Mistura Solution

Report
Southeast
Solutions
Mistura
Beauty
Solutions
“Beauty Simplified” – Mistura
vision
How can Mistura continue to
grow while confronting its
infrastructure and capital
needs?
Introduction
Analysis
Alternatives
Recommendation
Implementation
I. Introduction
II. Analysis
a) Porter’s Five Forces
b) S.W.O.T.
c) Value Chain
d) Current Marketing Mix
e) Financials
f) Product Life Cycle
g) Key Success Factors
III. Alternatives
IV. Recommendation
V. Implementation
VI. Conclusion
Introduction
Analysis
Alternatives
Recommendation
Implementation
Threat of New Entrants
-Moderate
-Saturated market
-Few barriers to entry
-Small firms may start easily
Supplier Power
-Moderate
-Dependent on
supplier prices
-Differing options for
suppliers
Competitive
Rivalry
-Moderate
-Several other
producers
-No direct competitor
for natural, simple
choice
-Multiple brand
choices
Substitutes
Buyer Power
-Strong
-Price-conscious
-Knowledge of
products is high
-Can easily shop
around from other
providers
Overall strength of forces: Moderate
If making sound business decisions,
a firm can earn profits in industry
-Weak
-Make-up has no other
comparable alternative
Introduction
Analysis
Alternatives
Recommendation
Implementation
Strengths
•
•
•
•
•
Weaknesses
Offers small number of natural, easy
to apply products*
*Distinctive competence
Availability in retail stores
Environmentally sound packaging
Devoted CEO
Free publicity
•
•
•
•
•
Opportunities
•
•
•
Developing relationship with Jen
Coutu and London Drugs
Growing interest in Mistura
Baby boomers
Introduction
Analysis
Alternatives
Lack of capital and infrastructure
Lack of personnel
Expensive supply chain
Oversight required
Late paying bills
Threats
•
•
•
•
Change in consumer preferences
Numerous competitors: Bare
Minerals, MAC, Sheer Cover, etc.
Product formula security
Ease of entry into market
Recommendation
Implementation
General Administration
Procurement
Inbound
Operations
Logistics
Marketing
and sales
Profits
Research, technology, and systems development
Services
-In-house distribution saves
shipping but distributor
needs are high
-Value lost due to
necessity of high oversight
of outbound shipping
Introduction
Analysis
Alternatives
Recommendation
Implementation
Product
• Quality yet
simple makeup
choices
•
•
•
•
Price
• Competitive
with other firms
6-in-1
beauty
solution
Luminada
Plump and
Glow Lip
Gloss
Retractable
make-up
applicator
brush
Introduction
Analysis
•Affordable
•Highquality
• Package
deals
• Refills sold
at discount
Alternatives
Placement
Promotion
• Retail stores
• Dragon’s Den
•Rexall
• Lawtons
Drugs
• Sears
•Pending other
retail stores
• Jean
Coutu
•London
Drugs
•Shop NBC
• Ottawa Small
Business Award
• Chantal
Sutherland as
spokeswoman
• Presenting
sponsor at
Golden Globes
• Print Media
•Shape
•The Globe
and Mail
•Elle
• CBC Radio
Recommendation
Implementation
5000000
4000000
3000000
Net Profit/Loss
2000000
Sales
Cost of Goods Sold
Operating Expenses
1000000
Deficit/Surplus
0
2010
2011
2012
2013
2014
-1000000
-2000000
Introduction
Analysis
Alternatives
Recommendation
Implementation
Sales and Profits
x
Introduction
Introduction
Accelerated Growth
Analysis
Alternatives
Maturity
Decline
Recommendation
Implementation
1. Provide simple beauty
2. Grow production
3. Financial Soundness
4. Continue control of company
.
