2. 2
Company Profile
Clacour International is headquartered in
Johannesburg, South Africa
The company is headed by R. Courtney and
Clara Priester who are building a team of
experts in the hair care and beauty industries
Combined the Priesters have more than 50 years
experience in marketing, sales and customer
service in the U.S. and South Africa
3. 3
Clacour Strategy
Vision
To become the premier, sought after agent
for distribution, marketing and sales of
ethnic hair care and beauty products in
South Africa and Sub-Saharan Africa
Mission
To meet the increasing demand for a wider
selection of quality ethnic hair care and
beauty products
4. 4
Keys to Success
Partnering with top quality U.S. manufacturers
Building strong business relationships with
retailers and wholesalers
Providing a professional approach to creating,
developing, and implementing sales and
marketing programs
Producing measurable growth for our clients
Maintaining consumer intelligence
5. 5
Cosmetics World Trends
Over 1000 companies manufacture and
market more than 20,000 cosmetics and
toiletry brands in the world
Most of the markets, notably the U.S. have
matured
Dropping from 31% of global sales in 2002 to 27%
in 2004*
Many U.S. companies are looking for
opportunities to enhance their growth
Africa provides such an opportunity
*Based on data from Euromonitor.
6. 6
World Top Ten Cosmetics Brands
other
49%
Avon
3%
Colgate &
Pamolive
4%
Shiseido
3%
Henkel
2%
Johnson & Johnson
2%
Beirsdorf
3%
Unilever
8%
Procter & Gamble
13%
Loreal
10%
Estee Lauder
4%
Ten leaders account for
more than 50% of total
industry sales
Estee Lauder, Limited
Brands, and Johnson &
Johnson are the major
marketers in the skin care
L'Oreal, Estee Lauder, and
Revlon are dominant in
make up
Procter & Gamble, L'Oreal,
and Unilever are the
leaders in hair care.
Coty leads in the
fragrances segment
7. 7
Cosmetics Segments
0 5 10 15 20 25
Hair Care
Skin Care
Colour
Fragrances
Bath & Shower
Oral Hygeine
Men's Grooming
Deodorant
South Africa
World
SIZE (%)
9. 9
Why South Africa at a glance . . .
The South African cosmetics industry is competitive
and sophisticated.
The sector has recently recorded its fastest growth
since the country’s first democratic election in 1994,
which marked the end of Apartheid.
Industry sources claim that the South African
cosmetic and toiletries industry grew by
approximately 45 percent during the last two years.
Currently it has an estimated value of over $ 3.4
billion (R24 billion) and it is predicted that it will grow
by 15 to 20 percent in the coming year.
Source: Research Wikis
10. 10
Why South Africa at a glance . . .
On the high-end of the consumer market,
there is a trend towards premium products,
especially those with anti-aging properties.
With the growth of the middle class and
increased spending power across many
socioeconomic groups, there is now demand
for affordable but reliable quality ethnic skin
care and hair products.
Source: Research Wikis
11. 11
Why South Africa at a glance . . .
Consumer demand for cosmetics and toiletry
products has created a demand emphasizing more
and more products specifically geared for local skin
and hair types.
The industry is set to grow continuously for the next
five years particularly in the following market
segments: cosmetics, sun care products, hair care
and treatment products and specialized facial creams
for the ethnic skin/hair market.
According to industry sources, there are over 15
million potential consumers in the ethnic hair
(maintenance) market alone.
Source: Research Wikis
12. 12
Why South Africa at a glance . . .
Consumer demand for cosmetics and toiletry
products has created a demand emphasizing
products specifically geared for local skin and hair
types.
The industry is set to grow continuously for the next
five years particularly in the following market
segments: cosmetics, sun care products, hair care
and treatment products and specialized facial creams
for the ethnic skin/hair market.
According to industry sources, there are over 15
million potential consumers in the ethnic hair
(maintenance) market alone.
Source: Research Wikis
13. 13
South African Market - Macro
Population: 45 Million
Adult population: over 29 million
14.7 million females
14.04 million males
Literacy: 86%
Total Area: 1.22 million km sq. (slightly
less than twice the size of Texas)
Nominal GDP: US$ 135 billion (approx
same as S. Carolina)
14. 14
South African Market - Macro
South Africa's regional importance
6% of the continent population
50% of purchasing power
18% of continent-wide GDP
45% of mineral production
15. 15
Retail Size: SA
Mass Market Buying and
Distribution Groups (Cash and
Carry)
Jumbo + 50
Score +100 stores
Shield +600 stores
Drug Stores
Clicks +34 stores
Diskom +100 stores
Dischem +100 stores
Others +100 stores
Hyper/Supermarket
Shoprite +1000
stores
Pick n’ Pay +1000
stores
SPAR +800 stores
Other
+1000 outlets
There are more than 33000 outlets in South Africa,
Clacour will focus on only key accounts.
16. 16
Hierarchy of Needs - SA
Consumers’ habits are driven largely by needs
and the ability to meet those needs.
