Business Strategy
Competitive advantage
The body shop has held the advantage over rivals on social wise. For many years, its campaigns about human right issue and protection for animal and environment have become as famous as its product. The customer get involve with the brand by sharing the believe which is not only the quality of natural product they buy, but the believe and philosophy as well.
Cost Advantage
The body shop has been supporting community-based enterprises. It aims to help build livelihoods and introduce educational and health benefits to many suppliers and their communities, also to explore trade-based approaches by supporting sustainable development through sourcing ingredients and accessories from socially and economically-marginalised producer communities.
The benefit from this social-sustainability building is The body shop could have plenty of exotic raw materials in lower average cost and also lower labour cost.
Moreover, The Body Shop has another strategy to cut the cost of packaging, which is offering its customers a refill service. But fewer than 1% of customers globally brought their bottles back. Instead, The Body Shop is turning its attention to producing recycled packaging, even though there is energy cost during the process,
the overall benefits are still positive.
Market dominance
The Body Shop has achieved the market dominance through 2 factors, the internal growth and acquisition:
Internal growth
All of the body shop’s staffs believe in the ethical idea behind the brand, which help holding the whole organization together. However, The Body Shop’s employees are encouraged to speak out on issues that concern them. This process of staff consultation enables the Body Shop to survey and test its mission statement against its company performance, as well as identify employee needs and future company initiatives
Acquisition
Since The body shop has been taken over by L’Oreal, there has been more opportunity for the brand growing more quickly and widely. However, the brand has won the fight to convince customers the brand’s standards have remained the same by an announcement that L’Oreal has not tested finished products on animals.
Jean-Paul Agon, Chief Executive of L’oreal, was quick to dismiss any idea of not being as dedicated to the cause as their new venture, Body Shop, stating: "The big ambition in terms of animal testing is to make animal testing disappear completely forever in the beauty industry" *(*Financial Times interview)
Citing the way around animal testing as researching alternative ways of testing the chemical ingredients, L'Oreal are at present looking into a technique to use artificially produced human skin and have stated that they will continue to "invest like crazy on alternative methods in the future".
New product development
To keep ahead of rivals, The body shop fights back by investing in new product development, store design and marketing approach. Body Shop is launching new product aimed at a variety of categories, new series of body product, for example, the body butter, which have been launched since 2008, has been a big hit in the market. The body shop “ new design” has been implemented on the appearance of the stores, the changes gave more contemporary look, flexibility that help promoting products more effectively, the idea minimum the cost by recycling old shop’s furniture. Moreover, in order to get closer to targets, the direct sales arm called the body shop at home has been launched. Lastly, to keep customer’s loyalty, “Love your body” customer card has been promoting since 2004.
Expanding
After L'Oreal taking over, The Body shop has still, been focusing on maintaining the brand’s core competency, also looking for more global expanse.
There are plans to develop the Body Shop brand in countries such as Brazil, Argentina and China, which are fast growing environment consumer market.
.
The Chinese cosmetic and toiletry sectors has recorded sales growth into double figures. This gives China one of the largest industry growth rates in the world and has helped secure a position as a world-wide hub for the cosmetics industry.
Likewise the Brazilian beauty market looks set to become the world's third largest beauty market by 2007. And in Latin America as a whole, like-for-like sales growth came in at 16.2 per cent to reach €481m in the first 6 months of this year
Having recently launched in India, L'Oreal is hoping that the Body Shop brand will more than double in size in the coming years, estimating that the number of stores will rise from 2,000 to 5,000 in over 100 countries. .*
(*http://www.cosmeticsdesign-europe.com/Financial/L-Oreal-announce-Body-Shop-expansion-into-international-markets)
The company also concerns the proposal to have more store in South and North Asia and Eastern Europe.
Thursday, 30 April 2009
Kitty-final Culture and Structure
Culture and Structure
The Body Shop culture has been formed through the value and beliefs of its founder, Anita Roddick, who has been develop a unique idea that business is primarily about human relationships. Inspired by her original believe, The body shop celebrates the notion of being in business to make a contribution, rather than just to accumulate wealth by replacing the idea of “work work work” with “work, live, love and learn”*
Its culture is rather feminine with its predilection for networks, care for the environment, natural growth and combining work and family.
The organization manages within a person culture, the company believes in each individual and has managed to stay independent. The employees are crucial to the success of the business as they represents the face of the company, they are encouraged to speak out the issue that concerned them, both work wise and environmental wise. The regions and store managers have been required to report back to HQ monthly on their issues and turnover in order to reduce difficulties and create good working environment equally. The staffs share the same believe and take pride to be a part of a company, around the world, employees take part in volunteering programme help making a better society.
The company has been investing in social sustainability campaign for years, there are numbers of foundations which aim to give the profits back to employee and the resource land.
Although The Body Shop has been taken over, it has not been folded into one of L’Oreal’s four business divisions. It is a separate business unit and still staying independent.
Even though The body shop has spread its business all over the world by its franchisees, The structure is not very formal and it allows its franchisees some flexibility in how business is conducted as long as they do not go against their company culture.
*The Body Shop Value report 2005, 2007
(.*Technique implementation and the problem of culture
by Mark Lee Inman
01 May 2001 http://www.accaglobal.com/students/publications/student_accountant/archive/2001/16/44019, )
*http://www.findfreecollegeessays.com/show_essay/22879.html
The Body Shop culture has been formed through the value and beliefs of its founder, Anita Roddick, who has been develop a unique idea that business is primarily about human relationships. Inspired by her original believe, The body shop celebrates the notion of being in business to make a contribution, rather than just to accumulate wealth by replacing the idea of “work work work” with “work, live, love and learn”*
Its culture is rather feminine with its predilection for networks, care for the environment, natural growth and combining work and family.
The organization manages within a person culture, the company believes in each individual and has managed to stay independent. The employees are crucial to the success of the business as they represents the face of the company, they are encouraged to speak out the issue that concerned them, both work wise and environmental wise. The regions and store managers have been required to report back to HQ monthly on their issues and turnover in order to reduce difficulties and create good working environment equally. The staffs share the same believe and take pride to be a part of a company, around the world, employees take part in volunteering programme help making a better society.
The company has been investing in social sustainability campaign for years, there are numbers of foundations which aim to give the profits back to employee and the resource land.
Although The Body Shop has been taken over, it has not been folded into one of L’Oreal’s four business divisions. It is a separate business unit and still staying independent.
Even though The body shop has spread its business all over the world by its franchisees, The structure is not very formal and it allows its franchisees some flexibility in how business is conducted as long as they do not go against their company culture.
*The Body Shop Value report 2005, 2007
(.*Technique implementation and the problem of culture
by Mark Lee Inman
01 May 2001 http://www.accaglobal.com/students/publications/student_accountant/archive/2001/16/44019, )
*http://www.findfreecollegeessays.com/show_essay/22879.html
Kitty Mission statement
Mission Statement
- To dedicate our business to the pursuit of social and environmental change
- To creatively balance the financial and human needs of our stakeholders: employees, franchisees, customers, suppliers and shareholders
- To courageously ensure that our business is ecologically sustainable: meeting the needs of the present without compromising the future
- To meaningfully contribute to local, national and international communities in which we trade, by adopting a code of conduct which ensures care, honesty, fairness and respect
- To passionately campaign for the protection of the environment, human and civil rights, and against animal testing within the cosmetics and toiletries industry
- To tirelessly work to narrow the gap between principle and practice, whilst making fun, passion and care part of our daily lives
Kitty- final key personnel
The Body shop Key Personnel
Cathie Cornish, The Body Shop at Home Consultant
Harry Hughes, Watersmead warehouse/Employee Representative, UK CRC and European Works Council
Steve Jennings, Global Advisor Livelihoods, Oxfam GB
Jean Paul Agon, CEO, L'Oreal
Alastair Kerr, Regional Director, The Body Shop UK/ROI
Suzy Santoso, Head Franchisee, The Body Shop Indonesia
John Sauven, Campaign Director, Greenpeace UK
Michelle Thew, Chief Executive, British Union for the Abolition of Vivisection
Sophi Tranchell, MD, Divine Chocolate Limited
Gordon Roddick, Co-Founder of The Body Shop
Cathie Cornish, The Body Shop at Home Consultant
Harry Hughes, Watersmead warehouse/Employee Representative, UK CRC and European Works Council
Steve Jennings, Global Advisor Livelihoods, Oxfam GB
Jean Paul Agon, CEO, L'Oreal
Alastair Kerr, Regional Director, The Body Shop UK/ROI
Suzy Santoso, Head Franchisee, The Body Shop Indonesia
John Sauven, Campaign Director, Greenpeace UK
Michelle Thew, Chief Executive, British Union for the Abolition of Vivisection
Sophi Tranchell, MD, Divine Chocolate Limited
Gordon Roddick, Co-Founder of The Body Shop
Kitty Body shop value report 2007
http://valuesreport.thebodyshop.net/index.asp?lvl1=1&lvl2=2&lvl3=0&lvl4=0
Kitty Epansion into international market
L'Oreal announce Body Shop expansion into international markets
French cosmetic giant L'Oreal has announced that it intends to extend the Body Shop brand into international markets. The move follows the £652m take-over of the UK based Body Shop by L'Oreal back in March 2006.
Talking to the Financial Times, Jean-Paul Agon, chief executive of L'Oreal, suggested plans to develop the Body Shop brand in countries such as Brazil, Argentina and China.
This would seem to be a lucrative business decision for L'Oreal as the three consumer markets are proving to be fast-growing environments of late.
The Chinese cosmetic and toiletry sectors has recorded sales growth into double figures - figures in line with GDP that continues to hover around 10 per cent. This gives China one of the largest industry growth rates in the world and has helped secure a position as a world-wide hub for the cosmetics industry.
Likewise the Brazilian beauty market looks set to become the world's third largest beauty market by 2007. This is due to strong industry sales growth, with the market growing at 34.2 per cent in 2005. And in Latin America as a whole, like-for-like sales growth came in at 16.2 per cent to reach €481m in the first 6 months of this year.
Having recently launched in India, L'Oreal is hoping that the Body Shop brand will more than double in size in the coming years, estimating that the number of stores will rise from 2,000 to 5,000 in over 100 countries.
L'Oreal is adamant that they are mirroring the flagship promotional message that Body Shop founder, Dame Anita Roddick, based the company on, which was the eradication of animal testing and the call for all businesses to be more 'ethical'.
