Expanding Into France-Customs

EXPANDING TIRES AND SERVICES

INTO FRANCE

August 20, 2007

MEMORANDUM

TO:

FROM:

DATE: August 20, 2007

SUBJECT: Expanding Tires and Service into France

Please find the following report as requested on how to expand sales into France.

Over the last three years sales have been down. Our studies show that the Philadelphia marketplace has become inundated with tire and auto repair stores. Valley Forge’s employees have expanded into other states, and yet we still do not see sales rising. It is time we expand further that the US.

Marketing has become extremely expensive to get the consumer to buy from Valley Forge in the US. We have a large inventory of tires and our cost is very low on tires, but we need to market to a place that needs the product. As discussed in our previous meetings, the company as a whole feels we should try to expand.

Importing into France will at first be difficult. There are many steps we must take to first prepare, but in the long run, I feel it will be worth it. We have the cooperation from our employees and this could be a great opportunity.

I would like to thank all of the employees that helped pull this report together; it has been a team effort. Please give me a call at my extension if you have any questions or are ready to discuss this.

CONTENTS

Page

EXECUTIVE SUMMARY 4

INTRODUCTION 5

FRENCH CULTURE 7

Geography 8

Transportation 9

Public Health 10

Government 11

Economy 12

DOING BUSINESS IN FRANCE 13

Entry Regulations 13

Working in France 14

Trade Regulations 16

CONCLUSIONS/RECOMMENDATIONS 17

WORKS CITED 18

EXECUTIVE SUMMARY

This report will analyze the benefits and reasons why we should expand our tire and auto services into France.

The US Market is inundated with product

Tire industries are importing into the US from Canada and Mexico. The market is saturated with product that is not moving. Our company has much of this product and our costs to attain it were inexpensive. We should move to distribute this to France. We would be able to make a profit by enlisting the help of Trade Advisors.

The bottom line

Product must move for Valley Forge Auto Center to stay in business. We have to move our product, and it must be shipped to France to make a profit. With the help of French Customs, we can cut costs and save time.

How to get started

The employees of Valley Forge Auto Center are committed 100 % to making the export to France happen. We have done our research. We know what the trade and entry regulations are and what steps we will have to take to work in France. We know how to market the product and feel we can accomplish the gross profit that is needed to stay in business.

EXPANDING TIRES AND SERVICES INTO FRANCE

INTRODUCTION

Valley Forge Auto Center has a need for gross profit right now. Inventory is high and sales are low. As a company we have tried to expand sales into other states such as Delaware and New Jersey; however, sales have not followed. Our start up costs was high, and we are now faced with cash flow issues.

We need to liquidate inventory. To save the company, we need to export our product outside the US. France is the place to choose right now. Down the road, we may want to transfer our auto services to France as well, but at this time, the French economy is suffering. We cannot afford to lose any more money. I suggest we hold off for now on transferring auto repair and focus on liquidating our inventory.

The purpose of this report is to introduce our thoughts and plans to the company as a whole. Understandable, as president, you make the decision. We are a tight-knit corporation, though, and will need all employees aboard if this plan is to work.

By exporting to France, we can gain market share and be able to make a profit. There are many vehicles purchased every year, and tires are a large part of the auto industry. Our inventory has good product, current, and popular.

This report was created by several departments of our company. The marketing department has created the culture part of this report. They sent a crew to France for two weeks to study French language, geography, transportation, and public health. What they found was that France is similar to the US in many ways. The marketing team believes that our goal can be accomplished. Our accounting department of Valley Forge Auto Center studied the economy and what should be done to do business in France. They looked into entry regulations and what was needed to work in France. This information was attained from the French Embassy and the US Customs and Excise department. Trade regulations were also studied so that we will be able to fully understand the costs involved with export.

THE UNKNOWN MARKET PLACE

Valley Forge Auto Center is not known in France. This will at first be a problem, but we have come up with a solution that will work for both our company and our customers. We have a few different directions that we can go into. A generic name, such as Tires Inc, could be used to express our product and be more specific. We could also go very heavy into marketing to get our name known. In trying to market to France, we should study French Foreign Trade Statistics. Below is a map of the French traffic zones, which we can use to determine where we should do business: