Marketing Assignment

Topics: Marketing, Retailing, Private label Pages: 11 (2705 words) Published: December 3, 2014

Table of Contents
1. Introduction2
2. Sarbec Cosmetics2
3. Present Situation faced by Sarbec in Italy3
4. SWOT Analysis4
5. Competitive position of Sarbec in Italian Cosmetics Market7 6. Contribution of Sarbec’s existing products/divisions to their standing in market8 7. Proposed Strategies for 2009 by Sarbec9
7.1 Analysis of Sarbec’s 2009 proposed strategy using Ansoff’s Matrix9 8. Suggestions11
9. Conclusion11
10. Reference12

1. Introduction

The following report is focused towards the analysis of the Sarbec Cosmetics Case Study including Market dynamics and the situation faced by the company. A SWOT analysis of the company has been done to recognize and spot the areas which are influencing the company’s business. Based on the proposed strategies by the company for next year, an Ansoff’s Matrix strategy analysis has been done to ascertain and check the feasibility of future market growth. 2. Sarbec Cosmetics

Sarbec Cosmetics was established in the year 1972 in France. It focuses on innovating, producing and selling its products in beauty as well as hygiene segment. With its effective and productive moves over the years, the company has performed well. With zero debt and reinvestment of the profits in new deeds, it created a position amongst top 10 players in the French Cosmetic Market. With advanced technology and manufacturing amenities, the company’s production is spread across three different areas 1. Cosmetics

2. Perfumes
3. Wet wipes

The Brand portfolio of Sarbec can be generalised under following brands

Corine de Farme
C. de Farme Paris
Institut Phyto
Jacomo

Apart from the above businesses it also deals in Private Label Brands business line and B2B line.

Sarbec Cosmetics also spends valuable amount of its finances across two salient features:
1) Quality Assurance practice – Centralised Quality unit along with separate Quality centres at every site. 2) Investment in Research and Development – 4% contribution from annual sales goes to R&D investments. 20% of new innovative formulae are incorporated into manufacturing.

Market Dynamics in Italy

Due to the global economic downturn in later half of the year 2008, there was a considerable decrease in the utilization and buying strength of the consumer. Despite unfavourable conditions, retail industry experienced a growth of 2.4% in 2008 with an increase in non-store selling and the big groups continued their expansion of stores and products. Overall, even with a lot of global economic problems faced by the Italian Cosmetics market, the development rate increased up by 2.2% in 2008. Due to identified increased beliefs, preference of consumers in Italy to purchase from specific retail outlets, online and directly, there was a decrease in sales of hypermarkets as well as in the supermarkets. The key players in the Italian Cosmetics Market are L’Oreal, P&G, Pampers and J&J.

3. Present Situation faced by Sarbec in Italy

The global economic distress across the country restricted business growth but still some situations were favourable & some were unfavourable for Sarbec

Situations favouring Sarbec
Private Label Business line was somewhat more stabilised.
Baby cosmetics business line was most booming trait in its business with a 36% contribution towards revenue with a growth rate of 80% with more margins. 93% of Company’s revenues under its in-house brands were capitalised in independent stores, with highest in Auchan due to continued business relationship. Effective marketing and increased spending in the advertising of Baby line Cosmetics and spreading more awareness of the brand increased sales in the baby line with elevated margin.

Situations not favouring Sarbec

Slow stock turnover leading to delisting from Conad chain leading to decline in revenue. Total Revenue declined by 5% on year to year basis and set targets were far too away from achievement and were...
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