However, at present L'Oreal is still conducting animal tests on certain ingredients, although it says it is committed to stopping the practise.
Jean-Paul Agon was quick to dismiss any idea of not being as dedicated to the cause as their new venture, Body Shop, stating: "The big ambition in terms of animal testing is to make animal testing disappear completely forever in the beauty industry" he said in the Financial Times interview.
Citing the way around animal testing as researching alternative ways of testing the chemical ingredients, L'Oreal are at present looking into a technique to use artificially produced human skin and have stated that they will continue to "invest like crazy on alternative methods in the future".
The extension into international markets comes at a time when Body Shop is launching new product aimed at a variety of categories.
The Business has recently launched a new colour cosmetics range 'Make Me Fabulous', which the company says is a result of feedback from customers.
The range focuses on delivering performance, premium packaging and new ideas based towards the need of their target audience.
Iftikhar Sidiqqi, product manager for the Body Shop UAE and Pakistan, stated 'The Make Me Fabulous collection's formulation, textures and colours are a result of feedback and comments from our customers all over the globe. In addition, the new packaging is 73 per cent recyclable and encompasses the latest trends in fashion.'
http://www.cosmeticsdesign-europe.com/Financial/L-Oreal-announce-Body-Shop-expansion-into-international-markets
Tuesday, 21 April 2009
Cloudia -Questions for Bodyshop shop buyer-some answered
- Questions For Body shop buyer: (if possible)
1. Body shop had the best Fake tan why did they stop doing it?
1.structure and culture, how important is it?
2. Companies objectives when buying sourcing product?
3.profile of key personnel
4.marketing and brand
5.business strategy
6.key financial
7. What is the best selling product?
9 Have their been any changes to what they buy since L'Oreal
10.where is the company positioned, in the market and whom would they see as a Fashion brand alongside them?
11.Where is the company going, and who is their competition etc?
What are their needs rational and emotional, how do they reach them etc?
Cloudia-I met Body shop Senior Buyer with Community Trade
Bodyshop-working with co-operatives
what is community trade
I recorded the questions and answers of interview,and took pics of the presentation.
Key thing seam to be Body shop sharing its resources with other companies such as Neals Yard,for sesame seed oil production,for the benefit of the supplier. This benefits body shop because it means the supplier/grower Isnt completely dependent on Bodyshop for business and if the were not to repeat an order,they would not be putting whole village/community out of business.
They have 30 suppliers in 22 countries and 25,000 people employed through that. The Cocoa Butter form Ghana, that I focused on along with Morenga,they share with Divine Chocolate,and therefore increase business of Kuapa Cocoa co-perative.
There is more but will outline for document.
Thanks for sending back the completed questionnaire. I just wanted to clarify that the Body Shop representative will not be talking in the panel at the evening seminar, a separate event which is focusing on working with co-ops - details are on our website and online network. You will be able to ask her questions during the Q&A session and perhaps individually after the end of the panel discussion.
See you tomorrow,
Kind Regards,
Julia
On 20 Apr 2009, at 17:31, cloudia wrote:
> Dear Julia, and Ethical Fashion Forum,
> please find attached my completed questionaire for tommorow Master Class,
> I hope that my questions and content are relevant and can be answered,and look forward to the Class.
>
> Kind Regards
> Cloudia
Monday, 20 April 2009
Branding,final
The principal strategy the Body Shop is following and makes it different from the competitors is that it suggests a social activism in everyday body treatment. The philosophy of the products is that you can choose a more natural way to treat your body and face and in the meantime attribute to a fair treatment of the environment.
Therefore the marketing strategy is considered to combine activism with traditional marketing values and claim that there is a better way to do business.
To support this marketing strategy, they have their own retail chain of stores in 53 countries; they never stand along with the other chemical-based brands. The environment in those stores is typical of the brand’s policy; the interior is made of natural materials like wood and glass. All the stores have posters with advertisements of the products or with strong logos that support the company’s values. The salesmen are well trained about the product characteristics and are dressed up in casual uniforms in order to look customer-friendly.
Therefore the marketing strategy is considered to combine activism with traditional marketing values and claim that there is a better way to do business.
To support this marketing strategy, they have their own retail chain of stores in 53 countries; they never stand along with the other chemical-based brands. The environment in those stores is typical of the brand’s policy; the interior is made of natural materials like wood and glass. All the stores have posters with advertisements of the products or with strong logos that support the company’s values. The salesmen are well trained about the product characteristics and are dressed up in casual uniforms in order to look customer-friendly.
SWOT analysis,final
If we want to see what the external factors are to the company, we should look at the SWOT analysis of the company.
Strengths:
The brand, with a strong name, logos and philosophy behind
Strong mission of the company
Reference to political and ethical issues
With their vegetarian and ecological products, they target a niche market.
Weaknesses:
The company doesn’t have the monopoly anymore
Unstable political factors in the countries that supply the company with ingredients
The loss of trust from a part of the consumers
Opportunities:
L’Oreal’s takeover can bring financial and expertise/consulting support
Increase of number of men that use cosmetic products
Threats:
New legislation(1) about animal testing can raise the competition in the so far monopolist market
Difficulties in distribution because of the new legislation about chemical ingredients
The economical crisis hits mainly companies on the high street
Monday, 13 April 2009
change in product after L'Oreal,final
After its purchase by L’Oreal, the Body shop’s principal marketing strategy was to support the environmentally friendly nature of the products. Their first marketing action was in the launch of a new line called Wellbeing, a line that declares how natural active ingredients act on emotions, where all the bottles are from 100% post consumer recycled materials (PCR). Within 12 months they managed to convert all PET bottles to 100% PCR.
change in product after L'Oreal
After its purchase by L’Oreal, the Body shop’s principal marketing strategy was to support the environmentally friendly nature of the products. Their first marketing action was in the launch of a new line called Wellbeing, a line that declares how natural active ingredients act on emotions, where all the bottles are from 100% post consumer recycled materials (PCR). Within 12 months they managed to convert all PET bottles to 100% PCR.
Does it do what it says on the jar?
There was propaganda about the innocence of Body Shop products, they let people believe that they were using only natural ingredients in their composition. The truth though is that despite their campaigns about against animal testing, they tended to use some ingredients that came from animal cruelty such as gelatin from pork fat or hedgehog hair in their shaving brush. It wasn’t until June 2007 that the Body Shop became 100% vegetarian, not quite pleasing the Vegans because of some substances they still used like beeswax.
Product final? version
Product
From its funding in 1976, Body Shop produced body and facial care products based on natural ingredients, a strategy that launched them differently in the chemical-based until then cosmetics market. The brand sells a wide range including cosmetics, home ware, body products and fragrances. The best selling product is their soap range, with 14 millions sold per year.
All the products are with natural ingredients, none of which is tested on animals in its final stage. Since 1997 Body Shop has produced hundreds of plant-based products, with everything from tea tree oil to macadamia nuts, blueberry, Brazil Nut Honey; all natural ingredients that A.Rodick had learned about in her journeys around the world. The fact that in their anti-dandruff shampoo they use ginger instead of aloe and eucalyptus like Kiehl’ s, proves that there is more than one natural solution for health problems such as dandruff.
From its funding in 1976, Body Shop produced body and facial care products based on natural ingredients, a strategy that launched them differently in the chemical-based until then cosmetics market. The brand sells a wide range including cosmetics, home ware, body products and fragrances. The best selling product is their soap range, with 14 millions sold per year.
All the products are with natural ingredients, none of which is tested on animals in its final stage. Since 1997 Body Shop has produced hundreds of plant-based products, with everything from tea tree oil to macadamia nuts, blueberry, Brazil Nut Honey; all natural ingredients that A.Rodick had learned about in her journeys around the world. The fact that in their anti-dandruff shampoo they use ginger instead of aloe and eucalyptus like Kiehl’ s, proves that there is more than one natural solution for health problems such as dandruff.
Thursday, 9 April 2009
Tuesday, 7 April 2009
Kalimba More Competitive Scenario
The Body Shop must reinvent its ethical principles to appeal to today's more sophisticated cosmetics consumer, designers claim this week, as the company moves to strengthen its marketing resource.
Andy King, who has prior experience at Mothercare, WH Smith and Boots the Chemists, joined as director of marketing last week to work at a global level alongside creative director Franco Bonadio, who was hired earlier this year
King's appointment follows flat retail sales figures in The Body Shop's October financial statement, at just over £306m, with pre-tax profits of £9.1m
While some parts of the global picture are encouraging, the UK faces a challenging competitive environment. Like-for-like sales at UK stores were down 9 per cent in the six months to 30 August.
The Body Shop chief executive Peter Saunders has said his products should offer cheaper alternatives to Estee Lauder, Clinique and Elizabeth Arden - a strategy referred to as 'masstige' or in between mass and prestige positionings.
In response, the chain has begun a 'Refresh programme' to update visual merchandising, uniforms and in-store signage, but designers believe it must review how it motivates customers, particularly in the UK.
Corporate Edge director Peter Shaw believes it will be 'an incredibly tall order' to develop a premium offer, though the brand 'might do well to follow the model of Tesco Finest'.
'When The Body Shop launched it was first [to market], with a unique set of products and a unique approach, as well as a very focal founder,' says Shaw.
'Now, ethical has gone mainstream and the luxurious nature of the products isn't enough. [King and Bonadio] must question how they position the product offer and refine that.'
Design Conspiracy partner April Kent says The Body Shop is 'a victim of its own success'.
'Boots, Lush and others have all now started to do what it used to be renowned for. In these post-"No Logo" times, they need to get back to being more proactive, more radical and more edgy.'
Easytiger Associates director Adam Devey Smith says the main priority is to increase footfall. 'They need more reason for new customers to shop [there] in the UK. [Having] revolutionised the skin and hair-care market, too many others have joined its sector. The Body Shop needs to use its believable [and] strong personality to revolutionise other related profitable sectors or invent a new one.'
Brands such as Clarins and Aveda have more convincing customer-focused offers, he says, and Lewis Moberly creative director Mary Lewis echoes the point.
'Segmentation has definitely improved, but The Body Shop still needs to offer its customers a heightened in-store experience,' she says. 'They remain vulnerable to retailers offering a holistic approach to wellness.'
Neither King nor Bonadio was available for comment. But a Body Shop spokesman points to the brand's international reputation.
