Ball Point Pen Refills

In modern time ball pen refills are being produced from plastic materials and is

having bright future in specially India. Ball pen refill is stocked by big stationery

merchants, general merchants, and even road side small shops. The ball point pen

refills are in extensive use in every home, industrial house, commercial

establishment, school and every shop etc. The ball point pen ink is quite different

from other type of writing inks. It gives a very shining and attractive writing. Ball pen

has largely replaced ink pen because of their cheapness and easiness in use. There

is a bright future for ball pen refills. The literacy in India is increasing with the

development of country. Demand for ball pen is increasing with the opening of

education centre. There is good future for existing as well as new entrepreneurs.

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MARKET SECTOR

The EU market for Ball-point pensPublication date: December, 2007Report summaryThis CBI market survey discusses the following highlights for the EU market for ball-pointpens:• Total EU consumption1 of ball-point pens in 2005 amounted to € 479 million. That year, thesix reviewed markets2 accounted for 84% of total EU consumption. This percentage gives ageneral picture of the share of these markets in EU ball-point pen production. The ballpointpen market in the reviewed markets represented a value of € 341 million3 in 2006.Please bear in mind, that the sources of data for consumption for the total EU and theseven reviewed markets are different. In comparison to previous years, the reviewedmarkets experienced a marginal decrease. For the future, only very slight fluctuations inthe market are expected, as it is mature and static in its nature. Ball-point production inthe EU countries represented a value of € 360 million in 2005. This represents aconsiderable drop, of 17% from 2003. One of the reasons is that some major European “A”brand manufacturers have stopped production in the EU and have outsourced it to lowwage countries.• The total import value of ball-point pens, refills, and parts into the EU increased between2004-2006 by 11%, reaching a value of € 818 million in 2006.• The trade structure of stationery in the EU is complex, as stationery is distributed throughmany different intermediaries and retailers. In the last decade the European stationerymarket has become increasingly competitive and this is due to the distinct maturity of themarket, especially in the North-western part of Europe.• Imports coming from developing countries accounted for 28% of the totalimports in 2006. The most important developing country suppliers are: China 79.1%,India 8.9%, Mexico 4.3%, 3.1% South Korea, Others 4.6%.This survey aims to provide developing-country exporters of ball-point pens with productspecificmarket information related to gaining access to the EU market(s). By focusing on theEU market(s) for one product (group), this document provides additional in-depth information,complementary to the more general information and data provided in the CBI market survey‘The stationery, office and school supplies market in the EU’ (2007), which can be downloadedfrom http://www.cbi.eu/marketinfo.Detailed information on the selected product (group) is given in Appendix A. This surveydiscusses the EU in general and the following markets in particular: Germany, France, Spain,Italy, the UK, the Benelux, the Nordic countries.1 Market description: consumption and productionConsumption

Total EU consumption of ball-point pens in 2005 amounted to € 479 million. That year, the sixreviewed markets accounted for 84% of total EU consumption. This percentage gives a generalpicture of the share of these markets in EU ball-point pen production. Please bear in mind, thatthe sources of data for consumption for the total EU and the seven reviewed markets aredifferent. The ball-point pen market in the reviewed countries represented a value of € 341million in 2006 and showed a marginal decrease over the previous year (€ 343 million in1 Apparent consumption (imports+production-exports) extracted from the Eurostat database is only available up to2005.2 The seven markets reviewed in this survey are: Germany, France, Spain, Italy, UK, Benelux, and the Nordiccountries.

3 MSP (Manufacturing Selling Prices) – The price at which manufacturers sell products to resellers or direct

to users.

