L¡¦Oreal Nederland B.V.
L¡¦Oreal Nederland B.V.
Pertinent Facts
L¡¦Oreal is the largest cosmetics company in the world. In 1992 the L¡¦Oreal Group was the largest cosmetics manufacturer in the world. They are Headquartered in Paris, it have subsidiaries in over 100 countries. In 1992, its sales were $6.8 billion (a 12% over 1991) and net profits were $417 million (a 14% increase). France contributed 24% of total worldwide sales. Europe (both western and eastern countries, excluding France) provided 42%, and the U.S.A and Canada together accounted for 20%; the rest of the world accounted for the remaining 14%. L¡¦Oreal¡¦s European subsidiaries were in one of two groups: (1) major countries (England, France, Germany, and Italy) or (2) minor countries (the Netherlands and nine others).
The company believed that innovation was its critical success factor. It thus invested heavily in research and development and recovered its investment through global introductions of its new products. All research was centered in France. As finished products were developed, they were offered to subsidiaries around the world. In established markets such as the Netherlands, any new product line introduction had to be financed by the current operations in that country.
L¡¦Oreal doesn¡¦t sell all of its product lines in every market in which it sells, and the market in the Netherlands is no exception. In the Netherlands, unlike in France, L¡¦Oreal and Garneir are both sold under the same sales force. In this particular case, L¡¦Oreal needs to decide which Garneir product lines such as Synergie skin care line and the Belle Couleur permanent hair colorants line to introduce in the Dutch market. Issues
• Although, L¡¦Oreal is the largest cosmetics company in the world but
L¡¦Oreal doesn¡¦t sell all of its product lines in every market and also in the Netherlands
• Upper management of the Netherlands¡¦ L¡¦Oreal subsidiary have to make decisions on which product lines will succeed in
Pertinent Facts
L¡¦Oreal is the largest cosmetics company in the world. In 1992 the L¡¦Oreal Group was the largest cosmetics manufacturer in the world. They are Headquartered in Paris, it have subsidiaries in over 100 countries. In 1992, its sales were $6.8 billion (a 12% over 1991) and net profits were $417 million (a 14% increase). France contributed 24% of total worldwide sales. Europe (both western and eastern countries, excluding France) provided 42%, and the U.S.A and Canada together accounted for 20%; the rest of the world accounted for the remaining 14%. L¡¦Oreal¡¦s European subsidiaries were in one of two groups: (1) major countries (England, France, Germany, and Italy) or (2) minor countries (the Netherlands and nine others).
The company believed that innovation was its critical success factor. It thus invested heavily in research and development and recovered its investment through global introductions of its new products. All research was centered in France. As finished products were developed, they were offered to subsidiaries around the world. In established markets such as the Netherlands, any new product line introduction had to be financed by the current operations in that country.
L¡¦Oreal doesn¡¦t sell all of its product lines in every market in which it sells, and the market in the Netherlands is no exception. In the Netherlands, unlike in France, L¡¦Oreal and Garneir are both sold under the same sales force. In this particular case, L¡¦Oreal needs to decide which Garneir product lines such as Synergie skin care line and the Belle Couleur permanent hair colorants line to introduce in the Dutch market. Issues
• Although, L¡¦Oreal is the largest cosmetics company in the world but
L¡¦Oreal doesn¡¦t sell all of its product lines in every market and also in the Netherlands
• Upper management of the Netherlands¡¦ L¡¦Oreal subsidiary have to make decisions on which product lines will succeed in