'You've got to remember that we have a successful global brand. A lot of UK retailers have tried to expand outside the UK and failed,' he says. However, he admits the Refresh initiative 'recognises specific challenges [the brand faces] in the UK'.
Design Week Author: By Richard Clayton Published: 13 November 2003
Andy King, who has prior experience at Mothercare, WH Smith and Boots the Chemists, joined as director of marketing last week to work at a global level alongside creative director Franco Bonadio, who was hired earlier this year
King's appointment follows flat retail sales figures in The Body Shop's October financial statement, at just over £306m, with pre-tax profits of £9.1m
While some parts of the global picture are encouraging, the UK faces a challenging competitive environment. Like-for-like sales at UK stores were down 9 per cent in the six months to 30 August.
The Body Shop chief executive Peter Saunders has said his products should offer cheaper alternatives to Estee Lauder, Clinique and Elizabeth Arden - a strategy referred to as 'masstige' or in between mass and prestige positionings.
In response, the chain has begun a 'Refresh programme' to update visual merchandising, uniforms and in-store signage, but designers believe it must review how it motivates customers, particularly in the UK.
Corporate Edge director Peter Shaw believes it will be 'an incredibly tall order' to develop a premium offer, though the brand 'might do well to follow the model of Tesco Finest'.
'When The Body Shop launched it was first [to market], with a unique set of products and a unique approach, as well as a very focal founder,' says Shaw.
'Now, ethical has gone mainstream and the luxurious nature of the products isn't enough. [King and Bonadio] must question how they position the product offer and refine that.'
Design Conspiracy partner April Kent says The Body Shop is 'a victim of its own success'.
'Boots, Lush and others have all now started to do what it used to be renowned for. In these post-"No Logo" times, they need to get back to being more proactive, more radical and more edgy.'
Easytiger Associates director Adam Devey Smith says the main priority is to increase footfall. 'They need more reason for new customers to shop [there] in the UK. [Having] revolutionised the skin and hair-care market, too many others have joined its sector. The Body Shop needs to use its believable [and] strong personality to revolutionise other related profitable sectors or invent a new one.'
Brands such as Clarins and Aveda have more convincing customer-focused offers, he says, and Lewis Moberly creative director Mary Lewis echoes the point.
'Segmentation has definitely improved, but The Body Shop still needs to offer its customers a heightened in-store experience,' she says. 'They remain vulnerable to retailers offering a holistic approach to wellness.'
Neither King nor Bonadio was available for comment. But a Body Shop spokesman points to the brand's international reputation.
'You've got to remember that we have a successful global brand. A lot of UK retailers have tried to expand outside the UK and failed,' he says. However, he admits the Refresh initiative 'recognises specific challenges [the brand faces] in the UK'.
Design Week Author: By Richard Clayton Published: 13 November 2003
Kalimba Competitive Scenario
L' Oreal SA lost investors when the world's largest cosmetics maker acquired the less profitable Body Shop last year. Now, amid a growing appetite for greener cosmetics, the acquisition has given L'Oreal an edge that should help push the stock higher.
Sales at the unit will grow three times the French company's pace by 2010 as more consumers seek products that use natural ingredients and aim to limit their environmental impact, Oddo Securities estimates. That will outweigh the retailer's impact on L'Oreal's profitability. "There is a definitive green movement,'' said Tina Gill, a researcher at London-based Organic Monitor, which compiles data for clients including L'Oreal and Procter & Gamble Co. "Consumers' expectations have become much higher in the last couple of years.''
Body Shop, which doesn't test products on animals and has pledged to be carbon neutral by 2010, attracts customers that are increasingly aware of the environmental impact their cosmetics have on their skin and the planet. P&G, the maker of Max Factor mascara, lacks a major environmentally friendly line.
The brand's sales will jump 24 percent in the next three years, Oddo estimates. By comparison, revenue growth at P&G's beauty division will slow from 7.6 percent this year to 4.5 percent by the end of the decade, Bank of America analysts forecast.
Fair Trade
Fair Trade
Body Shop, founded in 1976 by Anita Roddick, started as a single store in Brighton, England, selling skin lotions and shampoo. Roddick, who died in September, also promoted fair trade to provide workers in developing nations with a living wage, buying plant-based oils, essences and other ingredients from communities in developing countries. The company hasn't used PVC in products since 1993 and uses recycled plastics in its bottles.
L'Oreal bought Body Shop for 652 million pounds ($1.33 billion). Body Shop had annual sales of 419 million pounds in the year ended Feb. 26, 2005, compared with L'Oreal's 2005 sales of 14.5 billion euros. L'Oreal shares dropped 7.2 percent in the three months after the purchase was announced.
"Mid- to long-term, L'Oreal has really scored a winner,'' said Harold Thompson, an analyst at Deutsche Bank. "I think they took all their competitors by surprise.'' L'Oreal's shares will rise 11 percent to 104 euros by June 2008, Societe Generale analysts estimate.
Paris-based L'Oreal, whose brands span from mass-market Garnier shampoos to luxury Armani makeup and Lancome perfumes, is adding about 110 new Body Shop outlets this year and will keep the expansion pace next year.
"I like Body Shop because they are against animal testing,'' said Sophie Delannoy, a nurse shopping in a Body Shop in central Paris. ``They also practice fair trade, which is important to me.''
Profitability
Body Shop's expansion will offset its impact on profit, analysts estimate. Operating profit margin at Body Shop, which sells products like Honey & Oat Scrub Mask through more than 2,300 stores in 57 countries, will reach 9.9 percent this year, compared with a 16.8 percent for the rest of L'Oreal, estimates Venessa Laurence, analyst at Oddo with a "buy'' recommendation on the stock.
"We were all very surprised when L'Oreal announced it was buying The Body Shop,'' said Alica Lhanouz, a fund manager at Meschaert Asset Management in Paris who helps manage about 2 billion euros in assets including L'Oreal shares. "I don't think Body Shop's margins will ever match those of L'Oreal, but it boosted L'Oreal's sales and there are certain synergies in raw material costs.''
Organic Appetite
L'Oreal isn't stopping at Body Shop. Last year L'Oreal also bought Sanoflore, a producer of organic creams and essential oils based on plants from southern France that sells its products in pharmacies. Sanoflore's products including grenadine face cream and sweet orange lip balm are now available in Belgium, Switzerland, Germany and the Czech Republic.
The Body Shop may have to go even further and switch to purely organic products. Although its creams and makeup boast natural extracts, they also contain chemical additives such as parabens and phthalates that disqualify products from getting a fully "organic'' label.
"Body Shop does not fit the organic definition even though its products contain high levels of natural substances,'' Gill said. "They may have to become more organic in the future if they want to keep their customers, because people are getting much more sophisticated now.''
"Body Shop does not fit the organic definition even though its products contain high levels of natural substances,'' Gill said. "They may have to become more organic in the future if they want to keep their customers, because people are getting much more sophisticated now.''
Body Scrub
At a Body Shop counter at Galeries Lafayette in Paris, Veronique Davel bought the Honey Body Scrub "to give it a try, even though I don't think they are green enough for my taste.'' Davel, a Paris-based event organizer, said she preferred Sanoflore, L'Oreal's other ``green'' brand that meets Organic Monitor's standards.
Competitors are also catching on. Estee Lauder Cos.' natural brands Origins, Aveda and Ojon comprise about 7 percent of sales, estimated Ali Dibadji, an analyst at Sanford C. Bernstein & Co. in New York. Aveda sales have increased at about double the rate as the rest of Estee Lauder since 2001, he said. He rates Estee Lauder "market perform.''
"L'Oreal and Estee Lauder are now the main competitors in the field,'' Organic Monitor's Gill said. "Unilever, P&G and Henkel are looking at natural cosmetics now, but they are way behind.''
Waiting for her change at Body Shop's cash register, Sophie Delannoy's daughter Julie said she was a little worried that the brand would abandon its principles after it was bought by L'Oreal.
"L'Oreal obviously looked at the market and saw growing demand for natural cosmetics,'' she said. "But they didn't change, so I'll keep buying their products. It's good for my health, and it's good for the earth.''
Hi All From Kalimba
Hi All From Kalimba
The blog looks great!
Just to clarify, am I meant to be focusing on the L'Oreal takeover and the competitive scenario...yes/no?
Have gone through all of our emails and am now a bit confused...Okay, just let me know if I've got it wrong.
The blog looks great!
Just to clarify, am I meant to be focusing on the L'Oreal takeover and the competitive scenario...yes/no?
Have gone through all of our emails and am now a bit confused...Okay, just let me know if I've got it wrong.
Kitty TBS after L'oreal
The Body Shop and L'Oreal: Why can’t big be beautiful?
The backlash against Body Shop over its sale to L’Oreal is misguided
So L’Oreal is the new owner of Body Shop.This has to be good news. Two entrepreneurs built a durable brand through, not in spite of, championing their values. They could have closed the business down, broken it up, sold it to venture capitalists, or floated it on the stock exchange.
Instead they have sold the company as a going concern, safeguarding the livelihoods of staff and the employees of suppliers from some of the poorest parts of the world.
And yet the corporate social responsibility community is not amused. Anita and Gordon Roddick are accused of abandoning their principles.
In the weeks since the announcement of the deal we have been told by BrandIndex that Body Shop’s “satisfaction” rating has dropped by 11 points to 14, and its “buzz” rating, a measurement of a brand’s trendiness, has fallen by 10 points to -4.
The fact that Nestlé owns 26% of L’Oreal will not have done anything to help improve this.
Mike Brady, co-ordinator of Baby Milk Action, which campaigns against Nestlé, said: “[Body Shop] has been damaged, perhaps terminally, by linking itself to the world’s ‘least responsible company’.”
The inverted commas save Brady from the charge of overt intellectual dishonesty. He is quoting an internet poll conducted last year in which Nestlé was proclaimed the world’s least responsible company.
He knows that all over the world there are far less responsible employers – employers that exploit young girls for the sex trade; employers that bully and threaten and deny people access to their basic human rights.
The only reason Nestlé comes top in such consumer polls is that Nestlé is big and therefore an obvious target.
Big by popular demand
But big is not necessarily bad. Nestlé would never have become big without millions of consumers wanting its products and coming back time after time.
Multinationals like Nestlé, and L’Oreal do not sit outside society. They have succeeded in the long term through engaging the public in highly competitive markets. If these companies were national governments, this would equate to landslide victories in a series of ruthlessly fought elections.
