2002 market in size, accounting for 23 percent of the Presentation consumption of the reviewed countries. As in & Planning Germany, the British stationery market was materials affected by the weak economy. In 2002, the Envelopes Office & 12.0% British stationery market declined by 0.3 percent 19.6% Desk representing a value of € 2,250 million at MSP. accessories 9.0% Paper based Of the different stationery segments, the Writing products & Drawing Instrument market performed the Storage & 4.7% worst, dropping by 3.7 percent. The remaining Filing products stationery market segments remained relatively 11.6% stable, only developing marginally. A note must be made concerning the commercial envelopes Writing & Office market, which accounts for a value of € 441,0 Drawing paper million at MSP. This puts the British envelopes Instruments 29.4% 13.7% market well ahead of the German market. The Greeting Cards market shows a similar picture. According to Datamonitor, the British greetings Source: MPA International 16
  • 18. card market is worth approximately € 1,700 million at retail selling price (RSP), which puts the British greetings card market well ahead of the France and even the German market. The British paper-based products market grew 3.5 percent to a value of € 526 million, according to Euromonitor. France France is the third largest market; accounting for 17 percent of the consumption of the reviewed Figure 3.5: The French Stationery market: countries. Like Germany, cheap imports and the Segmentation, % Share, by value, 2002 rising share of discounters, hypermarkets and Presentation superstores have put increasing pressure on & Planning prices in the France stationery market. In 2002, Office & materials Envelopes the French stationery market grew by 1.6 Desk 10.0% 19.2% percent largely due to the positive developments accessories in the segment Office Paper. In 2002, the Office 8.6% Paper market grew by 3.9 percent to a value of € Storage & Paper based 498,5 million at MSP. In 2002, the value of the Filing products total French stationery market amounted to € products 5.5% 1,651 million at MSP. 10.5% In 2002, the Storage & Filing market increased Writing & by 2.1 percent to € 173,5 million at MSP. The Drawing Office French Writing & Drawing Instrument market Instruments paper increased by 0.6 percent. This can be explained 16.1% 30.2% by the increasing demand for fashionable writing instruments, which countered the Source: MPA International increasing penetration of PC’s and the Internet, (source: Datamonitor). The other markets developed only marginally. According to Euromonitor, the Greeting Card sector is relatively underdeveloped in France, in comparison with the United Kingdom. In 2002, the French greeting card market accounted for a value of € 607,0 million, which is slightly lower than the German market, (Source: Datamonitor). Italy Figure 3.6: The Italian Stationery market: Like the other markets highlighted, the Segmentation, % Share, by value, 2002 development of the Italian stationery market is very marginal. In 2002, the market grew by 0.8 Presentation percent to a value of € 1,083 million at MSP. & Planning The Italian stationery market is becoming materials Envelopes increasingly competitive, mainly caused by the Paper based 12.9% 10.2% high number of domestic manufacturers and Office & products multinationals present in the Italian market. Desk 6.5% accessories 10.1% As in Germany, the office paper market was the star performer in 2002, growing by 4.0 percent to a value of € 308,5 million at MSP. The Storage & Office Presentation and Planning Materials market Filing paper products grew by 2.6 percent to € 140,0 million at MSP. 28.5% 14.0% The Writing & Drawing Instrument market, Writing & relatively important, accounted for 17.8 percent Drawing of the Italian stationery market. In 2002, it grew Instruments by 1.6 percent to a value of € 192.5 million at 17.8% MSP. The Office & Desk Accessories market Source: MPA International 17
  • 19. grew by 1.9 percent to a value of € 109,5 million at MSP. Another notable development concerns the Envelopes market, which dropped by 8.3 percent to € 110 million at MSP. Regarding the Greeting Card market, no information is available. Spain Figure 3.7: The Spanish Stationery market: The Spanish stationery market was the star Segmentation, % Share, by value, 2002 performer of the countries highlighted in this Presentation survey. In 2002, the Spanish stationery market & Planning grew by 3.3 percent to an amount of € 964 million materials Envelopes at MSP. According to MPA International, the 13.7% 12.0% Paper based Spanish stationery has not been affected by the Office & products weak economy as much as the countries in the Desk 4.6% Northern part of Europe. This was partly due to accessories the lower maturity of some of the stationery 9.4% product markets. Storage & Filing Office Of the stationery segments highlighted, the products paper Presentation & Planning Materials market was the 13.5% 31.9% top performer in Spain, and increased by 9.1 Writing & percent to an amount of € 132,0 million at MSP. Drawing Another fast growing market was the Office Paper Instruments market, growing by 6.8 percent to a value of € 15.0% 307,5 million at MSP. Source: MPA International The Paper-based products market dropped by 6.4 percent to € 33,1 