Businessmodel of Safran

Customer Segments

Safran has a segmented market business model, with customer groups that have slightly different needs. The company targets its offerings at consumers, businesses, and governments.

Value Proposition

Safran offers three primary value propositions: innovation, risk reduction, and brand/status.

The company places a strong emphasis on innovation as part of its culture.  Approximately 30% of its global workforce is allocated for research and development efforts. Furthermore, in 2015, 7% of its total revenues were directed towards its R&D budget.

The company reduces risk by maintaining high security standards. It maintains the “Safran Code of Conduct” which establishes its principles and serves as a reference point for professional conduct. Safran also follows business compliance procedures adopted by its parent firm, The Safran Group. It has been awarded anti-corruption certification by independent auditors Mazars/ADIT.

The company has established a strong brand due to its success. It bills itself as the world leader in multi-biometric identification solutions (fingerprint, face, iris) and claims to be the only firm with expertise in every security technology. It also touts the following rankings:

• #1 worldwide in ID documents integrating biometrics
• #1 worldwide for ABIS (Automated Biometrics Identification System) in fingerprints, iris, and face recognition solutions
• #1 worldwide for Explosive Detection Systems (EDS) for hold baggage
• #1 worldwide for trace detection equipment
• #2 worldwide for gaming and betting terminals
• #3 worldwide for smart cards Safran employs over 8,700 people in 57 countries and achieved revenues of over €1.9 billion in 2015. It deploys its solutions in over 100 countries. Lastly, it maintains one of the world’s largest R&D centers that specializes in identification solutions.

Channels

Safran’s main channel is its direct sales team. The company promotes its offerings through its website, social media pages, and participation in trade shows and conferences.

Customer Relationships

Safran’s customer relationship is primarily of a self-service, automated nature. Customers utilize its products while having limited interaction with employees.

The company’s website features a “Media” section that includes useful resources such as publications, newsletters, case studies, photos, and videos. That said, there is a personal assistance component in the form of phone and         e-mail support.

Key Activities

Safran’s business model entails designing, developing, and manufacturing its products for customers.

Key Partners

Safran’s key partners are the over 13,000 suppliers that provide the equipment and materials it needs to manufacture its products. It also forms research partnerships with various public entities such as schools, universities, laboratories, local authorities, and national governments in order to foster product innovation.

Key Resources

Safran’s main resources are its human resources, namely the engineers that design, develop, and/or manufacture its products. It maintains important physical resources in the form of its network of offices, facilities, and R&D centers located in 55 countries worldwide.

Lastly, it places a strong emphasis on its intellectual property, with 629 patented inventions and more than 2,280 patent titles. In 2014 alone it filed 73 patents.

Cost Structure

Safran has a cost-driven structure, aiming to minimize expenses through significant automation. Its biggest cost driver is likely research/development, a fixed cost. Other major drivers are in the areas of cost of goods sold, a variable cost, and sales/marketing, a fixed cost.

Revenue Streams

Safran has one revenue stream: revenues it generates from the sale of its products to its customers.