Sa Sa Cosmetics, Harvard Business School
September 28, 2013
: CMGB 6101 Marketing Management
: Group 1 (Monday 6.30 – 9.30pm) –Dr. Gita Gayatri
: David E. Bell & Iris T. Li (2002) "Sa Sa Cosmetics"
Harvard Business School, May 8, 2003
Sa Sa Cosmetics is a well-known of largest cosmetic and beauty retailer service in Asia which is pioneering the concept of discount cosmetic retail stores in Hong Kong. The case explained the company background of Sa Sa developed by Simon and Eleanor Kwok (Figure 1). Besides, the case also describes how Sa Sa became successful and facing the problems in the organization and discusses the recent initiatives and strategies that were undertaken to sustain growth momentum and undertook some marketing research studies to guide. The research findings appear to confirm that Sa Sa may have some major problems. As 2001 comes to a close, Sa Sa contemplates what else can be done to improve profitability and keep on growing.
There are some reasons for Sa Sa’s early success. Sa Sa was creating value for its customers by providing them with quality products at a fair price. Sa Sa was first of its kind to pioneer the concept of discount store for the cosmetics (create and control). It did fast in the initial stages of the business (compete) by making the stores bigger and better from 40 sqft in 1978 to 750 sqft in 1985 to 10 stores in mid 1990s. Sa Sa was able to provide value to its customer by keeping the purchase prices low by using “parallel importation” and passed saving to the customers. One of the other important factor was Sa Sa listened to its customer demand (which products to stock). Sa Sa allowed the customer to touch and feel the cosmetics products that drove the demand. We also see Sa Sa’s strategy to deter the new entrants by holding onto old location. They controlled the inventory depending on the sales rate and the shelf life of the products....
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