million at MSP, this can be explained by the ongoing computerization in Spain, partly caused by the high priority ICT development has within the Spanish government. The Storage & Filing Products market and Office and Desk Accessories market grew respectively by 3.6 and 3.4 percent. Information concerning the Greeting Card market is not available. Benelux The Benelux stationery market is the smallest Figure 3.8: The Benelux Stationery market: stationery market distinguished in this survey, the Segmentation, % Share, by value, 2002 market accounts for only 9 percent of the Presentation consumption of the reviewed countries. Like most & Planning Office & materials European countries, the Benelux economy was Envelopes Desk 11.0% strongly affected by the global economic 18.1% accessories downturn. However, despite this development, the 8.3% stationery market which increased by a small 1.1 Paper based percent in 2002, reached a value of € 871 million Storage & products at MSP. Filing 4.0% products Like France, the growing consumption of office 10.0% paper accounted for the major part of the growth. Writing & In 2002, this market grew by 3.8 percent. Other Drawing Office markets which increased in 2002 were the Office Instruments paper & Desk Accessories market and the Presentation 14.5% 34.1% & Planning market, both however, only growing marginally. The Writing & Drawing Instrument market, together with the Paper-based products Source: MPA International market, showed the biggest decline, dropping by 1.6 and 1.4 percent respectively. 18
  • 20. According to Euromonitor, the Dutch and Belgium Paper-based product markets grew by respectively 5.3 and 3.0 percent, to a value of € 102,5 and € 72,1 million. Western-Europe versus Eastern-Europe In this section we will discuss the differences between the Western European and Eastern European stationery markets. Because information on the Eastern European stationery market is not richly available, we will only give some highlights concerning these markets. In this section we will therefore only note developments concerning the stationery markets of Poland, Czech Republic, Hungary and Slovakia. They, however, can be used as an indication for the other Eastern European countries. In figure 3.9 an overview of the difference between the Western European and Eastern European markets is reflected. It concerns an accumulation of the private consumption of both personal stationery as well as the writing instruments; office consumption is not reflected in the figures. Therefore extreme care must be taken when comparing these figures with the MPA International data. Because the Western European stationery market is a reasonably steady and mature market, the rivalry amongst the market players like distributors and manufacturers is becoming increasingly fierce. Expanding into the Eastern European markets offers the chance to extend their businesses. The accession of these countries to the European Union and their massive growth potential makes these markets even more attractive. Many Western companies have entered Eastern Europe to benefit from these developments. Office Depot, for example, has opened stores in both Poland and Hungary. As a manufacturing base the Eastern European countries are also very attractive for West European companies (see also chapter 4). Figure 3.9: Western and Eastern European Stationery market: relative attractiveness based on € consumption of personal stationery and writing instruments 25% Czech Republic 20% Hungary % growth 2002 15% Slovakia Norway 10% Netherlands France Sweden Poland 5% Finland Belgium United Kingdom Germany 0% 0% 20% 40% 60% 80% -5% % growth 1998 - 2002 Circle size based on Slovakia stationery market € 29,4 million Manufacturer selling price, 2002 German stationery market € 1,7 billion Source: Euromonitor According to publications of Office Products International, the Eastern European stationery market is in a growing phase. As can be seen in the figure 3.9, the four Eastern European countries Poland, Hungary, the Czech Republic, and Slovakia all show considerable growth, whereas the Western European countries all show much smaller growth. Especially the stationery market in the Czech 19
  • 21. Republic grew by gigantic proportions. In 2002, this market grew more 22 percent and between 1998 and 2002, the market almost doubled in size. The size of these Eastern European markets however, remains quite small in comparison with the markets in Western Europe. The Slovakia stationery market accounts for a value of € 29,4 million, whereas the German market accounts for a value of € 1,703 million. 3.2 Market Segmentation This is divided into two sections. The first section, paragraph 3.2.1 will highlight the developments in the different product groups discussed in Chapter 1. The figures given in this paragraph are based on research by MPA International. These figures, however, exclude some stationery products like for example calendars, diaries and artistic materials. Therefore, some additional information on these products is giving. Paragraph 3.2.2 gives a segmentation by the different users groupings which can be distinguished in the stationery market, namely professional business users, schools & universities, SoHo users and private users. In this paragraph the distinct characteristics and preferences regarding these different product groups will be discussed. 