Mary Kay in Thailand

Topics: Thailand, Sales, Mary Kay Pages: 22 (6541 words) Published: October 14, 2008
Mary Kay in Thailand


Table of Contents

Executive Summary3
Company and Industry Overview3
Mary Kay Global5
Market Trend Analysis6
Competition and Market Barriers7
The 4Ps8
Product Analysis8
The Market8
Product Function9
Products that contain specially controlled substances10
Market Access10
Product Manufacturing11
Promotion Strategy11
Delivery Profile13
Direct Sales13
Characteristics of the direct sales force13
Role of independent distributors13
Mass Marketing outlets14
Market Entry Strategy15
Pro Forma Financials16
Entry Costs16
Potential Revenue – 5 Year Forecast18
Cost per Item18
Promotion costs19
Sales/Delivery/Service Costs19
Net Profit20
Recommendations and Conclusion21
Appendix – Market Analysis21
1a. Market Analysis21
1b. Market Accessibility Profile22
2a. Product specific demand profile26
2b. Sales and Delivery Profile26

Executive Summary
Entering the Thai market is a feasible venture for Mary Kay as the region is primed for the introduction of anti wrinkle and anti aging products. Thailand’s cosmetic industry in is among the fastest growing sectors in Asia. The total market size for this sector was estimated at 287.5 million USD in 1997. Stimulated by growth since the economic downturn in 1995, the region is very open to foreign investment. Skin care product sales were valued at $336 million USD in 2006, with a forecasted growth of 15-20%. Facial products have the largest share of the market yielding an estimated worth of $205 million in 2006. The Mary Kay product line is a high-quality skin care treatment system that rivals that of Avon, our closest competitor in this market segment. Aside from the restrictive tariff rates of 30%, Thailand is a prime location to introduce our Timewise® product line. The Mary Kay brand is known for its quality products that provide a comprehensive system for all beauty and makeup needs. Adaptable to all skin types, the product line uses all natural ingredients. The distribution network of “beauty consultants” provides high impact direct sales activity and will reach the market through viral marketing and corporate promotions. Utilizing our existing distribution system and sales strategies, we anticipate solid market penetration. With an estimated initial investment of $432,000 we forecast a net profit of $64 million USD by 2009.

Company and Industry Overview
Mary Kay Cosmetics was started in 1963 by Mary Kay Ash (May 12, 1918 – November 22, 2001) of Texas. She had been employed by many direct sale companies where she proved to be a talented salesperson and trainer. The decision to retire in 1963 came when she was passed over for a promotion for man that she had trained. He received more than double her salary at the time of his promotion. At first her intention was to write a book for women in business. As time went on her book slowly became a business plan and eventually she found herself and her son starting Mary Kay Cosmetics with $5,000 in savings. Mary Kay products include skin care (cleansers, moisturizers, men’s skin care, and other needs), makeup (lips, eyes, cheeks, powders, foundations), spa and body products, fragrances, and various other products for men. Company focus is on empowering women to operate their own businesses as saleswomen for Mary Kay. As Independent Sales representatives or “beauty consultants”, women have dominated the direct sales profession with more than 75% of the sales force consisting of women. The direct sales industry is a growing marketplace with more than $100 billion worth of goods and services sold annually through direct sales. This has been an attractive form of employment for the Mary Kay distributors as they have the ability to balance life and work, set their own hours and earn based on their own motivation. Mary Kay is a member...
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