Introduction
Analysis
Alternatives
Recommendation
Implementation
Introduction
Alternative #1
Alternative #2
Renovation of
marketing
Seek out a venture
capitalist investment
Alternative #3
Alternative #4
Become a publically
traded company
Sell Mistura
Analysis
Alternatives
Recommendation
Implementation
Renovation of Marketing Strategy
Advantages
Disadvantages
No ownership dilution
Lack of capital unaddressed
Larger customer base
Lack of product development
High bankruptcy risk
Does not address infrastructure
needs
Introduction
Analysis
Alternatives
Recommendation
Implementation
Seek out a Venture Capitalist
Investment
Advantages
Disadvantages
Quick funding source
Risk of denial
Capital to meet infrastructure
needs
Diluting ownership
Capital for additional research
and development
Inclusion of expertise
Introduction
Analysis
Alternatives
Recommendation
Implementation
Become a Publically Traded Company
Advantages
Disadvantages
Potential strong funding source
Loss of control
More publicity
Regulations
Uncertainty of valuation
Introduction
Analysis
Alternatives
Recommendation
Implementation
Sell Mistura
Advantages
Disadvantages
CEO profits
Does not align with vision of the
owner
Company goals still achieved
Lose control of company
Prevents future profits
Introduction
Analysis
Alternatives
Recommendation
Implementation
Ranking Scale
1. The alternative does not effectively address this criterion.
2. The alternative may contribute to readdressing this criterion
3. The alternative provides an average solution to this criterion
4. The alternative provides an above average solution to this criterion
5. The alternative effectively addresses this criterion
Venture
Capital
Go Public
Leave the
Market
Revamp
Short-Term
Strategy
Key Success
Factors
Weight
Ranking
Weight
Ranking
Weight
Ranking
Weight
Ranking
Weight
Provide Simple
Beauty
.4
5*
2
5*
2
1*
.4
2*
.8
Grow
Production
.25
4
1
3
.75
1
.25
3*
.75
Financial
Soundness
.25
3
.75
4
1
5
1.5
3
.75
Continued
Control of
Company
.1
2
.2
4
.4
1
.1
5
.5
Total
Introduction
Analysis
Alternatives
Recommendation
Implementation
Ranking Scale
1. The alternative does not effectively address this criterion.
2. The alternative may contribute to readdressing this criterion
3. The alternative provides an average solution to this criterion
4. The alternative provides an above average solution to this criterion
5. The alternative effectively addresses this criterion
Venture
Capital
Go Public
Leave the
Market
Revamp
Short-Term
Strategy
Key Success
Factors
Weight
Ranking
Weight
Ranking
Weight
Ranking
Weight
Ranking
Weight
Provide Simple
Beauty
.4
5*
2
5*
2
1*
.4
2*
.8
Grow
Production
.25
4
1
3
.75
1
.25
3*
.75
Financial
Soundness
.25
3
.75
4
1
5
1.5
3
.75
Continued
Control of
Company
.1
2
.2
4
.4
1
.1
5
.5
Total
Introduction
3.95
Analysis
Alternatives
4.15
3.0
Recommendation
2.8
Implementation
Decision:
Seek Investment from Venture
Capitalist
Introduction
Analysis
Alternatives
Recommendation
Implementation
Capital Allocations
Venture Capital Funding Allocations
Increased Revenue
3.000.000
VP of Operations
100.000
Marketing Director
VP of
R&D
Operations 3%
3%
100.000
R&D
100.000
Marketing
750.000
Corporate Social Responsibility
Infrastructure Expansion
Repay Debt
50.000
1.300.000
Repay Debt
17%
Corporate
Social
Responsibility
2%
2.900.000
Margin for Error
Marketing
25%
Infrastructure
Expansion
43%
500.000
Increased Expenses
Introduction
Room for
Error
7%
100.000
Analysis
Alternatives
Recommendation
Implementation
Short-Term
Reach out to venture capitalist
Hire VP of operations to transfer oversight of daily operations
Begin research and development on eyeliner, mascara, etc.
Hire marketing director
Introduction
Analysis
Alternatives
Recommendation
Implementation
Short-Term
3 months
6 months
9 months 12 months
Reach out to venture
capitalist
Hire VP of operations to
transfer oversight of daily
operations
Begin research and
development on eyeliner,
mascara, etc.
Hire marketing director
Milestone Review
Introduction
Analysis
Alternatives
Recommendation
Implementation
Long-Term
What
Who
Buy advertising on WE, Oxygen,
HGTV
Marketing Director
Work with Susan G. Komen
Foundation for Breast Cancer to
set up sponsorship walks
Ms. Marcus & Marketing Director
Begin research and
development on nail polish
Ms. Marcus
Introduction
Analysis
Alternatives
Recommendation
Implementation
Long-Term
15 months
18 months 21 months 24 months
Buy advertising on TV
stations, other new
promotion
Set up breast cancer
awareness sponsorship
walks
Begin research and
development on nail polish
Milestone Review
Introduction
Analysis
Alternatives
Recommendation
Implementation
Product
• Quality yet
simple makeup
choices
•
•
•
•
•
•
•
•
•
Price
• Competitive
with other firms
6-in-1 beauty
solution
Luminada
Plump and
Glow Lip Gloss
Retractable
make-up
applicator
brush
Placement
• Retail stores
•Rexall
•Lawtons
Drugs
•Sears
•Pending
other retail
stores
• Jean
Coutu
•London
Drugs
•Affordable
•Highquality
• Package
deals
• Refills sold
at discount
New Products
Eye cream
Mascara
Eye shadow
Nail polish
(natural)
Introduction
Analysis
•
Enter into
new
locations
• Online store
Alternatives
Promotion
• Dragon’s Den
• Ottawa Small
Business Award
• Chantal Sutherland
as spokeswoman
• Presenting sponsor
at Golden Globes
• Print Media
•Shape
•The Globe and
Mail
•Elle
• CBC Radio
•Print advertising
• TV Networks
•Susan G. Komen
sponsorship
Recommendation
Implementation
Introduction
Analysis
Alternatives
Recommendation
Implementation
Introduction
Analysis
Alternatives
Recommendation
Implementation
Risk
Venture capitalists
not interested in
investing
Sales of current
products drop
Proposed new
product lines
unfeasible
New product lines
unpopular
Introduction
Analysis
Probability
Solution
Low
Consider either going
public with company
or filing for Chapter
11 Bankruptcy
Moderate
Focus on sales of
current products
before considering
expansion
Low
Look into other
product lines such as
sunscreens or wrinkle
serum
Moderate
Spend more on
advertising. If no
improvement,
reassess production
Alternatives
Recommendation
Implementation
Southeast
Solutions
Mistura
Beauty
Solutions
“Beauty Simplified” – Mistura
vision

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