National Pen Company
- Pages: 21
- Word count: 5068
- Category: Company
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National Pen Company has its history being traceable back to 1948, a year which saw the company start off in New York, Bronx as a tool and dye company. Over the years, the National Pen Company has undergone a lot of transformation- having been a manufacturer of pens and a marketing firm for instance. This means that the company has also undergone diverse forms of ownership for which it is under the management of Berwind as the parent company.
At the moment, the NPC is being beset by a myriad of problems that are mostly akin to financial setbacks. While NPC is trying to make measures that would reverse the situation, speculations are rife with one side of the divide having economic and business analysts pointing out that the company will subsequently realize growth, while on the other hand, other economic pundits maintain that the prospects of the company realizing any improvement is still debatable, given both the external and internal factors that surround the business. Most interestingly, both speculations are coupled with claims that cite SWOT analysis on the National Pen Company.
It is based on this kind of development that it has always behooved analysts that nothing short of a meticulous and dexterous SWOT analysis be carried over the National Pen Company as a firm, so that the ascertainment of its prospects can be determined. This means that the intra- organizational factors that favor the profitability of the National Pen Company as its Strengths will have to be taken to stock. Similarly, the intra- organizational arrangements that may derail the realization of success for the NPC are to be analyzed as the Weaknesses of the company.
The external conditions which are likely to favor the success of the NPC as the Opportunities of the NPC are similarly to be brought to scrutiny. Likewise, it is mandatory that factors in the market be taken to consideration when trying to ascertain the prospects of NPC’s success. The main difference between the Strengths and the Opportunities in SWOT analysis is that the latter refers to external conditions that are mostly extant in the market while the former refer to intra-organizational conditions that dictate the profitability or the failure of any business or corporate entity. In the same vein, the Weaknesses and the Threats of the SWOT analysis are really a bifurcation of the conditions that affect the vibrancy of a business, with the Weaknesses referring to factors that are akin to the internal profile of a company. The threats refer to external, environmental or market factors that possess the potency to dictate the success of any business or corporate entity.
The Strengths of the NPC Company
In the first place, NPC has been in business for over six decades. This poses a lot of positive attributes for the company. In the first place, this means a lot of field experience for the company. It is because of this that NPC has been able to gain an edge over its competitors such as Shanghai Gold Crown Fountain Pen and the French Based BIC Pen Company. Similarly, it is by this virtue that NPC has been able to produce stationery brands such as the Techie and Ruler Calculators.
The above has in most times, been accredited as one of the prime means by which NPC has been able to solidify here customer base. The fact that the Techie and Ruler Calculators are always associated with the NPC has made the company more popular, both at the national and at international level. According to statistical provisions served by Satterthwaite and Company (2005), majority of the clients overseas (in China) turned NPC as the stationery store of their choice, having learnt about it being accredited for the Techie and Ruler Calculators brand. Since all who were interested in making purchases of a wide range of stationery could find all forms of stationery under a single roof, the clients easily prefer shopping with NPC.
The fact that NPC has diversified its operations so as to provide the market with top marketing and advertising services has continued to accord the company accolades from the corporate sector. That NPC has earned a feather in its cap as a result of venturing into the advertising and marketing sector is best testified of by the fact that since 1970s when it started this advertising and marketing business, the company’s corporate image soared by 50% (Costigan 2001).
Likewise, it is important to take stock of the fact that the venturing into the advertisement and marketing business has been helpful to the NPC in a myriad of ways. First off, the company has been able to diversify risks that come a result of centralized economics. This means that any case of any negative eventuality that may affect the pen designing and manufacturing business can be assuaged by divesting some of the synergies from the marketing and advertisement business. Similarly, the venture into the marketing and advertisement section is likely to widen the berth for the realization of profits. This is because, the advertisement and marketing business is normally geared towards the corporate firms. Going by corporate statistics, a fair price that each corporate entity pays for the advertisement per unit portends a minimum of 700 US Dollars.
At the moment, it is pointed out by economic pundits that on daily basis, the NPC as a company registers about 30 applications for marketing and advertisement services. This only translates to a huge pool of revenue for the NPC as this portends a minimum of 630,000 US Dollars net profit at the end of every month (Costigan Ibid).
