4.0 ANALYSIS
4.1 Introduction to the Case Study
4.1.1 Introduction: L’Oréal Group.
Eugène Schueller, a young chemist with an entrepreneurial spirit, founded L’Oréal in 1909. It all began with one of the first hair dyes he formulated, manufactured and sold to Parisian hairdressers. With this, the founder of the group forged the first link in what is still the DNA of L’Oréal: research and innovation in the service of beauty (Loreal.com, 2016).
Nowadays, L’Oréal is the first cosmetics group worldwide. It covers all the lines of cosmetics: hair care, colouring, skin care, makeup and perfume, with a unique brand portfolio of 32 complementary brands.
The group is organized in four major divisions: the Consumer Products Division, L’Oréal Luxe, the Professional Products Division and the Active Cosmetic Division.
L’Oréal produces 87% of the units of products sold in its 40 factories around the world, so as to ensure a fast response to the end consumer. Moreover, its responsiveness is accentuated by the presence in 130 countries over five major geographical zones.
As the 2015 annual report shows, L’Oréal “recorded a strong growth in 2015, supported by a positive monetary effect, and outperformed the beauty market in three of its four divisions. The growth in sales, earning per share and dividend illustrates the quality and the robustness of the L’Oréal business model” (L’Oréal - Annual report 2015, 2016)
In fact, its sales showed a positive increment of 12,1% based on reported