2005). The refills market in the reviewed countries represented a value of € 65 million in2006, again showing a very small decrease over the previous year. According to research, therefills market will stay stable until the end of this decade, showing just a few minor increasesand decreases (less than € 1 million) among the reviewed countries.According to the agencies conducting sector-specific research in the field, the ball-point penmarket is likely to remain stable until the end of the decade. Only a marginal decrease ofabout 1% is expected between 2008 and 2009. The reasons for the slight decrease are mainly:• Higher competition from other types of pens (gel ink and liquid ink pens)• Penetration of cheaper, lower-quality imports as well as own-label products, resulting inlower prices (this in turn has decreased the Euro value of the market over the years).In general, the ball-point pen market can be segmented into three major market segments:professional end users, small office and home office users (SoHo), and private end users. Thedemand for ball-points may vary among the segments in the reviewed countries. Chapter 1‘Consumption’ of the CBI survey ‘The stationery, office and school supplies market in the EU(2007)’ elaborates further on the segmentation of the stationery market.The increasing penetration of PC’s, internet and e-mail negatively affects the demand forwriting instruments. In order to combat this competition, producers are undergoing continuousproduct innovation. Increasing imports from the Far East and China are driving down average

prices.• In Germany, the market for ball-point pens was estimated to be worth € 74 million in2006. Since 2003, consumption has decreased slowly from € 76 million to the current level.Research indicates that annual consumption in Germany will keep on decreasing veryslowly to € 73 million by the end of this decade. Overall, the German market for writinginstruments is flat. Refillable products account for more than 60% of the German ball-pointsector. Prices are falling in the ball-point market as a result of intensifying pricecompetition, due to the penetration of cheaper, lower-quality imports and own labelproducts. The consumption value of refills in the German market is forecast to decreaseslightly in the near future, caused by weakening prices.• In France, the market for ball-point pens was estimated to be worth € 74 million in 2006.Market-specific research indicates that the French ball-point market will stay relativelystable until the end of this decade. Disposable pens account for 70% of the French ballpointmarket. The majority of these disposable pens are budget products. The overallwriting instruments market appears to be very mature in France. The ‘back to school’period plays a large role in the French writing instruments market. However, in the lastdecade, the student population in France has slowly been decreasing. On the other hand,ballpoints may become increasingly popular as an advertising object. Sector-specificresearch indicates that refill consumption (€ 18 million) will remain stable in the Frenchmarket until the end of this decade.• In Spain, the market for ball-point pens was estimated to be worth € 28 million in 2006.Spanish consumption only increased by € 0.5 million over the last few years, and estimatesindicate it will grow slightly, to € 29 million by the end of this decade. For refills, researchindicates the market will stay stable at € 7 million in the coming years, as it has done forthe last few years. According to market research, the Spanish writing-instruments marketis quite mature and significant growth is unlikely. Spanish users continue to switch to gelink and liquid gel pens. Research indicates that the own-label market is now static (50%market share), which means that premium refillable ball-points are more likely to beaffected by imports from developing countries.• In Italy, the market for ball-point pens was estimated to be worth € 75 million in 2006 andis projected to decrease to € 72 million by the end of this decade. Research indicates thatthe most recent trend is towards the cheapest products. Intensifying price competition inthe market is the result of the increased low-price imports and own-label production. Refills

consumption value reached € 3 million in 2006, and research indicates it will decrease2 million at the end of this d• In the UK, the value of the market for ball-point pens was estimated to be € 77 million in2006. Up to the end of this decade, it is projected to grow to € 78 million. In the UK,disposable products account for about 55% of the total ball-points market and they haveseen a general increase in terms of volume (units) during recent years. Initially, disposableball-points in the UK faced difficult competition from gel and liquid ink pens. Researchindicates that these difficulties are being overcome.• In the Benelux, the value of the market for ball-point pens was estimated to be worth € 22million in 2006. Towards the end of this decade, research projects that it will move towards€ 21 million. Ball-points remain the best sold writing instrument in the Benelux. In terms ofvalue, about 65% of the ball-point market comprises disposable products.• In the Nordic countries, the consumption value of ball-point pens reached € 17 million in2006. In 2004, consumption was around € 18 million, and research forecasts that it willdecrease to € 17 million by the end of this decade. Disposable ball-points account for 70%of the market. Moreover, in the Nordic region, private-label products have a substantialand stable share of the market. Refills consumption value was estimated at € 4 million in2006, and research projects that it will decrease to € 3 million by the end of this decade.ProductionTotal production, in value and volume, for ball-point pens, refills and parts in the EU amounted€ 469 million in value, with a volume of 1.6 billion primary units in 2005. The EU is home tosome of the world’s leading manufacturers of ball-point pens. Over the reviewed period, theball-point market has become increasingly competitive, caused by the maturity of the marketand the increasing pressure of imports from low-cost countries. In order to survive, economiesof scale were of vital importance and this, in turn, has led to a consolidation trend amongstmanufacturers.The reasons for decline of European production may be:• low/static/mature consumption growth• some major European “A” brand manufacturers ceased production in the EU andoutsourced to low wage countries (such as the Far East and China); a tendency that isexpected to continue in the future• own label products have increased their market share in many European markets• imports have increased for budget products• continuing penetration of cheaper, low-quality products has intensified price competitionTable 1.1 shows the respective production of ball-point pens, refills for ball-point pens and