The diversification of the field of operation into the pen designing and manufacturing, alongside sales, marketing and advertisement has also meant for the NPC, the increase of the size of the clientele base. It is this same corporate artifice to diffuse risks by bifurcating its synergies into the sales, advertising and marketing from the pen designing and manufacturing that has seen the number of the clients for the NPC escalate. Initially, before the NPC became quasi sales, marketing and advertising company, it could brag about 199, 650 active customers. After the venturing into the advertisement and marketing sector, the company realized 224,664 additional active clients. It is by this virtue that NPC reportedly realizes an annual increase of the number of clients as being 174,494 in the pen designing and manufacturing sector and 189,956 in the sales, marketing and advertisement sphere (American Association of Credit Management 2000).
In about the same spectrum, it is after the diversification of the operations of the NPC businesses, markets and synergies that the firm has been able to realize a favorable clientele retention rate. During the formative stages (the first decade), the company originally had a client’s retention rating of 15%. As things stand at now, the company maintains a client retention rate that hits 43% even in foreign markets such as Denmark, Germany, Netherlands and Italy (Davies 1999). This means that NPC stands at par with few but highly reputable competitors such as Shanghai Gold Crown Fountain Pen and the French Based BIC Pen Company. At the same time, NPC has an edge over locally based firms such as the AAA Benekana International, Economy Pen and Pencil Co., and Eversharp, in the international market.
NPC has also been able to increase the volume of the multi-buyers ever since it ventured into the advertising, sales and marketing expeditions. Simply speaking, multi-buyers refer to clients who have made purchases within a period of 12 months, items through direct or conventional channels or conversely, those who had at least made one retail and one direct purchase.
Similarly, the NPC has been reputed to be ahead of its peers on the account of having a base of highly skilled and seasoned personnel who have a comprehensive threshold of experience. At the moment, it is estimated that NPC has 7,000 employees, of which ¾ of these possess a Bachelor’s Degree as the minimum prerequisite for employment. Business, corporate and organizational analysts with economic acumen point out that it is because of this situation that NPC has been able to flourish. Of these analysts, Herringshaw (2001) points out that this source of skilled labor was instrumental for the according of the NPC firm with sound, feasible and accurate advice at the very first time the company was intent on going global by first making an incursion into the Chinese market. Alongside the timely mental calculations that were bequeathed the NPC, the employees similarly provided skilled labor, moral support and dedication to the NPC ideology and NPC spirit of teamwork.
As far as product innovation is concerned, NPC is also reputed for having popular innovative and unique designs and brands that have always been attributable to it. The above attestation is overtly testified of by the Liguori designed pens that NPC alone has been known to produce. As if this is not enough, it suffices to say that NPC has been able to lure and to consolidate its clientele by making unique designs of products, and these attracting customers who harbor class consciousness. This artifice to attract high income earning clients, NPC also tampers with the designing and manufacturing of fancy but affordable designs so as to capture and consolidate both the middle and the low income earners. It is because of this company’s innovative culture in stationery designs that in the corporate sector, NPC is identified with the epithet: the King of Decorating Innovation (Beard 1999).
NPC also takes to provide the market with high value promotional products at very subsidized charges. While this is always seen to be practical and useful during the formative stages of any business, it is important to note that the same has been instrumental in consolidating regular customers and attracting new ones. NPC is known to give to the market, free products, or products whose prices have been subsidized, for instance.
It is also a well known fact that NPC as a company that primordially dealt with the provision of tying and dyeing services also deals in the manufacturing of ink. In this spectrum, the company has been able to provide top notch quality of ink- a feat that has always succeeded in ensuring the confidence of the regular customers. It is on this backdrop that NPC has been able to market its quality brand of ink, known as the National Ink Inc., in California, Santee. It must be known well that the National Ink Inc has the same reputation with leading ink brands such as Quill and Quink in leading markets such as Italy, Denmark, Britain, the us and the New Zealand, Australia, France and Belgium, among a host of other nations (McMaster 1999).
According to McMaster (Ibid), the success of NPC in the global market is still highly attributable to the sundry and all successful marketing channels that NPC possesses. McMaster (Ibid) maintains that to this extent, NPC takes as a matter of grave seriousness, the cause of marketing, advertising and sales. It is pointed out that annually, NPC spends 33,300 US Dollars in the advertisement sector alone. It is pointed out that it is through advertisement that the NPC as a company was able to penetrate into the foreign markets that had formidable competitors. Among these competitors are Blattner Brunner, Inc., Deutsch Inc., McKinney & Silver and Mezzina Brown & Partners. It based on this need to ensure swift marketability of the NPC products and services that virtually all the NPC centers are situated within the precincts of the Central Business District Areas, where supportive infrastructure, dense network of means of transport and security are highly extant and operational. It is pointed out by the same marketing pundits that if NPC is to maintain the current trend that it is observing in the marketing efforts, then this company is bound to realize positive dynamism in the area of market expansion (Clarke and Wormser 2006).