3.2.1 Market segmentation by product In the stationery market we can make a general distinction between two types of stationeries, namely commodity and specialty stationeries. Commodities are generally products that customers perceive to be exactly the same, brand awareness and preference are generally low. Envelopes, paper, notebooks, storage & filing products can, for example, be regarded as commodities. According to research by McKinsey, the product price, consistent level of product quality, service quality and on-time delivery are the most important purchase criteria in this segment. In the case of specialty stationery, the user regards the product as special and is prepared to go through substantial trouble to obtain it. Quality, branding and design are important purchasing criteria for these products. Specialty products must be able to satisfy consumer status. In case of the stationery market, special luxurious writing instruments, calendars and leather diaries can be regarded as specialties. This specialty segment offers important potential for manufacturers in developing countries. Specially crafted, handmade products like, for example, leather organisers and writing pad covers, are very popular in the EU. Stationery given away as a gift makes up an important share of the specialty segment. In the following section of this chapter we will discuss the products highlighted in Chapter 1 Envelopes The Envelopes market in the reviewed countries dropped 1 percent and accounts for a value of € 1,512 million at MSP in 2002. The increasing use of e-mail and the internet and a decline in writing letters is pressuring the envelopes usage, thus to MPA International. Despite this pressure, the Envelope market is estimated to grow slightly to approximately € 1,590 million in 2006, indicating a growth of approximately 5 percent, (Source: MPA International). According to the European envelope manufacturers association, the per capita consumption of envelopes in Western Europe is running at around 300 envelopes per year. In Eastern Europe the consumption is much lower, Poland for example consumes around 60 envelopes per capita per annum. There are numerous different types and sizes of envelopes. Most popular are the window envelopes and self-seal envelopes. The latter includes a protective peel-off strip over the adhesive flap. In general, the commercial envelopes market is increasingly being standardized mainly to assisting national postal services in the automated selection and sorting machinery, (source: Euromonitor. Special ISO norms exist on the size of envelopes, namely the ISO 216 Series C. In some countries there are however different sizes of envelopes in circulation, mainly in France and the United Kingdom. The weight and quality of the paper used making the envelopes vary per market, thus affecting pricing. Because envelopes are generally considered to be a commodity, private- and white label products play a significant role in this market segment. 20
  • 22. Paper-based products This segment includes a wide variety of products; it is therefore difficult to give precise statistical information concerning the market size. According to MPA International, the paper-based products market is worth approximately € 473,0 million at MSP. This figure includes the following products: exercise books, memo refill pads, duplicate and triplicate books, manuscript books and analysis books. The segmentation of the market based on MPA International statistics is reflected in figure 3.10. As can be seen, exercise books make up more than a third of the market Figure 3.10: The Paper based market, Segmentation, In figure 3.11 you can find the consumption of % Share, by value, 2002 paper-based products, according to Euromonitor. The Euromonitor statistics include all paper items Analysis like writing pads, printing paper, transparents, books envelopes, notebooks, account books and diaries. 11% Exercise Office supplies are excluded from the Euromonitor M anuscript books statistics. As can be seen, Germany is by far the books 35% largest market for paper-based product. 14% Unfortunately, information regarding Italy and Spain is not available. Duplicate & Triplicate According to MPA International, the paper-based books market is forecast to decline because of the 9% maturity of the market and the increasing M emo & computerization trends. The paper-based products Refill pads market is being subjected to increased competition 31% from products like the internet and cd-roms, (Source: Euromonitor. This development especially affects the duplicate and triplicate book Source: MPA International segments, (Source: MPA International. Because the educational market is an important segment in this market, the declining school population in most European countries has also contributed to negative forecasts of this market. MPA International estimates that this market will decline by about 5 percent towards 2006. Because low prices are a prime purchasing consideration in this market, private-label products, often imported from Asia, are gaining market share, mainly in the exercise and correspondence book market. In some niches, quality is also an important consideration. The educational market, for example, requires the opacity of a page to be sufficient to permit writing on both sides of the paper, according to Euromonitor. Other interesting stationery products, which are not reflected in the figures of MPA International, are wrapping paper, diaries, organisers and photo albums. In these segments the prices are under pressure because of the increasing importance of private label. An important threat to paper-based products is the development of information technology products, like electronic organisers and other gadgets, in which data can be stored electronically. However, despite this threat, the demand for these products is expected to grow. 21