At every stage this has meant anticipating how social trends would impact upon consumer needs.
Now that the values of organisations have gained marketing importance alongside the quality of their products, it is natural for multinationals to turn to companies that have learned from experience how to avoid undue exploitation of people or the environment.
It would make little sense for them to spend money and not to extract the expertise they paid for. As Anita Roddick says: “I do not believe that L’Oreal will compromise the ethics of the Body Shop. That is after all what they are paying for and they are too intelligent to mess with our DNA.
“I want to make things happen, to spread human values wider in business if I possibly can. And this sale gives us the chance to do so.”
In creating Bodyshop, the Roddicks created something of value, and in selling it they have found a potential amplifier for disseminating their values.
Local action on ethical products hits the buffers where people have been reluctant to let go of their favourite products in favour of more ethically sourced alternatives.
The fact that multinationals are buying into the ethical concept means that there is an opportunity for the first time for this to permeate the mainstream. Tesco can claim to have done more for the organic movement – eventually – than any number of farmers’ markets.
To use a political analogy, if you wanted to effect global change on an issue, you couldn’t do it on the back of passionate support of Luxembourg, Cyprus and Vietnam. You’d need the US and China on side.
The large multinationals have the power and influence to make real change happen. Many people express negative emotions towards them that range from distrust to outright hatred, but ultimately their success is the true barometer of people’s feelings towards them.
Business is an agent of change. Big business is the biggest agent. Detachment and contempt are easy; engagement and compromise are courageous. To tackle major problems, we need to think big.
http://www.ethicalcorp.com/content.asp?ContentID=4284
Kitty More Business strategy 02
Body Shop takeover – Ethical business as usual
Body Shop appears to be winning the fight to convince people the company’s standards have remained since its takeover by L’Oreal
It has been a turbulent year for Body Shop. Its $1 billion takeover by French cosmetics giant L’Oreal eight months ago raised unplucked eyebrows across the ethical business world. Animal rights and environmental campaigners, many of them long-term Body Shop supporters, threatened a boycott. Founder Anita Roddick was widely accused of selling out.Such is the emotion invested in small ethical brands. Body Shop, Ben & Jerry’s, Green & Blacks – these are the darlings of corporate responsibility. One by one, bigger brands have swallowed them up. But each time, concerns over their future seem to have been exaggerated.
Body Shop’s director of values, Jan Buckingham, admits: “Obviously there’s an impact on perception.” But internally, the takeover has not altered the company’s management structures. Body Shop operates as a separate, ring-fenced entity, reporting into L’Oreal.
Reassuring stakeholders that Body Shop could preserve its values and identity under new leadership was a challenge, says Buckingham. The main bone of contention was animal testing. L’Oreal is a company that historically has tested cosmetics on animals, while Body Shop prides itself on opposing vivisection.
Under its new owners the company maintains its strict policy of refusing to use ingredients that have been tested on animals since 1990. Since that date L’Oreal has not tested finished products on animals, something now prohibited by European law, although individual new ingredients are still tested.
http://www.ethicalcorp.com/content.asp?ContentID=4936
Kitty More Business strategy
The Body Shop - Body and soul
20 October, 2006
The Body Shop has never been afraid to mix profits with principles. However, the company’s success has attracted a host of competitors boasting a natural platform. In danger of being left behind, The Body Shop has had to fight back with new products, store designs and marketing approaches.
When The Body Shop first came onto the market in 1975, the brainchild of entrepreneur Anita Roddick, the concept of selling toiletries based on natural ingredients coupled with strong ethical values was unique and it rapidly set a trend which many others were keen to follow. However, the burgeoning growth experienced by the company during the 1980s came to a grinding halt as the company struggled to assert itself against the competition. Today, The Body Shop still adheres to its original values but recognises the importance of change, so it is investing in new store design, innovative product development and a successful direct sales arm called The Body Shop at Home.
The Body Shop started business as one small shop in Brighton, on the south coast of England, selling around 25 hand-mixed products in distinctive green bottles which could be refilled in the shop. Founder and entrepreneur, Anita Roddick, had a vision of retailing home-made naturally inspired products with minimal packaging and wanted others to share it. Franchising allowed for rapid growth and international expansion as hundreds of entrepreneurs worldwide bought into Roddick’s vision. Thirty years on, along with her husband Gordon Roddick, Dame Anita Roddick continues to be involved in the company as non-executive director and also consults on product, marketing and values.
The Body Shop International plc now operates in 51 countries with over 2,000 outlets spanning 25 languages and 12 time zones. Over the years, The Body Shop became as famous for its campaigning as for its products, having championed human rights issues and protection for animals and the environment. It continues to lead the way for businesses to use their voice for social and environmental change.
In 2003/4, total retail sales across all The Body Shop Outlets reached £699.5m. For the 25 weeks to end August 2004, global retail sales for The Body Shop increased by 4% to £318.4m, although comparable store sales were down 1%. Some regions registered positive comparable store sales growth, led by the Middle East, which increased by 14%, South East Asia, up 8%, Australia, growing by 5%, and the US with a rise of 2%. The poorest performing markets were the UK, recording a 5% decrease in the first half, with Canada, Germany and most of Southern Europe, all down in terms of comparable store sales. However, there has been an improving trend in the UK during September and October, and Canada’s poor performance was explained by a move to company ownership in July. In Southern Europe, The Body Shop has been recovering in Spain and Turkey, from the aftermath of the terrorist bombings, and in Greece, where its Athens stores were affected by the Olympic preparations.
Earlier in 2004, in its AGM statement, the company warned that profit before tax would be lower in the first half which came in at £8.3m, down from £9.1m in first half 2003. Exchange rate movements negatively impacted on profit before tax by £2.4m, due mainly to the weakness of the US dollar.
Commenting on The Body Shop’s poor performance in the UK, Bill Eyres, head of corporate PR, explains: “Like for like sales in the UK have improved from –7% in the first quarter to –3% in the second quarter, so we believe we are moving in the right direction. However, the continued success depends on the roll-out of new stores and the revamping of existing ones using the ‘recycle me’ format, the implementation of our new identity, better product presentation and delivery systems, so we still have some way to go.”
A recent successful initiative has been the UK launch of the Love Your Body customer card in June 2004, which costs £5 to join for one year and gives customers 10% off all their purchases as well as free gifts, updates on in-store activity, special offers by email and exclusive member events. This same customer loyalty scheme has been launched in Germany where The Body Shop is running an aggressive sales and marketing campaign.
The franchise affair
The Body Shop, which is publicly listed on the London Stock Exchange, employs over 6,000 people worldwide with more than 600 based at its headquarters in Littlehampton, Sussex. The Body Shop International operates as head franchise in the UK, US, Canada, Mexico, Austria, France, Germany, Denmark and Singapore, with the remaining 42 markets owned and operated by independent head franchisees.
From time to time, some of The Body Shop’s franchisees wish to liquidate their investments. “In such cases we will review the request from the franchisee and determine whether we wish to make a strategic investment and acquire the business ourselves, or facilitate the acquisition by an acceptable third party,” states Eyres.
During the first six months of 2004, two acquisitions were completed. In June, the company purchased 75% of The Body Shop franchise in Hong Kong and Macau as the franchisee wished to remain involved in the business. Subsequently, the company acquired the Canadian business in July, which included 42 stores operated by the head franchisee, together with an additional 69 sub-franchised stores. The acquisition of the Hong Kong and Canadian head franchises contributed largely to The Body Shop’s net debt increase of £45.5m, up from £34.2m in 2003.
Examples of third party acquisitions include West Malaysia and Finland. “We will continue to manage these opportunities, if and when they arise, for the benefit of their shareholders,” explains Eyres.
The Body Shop’s global reach may already be huge, but it plans to open 300 new shops, notably in the UK, the US, Central Europe and Japan. In addition, there are further opportunities to break into new markets with prime targets including North and South Asia, South America and Eastern Europe.
New design
Shop Me, is a new store design which The Body Shop has been trialling since the beginning of 2004 in eight pilot stores around the world. The first two stores with the new store design opened in the UK in London’s Covent Garden and Thurrock, followed by an additional three stores in Singapore, Hong Kong and Germany, with two more in the US and one in France which were due to open before Christmas. Eyres explains the rationale: “The new store is designed to look and feel more contemporary with our product range more effectively promoted. It is based on best practice drawn from our existing stores from around the world as well as global design and visual merchandising best practice.”
The changes that have been trialled include a more flexible shop fit that is easy to install and modify, light stone flooring, fresh green walls and white ceilings, improved branding and a flexible perimeter system which incorporates back-lit moveable hemp panels to allow bamboo dividers to be positioned to frame each product category.
In addition, a new The Body Shop brand identity has been launched which encompasses an evolutionary new logotype, typography and colour specification, together with the “Made with Passion” umbrella for its values and product stories. “Made with Passion” will appear in all new and refurbished stores and on in-store promotional material and packaging from 2005 onwards.
The Body Shop is also testing the idea of recycling shop furniture, which transforms the existing store design to give a more contemporary look while maximising the use of the existing shop fit. This has taken place in four UK stores and five US ones with encouraging results so far. “The ‘recycled’ shop concept takes our traditional ‘green box’ and updates it with our current branding and layout principles while minimising destruction of the existing structure. We plan to roll out this concept over the next several years,” reveals Eyres.
A new make-up merchandising system is also being trialled in the eight new stores and others across the four regions. “It is a simple system, which enables the customer to easily view and experiment with the product range on offer,” says Eyres, who maintains that these changes will be an evolution rather than a revolution for The Body Shop in terms of brand identity. “We are confident that the changes implemented will increase the customer experience of shopping in our stores.”
New masstige positioning
Investment in The Body Shop brand has been vital, not just in terms of satisfying its shareholders, but also to retain a point of difference in today’s naturals-saturated market. “The brand is currently moving to a ‘masstige’ positioning by developing innovative and credible products for customers at affordable prices,” says Eyres. “Major developments this year have included two ingredient-led, technically advanced product ranges: a complete sun care range that combines 100% mineral sunscreens with advanced antioxidant and moisturising benefits; and a new hair care range which has been developed with a trichologist. It contains six Community Trade ingredients, including honey and beeswax from Zambia and sesame oil from Nicaragua, and has been expertly formulated to deliver outstanding results. We have also built on the success of our ingredient-led bath and body range with the extension of the range into new variants such as Papaya and Sesame.”