In order to seal its perfection in the accordance of its advertisement, sales and marketing services for other companies, NPC tries to remain ahead of its peers and competitors in the advertising and sales business by providing corporate branding for diverse companies. Given the fact that NPC has been functional in the advertisement and marketing field, it is important to take stock of the fact that NPC specializes in making for companies and firms, unique range of logos and emblems. Examples of companies whose logos were designed by NPC include Rank Xerox, the Via Del Campo International Hotel and FedEx, among others.
Similarly, for different companies, NPC also designs unique and trendy Custom logos and personal imprints for the provision of promotional items. Compared to other companies such as Logoworks and Logo-Design Gurus whose rates for designing company logos range from 800 US Dollars to 950 US Dollars, NPC’s charges mainly range from 750 US Dollars to 790 US Dollars (Snowden, et al. 1997). It is on this premise that NPC is reputed as a company whose services or goods are underpinned by Low price for high value.
It is also pointed out that NPC is also known for sharpening its departmental focus so that each department becomes more product specific. Also known as job specialization and division of labor, NPC ensures that each department takes to carry its own tasks. The main departments in any NPC headquarter or subsidiary includes the finance, purchases and procurement, human relations, sales, marketing and advertising.
Since the above departments comprise the personnel who are pertinently trained in the respective fields, it becomes automatic that the services accorded are of high quality as a result of job specialization. Similarly, this leads to high levels of output: a feat that has continued bequeathing the NPC with a niche in the pen designs, production and in the sales, marketing and advertising section. It is postulated by West Publishing Company (1999) that it is because of this observation and strict adherence to the cause of job specialization that NPC has been able to realize strong staying power in both local and foreign markets.
Weaknesses for the NPC Company
At the moment, NPC is rife with accusations from some market sectors that some of the electronic products that it sells come in bereft of clear and concise CE Markings. With brands such as Techie and Ruler Calculators being pointed out as examples of the above services that are devoid of the markings, complaints have been rife within some sectors of foreign markets such as China, France and Italy. It is on this backdrop that economic analysts such as Goss and Clarke (1997) make prognosis that this same failure on the side of NPC is bound to elicit insurmountable backlash from the above local markets.
Herein, the crux of the matter is pegged on the fact that clients feel that what NPC does by not according these provisions is tantamount to the contravention of the Fairness Act. This Act requires that al the pertinent measures be made so that proper and adequate arrangements can be made for the fairness to the customers. This act has it that the CE Markings must indicate the boldness, the quality and the texture of the pen so that the client can know precisely, the type of pen being bought. This is to the effect that there are different types of pens (which are manufactured by NPC) which are meant for different and unique forms of usage. For instance, the Sheaffer and the Roller Ball Fountain Pens types are exclusively meant for appending signatures. It would therefore be offending of NPC to let a client purchase such pens for conventional use (writing) at an exorbitant price, due to lack of information. Making this matter worse is the fact that NPC does not allow back, products that are already sold, the condition of the product notwithstanding.
In about the same wavelength, there are still accusations that do rounds, suggesting that some of the products remain devoid of complete precautionary or warning labels, despite the fact that all these are overtly important. To this extent, it is expected by the business and the corporate fraternity, together with the entire global market that all merchandise possessing some degree of inflammability be indicated as being so. However, according to Glasson and Kinley (1998), NPC is bound to loose, come the following year, given the fact that, as a business entity, it fails to take to stock, minutiae details of safety measures. Glasson and Kinley (Ibid) elucidate that among the pens being designed and manufactured by the same, fall short of indications pointing out flammability of the ink within the pen.
While it is true that NPC continues to bear the brand of being the company that uphold the value of quality in the dispensation of the pen manufacturing and designs, it is also important to take to stock, the fact that the company is attested of being needlessly absorbed in this feat. Market pundits such as (Desty, et al. 1999) posit that while the designing and the production of pens that are of high quality is important in curving out a niche in any foreign market, yet, this should be done with some moderation.
