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Shiseido Company, Ltd.: Facing Global Competition

1992 words - 8 pages

Shiseido is a Japanese company founded in 1872 by Yushin Fukuhara and was at the beginning intended at the pharmaceutical sector. Since, it has become leader in cosmetic Japanese market but the market has been spiced with the introduction of foreign competitors like Max Factor. The company has had difficult period like in 1987 (six percent decrease) but has always found solutions and that's why for example the company had to rethink its marketing strategies. The agreement with Johnson and Johnson is just an answer of a number that are being made to improve its position. There are also opportunities for the Shiseido to invest in other markets such as a men's product range and also the foreign market.The company proposes a large range with three principal categories:-Cosmetics74% of sales-Toiletries16% of sales-Others10% of salesWith the long term project, Shiseido identified three goals: technological excellence, diversified operations, and customer satisfaction.We'll see in this case the current situation of Shiseido and its possible opportunities in term of market, distribution and exportation, but on the other hand we'll see few weakness of the company.1) What are the strengths, weakness, opportunities and threats for Shiseido?StrengthsLeader on the domestic market of cosmetics in terms of revenues and market shareShiseido's sector of R&D is very complete and at the top of technologyShiseido propose products for all types of demand with its inexpensive "Cosmenity" line and its other brands (lower end of the market), they have a very large range (about 3000 products)Establishment of its chain store system which permit to control a lot of things in the shop (merchandising, sales corner development...)Shiseido currently represented by 17 subsidiaries and more than 8,700 outlets in 69 countriesShiseido introduces at least one new product to the domestic market each month and tries to span the entire marketThey work together with its customers, business partners, shareholders, employees, and societyUsefulness of the membership club (approximately 70% of domestic sales)Shiseido takes care of environment in using the less bad products as possibleGood communication between Shiseido and its affiliated stores thanks to regular help from its representativesAdaptation of the offers with different consumers' needs in different areas thanks to Regional Center and Consumer Communication CenterMen's cosmetics which is an increasing sector already represents 10% of Shiseido sales1998 has seen an increase in overseas sales from 11% to 14,9% of Shiseido salesWeaknessNon appropriated policy classification by ageWhile customer loyalty to Shiseido is strong in the rural areas, it is weaker in the urban areas6 percent decrease in sales in 1987 which proves that leadership is difficult to maintain without doing mistakeShiseido current foreign sales is only 15 percent of total incomeOpportunitiesTo globalize its toiletries business, Shiseido made a strategic...

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