Presented by:

Megumi Nanya

Yanan Hou

Patrick Kelm

Agenda

• Company Overview

• Pentel France

• Why operate in France?

• Conclusion

is a privately held Japanese company that produces stationery and writing instruments

Deming Prize 1976

1946 2009

Company Overview

Pentel Co., Ltd.

Company Values

– Spirit of Wonder– Being Better Is What We’re All About!

– Leader in innovation– Commitment to excellence.

Product Portfolio

Global Network

2004 2005 2006 2007 20080

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

300,000,000

350,000,000

400,000,000Pentel's operating revenue (in U.S. dollars)

Operating revenue (total)

Operating revenue (eu-ropentel)

Note that 1 US dollar=88.35yen & 1 US dollar=1.47 euro

Pentel’s Financials

In USD

2004 2005 2006 2007 2008

-4,000,000

-2,000,000

0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000Pentel's net income (in U.S. Dollars)

Net income(total)

Net income(Europentel)

Pentel’s Financials

Note that 1 US dollar=88.35yen & 1 US dollar=1.47 euro

In USD

Environmental Activities

Pentel is the leader in environmental activities

• Following the worldwide trend of environmental responsibility

• In 2007 Pentel instituted the Recycology™ producing products…• with a minimum of 50% recycled materials by weight• without any liquid servants• no PDC

• The Pentel Path to Recycology™ - Reduce, Reuse, and Recycle -

International Children’s Art Exhibition

Social Activities

Pentel of America

Pentel France

In 1966, Pentel entered the French market

Headquarter Japan

Pentel Europe

USA ...

Pentel France

GER ...

Marketing Department

Manu- factring

Commer-cial

Ware-house

Sales-men

Located in Marne la Vallee

Located in Bry sur Marne

Ball Pen

$311 million sales 2008

$21.7 million sales 2008 60 employees

826 Employees

Pentel France

Pentel’s Customer in France

Revenues per market

B2B-Business

B2C- Business

60%40%

• Mass-market• Distribution

via stationary shops

• Office suppliers• Distribution direct

selling• European key accounts

(Global players)

• Europentel S.A.S. counts $21.7 million revenues• B2B-Revenues: $13.02 million• B2C-Revenues: $8.68 million• 3rd largest provider in France

Benefits

Geographic Factor

Economic/ Market Factors

Workforce

Why operate in France?

✔

✔

✔

Interaction with other European subsidiaries• Marketing activities• Common European brand image• Point of sales

Huge market for pencils• Price in Germany: €0.75 - €0.98• Price in France: €1.21 - €1.48

Basis for company’s innovativeness• Well educated• Cultural fit

Constraints

Taxation

Workforce

Bureaucracy

Cultural Constrains

Why operate in France?

✗

✗

✗

✗

Highest corporate taxes

• Highly unionized• 35h per week• No Strikes

Cultural differences between Japan & France• All employees are French• Chairman is Japanese

Role of the state

• Good understanding and integration of French’s way of doing business

• Gives certain autonomy

• Good understanding and adaption of Japanese company cultural

• Close cooperation with headquarters

Similar value towards employee loyalty, team spirit and identification with the company

Adaption to France

The headquarter culture fits with the French values

Doing Business in France

Major Advantages

Challenges in France

• Huge market

• Regional product, price & promotion differentiation

• Highly productive & well educated employees

• Highly competitive market

• Pressure to differentiate permanently from the competitors

• High quality human resources

The headquarter strategy fits into the French market

• Euro Pentel S.A.S operates in France since 1966

• The subsidiary consists of a manufacturing & sales department

• The main reasons for Pentel stay in France • Cultural fit between Pentel & France• Strategic fit between Pentel & France

• As long as this fit exists Pentel can operate successfully in France

Conclusion

Thank you very much