Shiseido to open sales subsidiary in Vietnam
The Japan-based cosmetics company has sold its products to Vietnamese consumers via a distributor since 1997.
The new sales subsidiary will commence operations from January 2010 and will handle the import and sales of cosmetic products. Located in Ho Chi Minh City, $12.75 million of capital has been invested in the new facility.
Three-year expansion plan
The decision to open a sales unit is part of the company’s three-year plan, an aggressive expansion strategy through which Shiseido seeks to become a ‘global player representing Asia with its origins in Japan”.
A joint venture with Gerolymatos Cosmetics.in Greece has seen Shiseido strengthen its operating bases in existing markets, and establishing sales channels in Egypt, Morocco, Laos and Azerbaijan has helped to expand operations in new and emerging markets.
Strengthening Vietnamese market position
Within the prestige cosmetics sector, the company plans to market the global Shiseido brand and the luxury Clé de peau beauté brand at separate sales counters within department stores and specialty stores.
In addition, the company plans to take initiatives to increase the consumer base of its Za brand, which is targeted at the expanding middle-income group in Asia.
In March 2008 Shiseido announced plans to open a production facility in Vietnam, which should be completed in February 2010. The production facility will be the 11th production base to be established overseas.
Steady sales growth recorded in Asia
The company recently released its first half year results for the six month period ending 30 September, recording a drop of 11.7 per cent in net sales in comparison to the corresponding period in 2008.
Sales in the overseas cosmetics business segment declined 17.5 per cent, which was mainly attributed to the drop in sales in the Americas and Europe due to the economic slowdown, and the appreciation of the yen against overseas currencies.
The company said in a statement that steady growth in sales in Asia on a local-currency basis was achieved. In China, the brand’s core market, this was due to the promotion of Aupres, a dedicated brand for department stores in China, and the strengthening of Shisheido’s makeup portfolio.
In other parts of Asia, sales increased due to the contribution of skin-brightening products, a market segment which continues to witness growth.