Elizabeth Arden Case Analysis

ELIZABETH ARDEN CASE ANALYSIS 22

ElizabethArden Case Analysis

ElizabethArden Case Analysis

CurrentCompany Status

Currently,the company produces cosmetics and products that define the beautyindustry globally. In designing these products, it is clear that thecompany was intending to adopt diversification as the strategy ofdominating the beauty industry (Tarrant,2014).Despite being a market leader in the production and distribution ofthese products, the company faces competition from several otherbrands that are also established in the market. The current marketfor the company is both tail and wholesale market.

Inthe retail market, the company sells its products at its Red Doorstore in Elizabeth Arden 5th Avenue (ElizabethAden, 2014).In the wholesale market, the company sells its products throughdepartmental stores. Another frontier to the company`s market is theexport market to the international clientele that involve retailersand stores. This expands the market reach that the beauty firm enjoysbased on the current strategy. Moreover, the firm sells its productin the digital era of ecommerce through its online platforms(ElizabethAden, 2014).This makes the company a significant player in the beauty industry inrelation to its competitors, who form a significant part of analyzingthe current company’s position.

Thecompany currently faces competition from three main competitors inthe global market. The first competitor is Coty Inc., a company thatboasts of the largest market share in the beauty industry (Tarrant,2014).Coty Inc produces and sells several brands to both the local andinternational market either in retail or to departmental stores. Thesecond main competitor is the Estee Lauder Companies Inc, whichdistribute its brands at the international level. The third maincompetitor is the Revlon Inc, which has a similar range of productsand market orientation as the same with the former (Tarrant,2014).Other competitors are multinationals that dominate several brands ofbeauty. According to the ElizabethAden case,the beauty industry is dominated by such few multinationals. Theunderstanding of the competition in the market is important for theanalysis of the business strategies employed by the company.

CurrentStrategic Issues

Oneof the major business strategies the company has implemented over isthe expansion strategy of mergers and acquisitions. Since itsformation in 1970, the company was acquired by two companies. First,it was bought by Eli Lilly &amp Company in the year 2001, whichlater sold it to two other firms before settling in the control ofthe Unilever (Tarrant,2014).Unilever later sold it to French Fragrance Inc FFI, which opted touse the current brand name, Elizabeth Arden. Through these changes,the company experienced several strategies that inclined the firm toexpand by acquiring other firms (Tarrant,2014).

Accordingto Tarrant(2014),one of the acquisitions is the Liz Claiborne’s Fragrances in theyear 2008. This company was acquired not only for the purpose ofexpansion, but also to extend the market reach. The market reachwould be achieved by the acquisition through the acquisition of thebrands that were previously supplied by the Liz Claiborne’sFragrances (Tarrant,2014).In this acquisition, the two companies structure a long-termlicensing agreement that made Elizabeth Arden a controller of LizClaiborne’s Fragrances in terms of stock and assets. In thisagreement, Elizabeth Arden would earn royalties from the sales thatLiz Claiborne’s Fragrances make. This made Elizabeth Arden acontrolling company in terms of incomes of beauty products suppliedby Liz Claiborne’s Fragrances, thereby gaining market withoutnecessarily rebranding the acquired company.

However,the company faced challenges in the distribution process where othercompetitors adopted favorable challenges. While the companyconcentrates on the manufacturing and distribution of its own brands,competitors engage in the distribution of their products throughincensed distributors. The competing companies explore the strategiesof licensing agreements for distribution of products in the UnitedStates and also globally. For instance, in the year 2008, InterPerfumes Inc entered into a distribution, licensing agreement withGap, a clothing company (Tarrant,2014).Under the agreement, Gap Company was to distribution Inter Perfumesin the United States as well as in the global markets (Tarrant,2014).

Anotherstrategy adopted by the company is the continued innovation of theproducts and services to the market. The company has designed severalbeauty products for the last decade, and is the core of the company`splans for market share. Through the continued innovation plans, thecompany has seen the expansion of its brand lines grow to success.This makes its marketing and distribution a complex, but asignificant function of the market. The firm also fulfills the needsof the market through innovation by meeting the changing consumerdemands. The company innovates to establish new products and enhancethe present product lines to appeal to the customers.

Thenext main strategy for the company is the venture to theinternational markets as the frontier of their marketing and productdistribution. The company distributes its products to over onehundred countries through departmental stores and perfumeries(Tarrant,2014).This market is extensive and provides the company a platform ofintroducing its products globally. As noted, the beauty industry isdominated by few multinationals that own and distribute a largepercentage of beauty brands in the market (Tarrant,2014).This makes it a necessity of Elizabeth Arden to diversify its marketsto the international level so as to keep up with the competition. Inaddition, the strategy to market its products globally increases itsincomes and sales volumes.

Asa global leader of the beauty products, the international market forthe company provides a platform of dominating the competition throughthe advantages that accrue with larger market share. Throughglobalizing its markets, the company has since grown from a start upto a market leader in the beauty industry (Kent,2003).This is because its global market strategy gives the firm the muchneeded boost in its sales volumes as well as the consistency of itsincomes. According to its 2007 financial reports, the company hadexpanded its incomes from $1.6 Billion to over $2 Billion within thefirst year if its international market expansion.

Theother business strategy that the company has utilized over the yearswas the increase of the number of its brands as a way of covering itsmarket reach. This strategy has successfully expanded its productline to over 400 brands (Tarrant,2014).According to Kent(2003),the beauty industry changes on a regular basis and requires a companyto establish several products that cater for these changes. Wheneveran industry faces dynamism in terms of customer demand, theappropriate strategy keeps up with the market is through diversifyingthe product line (Temporal,2011).This explains the advantage that Elizabeth Arden had gained throughits increased brand that currently makes it a market leader globally.