parts for 2001, 2003, and 2005. The seven reviewed European markets are further describedbelow, describing both increases and decreases in value and volume.Table 1.1 Production in the EU (millions of euros)Product 2001 2003 2005Ball-point pens 494.6 434.4 359.6Refills for ball-point pens 38.5 29.9 16.3Parts 136.1 135.2 92.9Source: Eurostat4 database (2006)The refills production in the EU countries represented a value of € 16 million in 2005, accordingto the Eurostat database. It showed a 45% decrease over the years 2003-2005, after alreadyhaving decreased by about 22% between 2001 and 2003. As far as the parts of pens areconcerned, production in the EU countries represented a value of € 93 million in 2005according to the Eurostat database. This indicates a decrease of 31% over the period 2003-2005. Please note that this number includes the parts of all types of pens and that is why it isrelatively large compared to the ball-point pens market. Another reason for this relatively large4 The Eurostat database is not exhaustive in its information. Numbers for certain years and countries might be missing

and this may give deceptive impression in some cases. One should not fully rely on the statistical

background providedecade.

value of parts production is the fact that a lot of parts are produced in Europe and exported todeveloping countries for assembly. Then they come back in the EU as complete pens.Moreover, Germany’s production of pen parts represents about 81% of the EU production ofparts. The main reason for that is the availability of strong manufacturers and suppliers of penparts in this country5. Finally, pen parts are also a very important source for opportunities formanufacturers and exporters from developing countries as production is showing a decline inEurope.Germany produced ball-point pens, refills and parts valued at € 258 million, 448 millionprimary units in 2005:• ball-point pens worth of € 171 million ( 66% share)• refills worth of € 11 million ( 4% share)• parts worth of € 76 million ( 30% share)In 2004, Germany produced respectively € 167 million, € 34 million, and € 82 million worth ofball-point pens, refills, and parts, totaling € 283 million, with a volume of 506 million primary

units. This indicates a decrease of 9% in value and a decrease of 12% in volume in totalproduction. The ball-point market in Germany is very fragmented. The main manufacturers inthe refillable market are Bic (www.bicworld.com), Schneider Schreibgeräte(www.schneiderpen.de), Lamy (www.lamy.de), Sanford (www.sanfordcorp.com), Senator(www.senatorpen.com), Herlitz (www.herlitz.de), and Pilot (www.pilotpen.com).France produced ball-point pens, refills and parts valued at € 100 million, 233 million primaryunits in 2005:• ball-point pens worth of € 80 million ( 80% share)• refills worth of € 5 million ( 5% share)• parts worth of € 15 million ( 15% share)In 2004, France produced respectively € 94 million, € 5 million, and € 18 million worth of ballpointpens, refills, and parts, totaling € 117 million, with a volume of 112 million primary units.This indicates a decrease of 15% in value, but an increase of 208% in volume in totalproduction. The main manufacturers of ball-point pens are Bic (www.bicworld.com) andSanford, with Reynolds and Papermate (www.sanfordcorp.com).Spain produced ball-point pens and parts valued at € 7 million, 15 million primary units in2005:• ball-point pens worth of € 6 million ( 88% share)• parts worth of € 1 million ( 12% share)In 2004, Spain produced worth of € 8 million, with a volume of 18 million primary units; itproduced respectively € 7 million and € 1 million worth of ball-point pens and parts. In total,This indicates a decrease of 17% in value and a decrease of 13% in volume in total production.Main manufacturers are Bic (www.bicworld.com), Staedtler (www.staedtler.com), and Sanford(www.sanfordcorp.com) for disposable ball-points. Main manufacturers in the refillable ballpointmarket are Sanford, Bic, and AT Cross (www.cross.com). Other luxury brands, likeMontblanc (www.montblanc.com) and Inoxcrom (www.inoxcrom.com), are also players in thismarket.Italy produced ball-point pens and parts valued at € 66 million, 873 million primary units in2005:• ball-point pens worth of € 65 million ( 98% share)• parts worth of € 1 million ( 2% share)In 2004, Italy produced worth of € 71 million, with a volume of 1012 million primary units; itproduced respectively € 69 million and € 2 million worth of ball-point pens and parts. Thisindicates a decrease of 6% in value and a decrease of 14% in volume in total production. Main

