France country cultural presentation Part 1

France country presentation

1. France BBH Leisure Car Rental

2. Executive Summary

3. Economic Status 5th largest in the world and represents about 1/5th of  Europe's GDP. One of the global leaders in Automotive, Aerospace and Railway.  It also has the highest number of science graduates (per thousands) in Europe.  Its primary imports include: machinery, automobiles and crude oil.  France is the most visited country in the world, so this is an exciting market to jump into. Could run into economic issues in country. 

4. Political System  France is considered a Republic, hence "The Fifth Republic." Established in 1958 by General de Gaulle, who was the first president and his prime minister Michel Debre.  It is parliamentary, but the executives like the president and prime minister do have more power than their western allies.  As of 2017, France was governed by the socialist party. 

5. Government Stability  Way before we came into play, religion and politics were two of the most circulated debates. But as of today, international order, economic and social issues have taken place.  France has a lot of stability, but also instability. The instability comes in when there are too many parties. In today's market, there would be a lot of negative opinions regarding an American abroad car service, but also positive.  Today there is more of an economic and social instability, rather than the fact that they are having trouble governing themselves. 

6. Short Term Political Risks  

7. Long Term Political Risks

8. Economic Analysis

9. France’s Demographics France’s current estimated population is about *64,975,424 Population growth rate reports confirmed as a whole, the country is growing at a faster rate than most countries across the globe. Natural growth, excludes immigration figures, accounts for nearly the whole of the natural growth recorded in the European Union. The median age for total population is 41.2 years The median life expectancy is 82 years (*A law from 1872 prohibits the French Republic from conducting census by making any distinction between its citizens in terms of race or religious beliefs, so French demographics can be a bit hard to determine.)

10. Income Avg. household net-adjusted disposable income per capita $29,759 (USD) per year Income variance among the rich and poor – top 20% of population earns close to 5x’s as much as bottom 20%. France’s Employment: 64% between of population between ages 15-64 in France have a paid job, 68% of men have paid jobs, 8% of employees work extended hours. Education and skills are crucial in obtaining work. 75% of adults aged 25-64 have completed some sort secondary education other beyond high school, 76% of men have successfully completed high school compared to 74% of women.

11. Exports and Trading France’s exports in 2016 accounted for close to 18% of it’s total Economic Output Shipped $488.8 billion (USD) worth of goods globally in 2016, up by 5.3% since 2009. Top 10 exports accounted for almost two-thirds (62.2%) of overall value of its global shipments. Total GDP for the fiscal year of 2016 was estimated to be close to $2.737 trillion . The following export products represent the highest $$$ value in French global shipments: Machinery including computers: US$57.3 billion (11.7% of total exports) Aircraft, spacecraft: $53.2 billion (10.9%) Vehicles : $45.4 billion (9.3%) Electrical machinery, equipment: $39.2 billion (8%) Pharmaceuticals: $30.1 billion (6.2%) Plastics, plastic articles: $19.5 billion (4%) Beverages, spirits, vinegar: $16.5 billion (3.4%) Perfumes, cosmetics: $15.6 billion (3.2%) Optical, technical, medical apparatus: $15.4 billion (3.2%) Iron, steel: $11.5 billion (2.4%)

12. Exports and Trading Cont.… Germany: US$78.9 billion (16.1% of total French exports) Spain: $36.6 billion (7.5%) United States: $36.1 billion (7.4%) Italy: $35.7 billion (7.3%) United Kingdom: $34.8 billion (7.1%) Belgium: $33.2 billion (6.8%) Netherlands: $17.7 billion (3.6%) China: $17.7 billion (3.6%) Switzerland: $16.9 billion (3.5%) Poland: $9.1 billion (1.9%) Turkey: $7.7 billion (1.6%) Japan: $6.9 billion (1.4%) Singapore: $6.8 billion (1.4%) Hong Kong: $6 billion (1.2%) Algeria: $5.6 billion (1.2%) Top 15 of France’s trading partners, countries that imported the most French shipments by dollar value. Close to three-quarters (71.6%) of French exports in 2016 were delivered to the above 15 trade partners. Leading gains in import purchases from France belong to Hong Kong (up 81.1%), China (up 61.4%), United States (up 32.2%) and Poland (up 26.4%).

13. Business Enviroment France’s government encourages foreign investment. Current economic climate government views foreign investment as a way to create jobs and stimulate growth. Investment regulations are simple, and a range of financial incentives are available to foreign investors. Investors reported they find France’s skilled and productive labor force, good infrastructure, technology, and central location in Europe attractive.  France’s membership in the E.U. and the Eurozone enables efficient movement of people, services, capital, and goods. French’s Government said to be among the least restrictive in the world. Few exceptions in certain specified sectors, no statutory limits on foreign ownership of companies.  Foreign entities have rights to establish and own business enterprises, and engage in all forms of lucrative activity.

14. Inflation Levels and Currency Exchange France among top six countries with largest GDP worldwide, behind the U.K., Germany, Japan, China and the U.S. One of the leading economies worldwide. Economy mostly relies on services sector w/almost 80%, agriculture makes up 1% of the economy, the industry sector the rest. 3 sectors typically seen as the main pillars of a country’s economy. Leading exporting & importing country worldwide . Both have increased over past years. Trade balance decreasing over last decade, means value of France’s exports was considerably lower than the value of its imports National debt of France increasing steadily, among the countries with the highest public debt. Standard of living in quite high, life expectancy among highest in the world. France: Inflation rate from 2010 to 2020 (compared to the previous year)

15. Inflation Levels and Currency Exchange Cont. French Euro is the currency used by France. Currency exchange can be done at most banks or at specialized stores called Foreign Exchange Bureaus. 1 Euro = $1.18 in USD Economist forecast the euro to modestly depreciate in 2018, based on 4 main considerations. 2017 will be as good as it gets for the eurozone, with the first half of 2017 being a high water mark in terms of real GDP growth. Europe's political risk will rise in 2018 due to the outcome of Italy’s general election and the end of Greece's bailout The ECB to maintain a cautious and measured approach to policies. 2 interest rate hikes from the US Federal Reserve in 2018 is above futures-implied market expectations.

16. Skilled Labor and Labor Costs High Skilled Wages in France increased to 3140 EUR/Month in the last half of 2016 from 3090 EUR/Month in the first half of 2016. Wages High Skilled in France averaged 3020.00 EUR/Month from 2015 until 2016, reaching an all time high of 3140.00 EUR/Month in the second half of 2016 and a record low of 2920.00 EUR/Month in the first quarter of 2015 Labor Costs in France increased to 107.30 Index Points in the 2nd quarter of 2017 from 106.80 Index Points in the 1st quarter of 2017. Labor Costs in France averaged 80.38 Index Points from 1978 until 2017, reaching an all time high of 107.30 Index Points in the 2nd quarter of 2017 & record low of 39 Index Points in the 1st quarter of 1978.

17. Legal System French legal system is based entirely on written civil law, called the code Napoléon (Napoleonic code). The code governs all branches of French law (The code civil , the code fiscal and the code pénal .) France is a strong defender of intellectual property rights. Under the French system, patents and trademarks protect industrial property, while copyrights protect literary/artistic property. Paris Convention and Washington Treaty regarding industrial property, U.S. nationals have a priority period following filing of an application for a U.S. patent or trademark in which to file a corresponding application in France:  twelve months for patents and six months for trademarks.

18. Legal System Cont. French law requires retention documents for a various periods. For example: Six Months – Hotel and restaurant bills. One Year – Receipts for chimney sweeping; telephone bills; huissier ’s fees; removal bills; children’s school attendance records ( certificats de scolarité ); proof of payment of fines. Two Years – Insurance receipts and cancellation letters; receipts for professional fees; standing order instructions and bank deposit slips; employment contracts; credit notes; water bills; bills for electric appliances and clothing; social security and complementary insurance refunds; property tax demands; receipts for family allowance payments. Three Years – TV license demands; currency exchange receipts. Four Years – Income and wealth tax bills and proofs of payment. Five Years – Life insurance receipts; pay slips other than salary statements; unemployment payment slips; divorce settlements; electricity and gas bills; rental charges and payment receipts; proof of payments to notaires ; social security contribution records; receipts for non-salary income. Six Years – Letters of dismissal; income tax demands and returns plus supporting paperwork. Ten Years – House and car insurance contracts; mortgage contracts; business account cheque stubs and bank statements; self-employment records; receipts for co-ownership charges; credit notes relating to property ownership or rental; receipts for repairs by a shop or for building work; invoices from private clinics; documents relating to a community property; estate agent’s bills. Eighteen Years – School reports; children’s health records (for their first 18 years). Thirty Years – Building permits; architects’ and builders’ contracts; bills for building work; personal bank statements; loan and debt records; official papers relating to self-employment. Life – Identity cards and residence permits; marriage and divorce certificates; education certificates; life insurance contracts; receipts for legal fees; salary statements; building and other work guarantees; unemployment registration; marriage contracts and divorce papers; co-ownership agreements; bills for valuables; records relating to gifts; education certificates; medical records and certificates; hospital bills; local tax bills; savings account books; livret de famille ; pension payment receipts and other documents. Product guarantees and receipts should be kept for as long as you have the products, and rental agreements until the end of the rental period.