Maslow’s pyramid suggests that human beings
have some basic requirements which they need
to meet.
A growing economy and increasing distribution
of wealth more so to previously disadvantaged
groups, enables more people to meet their
needs.
Living Standard Measure (LSM) levels 6-10
have enjoyed a significant growth due to the
emerging black middle class.
17. 17
Hierarchy of Needs - SA
Many “aspirational” brands are now within
reach
Not every brand will deliver the benefits, but
only those specifically made for ethnic markets
Clacour will use every appropriate channel to
reach this emerging market
Our brands are there to serve the target market
since they are created for the consumers and
not the consumers for the brands
18. 18
Hierarchy Of Needs – SA
Laundry bars, Vaseline,
Lifebuoy
Vaseline, Dawn, Ingram's,
Almay, Charlie, Rimmel, Sleek ,
Sof n’ Free
Kalos, Dark n’ Lovely
Pantene, Camelle, Revlon
MAC, Fashion Fair
Vininto
Estee Lauder
Chanel, Redken,
Paul Mitchell
Products Disposable
Income
Prestige
Brands
R13 406.00
Branded
Skincare,
color
cosmetics,
fragrances
R7 470.00
Hair care,
Deodorant,
cheap
color
cosmetics
R3 731.00
Toiletries,
oral
hygiene
R1 595.00
Oral
Hygiene
R895.00
LSM Pop.
%
+10 10%
7-10 20%
5-6 24%
3-4 20%
1-2 26%
19. 19
People of Colour: South Africa
Black South Africans account for almost 56% of the
spending power.
The brands status in the store has not really changed. It is
still 90% dominated by these global players especially in
the department stores.
This new market however seeks identity and image hence
desire to use prestige brands or rather global brands like
Estee Lauder, MAC, Clarins, Elizabeth Arden, Lancôme,
Bobbi Brown, etc
Many of these consumers experience “postpurchase
dissonance”
Brands fail to reach their expectations
Majority of brands though they are global, were not made
specifically for Black consumers
20. 20
Cosmetics Market Trends: SA
A Black Person’s Needs:
Target Young emerging markets Products
Lifestyle Fairly successful
Seemingly affluent
Materialistic
Very image conscious
Diet conscious and body
ware
Quality Package
Quality ingredients
Value for money
Highly esteemed
brands
Endurance
Positives Pride in success
Health focused
Enjoyment of
admiration/attention
Negatives Credit-based, little capital-
lifestyle funded by salary
Stressful – fear of losing
everything
21. 21
Hair Care - Global
Global Hair care
Conditio
ners
20%
2-in-1
products
1%
Shampo
o
31%
Saloon
Hair
Care
10%
Hair
Colourants
20%
Perm &
Relaxant
s
1%
Styling
Agents
17%
Hair care products
contribute the
biggest in the
cosmetics sector
Most of the giants
have hair care
contributing more in
both turnover and
profit
22. 22
Hair Care – SA Key Players
Henkel
2%Kao Corp
2%
Rapidol
2%
Unilever
8%
P & G
27%
Amka
16%
Designer
Group
6%
Alberto
Culver
2%
Colgate
Pamolive
1%
Loreal
34%
Ethnic hair care
products make up
approximately 43% of
sales, which makes
SA one of the world’s
largest ethnic hair
care markets
Top hair care players
are gaining market
share at the expense
of smaller
manufacturers.
23. 23
SA Market Entry
For international companies to enter the
South African cosmetics and toiletry market it
is imperative to find a local representative,
distributor or agent.
South African industry is extremely brand
and supplier loyal, and the quickest road to
success in the market is teaming up with a
widely networked local partner.
24. 24
Market Issues and Obstacles
There are no major issues or obstacles regarding importation of
toiletries, cosmetics or fragrances into South Africa.
However, if cosmetics, hair care or skin care products claim medicinal
ingredients, they will need to be registered with the Medicines Control
Council of South Africa (MCC) – a tedious, long and complicated
process.
The South African cosmetics and toiletry industry is largely self-
regulatory. Regulatory requirements developed by the CTFA, the
South African Government, the South African Bureau of Standards
(SABS) and the local cosmetics industry, are based on E.U.
cosmetic directives.
The advertising of cosmetic products is closely regulated by the
Advertising Standards Authority (ASA).
South African Governmental regulations relating to the ingredients
of cosmetic products are included in the Foodstuffs, Cosmetics
and Disinfectants Act 54 of 1972
For the complete Act browse to
hhtp://www.doh.gov.za/docs/legislation/acts/1972/act54.htmp
25. 25
SA Prospective Buyers
Prospective buyers for large volumes of
cosmetics, toiletries, and fragrances
include major retail chain stores,
department stores, pharmacy chain
stores and wholesalers - who in turn sell
to smaller retail stores.
