Sun Sentinel Palm Beach Edition
Once-hip Bic tries to keep pens, lighters, razors chic
Smoking rates have been falling for decades, smartphones and tablets are replacing pen and paper, and beards are all the rage. It’s no wonder investors have turned their backs on Societe Bic SA.
Shares in the French maker of lighters, pens and razors have slumped 40 percent from their 2015 peak. The family-controlled company that built a global brand in the 1960s and 1970s with brightly colored products and kicky marketing now is struggling to catch up with rivals that have embraced online sales and shifting consumer trends.
Analysts and investors aren’t ready to call the bottom yet: The stock has the lowest analyst rating of any similarly sized household products or office supplies company in Europe, and the highest percentage of shares sold short, according to data compiled by Bloomberg and IHS Markit.
“Bic is a company at a standstill,” said Yorick Cazal, an independent wealth manager in Lausanne, Switzerland, who sold his shares in Bic a few years ago. “The problem is the distribution channels and its relationship with distributors.”
The stock took its latest leg down in October after the company reported disappointing third-quarter sales, after twice cutting its outlook for growth earlier in the year. Bic was little changed Monday at 95.95 euros, giving the Clichy, France-based company a market value of $5.4 billion.
Bic has no online presence of its own in the U.S. shaver market to compete with Procter & Gamble Co.’s Dollar Shave Club and startup Harry’s. In its other businesses, the company is feeling pressure from Pilot Corp.’s erasable Frixion pen and from cheaper Chinese lighters.
Bic is doing what needs to be done to catch up to rivals and revive growth, Chief Executive Bruno Bich said. The company is rolling out an online subscription razor service, the Bic Shave Club, in France and the U.K.
“We are working on new products; we are very open to new distribution systems,” the CEO, the 71-year-old son of co-founder Marcel Bich, said in a telephone interview. “We are pushing to get market share in a difficult market.”
Erasable Frixion pens — the rage among schoolchildren for the past few years — have been more of an issue, prompting Bic to introduce its own erasable pen, and refreshing its staple 4-color pen.
To keep its lighters colorful and attractive, it signed partnerships with Brazilian soccer teams such as Corinthians and Fluminense. Bic is also continuing its lobbying efforts in Europe and China to obtain enforcement of safety rules on lighters imported from Asia.
Cazal, the Lausanne wealth manager, says he believes in Bic and would still be willing to buy the shares again if the stock were to go down further.
“It’s a good stock; it pays good dividends,” he said. “Still, in today’s time it’s hard to get excited about lighters, pens and shavers.”