Industry Assessment - Part 1: Cosmetics Industry

Industry Assessment - Part 1
Cosmetics Industry
Riley Bell
Alexandru Colita
Nicholas Gonzalez
Derek Morin
Yuan (Amy) Zhang
MGMT 390: Industry Analysis Projects
Norine Webster
University of British Columbia Okanagan
February 14th, 2014

Table of Contents

1. Executive Summary……………………………………………………………………….2
2. Industry Description………………………………………....…………………………….3
3. Value Chain……………………………...………………………………………………..5
4. Relevant Features/Factors for the Industry ……………………………………………….7
5. Porter’s Five Forces ………………………………………………………………………9
5.1. Competitors and Level of Rivalry ……………………………………………………………………...9
5.2. Suppliers and Relative Power…………………………………………………………………………10
5.3. Buyers and Relative Power …………………………………………………………………………...10
5.4. Possible New Entrants, Barriers to Enter and Exit, Threat of Entry ………………………………….11
5.5 Substitute Products, Barriers to Switching, and Threat of Substitutes………………………………...12

6. Financial Ratios………………………………………………………………………….12
7. STEEP Analysis………………………………………………………………………….16 7.1. Social/Cultural Factors…………………………………………………………………………………16 7.2. Technological Factors…………………………………………………………………………………..18 7.3. Economic Factors………………………………………………………………………………………19 7.4. Environmental Factors………………………………………………………………………………….20 7.5. Political Factors………………………………………………………………………………………...20

8. Significant Drivers……………………………………………………………………….20
9. Key Success Factors……………………………………………………………………..22 9.1. Distribution……………………………………………………………………………………………..22 9.2. Brand Name and Brand Loyalty………………………………………………………………………..22 9.3. Manufacturing and Packaging………………………………………………………………………….23 9.4. Excellent Customer Service…………………………………………………………………………….24 10. Conclusion……………………………………………………………………………….24
11. Appendix………………………………………………………………………………....26
12. Bibliography…………………………………………………………………………......28

1. Executive Summary Thesis The cosmetic industry is a

Bibliography: Associated Press. (2014). N.Y. Legislation Would Ban Plastic Bits in Cosmetics. Retrieved February 11, 2014 from http://online.wsj.com/article/AP0c36e8466d994b919b1fef47 4b54c8a0.html?KEYWORD S=NY Azoury, N., & Salloum, C. (2013). Brand Affect 's Impact on Consumer Loyalty: Empirical Analysis. Revue Des Sciences De Gestion, 48(261), 11-11. Edgar, M. (2008). Canadian Chain Gets Eco-Savvy. WWD: Women 's Wear Daily, 195(89), 7-7. Hitchcock, B. (2001). Thank Heaven for Little Girls. Marketing Magazine, 106(1), 14. Latimer, J. (2011). Women lash Out-Way, Way Out. Maclean 's, 123(51), 92-92. L 'Oréal Finance : Half-Year Financial Report. (2013). L 'Oréal Finance : Half-Year Financial Report. Retrieved February 12, 2014, from http://loreal-finance.com/eng/half-year-report MarketLine MarketLine. (2013). Make-up Industry Profile: United States. MarketLine Industry Profile. 1-38. Nezakati, H., Yen, C. P., & Akhoundi, M. (2013). Antecendens Impact on Brand Loyalty in Cosmetics Industry. Journal of Applied Sciences, 13(1), 126-132. doi:10:3923/jas.2013.126.132 N.Y Procter & Gamble. (2013). PG.com Investor / Shareholder Relations: Current Events, Latest News. Retrieved February 12, 2014, from http://www.pginvestor.com/ Product Line: Cosmetics, Make-Up, and Perfumes (Sub Category) Revlon Inc. - AnnualReports.com. (2013). Revlon Inc. - AnnualReports.com. Retrieved January 17, 2014, from http://www.annualreports.com/Company/784 Revlon, Inc Topoyan, M., & Bulut, Z. A. (2008). Packaging Value of Cosmetics Products: An Insight from the View Point of Consumers. ICOVACS, Izmir-Turkey. Grading Rubric for Industry Assessment – Part 1 Section: Date: February 14, 2014