The Mumbai-based pharma player, Elder Pharmaceuticals has teamed up with Japanese cosmetic giant, Kose to develop a range specifically for the Indian market.
The joint venture will be known as 'Kose Elder', to which Kose, one of Japan’s biggest cosmetic and personal care providers with a wide presence in the AP region, will hold a 60 percent holding as its experience in the cosmetics industry, Elder believes will help both companies hone their skills for the Indian market.
According to Elder Pharma joint managing director, Alok Saxena; "Elder has successfully established and run subsidiaries abroad and with alliance with Kose, it is foraying into its maiden joint venture arrangement in India with a Japanese company."
The venture, Saxena says, will benefit from Elder's knowledge of local markets and strong sales network in India, and will be synergized with the Japanese giant's strengths of technological prowess and the development of high value added cosmetics.
"The aim is to develop new products assimilating Japan's refined, advanced technology with the universal aesthetic demanded by the Indian woman, and to expand in the Indian market," he explains.
Honing both companies skills to successfully target the Indian market
Up until now, Kose's main means of advancing into overseas markets has been to export products that matched the requirements of the target country, from its base in Japan.
However; with the Indian market, where culture and tastes are very different, the Japanese company is said to have considered it essential to undertake strategic and business planning tailored to the region, and are "proceeding with investigations through agreements with local enterprises that are familiar with the markets."
Once the joint venture is established, Saxena says the parties will consider the details of sharing tasks between the two companies and specifics such as sales channels, products, and brands for the Indian Market.
Tokyo headquartered Nomura Securities Co. acted as the financial advisor to Elder for the joint venture with Kose.
Kose's increasing efforts to expand
In recent years Kose has increasingly focused its efforts on developing international markets to counterbalance weaker developed markets. Although the company has been focusing on capturing a greater share of the international market for some time now, the latest aims represent a more ambitious target.
Company president Kazutoshi Kobayashi says that the new strategy is crucial to ensure that the company can emerge from the current economic conditions as a stronger business.
Back in 2008 the company announced a joint venture to import Coty’s Rimmel brand into China, allowing it to manufacture color make-up products and distribute them throughout the country. It also put in a bid to buy up the cosmetics division of consumers goods manufacturer Kanebo back in 2005, but failed and was eventually bought out by competitor Kao.