19. Market Opportunity Analysis Very specific target market Car rental market is on the decline Students are limited in travel options Competition from other rental agencies Uber entering the market Integration with university campuses

20. Market Potential/Size of Market Rental market saw moderate growth of 1% in 2017 and is expected to decline at a rate of 1% each year until 2022 Total market value in 2017 is EUR 2.7 billion For the academic year 2014-2015 the U.S. had 313,000 students studying in foreign countries, up 2.9 percent from the year before More than half of these students are studying in just 4 European countries: United Kingdom, Italy, Spain, and France

21. Current Product Usage Habits Market segmentation breakdown of car rentals in France: Leisure – 54.7% Business – 32.1% Other – 13.1% How students typically travel in France Limited to group trips to common tourism locations and public transportation.

22. Competition in the Market Competition includes traditional rental agencies that have established dominance. A handful of U.S.-based companies hold a majority of the market: Avis Budget Group, Hertz, ADA, Sixt Budget already has over 450 locations in France New companies such as Uber and Lyft are making their way into the market. They pose a threat to rental services as they gain popularity

23. Target Market and Demographic Highly specified target market – American students age 17-25 studying abroad at French universities Students want to be able to go out and explore on their own, not be confined only to where the program allows them France is one of a handful of European nations with the highest concentration of American students

24. Other Marketing Considerations Ideally, universities would be willing to integrate our service into their programs to make it as convenient as possible for students to take advantage of. The vehicles will be accessible on campus in designated spots when not in use. The service can be advertised as an optional package alongside the study abroad program.

25. Questions/Comments

26. References Car Rental In France. (2017). (). London: Euromonitor International Ltd. Retrieved from https://sacredheart.idm.oclc.org/login?url=https://search.proquest.com/docview/1949481272?accountid=28645 http://worldpopulationreview.com/countries/france-population/ https://search-proquest-com.sacredheart.idm.oclc.org/abicomplete/docview/1952265615/C97DBFAB00AC45B1PQ/1?accountid=28645 https://tradingeconomics.com/france/gdp-per-capita http://www.worldstopexports.com/frances-top-10-exports/ http://www.worldstopexports.com/frances-top-import-partners/ https://img1.etsystatic.com/034/0/6582333/il_570xN.562488115_edxe.jpg https://www.justlanded.com/english/France/Articles/Culture/Legal-System https://www.export.gov/article?id=France-Protecting-Intellectual-Property Marketline . (2017, January 25). France - car rental. Retrieved October 23, 2017, from https://advantage-marketline-com.sacredheart.idm.oclc.org/Product?pid=MLIP2222-0007&view=d0e202 Trends in U.S. Study Abroad. ( n.d. ). Retrieved October 23, 2017, from http://www.nafsa.org/Policy_and_Advocacy/Policy_Resources/Policy_Trends_and_Data/Trends_in_U_S__Study_Abroad/ Locations. ( n.d. ). Retrieved October 23, 2017, from http://www.avisbudgetgroupcareers.com/about-us/locations/france.aspx “France Political Risk, Short-Term - Data, Chart.” TheGlobalEconomy.com, Credendo Group, www.theglobaleconomy.com/France/political_risk_short_term/ . Fifth Republic – BonjourLaFrance .” BonjourLaFrance , www.bonjourlafrance.com/about-france/french-history/fifth-republic/ . Local, The. “Paris Tourism Has Lost €750 Million since Terror Attacks.” The Local, The Local, 23 Aug. 2016, www.thelocal.fr/20160823/paris-tourism-has-lost-750-million-since-the-attacks-strikes-floods . “France Political Risk, Long-Term - Data, Chart.” TheGlobalEconomy.com, Credendo , www.theglobaleconomy.com/France/political_risk_long_term/. Goguel , François. “Political Instability in France.” Foreign Affairs, Reuters, 11 Oct. 2011, www.foreignaffairs.com/articles/france/1954-10-01/political-instability-france . “The French Political System.” French Politics, Government and Constitution. About-France.com, about-france.com/political-system.htm. FocusEconomics . “France Economy - GDP, Inflation, CPI and Interest Rate.” FocusEconomics | Economic Forecasts from the World's Leading Economists, www.focus-economics.com/countries/france . Goguel , François. “Political Instability in France.”  Foreign Affairs , Reuters, 11 Oct. 2011,  www.foreignaffairs.com/articles/france/1954-10-01/political-instability-france .