26. Distribution
Clacour Plan
Departme
nt Stores
30%
Pharmaci
es
15%
Direct
Sales
10%
Supermar
kets
25%
Specialty
Stores
10%
Salons
10%
Global Trends
Supermkts
25%
Outdoor Mkt
2%
Direct
Sales
12%
Specialist
12%
Others
4%
Dpt Stores
13%
Discounters
8%
Pharmacies
18%
Convenient
stores
3%
Food stores
3%
Clacour operates on a “Key accounts management” principle,
where we seek to trade with existing and potential key
customers in different channels.
The brands will be present in all esteemed channels relevant to
our defined target market.
Global Trends reflect that cosmetics are accessed more through
supermarkets, Pharmacies, Department stores, and others
27. 27
Further Africa Potential
Cosmetic, toiletries and fragrances imported into
South Africa cater primarily for the local market, but
Increasingly, cosmetic companies are expanding
their business to the greater SADC (Southern African
Development Community) region.
The SADC is comprised of Angola, Botswana,
Lesotho, Namibia, Mozambique, Malawi, Mauritius,
Democratic Republic of Congo, Tanzania, Swaziland,
Seychelles and Zimbabwe.
The SADC has a population of over 180 million
people and countries such as Zambia (5.3 percent)
and Angola (16.3 percent) are showing rapid GDP
growth.
28. 28
Distribution Fees
Clacour functions as a distributor in two ways:
1. Appointment by the principal on a given territory
Undertake full responsibility to nurture and grow both the
market share and the sales volume
1. As an agent on a commission to prospect and
identify the customer and obtain orders on behalf of
the principal.
In this case the marketing functions remains fully the
principal’s responsibility.
Commission will be determined per contract
29. 29
Human Resources Plan
Clacour seeks not only to create more jobs
but to work and develop local nationals in
respective countries to be international
professionals
Emphasis is on the importance of attracting,
developing and retaining outstanding
professionals
Enhancing management succession primarily
within the organization
Our ultimate goal is to become and remain a
preferred employer
30. 30
SWOT Analysis
Strengths
High quality range of
products
Innovation of products
Knowledgeable of
African markets
Lower overhead costs
Support from local
community
Weaknesses
New player, new brands
Turnover based on
prediction
Limited financial
resources
31. 31
SWOT Analysis
Opportunities
Untapped market of
South Africa and Sub-
Saharan
Increases in middle
class spending power
Appeal of U.S. products
Threats
Aggressive competitor's
marketing
Global economic
recession
New regulation in
cosmetics industry
Different regulations in
countries on which
markets will be involved
32. 32
Clara Priester
Clara Priester has significant advertising and marketing experience. Her expertise is
strategic marketing, branding and planning; assessment and training of marketing staff.
In 1978, Clara’s advertising and marketing career started at Leo Burnett Advertising
Company located in Chicago, Illinois. Clara then joined McDonald’s Corporate
Headquarters in 1987 where she was responsible for strategic marketing and planning,
ethnic marketing and the breakfast business until 1998 when she undertook the
responsibilities of Marketing and Communications Director for McDonald’s South Africa.
From 2003 to 2006, Clara was the Director: Marketing and Communications for Wits
Business School where she is currently a lecturer; and Programme Director for Women
Entrepreneurs New Venture Creation Certificate Programme, Women’s Management
Development Programme (WOMAP) and isiZulu, French and Mandarin Language Courses.
She is a director of Brandworx, (Pty) Ltd which specialises in strategic branding
consultation and marketing training. She is a member of the Institute of Directors; and
since 2002 has been Chair of the Businesswoman’s Association (BWA) Johannesburg
branch.
She is currently a Women’s Private Equity Fund Trustee and a CAF Southern Africa Board
Member. She is also a member of the Democrats Abroad South Africa Steering
Committee.
Clara has a Bachelors Degree in Psychology and Secondary Education from Kansas
33. 33
R. Courtney Priester
R. Courtney Priester has significant customer service and hospitality management
experience within the telecommunications and hospitality industries. His expertise is in
organizational and personnel management. Courtney also has experience in Project
Management, Help Desk Management and Call Centre management.
In 1979, Courtney began his career in the hospitality industry where he managed and
worked at various private clubs, bars and restaurants until in 1994 when he became a
partner in “Upon Your Request”, a successful Jazz Venue located in downtown Chicago.
In 1995, Courtney joined SBC and was quickly promoted to manage the regional Help
Desk, supervising a core of assistant managers and service representatives to resolve
escalated customer service issues. In 2000, Courtney was again promoted to the position
of a Network Provisioning Manager where he remained until relocating to Johannesburg
South Africa in 2003. In 2005 Courtney joined a partnership and opened Mzansi Orleans, a
New Orleans styled restaurant and jazz club in Norwood, SA.
Courtney has had success in selling items from Italian Jewellery to Insurance. He has
accumulated many top sales awards in those various industries.
Courtney has a Bachelors Degree in Hospitality Management from Roosevelt University in
Chicago, Illinois. He also has various certificates in security, community service, and
customer service. .