  • 23. Figure 3.11 Consumer expenditures of paper-based products (per year in €), in the EU, 2000-2002 Slovakia 17.0 2000 Hungary 50.3 2001 Czech Republic 55.0 2002 Poland 57.0 Finland 14.9 Norway 27.0 Sweden 34.0 Belgium 72.1 Netherlands 102.5 Switzerland 120.8 France 215.3 United Kingdom 526.2 Germany 879.3 - 100 200 300 400 500 600 700 800 900 1,000 Source: Euromonitor Writing & Drawing Instruments In 2002, the consumption of Writing & Drawing Instruments in the reviewed countries represented a value of almost € 1,420 million at MSP. According to MPA International, the Writing & Drawing Instrument market is a mature market which is largely driven by innovation and new product introduction. Manufacturers are coming up with new, unusual design shapes and colours to boost their sales. Due to this, the market is forecast to grow very little in the near future. According to estimates made by MPA International, the European Writing & Drawing Instrument market will represent a value of 1,456 million at MSP in 2006, which indicates an increase of only 2.5 percent compared to today’s market size. According to Paperworld, the Writing & Figure 3.12: The Writing & Drawing instrument market, Drawing Instrument market is becoming more Segmentation, % Share, by value, 2002 polarised, in particular the writing instruments market. The low-price segment is suffering from increasing price pressure. Due to cheap Refills Other Pencils imports, gel-ink pens and rollerballs are under 5% Correction 4% 14% increasing price pressure. Products in the aids higher segments are following the high quality 9% trend. In this segment, handmade and Highlighters unconventional materials like amber and 5% Ballpoints leather are expected to be very popular, M arkers 20% (Source: Paperworld). 8% Fibre & In general, the Writing Instrument market is plastic tip pens dominated by international brands, like Fountain 7% Rollerballs Gel ink Sanford and Bic. However, low-priced private 7% pens pens label products, deriving mainly from Asia, are 8% 13% increasingly making inroads into the European market. This development has, in turn, led to increasing pressure on existing price levels. Source: MPA International This is particularly evident in the commodity 22
  • 24. segment of the Writing & Drawing Instruments market. As can be seen in figure 3.12, ballpoints and pencils together account for the majority of the market. Also fountain pens remain popular, when it seemed they were likely to be replaced by the ballpoint; this is partly due to the popularity of these pens as a status symbol and a fashion accessory. The category ”Others” includes erasers (2%), pencils sharpeners (1%) and rulers (1%). Nowadays, writing instruments made of translucent materials are very popular. Ergonomic design is also a major consideration for writing instruments, according to TDC trade. Soft holding zones, angled writing points and gel technology offer users a high degree of comfort. Note that these trends can vary from year-to-year. Other interesting stationery items, which are not reflected in the Writing & Drawing Instrument figures of MPA International are the artistic materials, with include brushes, paint, crayons, pastel, glues and other sorts of products which can be used for artistic and hobby purposes (see also § 3.2.2.). The lion’s share of these products is made for school-age children, with the remainder going to professional users. According to Euromonitor, the artists’ material market in France is approximately € 21.1 million. Unfortunately information regarding other European markets is not available. Writing & drawing instruments are sold in a number of ways. Instruments designed for private use or as personal gifts are generally purchased in the retail market. Alternatively, writing & drawing instruments may be bought by businesses for employees' use or to be given away either as promotional gifts or as employee incentives. However, they are more often regarded as giveaways than simply as writing instruments for the promotion market. Storage & Filing products Figure 3.13: The Storage & Filing product market, In 2002, the consumption of storage & filing Segmentation, % Share, by value, 2002 products in the reviewed counties accounts for approximately € 1,192 million at MSP. According Indexes & to MPA International, this market is relatively Dividers M anila files stable and mature. The private/own label Archival 10% 22% penetration in this segment is high and is expected filing to increase; explained by the fact that these 10% products are generally considered to be commodities. Ring binders 11% Soft Plastic Sales in this sector are greatly related to office files paper demand. Digital storage of data is 14% Suspension considered to be the main threat in this sector. files However, the use of technologies like computers 11% Lever arch rather boosts sales of office paper than the reverse. files According to MPA International, this market is 22% expected to grow to be worth € 1,271 million at MSP in 2006. The increasing SoHo sector (see § 3.2.2) is also an important sales driver in this Source: MPA International sector. Although this segment is rather stable and considered to be a market with little innovation, there is one notable development. Due to the increasing use of these products in the private and SoHo sector, there is a trend towards more brightly-coloured products and finishes, according to MPA International. 23
