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COSMETICS INDUSTRY Operations Analysis
- 1. COSMETICS INDUSTRY Operations Analysis PresentedBy: 13 Neha Goyal 23 Aditi Mandloi 33 Vishesh Pillai 43 Pranav Sharma 53 Shikhar Sodhani 63 Akshay Vishwanathan
- 2. An overview: GlobalScenario • Report by Ernst and Young worldwide cosmetics market • Dynamic, reason- Population, urbanization, world GDP growth • Top three China, Brazil, the US • Double in size next 10-15 years • China, the US, Brazil, India and Japan- Future top markets • Increasing pollution- will trigger growth
- 3. Indian Scenario • CAGRduring 2011-2015 - around 17% • Exposure to Internet & TV- increase in awareness • According to CII total market size is US $950 million • Maximum 24% Market share of L’Oreal and 19% Ayur products • Demand for herbal products increasing rapidly
- 4. Technical understanding INGREDIENTS OFCOSMETICS Common ingredients Castor Oil and its derivatives Cerebrosides (cells from the nervous systems of cattle and swine) – banned now Visual effects Strong red colours Pearlescence TYPES OF COSMETICS Facial cosmetics Perfume Deodorants and antiperspirants
- 5. Industry location selection Plantlocation selection Availability of Raw Material Proximity to market Infrastructural Facilities Government Policy Availability of Manpower Ecological and Environmental Factors Competition Climatic Conditions
- 6. Strategic operations ---Technology Research Projects Nanotechnology ProductTesting Microbiological Safety and Cosmetics
- 7.
- 8. PARAMETERS FOR EFFICIENTSUPPLY CHAIN MANAGEMENT Warehouse Handling Multi-stream Expertise Stream Analysis Packaging Requirements Marketing Impact
- 9. Strategic operations ---capacity andefficiency Production Capacity varies from one company to other based on their resources, capital, work force and plant size DU-VAR laboratory’s - 50,000kg per day L’OREAL - 43 plants worldwide Efficiency Benchmarking Six Sigma standards TQM
- 10. Case analysis 1:Loreal Solution • Loyalty Program • Distribution Monitoring • Integration with SAP • Senior management level analytics Benefit • Manager having real time insights • Larger sales volume • Increased productivity in distribution • Response time to events reduced Challenge: • Congestion of information, due to large number of distributors; which ultimately resulted in slowing down of the sales process
- 11. Case analysis 2:Role of Penske Logistics in Latin American company Solution • Supervision in construction of regional warehouse • Recruitment of specialized professionals • Stock maintenance and control • Investment in industrial research Benefit • Creation of best distribution centre and supply chain in Brazil • Larger sales volume • Decrease in delivery time • Successfully pushed environmental sustainability in its supply chain Challenge: • Unable to support and adapt its structure to increased sales
- 12. Case analysis 3:EMAMI Challenge: • Competition from Hindustan Lever in the Men’s Fairness Cream sector • Solution • Emami tied up with the telegram and postal service • They started working with ITC’s E- Choupal • Direct distribution • Project Swadesh • Benefit • Fair and Handsome reached Rs.100 crores in 4 years. • 8000-9000 villages have been covered • Same Distribution for others goods also • Larger sales volume
Editor's Notes
- #3 According to report by Ernst and Young Worldwide cosmetics combined effects of population, urbanization, progress in infrastructure and growth in world GDP will continue to drive the market. more than half of consumers will be located in tropical zones with hot, humid climates, and some 60% of the world’s population will live in major urban centers affected by pollution. These trends will further boost the demand for quality cosmetic products.