5 Note that Switzerland is also a big manufacturer of pen parts in Europe. Unfortunately, quantitative

information for that country is not available in the Eurostat database.

manufacturers of disposable ball-points are Bic (www.bicworld.com), Sanford(www.sanfordcorp.com), Osama Scrittura (www.osama.com), Pilot (www.pilotpen.com), andPentel (www.pentel.com).The UK produced ball-point pens valued at € 28 million in 2005.In 2004, the UK produced worth of € 30 million; it produced respectively € 27 million and € 3million worth of ball-point pens and parts. In total, this indicates a decrease of 6% in value intotal production. Main manufacturers of disposable ball-points are Bic (www.bicworld), Sanford(www.sanfordcorp.com), Pentel (www.pentel.com), and Staedtler (www.staedtler.com). In therefillable ball-point market, the main manufacturers are Sanford, Bic, and AT Cross(www.cross.com).Unfortunately, the Eurostat database has no information available about the Benelux market.Bic (www.bicworld.com) dominates the Benelux market for disposable ball-points, owning a25% market share. Main manufacturers of (premium) refillable ball-points are Sanford, ATCross (www.cross.com), Montblanc (www.montblanc.com), Bic (with Sheaffer) and Pelikan(www.pelikan.com).The Nordic countries produced ball-point pens valued at € 4 million, 6 million primary unitsin 2005. In 2004, the Nordic countries produced € 4 million, with a volume of 7 million primaryunits. This indicates a decrease of 18% in value and a decrease of 18% in volume in totalproduction. Main manufacturers in the Nordic countries are the Bic (www.bicworld.com),Faber-Castell (www.faber-castell.com), Pilot Pen Company (www.pilotpen.com), Merz andKrell, and Staedtler (www.staedtler.com).Opportunities and threats+ Opportunities for certain writing and graphic market products lie mostly in the ‘back-toschool’period.+ The ball-point pen market is mature/stature, but production figures have decreasedsignificantly over the last years.- The penetration of electronic devices such as personal computers and e-mail negativelyaffect the volume growth in consumption in the European Union.- In the near future, competition can be expected from digital pens, now in their early phaseof development.- Lack of growth in the ball-point markets indicates a lack of opportunity.± There has been a visible shift in consumer demands in the writing and graphic supplies

market. More innovative products are occurring, as manufacturers add value to theirproducts, by paying more attention to aspects such as comfort, design, and reliability.The same development or trend can be an opportunity for one exporter and a threat foranother; exporters should analyze if these developments represent an opportunity or a threatand the outcome of this analysis depends on the specific situation of an exporter. We refer tochapter 7 ‘Opportunity or threat?’, of the EU survey ‘Stationery, office and school suppliesmarket in the EU (2007)’ for more information on opportunities and threats.2 Trade channels for market entryThis chapter gives a brief overview of the distribution of ball-points and contains an overviewof relevant distribution intermediaries (importers/wholesalers, contract stationers, schoolsuppliers, etc.). For a detailed description of the various types of distribution channels, seeChapter 3 ‘Trade channels for market entry’ of the CBI survey ‘The stationery, office andschool supplies market in the EU’ (2007).Distribution intermediariesThe trade structure of stationery in the EU is complex, as stationery is distributed throughmany different intermediaries and retailers. Figure 2.1 gives a simplified picture of the tradestructure in the stationery market, and it shows the basic relation of the various kinds of intermediaries. As can be seen, ball-point pens reach the end users through a number of