Another recent launch is Skin Focus which is a new facial skincare range of performance treatments, such as Re-Texturising Peel, Line Minimiser, Lip Enhancer and Face Illuminator, each promising an instant, visible improvement in the appearance of the skin. Skin Focus is a good example of how The Body Shop can no longer rely solely on its natural ingredient positioning but must back it up with a strong technology story. Other recent launches include Ultra Smooth Face Base, a new foundation with innovative leading edge technology, and the new Everyday Aromatherapy range, which features four of the most popular essential oils (ylang, ylang, lavender, peppermint and bergamot).
The Body Shop has also shown that it can be truly innovative by being the first high street retailer to offer a bespoke fragrance service for its customers. Invent Your Scent was launched in October 2004, a unique mass market concept which allows the customer to play at being perfumer by creating a bespoke scent combining two or three of nine edts. Each edt is made up of naturally inspired top, middle and base notes to create individually complex fragrances that can also be worn alone. A suggested menu of fragrance combinations is provided, but it is possible to layer any number to create an individual scent. In order to help customers make up their mind, they can purchase all nine fragrances in 3ml mini vials, or they can opt for full sized 30ml bottles.
Recycling appeal
The Body Shop was the first toiletries company to offer its customers a refill service, but has found that in recent years uptake has been poor. Despite promoting the service and using marketing incentives, fewer than 1% of customers globally brought their bottles back for refilling. Instead, The Body Shop is turning its attention to producing recycled packaging for its plastic bottles, jars and tubes. Advances in technology and improved recycling infrastructures means that plastic can be reused in the form of post-consumer recyclate. Since January 2003, all of its PET bottles incorporate 30% recycled plastic, which saves the equivalent of approximately four million virgin plastic bottles every year. While recyclate does incur energy costs, the overall benefits are positive. “We are committed to further reducing the use of virgin plastic in our packaging and are exploring the possibility of increasing the level of recycled plastic in PET bottles and introducing it into our HDPE bottles,” comments Eyres.
Home and away
The Body Shop is a multi-channel business operating in retail and direct sales, as well as via an e-commerce site just launched in the US.
The Body Shop at Home is the direct sales arm of The Body Shop, which employs independent sales consultants who hold product parties in people’s homes. It first launched in the UK in 1994, followed by Canada in 1995, Australia in 1997, and the US and Ireland in 2001. This division is outperforming retail sales and its sales grew by 51% during the first six months of 2004 to £21.5m. The Americas region has seen a 92% increase in sales, while Asia Pacific grew by 27% and the UK by 25% during this period.
Eyres explains how The Body Shop at Home operates: “The Body Shop at Home offers our customers the convenience of shopping in their own environment and among friends. It gives them the opportunity to have products fully demonstrated to them, to have make-overs and to experiment with the products before buying them. It also offers convenient shopping for those customers who do not live near a local store. The Body Shop at Home gives these customers the in-store experience, at home.”
He continues: “Direct and retail sales channels are complementary to each other and we find that many customers will use both routes to buy, choosing whichever is most convenient to them.”
At present, The Body Shop at Home represents less than 10% of sales, but the business is growing rapidly.
Cosmetic crusader
The Body Shop has been a leader in the trend to greater corporate transparency and has been a force for positive social and environmental change through its lobbying and campaigning programmes around five core principles: Protect Our Planet, Defend Human Rights, Support Community Trade, Activate Self Esteem and Against Animal Testing. The current global campaign running across its four regions is called Stop Violence in the Home, focusing on domestic violence.
“The Body Shop is committed to maintaining high standards of social and environmental performance,” explains Eyres. “We believe in doing business with integrity and transparency. This means using our ethical principles to inform the way we do business, setting ourselves and our business
partners clear standards of practice, engaging stakeholders behind our business aims and reporting on our performance and our intent to improve the overall context of our business strategy.” Details of the company’s social, economic and environmental performance globally are available via web-based stakeholder accounts, which build on the role The Body Shop played in spearheading the move for companies to report on their social and environmental performance in the 1990s. Its first Values Report was published in 1995 and was described by the United Nations Environment Programme as “trailblazing”.
The Body Shop was the first cosmetics retailer to operate a special purchasing programme sourcing from and supporting community-based enterprises. The Community Trade programme has been operating for more than 15 years and aims to help build livelihoods and to explore trade-based approaches by supporting sustainable development through sourcing ingredients and accessories from socially and economically-marginalised producer communities. In 2003, The Body Shop supported its Community Trade programme with £5.3m. The company trades with over 36 Community Trade suppliers in 23 countries, helping to support thousands of people building livelihoods for their families and has introduced educational and health benefits to many suppliers and their communities.
Some 490 products on sale in The Body Shop stores contain ingredients sourced through the programme. These include cocoa butter in Cocoa Butter Hand & Body Lotion, shea butter and olive oil in the popular Body Butter range, and accessories such as massagers from India and loofah products from Honduras.
Eyres comments: “We believe our values are entirely consistent with strong and sustained financial performance and that profits with principles must be achieved in order to sustain the long term future of the company.”
http://www.cosmeticsbusiness.com/story.asp?storycode=476
Kitty Body Shop Bisiness strategy news
Body Shop changes strategy on public relations
Friday, 14 October 1994
BODY SHOP, the high street retailer run by Anita Roddick, has appointed a public relations company to promote its products.
The deal with Chiat Day is a radical departure for a company that had insisted it would not fritter away customers' money on advertising.
It also marks a new emphasis by the company's increasingly professional management, led by the managing director, Stuart Rose, on heightening awareness of the Body Shop brand in its mature domestic market and in its increasingly important foreign markets.
In the past Mrs Roddick relied on promoting Body Shop with colourful window dressing and a love affair with the media. She shocked American retailers in 1990 by refusing to advertise, establishing instead a community care department and an environmental projects department.
'I'm not interested in seducing the consumer with expensive images,' she said at the time. 'We've got better things to do with the money.'
Since then the company has suffered a number of blows to its confident image. After 200 shops had been opened in the US, Mrs Roddick's researchers found that shoppers across the Atlantic could not distinguish the Body Shop from competitors such as Bath and Body Works and H2O. This marketing failure was partly blamed for the disappointing fall in like-for-like sales in the US of 1 per cent in the six months to August 1994 compared to 1993.
In Britain managers have complained that the domestic market has matured and say they need additional promotions to pull in new customers. Finally, this summer, its free media publicity, once valued by Mrs Roddick at pounds 2m a year, dried up after a US magazine, Business Ethics, questioned Body Shop's ethical credentials. At the same time American Express advertisements shown in America featuring Anita Roddick were judged a great success by the company. News of the marketing initiative was accompanied by the appointment of two non-executive directors, the first in the company's history. They are Penny Hughes, president of Coca-Cola Britain and Ireland, and Aldo Papone, formerly an executive at American Express. Gordon Roddick, chairman, said further non-executive appointments would follow.
Yesterday shares in the company were initially buoyed by better-than-expected interim results, hitting 230p, but fell back as analysts digested the news. They closed 2p better at 225p.
The results showed worldwide retail sales up from pounds 175.8m to pounds 208.1m. Pre-tax profits rose from pounds 10m to pounds 12.3m, slightly ahead of City expectations. The net dividend increased from 0.75p to 0.9p.
The performance was slightly brighter than expected, Julie Ramshaw, retail analyst at Morgan Stanley, said. A 5 per cent increase in profit from British operations was particularly encouraging.
In the US, however, like-for-like sales fell by 1 per cent. Total sales, including the new stores, increased by 31 per cent but margins were squeezed by competition and operating profits rose by only 15 per cent. The company blamed poor management in its east coast division, but Mr Roddick said the problem had already been rectified.
Hi Kalimba from Kitty
Hey K,
This is chapters that I am doing:
-Structure
-Personnel
-Culture
-Business strategy
If u r interested in any of this, just let me know :)
Ohh Evie, could u pls send me word doc file that we worked on last night?
Thanks and have a safe trip!!!
Kitty
This is chapters that I am doing:
-Structure
-Personnel
-Culture
-Business strategy
If u r interested in any of this, just let me know :)
Ohh Evie, could u pls send me word doc file that we worked on last night?
Thanks and have a safe trip!!!
Kitty
Team update
We done the Skeleton for the document,and only have to fill a few chapters and edit,so hopefully its easy for you to see whats going as we on,we did contents page,with names next to chapters,Evie and Kitty really work out strategy,and placement of chapters,We put our initials next to the chapters we are doing,we each have four so far,so if you take one from each of us?
C-Cloudia
E-Evie
K-Kitty
and put yourself as K.C, it should work fine,
Do you want to takeover the L'oreal chapter and competitive scenario from me? we budgeted 130 words per chapter.( I know it was the bit you were interested in,so lets work with what we are all interested in to get the best out this project,we had fun.
Kitty lives near you, so she can fill you in on it,or if you in London this week you come over to me, for tea coffee we go throught it,before we all meet up again. I dont know what the other two want to do about they're chapters, they will Blogg it.
C-Cloudia
E-Evie
K-Kitty
and put yourself as K.C, it should work fine,
Do you want to takeover the L'oreal chapter and competitive scenario from me? we budgeted 130 words per chapter.( I know it was the bit you were interested in,so lets work with what we are all interested in to get the best out this project,we had fun.
Kitty lives near you, so she can fill you in on it,or if you in London this week you come over to me, for tea coffee we go throught it,before we all meet up again. I dont know what the other two want to do about they're chapters, they will Blogg it.
Monday, 6 April 2009
Outline-work split
Hey girls based on all the research adn work we have done here, we edit now,currently on 7,000 words,
Deadlines 11th April-cut to 120 words per chapter and we finish chapters and words so I can edit spell check,and edit.
18th April-We add additional images, graphs,and fig details, numbering document styling for the following week ( Details from P.R. Makeover additions)
25th April-Then we meet again for intro and conclusion,and discuss it all.
2nd May-Ready for print out and proof read by P.R. and peer group
9nth May-Final Conclusions-final print outs and submit to Moodle incase of IT problems.
