Transforming beauty
Making the announcement on 30th June 2017, Kao states the new organisation, which aims to specialise in the consumer products business, will be operational from 1st January 2018.
Final agreements and discussions are yet to be made, with decision-making bodies from each company, talks with the labour union and other measures required before the new organisation is finalised.
The Japanese cosmetics leader, which owns brands including Kanebo, John Frieda and Molton Brown, will seek to improve Kao Group's collective capabilities, expertise and productivity through its restructuring.
Purpose-built restructure
Focusing on functionality, as of the 1st January 2018, the sales-related subsidiaries will be reorganised into four companies based on three core purposes: trade marketing, sales and negotiations with distributors; in-store beauty counselling; and in-store merchandising.
Kao also plans to merge its leading brand of the same name with its Japanese skin care, make up and hair care counterpart, Kanebo, into a single company to position the brand as a comprehensive manufacturer of consumer products and cosmetics and simplify sales handling.
Through strengthening relationships with distributors, Kao hopes to build proposal-based activities to boost its place within the market.
In-store beauty counselling
In 2017, Kao initiated K20, a four-year mid-term plan. Michitaka Sawada, President and CEO of Kao Cosmetics stated that one of the company’s core objectives is to emphasise the “differentiated features of Sofina and Kanebo”.
As a result, Kao will create two companies; Sofina Beauty Counseling and Kanebo Beauty Counseling “to more clearly and accurately convey the uniqueness and value of Sofina and Kanebo Cosmetics respectively”, Kao highlighted in a press release.
Together, the two companies will specialise in in-store beauty counselling and will develop management systems to support brand appeal and counselling expertise.
In-store merchandising
Kao also announced that as part of the ongoing major reform of Kao Group's cosmetics business, it will consolidate merchandising into one company to increase productivity and solutions.
With the slogan, "Transforming Ourselves to Drive Change”, Kao’s K20 plan will see it provide new areas of marketing and sales and understand the changing market environment better to collaborate with distributors and address customer preferences.