different intermediaries

Source: CBI Market survey ‘The stationery, office and schools supplies in the EU’ (2007)In the last decade the European stationery market has become increasingly competitive.On the one hand, this is due to the distinct maturity of the market, especially in the Northwesternpart of Europe. However, the sluggish economic development of the EU ever since2001 has also had its effect on stationery consumption. As the EU economies are obviouslyimproving, this has already had and will have its positive effects on this sector, althoughslightly yet. However, despite this positive news, the increasing pressure of new types of retailformats selling stationery, such as hypermarkets, superstores, e-tailers, etc. still leads tosliding profits and escalating debts among many established market players. In particular, theintroduction of superstores and e-commerce has impacted the European market considerably.It is important to note that the distribution structure differs quite substantially per end usersegment. Large professional end-users generally purchase ball-points and other stationery,office and school supplies through contract stationers and, marginally, through direct salesfrom manufacturers and wholesalers. The medium-sized Professional users (10 to 100 officeworkers) are often supplied by retail chains, department stores, but especially through officesupply dealers, specialized superstores and mail-order companies. There can, however, be acertain overlap between the distribution channels used to service medium-sized and largeprofessional users. Schools and Institutions generally have their own specific suppliers.

These so-called school suppliers are under growing pressure from other suppliers, who areincreasingly targeting their marketing efforts at this group of end-users. This is a reason forthe specialized school suppliers to initiate more marketing activities towards offices. The SoHoand private end-users, such as scholars, students and families, typically use a variety ofdistribution channels, among which are superstores, hypermarkets and department stores.Looking closer at the distribution of ball-points, the so-called school suppliers are ofconsiderable importance. These are importers and/or wholesalers who have specialized insupplying schools and institutions. Nowadays some of these companies have expanded theirbusiness to the private and/or SoHo and/or professional end users in order to grow. Someexamples of companies that have been typically so-called school suppliers are: WMS in theUnited Kingdom and Koks Gesto in The Netherlands. Unfortunately, there are no separatedistribution statistics available for ball-points.CBI MARKET SURVEY: THE EU MARKET FOR BALL-POINT PENSSource: CBI Market Information Database • URL: www.cbi.eu • Contact: marketinfo@cbi.eu • www.cbi.eu/disclaimerPage 7 of 18

Although the distribution landscape within the reviewed countries is globalizing

Source: CBI Market survey ‘The stationery, office and schools supplies in the EU’ (2007)In the last decade the European stationery market has become increasingly competitive.On the one hand, this is due to the distinct maturity of the market, especially in the Northwesternpart of Europe. However, the sluggish economic development of the EU ever since2001 has also had its effect on stationery consumption. As the EU economies are obviouslyimproving, this has already had and will have its positive effects on this sector, althoughslightly yet. However, despite this positive news, the increasing pressure of new types of retailformats selling stationery, such as hypermarkets, superstores, e-tailers, etc. still leads tosliding profits and escalating debts among many established market players. In particular, theintroduction of superstores and e-commerce has impacted the European market considerably.It is important to note that the distribution structure differs quite substantially per end usersegment. Large professional end-users generally purchase ball-points and other stationery,office and school supplies through contract stationers and, marginally, through direct sales