Company Background-C
Structure-K
Personnel-K
Key Financial-E
Product-E
Competitive scenario-C
Business strategy-K
SWOT-E
--------------------------------------------------------------
Second-
Culture-K
Values-E
Objective-E
Branding-E
marketing-E
L'Oreal-C
Bibliography-C
different story of beginning
Anita Roddick chose to take a trip to the United Nations to study women in the third world. There, she found that women in underdeveloped countries used organic potions to care for their skin. This provoked Anita to open up her own cosmetics shop carrying natural products.
cosmetics industry history-
Cosmetics Industry. Though the wearing of cosmetics goes as far back as ancient Egypt, the economic history of its business practices can be traced to the late eighteenth-century consumer revolution. In both England and France, the middle classes entered the market as consumers of luxury goods for the first time due to the availability of affordable imitations. Among these new purchases, cosmetics were an essential means of representing social position and wealth, especially mimicking the white face paint and rouge worn at court. Aristocratic courtiers, both men and women, traditionally bought their makeup from reputable master artisans. In France, the guild of perfumers controlled the production of perfumes and creams, regulating new innovations and outlawing any means of publicity.By the 1770s, however, independent sellers benefited from the new customer base, marketing their products through newspaper advertisements, money-back guarantees, and instructional pamphlets. Many cosmetic sellers were innovative entrepreneurs who profited from the toppling of traditional hierarchies and the expansion of consumer markets promoted by the Enlightenment and fully realized by the French Revolution of 1789. A number of prominent eighteenth-century beauty businesses survived the Revolution unscathed. Some, such as Maille (founded in 1747, maker of vinegar rouges) and Dissey & Piver (1774), are still around today.As cosmetics developed public visibility, so did concern over the ingredients they contained. Doctors warned that the addition of lead, hydroxide, arsenic, and other minerals to face paints could be deadly. Horror stories of death and disfigurement were common fare in England. In France, the Academy of Medicine attempted to control the sale of dangerous products by instituting a system of scientific examination for all cosmetic patent requests.Medical concerns were matched by growing criticisms against the application of visible makeup. By the end of the century, a new ethos of beauty had triumphed that emphasized hygiene, health, and naturalness. Men were no longer to pamper themselves and women were to do so with the goal of emphasizing their inherent traits rather than applying layers of paint. Water was the best cosmetic, and the roses of youth the best makeup. This shift forced cosmetic sellers to reevaluate their selling strategies. New products, such as creams for face whitening, hair loss potions, and toilette soaps, became popular. Old products were renamed and relabeled. For instance, rouge became “vegetable rouge” and was marketed as being able to mimic the first blush of youth without any visible artifice. This transformation of meanings and products allowed cosmetics sellers to survive in a period that emphasized unadulterated beauty.The majority of cosmetic manufacturers in the early nineteenth centuries were small family businesses. It was not until the 1830s that these artisanal workshops expanded into industrial enterprises. The development of distillation through vapor, the use of volatile solvents, and the manufacture of industrial glass allowed perfumers to sell their goods more widely and cheaply. Guerlain, established in 1828, had a bustling factory by the 1850s and a range of highly original flowery scents.As the historical base for flower growing, the city of Grasse in the south of France became the center of industrial production, boasting sixty-five perfumeries by 1866. Select French perfumers provided the courts of Europe with scents, while cosmetic manufacturers sent their wares as far as the Americas. Advertisers evoked the dominance of the national industry to represent French industrial and commercial progress. During the European quest for colonies in the nineteenth century, cosmetics became symbols of national pride, a process that often implied the transformation of exotic ingredients into European commodities. British imperialists may have learned to appreciate bathing from their Indian subjects, but the very English toilette soap was marketed as the ultimate tool for civilizing the natives.Europeans, specifically the French, dominated innovation and industrial production of cosmetics during the nineteenth century. In the United States, only a handful of companies had industrial capabilities. Most cosmetic products were fabricated in small batches and sold by itinerant hawkers. Women were central to the development of recognizable brand names. They opened beauty parlors, invented new products, and marketed their goods across America. Many of these women came from poor backgrounds, finding in the beauty trade the possibility of stable female employment.Women, however, faced discrimination in a business world that privileged the professional skills of male chemists and perfumers. African-American women had an even harder time finding shelf space for their products in white drugstores, often preferring door-to-door and catalog sales. Trained African-American beauticians, working for a specific brand, such as Annie Turnbo's Poro hair system, were at the vanguard of franchise and pyramid schemes.These small businesses focused on hair care, face creams, and bath products, few venturing into the disrespectable world of makeup or the sensual world of perfume. Rouge and face paint were associated with actresses and prostitutes, and many of these products still contained zinc oxide. Perfumes made with real animal or vegetable scents were seen as sexual enticements or extreme luxury products for the elite. Developments in chemistry and pharmaceutical research, however, made the compositions of cosmetics more reliable as well as cheaper by the end of the century.The discovery that organic matter could be synthesized in the 1860s led to the first synthetic scent in 1868 by Houbigant. Synthetic scents were much cheaper than organic ones, allowing for greater production and distribution. In 1906, the United States and France both passed laws to control cosmetic manufacture, prohibiting the use of lead and other harmful ingredients. Increasingly, leading cosmetics firms hired chemists to help develop new products and by 1933 adopted animal testing to guarantee safety.Developments in science may have made cosmetics safer and cheaper, but a radical change in women's roles was necessary before they garnered mass-market appeal. The late nineteenth century saw the development of department stores, national magazine advertisements, and photography, all focusing attention on the feminine quest for beauty. Advertising campaigns promoted the use of toilette soap, toothpaste, and shampoo.By the turn of the century, the high price of personal hygiene was an accepted aspect of consumerism. After World War I, even the use of makeup gained mass-market appeal as a result of radio and newspaper advertising campaigns. The New Woman, the flapper, and the screen star offered new models of femininity that represented liberation from past fetters, public display, and self-sufficiency. Makeup could ensure self-confidence and sex appeal while also functioning as a political statement: in a 1912 rally in New York City, suffragettes consciously adopted red lipstick as a sign of rebellion.As the image of the made-up woman became acceptable, many female-run businesses declined because of competition from larger corporations that could afford mass advertising, industrial production, and cheaper prices. The association of beauty treatments with African-American dignity and self-advancement promoted by Annie Turnbo's Poro line was replaced with advertisements that associated cosmetics with sexuality and whiteness.In addition to being unable to match the ploys of big business, many female entrepreneurs, both white and African American, did not survive the difficult years of the Great Depression. A few women who started small did thrive in this new competition, deploying their feminine identities as a key marketing ploy. Helena Rubinstein (1870–1965), a Polish immigrant to Australia, opened her first beauty salon in 1900 and by World War I had developed an international empire of luxurious beauty care. Elizabeth Arden (1884–1966), a Canadian who immigrated to New York City in 1908, built up a multinational company by the 1940s. Both women were from modest backgrounds, and focused on creating an exclusive, high-fashion image, while extending their brand as widely as possible to all women who could afford the high pricetag.Other successful companies targeted the larger market of middle- and working-class women. Working in Hollywood from 1908, the Russian immigrant Max Factor invented shades of makeup that looked natural under the camera lights. In great demand as the makeup artist tothe stars, Max Factor's reputation allowed his family to build up an empire of mass-market products distributed through supermarkets and drugstores. His pancake makeup and lipsticks advertised by the stars promised to turn everyday women into Joan Crawford or Bette Davis. Founded in 1886 as the California Perfume Company, Avon developed a national network of door-to-door saleswomen who gave it a firm hold on rural America. One of the few companies able to grow and prosper during the Great Depression, by the mid-1950s Avon had expanded into Latin America, and by 2000 it boasted selling networks in 140 countries. Avon promoted itself as a women's company with global concerns, aiming to empower local women through direct selling, create personal bonds between representatives and clients, and emphasize the role of beauty aids in building self-esteem.Europe and America were not the only places to develop international brands. In Japan, Shiseido, first established in 1872 as a Western-style pharmacy, proposed an alternative to the traditional chalk-white face and red lips. Its founder, Yushin Fukuhara, marketed Western-style compacts filled with skin-toned powders or colorful pastel shades. These powders were popular not only among aristocratic, westernized women but also among more traditional, middle-class women as well. Fukuhara's son Shinzo developed the brand, copying European-style packaging and promoting a liberated female figure. Today, Shiseido has become one of the world's most profitable cosmetics companies, rivaling L'Oréal and Revlon with its distinct hold on the Asian market.World War II brought with it shortages and belt-tightening. Governments debated the utility of cosmetic spending, while efficiency experts argued that makeup would enhance women's productivity in their new role as workers. For a small price, cosmetics fulfilled desires for scarce luxuries, thereby boosting morale for both men and women. After the war, the cosmetics industry continued to grow, with sales increasing from 1.2 billion to 2.9 billion dollars from 1955 to 1965 in the United States. Much of this increase was a result of an almost total acceptance of makeup as essential to proper femininity.Women were told that without makeup they would not be able to get or even keep a man. Lipsticks with evocative names and available in a dazzling array of shades were worn by 80 to 90 percent of American women by 1948. New product lines appeared to take advantage of the increased consumer affluence. While Estée Lauder (founded in 1946) sold high-end products in department stores, Revlon (1932) sold sex and fantasy in women's magazines and Cover Girl (1960) targeted the growing teenage market. Though aimed at different demographics of American women, none of these brands took into consideration African-American skin tone or beauty needs.By the 1960s, young politicized African Americans condemned face whiteners and hair straightners, adopting “black is beautiful” as a political cry for action. The white feminist movement also denounced lipstick and bras, burning these latter symbols of female oppression in a 1968 protest of the Miss America beauty pageant. The cosmetics industry was blamed for reinforcing the patriarchal capitalist economy and limiting women's role to that of an object.By the late 1970s, animal rights groups also began to target cosmetic companies for their use of vivisection, further turning the production of beauty into a political affair. The growing concern with natural, cruelty-free, politically correct products led to the creation of The Body Shop by Anita Roddick in 1976. Mass-market firms revised the tone of their advertisements, created new ethnic lines, and promoted female emancipation in an attempt to woo back customers. By the 1980s, makeup and cosmetics had regained their hold over women's wallets. Increasingly, women's-rights activists stressed the personal empowerment of self-fashioning, best represented by power-suited businesswomen on Wall Street and “lipstick lesbians” in the counterculture.In the 1990s, scientific promises helped sell new products, such as the fast-growing lines of fake-tanning lotions, anti-aging formulas, and cellulite creams. New ingredients, such as ceramides, alpha-hydroxy acids, and liposomes, not to mention botox treatments, intensified the quest for youth. Multinational cosmetic firms continued to grow by buying out smaller local cosmetics businesses, specifically targeting ethnic markets. Such companies as L'Oréal, Avon, and Revlon have also expanded rapidly into Latin America, Asia, and eastern Europe. With L'Oréal as the unquestioned leader, the top ten companies controlled 55 percent of worldwide cosmetics sales. With increasingly trendy packaging designs, celebrity endorsements, sophisticated advertising campaigns, and almost total social acceptance in the Western-influenced world, cosmetics seem to be an invincible economic force. See also Fashion Industry and Personal Services.