  • 25. Office & Desk accessories The market for Office & Desk Accessories in the Figure 3.14: The Office & Desk Accessories market, Segmentation, % Share, by value, 2002 reviewed countries accounted for a value of € 827 million at MSP in 2002. This segment includes Rubber both commodities as well specialty stationeries. bands, Pins, As can be seen in figure 3.14, paper & card Scissors Clips, etc. Waste bins adhesive account for almost a quarter of this 4% 2% Adhesive 4% Punches market. According to MPA International, the tapes 5% Office & Desk Accessories market is a mature Letter trays 21% market, where the volume demand is stable. 6% Innovation and product styling are the two main Guillotines market drivers. Price competition is increasing due & Trimmers to the increasing share of private and white label 6% products and imported products deriving from Paper & Staplers, low-wage countries. The Office & Desk Card Staples & Accessories market is forecast to grow to a value adhesives Stapleextrac of € 872 million at MSP in 2006, (Source: MPA 22% tors Repositiona International). 13% ble notes 17% The increasing SoHo sector triggers the demand for more fashionable office & desk accessories. Source: MPA International The trends in colours and design of these more fashionable products mainly derive from the home decoration market. The premium items in this segment are often designed for professional use and often have a more classical design and more traditional colours. Presentation & Planning materials Figure 3.15: The Presentation & Planning materials This segment includes planning boards, wall market, Segmentation, % Share, by value, boards, white boards, flipcharts & accessories, 2002 calendars and year planners. According to MPA Planning International, the consumption of presentation & Flipcharts boards & planning materials in the reviewed markets & Year accounts for approximately € 1,343 million at Accessories planner MSP in 2002, indicating a decline of 0.9 percent 3% 6% with the preceding year. This decline is mainly Wallboards due to a weak economic climate which affected Stock 7% business confidence and hence investments in diarries these sort of items. Professional users are the main 49% purchasers of these products, next to schools. According to MPA International, the increasing trend towards more business presentations is the Stock main growth driver in this segment. It is forecast calenders that this market will grow to a value of 35% approximately € 1,440 million in 2006, indicating a growth of 8.2 percent over the figures for 2002. Source: MPA International The development towards electronic products like beamers used in business presentations is considered to be the main threat. This development in turn offers a chance for manufacturers of screens, which could benefit from the development towards more electronic products. According to MPA International, these products are often used in tandem with the traditional presentation products. Like many other stationery markets, the presentation material sector is increasingly being penetrated by cheaper own-label products, often imported from low-wage countries in Asia and Eastern Europe. This in turn has driven down average market prices. 24
  • 26. Greeting Cards According to Datamonitor, the European Greeting Cards market was worth € 5,100 million at RSP in 2002. As the European market continues to mature, pricing is becoming more important. According to Euromonitor, the internet is a fierce competitor to the greeting card industry. E-cards and E-mail are gaining in popularity in comparison with the traditional cards, due to their convenience and speed. However, despite the increasing popularity of the internet, greeting cards are still popular in Europe. This popularity is mainly due to innovative power of the card industry. According to Euromonitor, greeting card publishers have created many new markets, expanding on the concept of Christmas, New Year, Valentine’s Day, birthdays, graduations, changes of address, marriages and many other occasions, thereby contributing to this success. At the premium-end of the market there is an increasing demand for more sophisticated printing techniques and handmade cards, (Source: Euromonitor). Nowadays, cards are available in a lot of different shops, mostly marketed as cheap impulse purchases to boost sales. According to a study by TNS Impulse, a British research agency, the greeting card market can be divided into three main groups: everyday cards, Christmas/ New Year cards and seasonal cards. The everyday cards market accounts for 59.6 percent of the market, and the largest card giving occasions