Market pundits posit that where it is clear that the pen manufacturing and design industry is not extant or is still a fledgling, then the synergies of the company to delve into this market can be channeled elsewhere. On the contrary, NPC Continues with working on quality issues that ought to be restricted to China. This is because China is the only foreign market NPC has made an incursion into, without properly placing her feet solidly on the ground. This on the other hand has affected other important aspects of services delivery, for instance mail delays, test delays and subsequently, forced out stages.
Similarly, critics continue to point out that the looming downsizing that NPC is about to implement carries very little prospects for profiteering the NPC. Desty, et al. (Ibid) for instance point that while there are situations that may from the façade, seem to support the need to retrench the employees so as to scale down the size of expenses, not all adverse conditions can be solved through retrenchment. McCabe (1999) divulges that a company that trudges the path of downsizing more than once is always likely to be associated with serial loathe for its employees.
More elucidations are made on this, with this act or state of affairs being blamed on a company being highly susceptible to high employee turnover. This high employee turnover sets in as the labor force shies away from being employed by a firm that is linkable to chronic downsizing. Employees within this organization have always an outward looking, waiting to go to greener pastures, whereas potential employees would consider working with this firm as the last resort, and as a stepping stone to greater prospects.
All the above conditions render the NPC’s upcoming downsizing nothing more than the treading on along a primrose path. This is because, at the turn of the 21st century, NPC conducted a major shake up, an exercise which critics pointed out as nothing more than a cover up that was aimed at retrenching employees, rather than transferring them. In the following year (2001), NPC executed another retrenchment exercise. With this imminent retrenchment exercise, despite the fact that the entire globe is under financial gloom, nothing more is going to avert the public perception on NPC as an institution that does not wax despondent at the sheer notion of disposing off its employees. This is likely to rid the pencil designs and manufacturing, advertising, sales and marketing firm of the large pool of customers that it has (McCabe 1999).
Similarly, it is true that NPC is espousing talks on the impending suspension of pencil marking waiver in February (2010). Though this is simply an artifice to assuage the high rates of expenses that are incurred as a result of the price waiver; nevertheless, marketing and economic pundits such as Goss and Clarke (1997) postulate that this is a fatal mistake. To bolster this accusation, it is pointed out that this exercise is very sensitive since it is the pen and pencil designing and manufacturing that forms the mainstay of the NPC. It is at the same time, pointed out that according to the West Publishing Company (1999) statistics, this price waiver on NPC pen and pencils was responsible for 30% increase of the client’s base in 2006, as far as the Chinese market is concerned.
Therefore, going by the above statistical provisions, it can be correctly surmised that the withdrawal of the marking waiver in 2010 February will see the market base for the NPC take a nosedive. Reputable business analysts who have high financial acumen and market moguls such as Glasson and Kinley (1998) point out that given the economic dearth that faces the globe, there is bound to be a plummeting in the purchasing power, in the global market. In the same vein, the withdrawal of the pencil marking waiver from the market, and the eradication of the subsidization of commodity prices is likely to leave the NPC products prices and services at relatively exorbitant rates. This is going to leave the larger part of the market resorting to companies that are less expensive, or better still, those companies that accord inferior quality of goods and services at cheaper prices. This state of affairs is bound to see NPC being at the loosing end.
The Opportunities for the NPC Company
In the first place, NPC ensures that its merchants work within the proximity of the Supply Chain. This is likely to boost and fasten the accessibility of NPC products and services by the clients. This same measure ensures that NPC does not expend so much of its synergies in order to avail its services to the market. It is also by this exercise that NPC has been able to prevent excesses. For example, in the US, the NPC is known to be within the proximity of Bronx, Los Angeles, Nashville and San Diego- all these being cities that are known to have a very dense network of transport network (road, rail and water transport). In France, the NPC subsidiary is located within Paris, Lyon and Marseille. These cities are reputed to be the most densely bequeathed with railway lines, road transport network and water transport.