Kitty's topics
1. Structure
2. Culture
3. Geographical segmentation
4.business strategy
Bibliography and aprendix
2. Culture
3. Geographical segmentation
4.business strategy
Bibliography and aprendix
Financials
e.g. "VOD" or "Barclays"
The Body Shop International PLC - Discuss The Body Shop International PLC
Find more results for the bodyshop
var _timeZoneOffset = '-18800';
Summary
Promoting beauty in the customer's eye instead of the beholder's, The Body Shop International sells skin and hair care products so natural they sound edible (Peppermint Foot Lotion, Banana Shampoo). The company combines activism with marketing, encouraging women to focus on self-esteem and social and environmental causes. The Body Shop operates some 2,425 stores (the majority are franchised) in about 60 countries. It also sells its products via The Body Shop at Home, an in-home sales program the UK, the US, Germany, and Australia. Surpassed by Intimate Brands' Bath & Body Works, the company gave up manufacturing to focus on retailing. The Body Shop was sold to France's L'Oréal in mid-2006. More from Hoovers »
Watersmead Littlehampton, BN17 6LS GBR +44-1903-731-500 (Phone)+44-1903-726-250 (Fax)
Company website:http://www.thebodyshopinternational...
Related Companies
Name
Name
Exchange
Symbol
Last Trade
Change
Mkt Cap
Lush Ltd.
Lush Ltd.
Sephora USA, Inc.
Sephora USA, Inc.
Bath & Body Works, Inc.
Bath & Body Works, Inc.
Marionnaud Parfumeries SA
Marionnaud Parfumeries SA
Merchant Retail Group plc
Merchant Retail Group plc
Mary Kay Cosmetics Ltd.
Mary Kay Cosmetics Ltd.
Neways International (UK) Ltd.
Neways International (UK) Ltd.
Victory Corporation Plc
Victory Corporation Plc
Alliance Boots Holdings Limited
Alliance Boots Holdings Limited
QVC UK
QVC UK
News
Yes, Yes, Yes to Safe Sex Market Wire (press release) - Mar 23, 2009
Goodness in beauty New Straits Times - Mar 9, 2009
The Body Shop International PLC - Strategic Analysis Review ... PR-Inside.com (Pressemitteilung) - Feb 24, 2009
CEVA Logistics Wins Contract With The Body Shop International Logistics Online (press release) - Feb 3, 2009
The Body Shops Deep Sleep Dreamy Pillow and Body Mist proves to be ... WebWire (press release) - Jan 15, 2009 - Related articles »
The Body Shop seasonal Sparkling Seduction make up collection ... PRLog.Org (press release)
View all news »
Officers and directors
Adrian D. P. Bellamy
Chairman
Andy King
Director Marketing
Bill Eyres
Head, Global Corporate Public Relations
Discussions
Start a discussion about The Body Shop International PLC »
Body Shop profits dive
Published: 18 February 2009 08:33
Author: Nicola Harrison
Last Updated: 18 February 2009 09:29
Body Shop profits slumped to €36m in 2008
Body Shop's profits slumped from €64m in 2007 to €36m in 2008, dragging down the performance of parent company L'Oreal.
Like-for-likes declined 1 per cent in the fourth quarter, while sales fell 8 per cent.
Owner L'Oreal blamed the poor performance on the weak market in Britain, Spain and North America, as well as the fall in the pound.
The French company,which has repeatedly boasted double digit growth, yesterday apologised for missing an internal sales target of 4 per cent.
Body Shop's founder, the late Anita Roddick, sold the chain to L'Oreal for £652m almost three years ago, when the high street was booming. But Body Shop has suffered in recent years, with supermarkets stocking health and beauty products and new chains springing up, competing in the same market.
Observers say sales of beauty products should be on the increase, thanks to a phenomenon known as the "lipstick effect", where women trade down and buy make up - as opposed to big ticket items - in times of recession.
Author: Nicola Harrison
Last Updated: 18 February 2009 09:29
Body Shop profits slumped to €36m in 2008
Body Shop's profits slumped from €64m in 2007 to €36m in 2008, dragging down the performance of parent company L'Oreal.
Like-for-likes declined 1 per cent in the fourth quarter, while sales fell 8 per cent.
Owner L'Oreal blamed the poor performance on the weak market in Britain, Spain and North America, as well as the fall in the pound.
The French company,which has repeatedly boasted double digit growth, yesterday apologised for missing an internal sales target of 4 per cent.
Body Shop's founder, the late Anita Roddick, sold the chain to L'Oreal for £652m almost three years ago, when the high street was booming. But Body Shop has suffered in recent years, with supermarkets stocking health and beauty products and new chains springing up, competing in the same market.
Observers say sales of beauty products should be on the increase, thanks to a phenomenon known as the "lipstick effect", where women trade down and buy make up - as opposed to big ticket items - in times of recession.
SWOT analysis
...However, to carry out a more in depth analysis we also used SWOT analysis, which is a measure of the strengths, weaknesses, opportunities and threats of the business, in order to see how the external pressures influence the business and how they can react to them.
Internal factors:
strengths
• Brand (name, image, ethic natural ingredients)
• Experience, financial ... expertise of L’Oreal
• Body Shop targets a niche market. By stating that it is not testing its products on animals and by appearing to have an ecological profile, it has appealed to customers with ethical issues. Being the only shop in the shopping centre that sells ecological
· Increased awareness of organic and eco friendly products (89% avoid synthetic chemicals in personal care goods)
· Lack of Marketing, guerrilla/viral strategy
· Connection to political issues
· Strong customer community
· Strong social mission
· Lack of shareholder "consideration"
· The first to break the market
weaknesses
• Loss of trust from different... the supply chain (publication...)
• Number of stores in the UK
• Not "purple" in the US Market (they have been copied)
opportunities
• Increased interest of men in their
(The Metrosexual factor)
Threats
• Slower distribution (because of the chemical legislation)
• Unstable supplies of ingredients, materials and
• On the other hand the collapse of banking institutions and economy indicates
• tougher times ahead for anybody trading on the high street.
• Exchange rate. The fall of pound indicates higher prices for imported ingredients and products
• New legislation banning animal tested products and the marketing of such policy may raise the competition.
Strengths
The Body Shop International has many strong traits of strength that have catapulted them into the limelight throughout the years. Many of them are extremely unique to their business which also grips them into political controversy and "drama" as they undergo "business as usual".
Their first strong strength revolves around The Body Shop's lack of a traditional marketing strategy. Instead, their focus rests on a viral marketing strategy where consumers/customers take the burden of advertising upon The Body Shop and tell their friends. It is completely free and is proven.
Building on their lack of a marketing program – The Body Shop has built an incredibly strong community of customers as they build up their "trade" dollars. Entering the viral strategy requires customers that are willing to go out of the way to "trade" and to tell their friends about the entire experience and their incredible community supports this strategy.
Their strong social mission helps to build upon the previous strength as another strength. Not only is The Body Shop paving the way for corporate responsibility and community engagement – but they are building a clientele that wildly supports their views and once again will tell their friends about it. The fact that they are changing the world seems to be just a small afterthought.
The Body Shop has many other strengths that stay out of the norm of traditional business. Their lack of shareholder "consideration" helps them to maintain their mission without...
Source:Mintel national statistics
Internal factors:
strengths
• Brand (name, image, ethic natural ingredients)
• Experience, financial ... expertise of L’Oreal
• Body Shop targets a niche market. By stating that it is not testing its products on animals and by appearing to have an ecological profile, it has appealed to customers with ethical issues. Being the only shop in the shopping centre that sells ecological
· Increased awareness of organic and eco friendly products (89% avoid synthetic chemicals in personal care goods)
· Lack of Marketing, guerrilla/viral strategy
· Connection to political issues
· Strong customer community
· Strong social mission
· Lack of shareholder "consideration"
· The first to break the market
weaknesses
• Loss of trust from different... the supply chain (publication...)
• Number of stores in the UK
• Not "purple" in the US Market (they have been copied)
opportunities
• Increased interest of men in their
(The Metrosexual factor)
Threats
• Slower distribution (because of the chemical legislation)
• Unstable supplies of ingredients, materials and
• On the other hand the collapse of banking institutions and economy indicates
• tougher times ahead for anybody trading on the high street.
• Exchange rate. The fall of pound indicates higher prices for imported ingredients and products
• New legislation banning animal tested products and the marketing of such policy may raise the competition.
Strengths
The Body Shop International has many strong traits of strength that have catapulted them into the limelight throughout the years. Many of them are extremely unique to their business which also grips them into political controversy and "drama" as they undergo "business as usual".
Their first strong strength revolves around The Body Shop's lack of a traditional marketing strategy. Instead, their focus rests on a viral marketing strategy where consumers/customers take the burden of advertising upon The Body Shop and tell their friends. It is completely free and is proven.
Building on their lack of a marketing program – The Body Shop has built an incredibly strong community of customers as they build up their "trade" dollars. Entering the viral strategy requires customers that are willing to go out of the way to "trade" and to tell their friends about the entire experience and their incredible community supports this strategy.
Their strong social mission helps to build upon the previous strength as another strength. Not only is The Body Shop paving the way for corporate responsibility and community engagement – but they are building a clientele that wildly supports their views and once again will tell their friends about it. The fact that they are changing the world seems to be just a small afterthought.
The Body Shop has many other strengths that stay out of the norm of traditional business. Their lack of shareholder "consideration" helps them to maintain their mission without...
Source:Mintel national statistics
Macro-environmental analysis
Political factors
• Unstable political situation in Guatemala from where the cosmetics companies source Aloe Vera
• Unstable political situation in Pew: the country is a source of Brazil nut oil from the Amazon forest in Peru
www.news.bbc.co.uk
Economic factors
The falling interest rates play in the favour of the company’s franchising policy as growth strategy.
www.news.bbc.co.uk
Social factors
• Raised awareness regarding fair trade
• Raised awareness regarding natural products/ animal testing.