from manufacturers and wholesalers. The medium-sized Professional users (10 to 100 officeworkers) are often supplied by retail chains, department stores, but especially through officesupply dealers, specialized superstores and mail-order companies. There can, however, be acertain overlap between the distribution channels used to service medium-sized and largeprofessional users. Schools and Institutions generally have their own specific suppliers.These so-called school suppliers are under growing pressure from other suppliers, who areincreasingly targeting their marketing efforts at this group of end-users. This is a reason forthe specialized school suppliers to initiate more marketing activities towards offices. The SoHoand private end-users, such as scholars, students and families, typically use a variety ofdistribution channels, among which are superstores, hypermarkets and department stores.Looking closer at the distribution of ball-points, the so-called school suppliers are ofconsiderable importance. These are importers and/or wholesalers who have specialized insupplying schools and institutions. Nowadays some of these companies have expanded theirbusiness to the private and/or SoHo and/or professional end users in order to grow. Someexamples of companies that have been typically so-called school suppliers are: WMS in theUnited Kingdom and Koks Gesto in The Netherlands. Unfortunately, there are no separatedistribution statistics available for ball-points.CBI MARKET SURVEY: THE EU MARKET FOR BALL-POINT PENSSource: CBI Market Information Database • URL: www.cbi.eu • Contact: marketinfo@cbi.eu • www.cbi.eu/disclaimerPage 7 of 18Although the distribution landscape within the reviewed countries is globalizing and becomingsimilar, there are some considerable differences:• In the United Kingdom, the wholesalers, such as Spicers and Kingfield Heath, are ofconsiderable importance, making up 15% of the manufacturers’ sales.• In Germany and the Netherlands, buying groups are an important feature in the market.Important buying groups are Branion GmbH in Germany and Quantore and Hameco in theNetherlands (not reflected in figures).• In France, hypermarkets like Carrefour, Leclerc and Auchan are of considerable importanceespecially regarding ball-point pens sold to the private end users in the back-to-schoolperiod. In Germany discounters such as Aldi and Lidl are increasingly making inroads intothe market but only with temporary promotional sales.• The Spanish retail scene is rapidly changing from traditional structures, dominated bysmall, often family-owned, stores, to modern shopping environments with new retail

formats operated by large multiple groups. El Corte Ingles is an important chain ofdepartment stores also selling writing and drawing instruments. An example is GrupoPicking Pack (GPP), which has the largest network of office products stores in Spain,serving the SoHo market through a network of franchise stores.• The mail order channel is expected to increase its share further as attitudes to this mode ofbusiness begin to change in Italy. Mail order is expected to compete successfully withsmaller office products dealers, retailers and office superstores.Most important distribution channels for developing countries exportersMost intermediaries discussed can be of interest for the manufacturers in a developing country.The following intermediaries may, in our opinion, be an option for manufacturers in developingcountries:• Agents -An agent is an intermediary who does not keep stocks. The agent may serve as anintermediary between the manufacturer and the wholesaler or retailer, receiving acommission from the former. The agent usually has a good knowledge of distributionstructures and consumer behaviour. The problem of working through an agent is, however,that the manufacturer is totally dependent and has to trust the quality of the agent'sknowledge, commitment and selling ability.• Importers/ wholesalers - Importers are familiar with local markets and can supplyconsiderable information and guidance to the overseas manufacturer, such as the handlingof import and export procedures and holding of stock, in addition to the primary businessof buying and selling. Furthermore, they have strong relationships with suppliers andbuyers all over the world.• Buying Groups - Buying Groups source stationery on behalf of their members. Negotiatingcompetitive pricing and other marketing benefits including rebates and co-op funds are themain functions of buying groups. The Buying groups generally have strong importprograms and can therefore be an interesting trading partner for an exporter in adeveloping country.• Retailers - Some retailers do import directly from manufacturers in low wage countries. Thetraditional retail formats are under pressure from new formats. Super- and hypermarketsnowadays offer a wide range of stationery. Relatively new retail formats, like superstoresand e-commerce, are also entering the stationery market.Useful sourcesBelow are listed the most important contract stationers, importer/wholesalers, dealers, buyinggroups, chains of retailers and department stores, involved in the distribution of Ball-pointpens per country.Germany• EK Grosseinkauf eG - http://www.ek-grosseinkauf.de/• Herlitz AG - http://www.herlitz.de/