are birthdays, anniversaries, Get Well cards, Friendship cards, and Sympathy cards. Christmas and New Year cards account for 27.2 percent of the market. The remaining share is made up by the seasonal card market. In this market Valentine’s Day is a leading card-giving occasion, other occasions are Mother’s Day, Father’s Day and Easter. The most important trade fair for greeting cards is the Birmingham Springfair in the United Kingdom. Bags & Briefcases This group consists of products like backpacks, shoulder bags, bags, mini backpacks for younger children and briefcases made of materials like leather, polyester, nylon, PVC, PU and canvas. According to the Hong Kong Trade Development Council (TDC) many bags & briefcases are moving away from black towards more fashionable bright and funky colours. In addition, new fabrics and materials, like micro-fleece grid fabric, crinkle nylon/polyester, suede, skin etc., are being introduced. Unfortunately, no quantitative information is available regarding the bags and briefcases market; therefore only some qualitative information will be given. With the trend of globalization and e-commerce, people are increasingly working out from the office, according to the Hong Kong Trade Development Council (TDC). Because of this development, bags for carrying laptops and computer trolleys are increasingly in demand. In addition, highly- compartmentalized briefcases are designed to act as mobile offices, to assist doing business out of the office, with ease and more convenience, (Source: TDC trade). As can be seen in paragraph 3.3, women are becoming increasingly important for the European workforce. To benefit from this development, an increasing number of bag & briefcase manufacturers are designing and producing lines specially adapted for women. In addition, some new lines targeted at women feature special sections for toiletries, cosmetics, shoes and other items that enable female travelers to travel more conveniently. The health issue is becoming increasingly important, especially in the bag market for children. According to research, children in Europe have to carry heavy school bags, risking back pain and spinal disorders. Ergonomics is an import issue. New ergonomic designs redistribute the weight of the bag so that less stress will be placed on the users' back, arms and shoulders. Bags designed for children come in a wide variety of styles with bright colours. Licensing is also often used in the children segment. Bags featuring, for example, movie characters like Winnie the Pooh, Mickey Mouse, Paddington Bear and more recently Harry Potter and Bob the Builder, are very popular with children and young school-goers. 25
  • 27. Fashion, regarding style and colours in the bags & briefcases market, is generally closely aligned with the trend in the fashion industry. This especially applies to the handbag segment, where leading manufacturers like Louis Vuitton, Salvatore Ferragamo, Gucci, Prada and, Miu Miu are the trend- setters. The weight of the product is also important; since most people prefer lighter weight bags & briefcases. Therefore production skills developed in other lightweight industries such as clothes, plastic, etc. are often used. More information regarding leather bags & briefcases can be found in the CBI survey “leather goods”. 3.2.2 Segmentation by user In the preceding section we have discussed the segmentation by product. In this paragraph we will make a distinction between the different segments in the stationery market. General we can distinguish between three main market segments, i.e.: • Professional (business) users, • Small office and Home office users (the so called SoHo) • Private users. The professional user segment includes medium-size offices with 10 -50 employees and large offices with more than 50 employees. The SoHo segment includes small offices with from 1- 10 employees and home offices employing 1 to 3 people. This segment also includes teleworkers working for an employer, or on a freelance basis, from home. The private users, includes stationery sold for domestic use and includes sub-segments like children, teens, students, etc. According to a Euromonitor study of the French market, business users (including SoHo users) account for approximately 54 percent of total stationery sales (excl. greeting cards). The public administrations account for 17 percent and schools and private users account for approximately 29 percent of the stationery sales. Information concerning the other markets is not available. Professional users According to Eurostat there were 11,5 million enterprises active in the EU, over 85 percent of these companies have less than 10 employees of which the vast majority is found in the service industry. These companies employ 25 percent of the total EU workforce. Large companies with more than 250 employees only account for 0.5 percent of the companies in EU, but they employ 30 percent of the EU workforce. These larger companies are mainly situated in the industry sector. Figure 3.16: Number of enterprises and persons in the EU employed broken down by size-class, 2000 (% share of total) 50-249 250+ pers. pers. 250+ 1-9 pers. 10-49 employed employed pers. employed pers. 2.2% 0.5% employed 25.1% employed 37.0% 11.4% 10-49 pers. 50-249 employed 1-9 pers. pers. 20.4% employed Employed 85.9% 17.6% 26