Mistura Beauty Solutions

Southeast Solutions

“Beauty Simplified” – Mistura

vision

How can Mistura continue to grow while confronting its infrastructure and capital

needs?

Introduction Analysis Alternatives Recommendation Implementation

Key Issue

I. IntroductionII. Analysis

a) Porter’s Five Forcesb) S.W.O.T.c) Value Chaind) Current Marketing Mixe) Financials f) Product Life Cycleg) Key Success Factors

III. AlternativesIV. RecommendationV. ImplementationVI. Conclusion

Table of Contents

Introduction Analysis Alternatives Recommendation Implementation

Threat of New Entrants

Supplier Power Competitive Rivalry

Buyer Power

Substitutes

-Moderate-Saturated market-Few barriers to entry-Small firms may start easily

-Moderate-Dependent on supplier prices-Differing options for suppliers

-Strong-Price-conscious-Knowledge of products is high-Can easily shop around from other providers

-Weak-Make-up has no other comparable alternative

Introduction Analysis Alternatives Recommendation Implementation

Porter’s Five Forces

Overall strength of forces: ModerateIf making sound business decisions, a firm can earn profits in industry

-Moderate-Several other producers-No direct competitor for natural, simple choice

- Multiple brandchoices

Strengths• Offers small number of

natural, easy to apply products*

*Distinctive competence• Availability in retail stores• Environmentally sound packaging• Devoted CEO• Free publicity

Weaknesses• Lack of capital and

infrastructure• Lack of personnel• Expensive supply chain• Oversight required• Late paying bills

Opportunities• Developing relationship with

Jen Coutu and London Drugs• Growing interest in Mistura• Baby boomers

Threats• Change in consumer

preferences• Numerous competitors: Bare

Minerals, MAC, Sheer Cover, etc.• Product formula security• Ease of entry into market

S.W.O.T.

Introduction Analysis Alternatives Recommendation Implementation

General AdministrationResearch, technology, and systems development

ProcurementInbound Logistic

sOperations Outbound

logisticsMarketing and sales Services

Profits

-In-house distribution saves shipping but distributor needs are high-Value lost due to necessity of high oversight of outbound shipping

Value Chain

Introduction Analysis Alternatives Recommendation Implementation

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

Placement

• Retail stores

• Rexall• Lawtons

Drugs • Sears

•Pending other retail stores

• Jean Coutu• London

Drugs•Shop NBC

Price

• Competitive with other firms

• Affordable• High-

quality• Package

deals• Refills sold

at discount

Product

•Quality yet simple makeup choices

• 6-in-1 beauty solution

• Luminada• Plump and

Glow Lip Gloss

• Retractable make-up applicator brush

Introduction Analysis Alternatives Recommendation Implementation

Current Marketing Mix

Financials

Introduction Analysis Alternatives Recommendation Implementation

2010 2011 2012 2013 2014

-2000000

-1000000

0

1000000

2000000

3000000

4000000

5000000

Net Profit/LossSalesCost of Goods SoldOperating ExpensesDeficit/Surplus

Introduction

Accelerated Growth Maturity Decline

Introduction Analysis Alternatives Recommendation Implementation

Product Life Cycle

x

Sale

s an

d Pr

ofits

1.Provide simple beauty2.Grow production3.Financial Soundness4.Continue control of company

.

Key Success Factors

Introduction Analysis Alternatives Recommendation Implementation

Alternative #3

Become a publically traded

company

Alternative #2

Seek out a venture capitalist

investment

Alternative #4

Sell Mistura

Alternative #1

Renovation of marketing

Alternatives

Introduction 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

Alternative #1

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

Alternative #2

Introduction Analysis Alternatives Recommendation Implementation

Become a Publically Traded Company

Advantages DisadvantagesPotential strong funding

source Loss of control

More publicity Regulations

Uncertainty of valuation

Alternative #3

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

Alternative #4

Introduction Analysis Alternatives Recommendation Implementation

Go Public Venture Capital

Leave the Market

Revamp Short-Term Strategy

Key Success Factors

Weight

Ranking Weight Rankin

gWeigh

tRankin

g 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

Ranking Scale1. The alternative does not effectively address this criterion.2. The alternative may contribute to readdressing this criterion3. The alternative provides an average solution to this criterion4. The alternative provides an above average solution to this criterion5. The alternative effectively addresses this criterion

***Weighted Competetive Strength Analysis

Weighted Competitive Strengths

Introduction Analysis Alternatives Recommendation Implementation

Go Public Venture Capital

Leave the Market

Revamp Short-Term Strategy

Key Success Factors

Weight

Ranking Weight Rankin

gWeigh

tRankin

g 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 3.95 4.15 3.0 2.8

Ranking Scale1. The alternative does not effectively address this criterion.2. The alternative may contribute to readdressing this criterion3. The alternative provides an average solution to this criterion4. The alternative provides an above average solution to this criterion5. The alternative effectively addresses this criterion

***Weighted Competetive Strength Analysis

Weighted Competitive Strengths

Introduction Analysis Alternatives Recommendation Implementation

Decision:

Seek Investment from Venture Capitalist

Introduction Analysis Alternatives Recommendation Implementation

Recommendation

Financials

Introduction Analysis Alternatives Recommendation Implementation

Venture Capital Funding Allocations

Increased Revenue 3.000.000

VP of Operations 100.000

Marketing Director 100.000

R&D 100.000

Marketing 750.000

Corporate Social Responsibility 50.000

Infrastructure Expansion 1.300.000

Repay Debt 500.000

Increased Expenses 2.900.000

Margin for Error 100.000

VP of Operations3%

R&D3%

Marketing25%

Corporate Social Re-

sponsibility2%Infrastructure Expansion

43%

Repay Debt17%

Room for Error7%

Capital Allocations

Short-TermReach 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

Implementation

Short-TermReach 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

Implementation

6 months3 months 9 months

Milestone Review

12 months

Long-TermWhat 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

Implementation

Long-TermBuy advertising on TV stations, other new promotion

Set up breast cancer awareness sponsorship walks

Begin research and development on nail polish

Introduction Analysis Alternatives Recommendation Implementation

Implementation

Milestone Review

18 months15 months 21 months24 months

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

Placement

• Retail stores

• Rexall• Lawtons

Drugs • Sears• Pending

other retail stores

• Jean Coutu

• London Drugs

• Enter into new locations

• Online store

Price

• Competitive with other firms

• Affordable• High-

quality• Package

deals• Refills sold

at discount

Product

•Quality yet simple makeup choices

• 6-in-1 beauty solution

• Luminada• Plump and

Glow Lip Gloss

• Retractable make-up applicator brush

•New Products•Eye cream•Mascara•Eye shadow•Nail polish

(natural)

Introduction Analysis Alternatives Recommendation Implementation

Current Marketing Mix

Introduction Analysis Alternatives Recommendation Implementation

Financials

Introduction Analysis Alternatives Recommendation Implementation

Financials

Risk Probability Solution

Venture capitalists not interested in investing

Low

Consider either going public with company or filing for Chapter 11 Bankruptcy

Sales of current products drop Moderate

Focus on sales of current products before considering expansion

Proposed new product lines unfeasible

LowLook into other product lines such as sunscreens or wrinkle serum

New product lines unpopular Moderate

Spend more on advertising. If no improvement, reassess production

Contingency

Introduction Analysis Alternatives Recommendation Implementation

Mistura Beauty Solutions

Southeast Solutions

“Beauty Simplified” – Mistura

vision