• PBS - http://www.deutschepbs.de/

UK• Kingfield Heath - http://www.kingfieldheath.com/• Office Club Ltd. - http://www.officeclub.co.uk/• WH Smith - http://www.whsmith.co.uk/France• Carrefour - http://www.carrefour.fr/• Auchan - http://www.auchan.fr/• Guilbert - http://www.guilbert.fr/• Groupe Casino - http://www.groupecasino.fr/• G3+ - http://www.intropa.fr/• Galeries Lafayette - http://www.galerieslafayette.com/Benelux• Bruna - http://www.bruna.nl/• Vroom and Dreesman - http://www.vroomendreesman.nl/• Hema - http://www.hema.nl/• Timmermans - http://www.timmermansnet.com/• Ahrend - http://www.ahrend.be/• Carrefour - http://www.carrefour.be/• Quantore - http://www.quantore.nl/• Galleria Inno - http://www.inno.be/Spain• Comercial del Sur de Papeleria S.A. - http://www.liderpapel.com/• Makro Paper - http://www.almacenespaez.com• El Corte Ingles - http://www.elcorteingles.es/• RED - http://www.grupoccs.com/• Sett Grup - http://www.settgrup.es/Nordic countries• Ahlens - http://www.ahlens.se/• Beltton Oy - http://www.beltton.fi/• EMO A/S - http://www.emo.no/• Nio Fem - http://www.niofem.se/• Bogpa A/S - http://www.bogpa.dk/• Oy Wulff AB - http://www.wulff.fi/• Andvord Tybring-Gjedde - http://www.tybring-gjedde.com/Italy• Errebian - http://www.errebian.it/• Buffetti - http://www.buffetti.it/)• Coin - http://www.coin.it/• La Rinascente - http://www.rinascente.it/Price structureThe most traditional route for ball-point pens from manufacturer to the end user is as follows:manufacturer -> importer/wholesaler/buying group/chain -> retailer -> end user. Below you willfind an indication of the average margins. Please note that information on margins shouldalways be updated and checked for the specific product / market combination.CBI MARKET SURVEY: THE EU MARKET FOR BALL-POINT PENSSource: CBI Market Information Database • URL: www.cbi.eu • Contact: marketinfo@cbi.eu • www.cbi.eu/disclaimerPage 9 of 18Traditional trade price structure

End-users (street) price inclusive of VAT € 2,50VAT 19%6 € 0,40End-users (street) price exclusive of VAT € 2,10Average margin retail outlet / shop 38% € 0,80Retailer’s purchase price € 1,30Average wholesalers/importers margin 27% € 0,57Wholesaler/importers purchase price in house € 0,73Import and transport cost 20% over fob! € 0,12Wholesaler/importer’s purchase price fob € 0,61Transport % import cost € 0,10Ex works € 0,51A multiplier of 4 is applied to a manufacturer’s FOB price to estimate retail prices (in the aboveexample that multiplier exactly amounts to 4.1). Throughout the different trade channelsmargins and prices vary widely.In earlier days, in the so-called product driven economy, the manufacturer would calculate hiscost price, add his ‘desired’ profit margin and quote that price to his potential buyers (bottomup method). However, nowadays, the so-called market driven economy manufacturers havestarted to realize that they and their (potential) buyers/trading partners do not determine theprice levels on their own. The price levels in the entire supply chain are for the major part‘determined’ by the end-users, the market, how much are they willing to pay for the product.For generic products this is generally much lower than for specialised or branded products.Selecting a suitable trading partnerA possible way of finding a business partner is the CBI Company Matching Tool, which canappropriately match your company to a European partner. This can be the case only if yourcompany meets the criteria of CBI for an eligible candidate and if it produces products thatcorrespond with the eligible product groups. For more information on that and furtherprocedures consult the CBI site http://www.cbi.nl. Other suitable ways of finding a businesspartner(s) are given in Chapter 5 of the CBI’s Export planner, namely ‘Selecting tradepartners’. Possible ways of searching are through Internet, short-listing possible partners. Youshould travel around, pick up information, compare and select. An idea here is to visit tradefairs and exhibitions in any one of the selected countries:• Eventseye - http://www.eventseye.com/fairs/event_tg171_1_1.html - Trade Shows,Exhibitions, Conferences and Business Events Worldwide• Biz tradeshows - http://www.biztradeshows.com/office-supplies/• Infomat - http://www.infomat.com/calendar/infsg0000015.html• The Wholesaler UK - http://www.thewholesaler.co.uk/trade_diary_dates.html3 Trade: imports and exports It is necessary to point out that the numbers for 2002 and 2004 consist of EU-25 data,excluding Romania and Bulgaria. 2006 incorporates these two countries: the EU. The total

