Beauty And Grooming Group: The L Oral Company Case Study

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The L’Oreal Group, which is has its centered in Paris, is the world's largest company which caters to the beauty and grooming products. The company majorly works in the cosmetics business and personal grooming products as hair colour, sun screen lotions, fragrances and other skin treatment products. Its wide range of products span from the dermatological to pharmaceutical fields. L’Oreal is also technologically advanced and the R&D department has numerous patents in the US.
It offers its products in over 125 countries and markets in access of 17 brands which can be categorized under dermatology and cosmetics. The cosmetics division of L’OREAL has the following segments: specialized products, customer products, affluent products and dynamic
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Due to this it’s bargaining power with them is low. It tries to develop solid and sustainable relations with its dealers, based on trust, mutual interest and high standards. The purchasing division concentrates on the following aspects when dealing with suppliers: quality, logistics, production, packaging, development, research and innovation.
L’Oreal uses various natural raw materials like polymers, fats, natural products, perfumes, solar radiation filters, vitamins etc. in its production process which are sourced from specialized suppliers.
The company encourages its suppliers to research quality and safety improvements by developing a system that gives suppliers the ability to propose new solutions and technology and to develop innovative products and services in partnership with the L’Oreal. This contributes to its ability to quickly develop innovative products.
While packaging its products L’Oreal ensures that the packaging should be both original and ecological friendly as well as protect the product and increase its value. L’Oreal has a Packaging Research and Expertise Center that works with
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L’Oreal is restricted due to laws governing use of certain chemicals as well as laws regulating advertising.
Some countries also have laws governing testing of products on animals. L’Oreal has to comply with all the regulations of different countries to ensure it is allowed to operate freely.
Economic Environment Analysis: L'Oreal has to adapt to different monetary conditions and problems in all countries it operates in. It is also affected by the changes in exchange rates of different countries.
Social Environment Analysis: The culture of countries L’Oreal operates in dictates the acceptability of the product. The level of education and the demand for quality products affects the perception of customers towards various brands. L’Oreal has to recognize these factors and position its products to take advantage of consumer perception.
Technological Environment Analysis: With rapid changes in technology, L’Oreal has to continuously innovate in its product line to ensure it does not fall behind competitors in bringing new products to the market and needs a strong focus on Research & Development.
Opportunities and

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