Shiseido

8 Pages 2057 Words

CASE #14 SHISEIDO COMPANY

DECISION FOCUS:
Shiseido was founded by Yushin Fukuhara as Japan’s first Western-style pharmacy in 1872, and has shifted back and forth from cosmetics and pharmacy. Established in the Ginza district in Tokyo in 1872, Shiseido is today a global manufacturing and sales corporation in the fields of cosmetics, salons, pharmaceuticals, toiletries, and nutritional products. After inaugurating its global business with sales to Taiwan in 1957, Shiseido began marketing to Europe in 1963 and to the United States in 1965. In Japan, Shiseido has long been considered an important force in the arts through its product designs and advertisements, which were originally overseen by the company’s first president, Shinzo Fukuhara.
In 1987, the grandson of the founder took over as president. The same year Shiseido announced a 6 percent decrease in sales and a write-off in inventory of $239 million. In 1998 product mix consisted of cosmetics (74%), toiletries (16%), and other businesses (10%). They began to streamline domestic cosmetics lines to reduce inventory, eliminating products with a consistent turnover, while developing new technology and items.
Shiseido’s management policies are embodied in its “Global No. 1” long-term vision, Shiseido identified three goals: technological excellence, diversified operations, and customer satisfaction. The company uses techniques like brand marketing, store marketing, and area marketing.
To prepare itself for a more crowded domestic market, Shiseido is aiming for further overseas expansion, an area in which the company should pay more attention, given that its current foreign sales is only 15 percent of total income. Shiseido is planning to expand its foreign operations and increase its net foreign sales to as much as 25 percent of the total in the fiscal year 2003.
Alternative Choices:
1. Establish a dominant position in the domestic cosmetics market.
2....