NPC at the same time, observes punctiliously, the observation and the maintenance of direct and regular channels of communication between all its branches, headquarter, and subsidiaries and its clients. It is this measure that has ensured that NPC’s services and merchandise get to reach the market. To this effect, NPC makes sure that its services are not channeled through brokerage and middlemen. This ensures that clients gain in a dual sense. In the first case, this ensures high accessibility of NPC goods and services, while at the same time, cushioning consumers or the market in general, from exploitation by the middlemen. It is because of this that it is pointed out by Herringshaw (2001) that NPC takes seriously, the concept and practice integrating the channels of sales and marketing. This has been instrumental in helping NPC secure greater retention of lifetime revenue.
At the same time, it is worth taking to stock, the fact that as far as the Human Relations Management is concerned, NPC banks on the maximization of the experience of the clientele and the easing relations and business transactions between the client and the NPC. As far as the NPC tradition goes, NPC has been ensuring that it accords its employees equal chances of ascending higher echelons of management through merit. As far as one continues to accrue experience while working with NPC, and also carrying on with further studies, the accession of managerial positions becomes a reality. This aspect is accredited by some as being responsible for the existence of positive public relations between the company and the public at large.
Similarly, NPC totally remains compliant to the laws of the land on employment. This is to the effect that NPC considers a certain percentage for employment, with this percentage varying with the law of the land which acts as the NPC market. It is therefore pointed out that this is one of the chief reasons that espouse the populace to NPC brands and advertising services.
NPC has been working well and dexterously so as to realize positive cash flow. To this extent, the company has implemented plans that would ensure the integration of channels of sales and marketing. As a result of this, it is pointed out by Herringshaw (Ibid) that this feat rids NPC of the need to cater for the expenses that are incurred as a result of adopting a protracted channel of goods or products distribution. It is this same Herringshaw (Ibid) who points out that this measure has helped NPC realize the retention of revenue. The same Herringshaw (Ibid) explains that it is not fortuitous that among all the tying and dying firms, NPC is the one business entity that has the most attenuated span of this channels of distribution- a feat that has NPC saving 41% more revenue, compared to her competitors such as Blattner Brunner, Inc., Deutsch Inc., McKinney & Silver and Mezzina Brown & Partners. The fact of the matter is that NPC spends about 750 US Dollars on commodity distribution, as opposed to her peers who spend approximately 900 US Dollars.
That NPC has totally expanded her market both locally and international scope is widely held to be true since the company has markets in Spain, France, Italy, Canada, Germany, Australia, united kingdom, Portugal, Switzerland, Sweden, Belgium, Denmark. A peek at this list reveals that NPC deals mainly with the developed world as its source of market. This gives NPC the chance to realize easily, high rates of trade and commercial incentives (auxiliary to trade) such as: insurance, banking, efficient infrastructure, security, among others (Cooley and Vold 2000).
In the same vein, all the above countries are known to have political stability, by the fact that they are all stable democracies. In most cases, it is apparent that politically stable environments always breed salubrious political situation that is always responsible for the creation of felicity conditions for investments. The extension of this fact is seen in the fact that in the above citadels of democracy, chances for corporate and business security stand at least at 70%. On the other hand, less democratic countries that are mostly found in the Less Developed Countries (LDCs) support only an average of 35% chances for investments. The crux of the matter is that there can never be security outside political instability, with the extension of this reality being that there can never be investment without security.
The list of countries that NPC delves into for the marketability of its products testifies of the fact that the company practices and takes seriously, the concept of the diversification of the market. Diversification of the market, as opposed to centralization of the market is likely to ward off the risks that would come in as a result of adopting a one market stratagem. Some of the pitfalls of the one market strategy include: fluctuation of the value of currency; susceptibility to the client’s whims, tastes, preferences, cultural compunctions; stifling government regulations and unfriendly policies on taxation, among others.
It is important to note that by having more than 12 markets globally, NPC has already diffused these risks and as such, is likely to realize conducive market conditions. It is also worth, taking to stock, the fact that these countries that form the core of the NPC market exact friendlier taxes and government policies on foreign business. Partly, this is because virtually, all these countries are members of the World Trade Organization (WTO), and as a result, are subject to the deliberations of the DOHA reconstructions. These reconstructions ruled out that the exaction of tariffs on foreign products and the issuance of subsidies to local entrepreneurs and agriculturalists by local governments be eradicated. This measure has been responsible for the extirpation of chances for unequal and unfair competition in foreign markets.
It is on this account that NPC was accredited in 2000 as having been the leading firm to consolidate a positive trend in realizing the growth of international sales and the focusing on of designated countries by the American Association of Credit Management (2000).
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