import share of Romania and Bulgaria in 2006 amounted 2% (with a combined a value of 13.1million) of total imports.Total Intra-EU imports grew 12% from 2004 to 2006. Also, imports from developing countriesgrew almost 29% from 2004 to 2006. The main supplier of these imports is China, the largestsupplier in all the reviewed countries, and responsible for over 79% of all imports fromdeveloping countries. Almost 22% of total imports into the EU come from China. The largestimporter from developing countries by value is Germany. The largest importers fromdeveloping countries by share of total imports are Spain and the UK (each 34%). Extra-EUimports are substantially decreasing, according to a trend over the last few years. Theseimports are being replaced by imports from developing countries and from within the EU.Imports into Germany amounted € 144 million in 2006 compared to € 128 million in 2004. Thisincrease was caused mainly by an increase in imports from developing countries. Intra-EUimports increased slightly, but extra-EU imports suffered a decline of less than 1%. Importsinto France amounted € 132 million in 2006, up from € 109 million in 2004. While the statisticsshow an increase in imports from all 3 sources, intra-EU, extra-EU, and from developingcountries, the increases in imports from intra-EU and developing countries were significantlygreater than in extra-EU imports. Imports into Spain amounted € 70 million in 2006, up from€ 67 million in 2004, a 4% increase. However, imports from developing countries increased asimports from intra- and extra-EU sources fell. Imports into Italy amounted € 85 million in2006, rising from € 78 million in 2004, an increase of almost 10%. Again, imports from extra-EU countries decreased while those from intra-EU and developing countries increased. Importsinto the UK amounted € 123 million in 2006, falling by 8% from € 133 million in 2004. Whileboth intra- and extra-EU imports decreased, imports from developing countries increased.Imports into the Benelux amounted € 65 million in 2006, 5% down from € 68 million in 2004.Finally, imports into the Nordic countries increased slightly, showing some increase in theimports from intra-EU countries and developing countries.Ball-point pens, refills, and partsThe total ball-point pen market can be divided into three main product groups: ball-point pens,refills for ball-point pens, and parts for ball-point pens. Total import-shares in 2006 amongthese product groups, among the seven reviewed markets, are reviewed below.

Total EU imports into the seven reviewed markets of the ball-point pen product groupconsisted of 89% of ball-point pens, 4% of refills, and 7% of parts.• Total German imports of the ball-point pen product group consisted of 83% of ball-pointpens, 6% of refills, and 11% of parts• Total French imports of the ball-point pen product group consisted of 87% of ball-pointpens, 4% of refills, and 9% of parts• Total Spanish imports of the ball-point pen product group consisted of 92% of ball-pointpens, 5% of refills, and 3% of parts• Total Italian imports of the ball-point pen product group consisted of 89% of ball-pointpens, 6%Opportunities and threats+ Increasing amount of imports, and also an increasing share coming from developingcountries.+ From 2006, some buyers who have in the past decade been very actively buying fromChina, clearly and explicitly initiated new sourcing activities outside China, an importantlarge volume supplier in this sector. In most cases, the reasons stated were increasingprices in China and, in some cases, also the ongoing inconsistency in quality and deliverytimes.+ In Spain, luxury or higher-quality refillable ball-points are the niche facing strongestcompetition from the exporters from the developing countries. Own label productspenetration is static and more expensive pens are more likely to face competition from DCproducers and exporters than cheap private label ball-points.+ Imports into Benelux are significant for the population of the countries included in it. Themajority comes from the Far East, France, Spain, Italy and Germany. According to MPAInternational, an increase in the imports is not expected. Moreover, the consumption ofball-points in this market is static due to the intense competition from other types of pens.+ Japanese suppliers are losing considerable market share in the EU. India, Thailand andTurkey have strengthened their position in the EU recently. EU countries still play animportant role e.g. France and The Netherlands.+ Persistent and relatively high wage increases, combined with low (or even negative) labourproductivity growth, have given rise to competitiveness problems for some Member States.Nominal unit labour cost is estimated to have risen by around 2½-3% in Spain, Portugaland Finland, and by 3% or more in Greece, Ireland and Italy in 2005.