• Raised awareness of men regarding their appearance (according to Mintel’ s Men’s Toiletries, UK, March 2008)
• Increased number of on-line buyers (Key Note 2008: 65% British Households have internet).
• Ageing population (willingness to spend on premium-priced products claiming anti-ageing properties)
Source Mibtel,key notes, natural statistics
Technological factors
• Use of toxic chemicals (e.g.Kojic acid). According to the Scientific Committee on Consumer Products, the presence of this acid in cosmetics can affect melanin count in skin.
Environmental factors
• Sustainable/green packaging
• Recycling/disposal of by-products
• Concern for deforestation (Supply of palm oil and brazil nut oil from forests in conserved areas)
Legal factors
• New chemical legislation in the EU: from 2008 chemicals imported into Europe in amounts at 1 tone per year (including mixtures) will need to be registered with a new European Chemical Agency (ECHA) in Helsinki.
• Ban on the sale and marketing of animal tested cosmetic products throughout the EU from March 2009.
SOURCE: health and safety execution
Financial Objective
• By September 2008 total retail sales increased by 5%
• Key Note 2008 reports modest growth in sales till 2012
OBJECTIVE:
• To achieve the sales growth of 2% in the face of economic recession in the next 12 months
Political factors
• Unstable political situation in Guatemala from where the cosmetics companies source Aloe Vera
• Unstable political situation in Pew: the country is a source of Brazil nut oil from the Amazon forest in Peru
www.news.bbc.co.uk
Economic factors
The falling interest rates play in the favour of the company’s franchising policy as growth strategy.
www.news.bbc.co.uk
Social factors
• Raised awareness regarding fair trade
• Raised awareness regarding natural products/ animal testing.
• Raised awareness of men regarding their appearance (according to Mintel’ s Men’s Toiletries, UK, March 2008)
• Increased number of on-line buyers (Key Note 2008: 65% British Households have internet).
• Ageing population (willingness to spend on premium-priced products claiming anti-ageing properties)
Source Mibtel,key notes, natural statistics
Technological factors
• Use of toxic chemicals (e.g.Kojic acid). According to the Scientific Committee on Consumer Products, the presence of this acid in cosmetics can affect melanin count in skin.
Environmental factors
• Sustainable/green packaging
• Recycling/disposal of by-products
• Concern for deforestation (Supply of palm oil and brazil nut oil from forests in conserved areas)
Legal factors
• New chemical legislation in the EU: from 2008 chemicals imported into Europe in amounts at 1 tone per year (including mixtures) will need to be registered with a new European Chemical Agency (ECHA) in Helsinki.
• Ban on the sale and marketing of animal tested cosmetic products throughout the EU from March 2009.
SOURCE: health and safety execution
Financial Objective
• By September 2008 total retail sales increased by 5%
• Key Note 2008 reports modest growth in sales till 2012
OBJECTIVE:
• To achieve the sales growth of 2% in the face of economic recession in the next 12 months
Financial data
In January 1986 The Body Shop company went to the London Stock Exchange Market. From that day on the organization had to act differently. With a capital injection the company could turn from being a niche retailer to an international corporation.
The Body Shop has been listed on the London Stock Exchange for 20 years and finally it was taken over by a cosmetic giant from France, L’Oreal, in March 2006. It is said that, despite this huge change in ownership, “Anita Roddick’s baby” will “retain its existing identity and values and operate independently within the L’Oréal group, led by the current management team. ” Time will show the truth.
This performance measurement analysis will concentrate on years 2001 – 2006 as this seems to be a reasonable time range.
Firstly, table no. 1 shows basic indicators of performance. Operating profit has been rising each year. This trend has become stronger between year 2003 and 2005 with a downfall to just 6% increase in 2006 (£41.5 millions). Turnover was fluctuating around the same level till year 2004 (~ £380 millions) and turned into an upward trend that is becoming faster. A very similar situation is presented by the retail sales value, which in 2006 reached a level of £772 millions. The net debt, which is short and long term debt minus cash & cash equivalents, was reduced significantly till year 2004, when an implementation of new £100-million-investment-plan started.
Such sequence of changes in first three indicators was caused by several factors. In year 2002 results were expected to be better, but the tragedy of the 11th of September influenced American market severely. Asia and Pacific as well had problems in the second half of the year as the economy was deteriorating. What’s more stores overheads were higher due to rental costs and in addition to that the company faced exceptional costs (£11.5 millions) such...
The Body Shop has been listed on the London Stock Exchange for 20 years and finally it was taken over by a cosmetic giant from France, L’Oreal, in March 2006. It is said that, despite this huge change in ownership, “Anita Roddick’s baby” will “retain its existing identity and values and operate independently within the L’Oréal group, led by the current management team. ” Time will show the truth.
This performance measurement analysis will concentrate on years 2001 – 2006 as this seems to be a reasonable time range.
Firstly, table no. 1 shows basic indicators of performance. Operating profit has been rising each year. This trend has become stronger between year 2003 and 2005 with a downfall to just 6% increase in 2006 (£41.5 millions). Turnover was fluctuating around the same level till year 2004 (~ £380 millions) and turned into an upward trend that is becoming faster. A very similar situation is presented by the retail sales value, which in 2006 reached a level of £772 millions. The net debt, which is short and long term debt minus cash & cash equivalents, was reduced significantly till year 2004, when an implementation of new £100-million-investment-plan started.
Such sequence of changes in first three indicators was caused by several factors. In year 2002 results were expected to be better, but the tragedy of the 11th of September influenced American market severely. Asia and Pacific as well had problems in the second half of the year as the economy was deteriorating. What’s more stores overheads were higher due to rental costs and in addition to that the company faced exceptional costs (£11.5 millions) such...
Latest news
The Body Shop Looks to Cut Manufacturing
Posted: March 5, 2009
The Body Shop, a L'Oreal-owned company, has announced plans to cut 275 jobs, many in manufacturing and distribution. In addition, the company is looking to sell its two manufacturing facilities in Littlehampton, UK.
The company reportedly will cut nearly 200 jobs at the company's head office at Littlehampton, UK. The remainder of the job cuts will be cut from manufacturing and distribution. The cuts will not affect individual stores or store staff.
The job cuts are part of a restructuring plan by company chief executive Patrick Gournay that was designed to aid falling sales. The company revealed that it may sell its two manufacturing plans in Littlehampton.
Source:http://www.cosmeticsandtoiletries.com/networking/news/company/40783282.html?utm_source=Related+Items&utm_medium=website&utm_campaign=Related+Items
Recently, The Body Shop won the "Proggy" award for best cruelty free cosmetics, given by PETA Europe.
Posted: March 5, 2009
The Body Shop, a L'Oreal-owned company, has announced plans to cut 275 jobs, many in manufacturing and distribution. In addition, the company is looking to sell its two manufacturing facilities in Littlehampton, UK.
The company reportedly will cut nearly 200 jobs at the company's head office at Littlehampton, UK. The remainder of the job cuts will be cut from manufacturing and distribution. The cuts will not affect individual stores or store staff.
The job cuts are part of a restructuring plan by company chief executive Patrick Gournay that was designed to aid falling sales. The company revealed that it may sell its two manufacturing plans in Littlehampton.
Source:http://www.cosmeticsandtoiletries.com/networking/news/company/40783282.html?utm_source=Related+Items&utm_medium=website&utm_campaign=Related+Items
Recently, The Body Shop won the "Proggy" award for best cruelty free cosmetics, given by PETA Europe.
why not to boycot Bodyshop
Our inclination might be to disengage, but it appears to be a counter-productive strategy, so what should we do to help ensure that the Body Shop does remain true to its values and help L’Oreal see that corporate responsibility is an idea they should embrace wholeheartedly?
1. In an ideal world, instead of boycotting, if we buy their products in droves, they will be a wildly successful company and L’Oreal might even think this ethics stuff isn’t a bad idea for the rest of the group. All the other retailers will be on the ‘bandwagon’ in record time! (By the way, I don’t have shares in either company)
2 Write personally to the Chairman/CEO of L’Oreal, Lindsay Owen-Jones and also the non-execs on the L’Oreal Board and express in forceful terms that your continued support depends on their maintaining Body Shop values. You’d be amazed at how insulated such people often are and how letter campaigns can hit home.
3 Keep a very close eye on Body Shop to ensure it continues to uphold its values and improve its performance in these areas. Write to them where you see gaps; come up with innovative ways to help; read their social report; give them feedback - make sure we keep them on their toes.
4 Devise or join campaigns that advocate the specific change that you want – e.g. fair trade, and lobby L’Oreal hard in creative ways. Make sure it is targeted to a specific behavior you want changed, not just a generic rant.
5 I’m sure there are lots more creative ways to lobby these and other companies, send them to Ethical Corporation; I like the idea of an ‘ideas bank’ of good campaigning ideas!
So, for me, the answer is no, don’t boycott Body Shop, that is a very passive way of getting exactly what you don’t want – less fair trade and the high street taken over by companies who don’t support your values. Be active, use carrots as well as sticks, support where it is due, sanctions only when they are really justified.
1. In an ideal world, instead of boycotting, if we buy their products in droves, they will be a wildly successful company and L’Oreal might even think this ethics stuff isn’t a bad idea for the rest of the group. All the other retailers will be on the ‘bandwagon’ in record time! (By the way, I don’t have shares in either company)
2 Write personally to the Chairman/CEO of L’Oreal, Lindsay Owen-Jones and also the non-execs on the L’Oreal Board and express in forceful terms that your continued support depends on their maintaining Body Shop values. You’d be amazed at how insulated such people often are and how letter campaigns can hit home.
3 Keep a very close eye on Body Shop to ensure it continues to uphold its values and improve its performance in these areas. Write to them where you see gaps; come up with innovative ways to help; read their social report; give them feedback - make sure we keep them on their toes.
4 Devise or join campaigns that advocate the specific change that you want – e.g. fair trade, and lobby L’Oreal hard in creative ways. Make sure it is targeted to a specific behavior you want changed, not just a generic rant.
5 I’m sure there are lots more creative ways to lobby these and other companies, send them to Ethical Corporation; I like the idea of an ‘ideas bank’ of good campaigning ideas!
So, for me, the answer is no, don’t boycott Body Shop, that is a very passive way of getting exactly what you don’t want – less fair trade and the high street taken over by companies who don’t support your values. Be active, use carrots as well as sticks, support where it is due, sanctions only when they are really justified.
Subscribe to:
Posts (Atom)