CurrentStrategic Issues and challenges

Competition

ElizabethArden faces a stiff competition in the beauty industry from bothestablished and small beauty and fragrance companies. The beautyindustry is competitive for the firm to keep its brands dominating inthe market. According to the Elizabeth Arden case, the firm is one ofthe market leaders in the beauty industry since the expansion of thefirm to increase its brands and location. However, the firm stillfaces significant competition in the market. As noted, competition inthe beauty industry is dominated by some of the players in the marketthat were established in the twentieth century, just the same timewhen Elizabeth Arden was founded. The competition that emanates fromthese players and new companies is challenging to Elizabeth Ardenboth in sales and brand expansion.

Beforethe year 2004, the industry had a share of $124.5 billion worth ofsales dominated by the top 100 companies (Tarrant,2014).Out of these companies that dominated this market value, were thefive major companies that dominated a large percentage of this value.According to Tarrant(2014),they are Proctor &amp Gamble with $16.5 billion, the L’orealGroup with $17.7 billion, Unilever with $9.4 billion, ShiseidoCompany Limited with $5. 9, and the Estee Lauder Inc with $5.8billion, (Appendix 1). These were the largest beauty and cosmeticproducts as they controlled over 44% of the market controlled by thetop 100 companies (Tarrant,2014).In 2007, the sales of the cosmetics industry were $ 170 Billion, withEurope leading (Tarrant,2014)Appendix 2. This means that the firm should establish measures andstrategies that will manage its brand marketability and help the firmto remain competitive.

Consequently,the competition in the industry involves the large companies with theability to finance their market operations and marketing function.This means that the competition is fierce for both the largecompanies and the smaller ones. This means that Elizabeth Ardenshould have proper knowledge of the market and the consumer demandsfor its existence in the market. This will include a clearunderstanding of the trends that dominate the market in terms ofchanging tastes and preferences, changes in demographics and consumerspending behavior (Temporal,2011).This information will enable the company to establish competitivebrands and will respond to product availability through properinventory management.

ElizabethArden should therefore work to establish successful brands byconsidering two main things. First, the company should considerconsumer demands and the expectations in the market. This willrequire the firm to advance its market information and gather theexpectations of the customers. Secondly, Elizabeth Arden will need toconsider the strategies employed by competing firms so as tostrategically position its brands. This means that the company willadapt to the market with the perspectives of the consumer and thecompetitors in addition to its own business strategies.

Thechallenge with the current competition is the impact of the pressureon the Elizabeth Arden incomes due to limited sales volumes, subjectto the competition. The market share is fiercely contested, leadingto lower sales as the market volume is shared among the competitors.This presents two main problems to Elizabeth Aden. The first problemis the increased expenditure on marketing as the company seeks tospend in order to sustain the market share. These costs will coverthe efforts of the company in developing new channels of distributionfor its brands in the market, both in existing and new market(Grosse,2000).This means that the firm will increase its budget and hold itsfinancial resources towards marketing. Secondly, the company willhave limited control of the development of its brands in the market.The growth of the brand is limited to the growth of the competingbrands.

Thecompetition is even more challenging for the Elizabeth Arden becausethe competing firms enter into licensing agreements with controllersof the preferred distribution channels. In addition, some securesignificant acquisitions of the brands in the market. This is done tosecure significant market partners in both marketing and distributingtheir brands (Grosse,2000).Consequently, such moves limit the extent of growth of ElizabethArden brands, especially when it has not secured strategic agreementswith strategically placed distribution channels. However, ElizabethArden has over the years purchased some brands in the market thathave enhanced their competitive position and pushed its brand line toover 400 brands.

Thecompetition is also fierce for Elizabeth Arden because the industryplayers seek partnerships and market relations with the consumergoods and supply companies. The cosmetics supplies and consumer goodscompanies are compliant with the Food and Drugs Administration, FDA,which regulates standards (Tarrant,2014).Such partnerships and agreements ensure the cosmetic companies ofsupplies that are certified by the FDA, thus gaining a competitiveedge over others (Tarrant,2014).For instance, the Givaudan, a Swiss fragrance and flavor manufactureentered into partnership with Colgate-Palmolive an agreement thatwill make it a part of the preferred brand of the consumer goodscompany (Tarrant,2014).This move by players presents a challenge that makes the industry acostly competition for Elizabeth Arden to thrive on.

TurningGrowth into Profit

Oneof the major challenges the company is facing is translating thegrowth the company has had into profits. The company has developedstrategies that have led to its growth and expansion of the marketcoverage. However, this growth does not add value to the companyabout it does not translate to increased incomes. Despite the largemarket share, a company requires expansion of its incomes and profitmargins for the value of the business growth to be significant in theshort-term and long-term plans (McManus,et al, 2009). Thechallenge of translating the business expansion to profits presentsthree main problems to the company.

Thefirst problem with low profits is experienced in the financing of thecompany’s marketing function, which is expanded due to growth. Thebusiness expansion process costs the company large sums of moneydepending on the expansion program adopted. This expansion gives thecompany a large market share that requires to be maintained byregular promotions and sustainable marketing programs (Temporal,2011).For instance, the companies acquired or new stores opened willrequire the financing of Elizabeth Arden to develop into sustainableunits or brands. This means that Elizabeth Arden is in need ofincreased incomes to finance the business growth. The main arm of thecompany that relates to this sustenance is marketing and promotions.Therefore, the expansion will create a problem t the marketing armsuch growth does not generate extra financial resources in terms ofprofits that can be used for marketing sustenance.

Thesecond problem is the threat of experiencing poor branding and losingthe brand image gained from the expansion programs. This is becausethe expansion program leaves the company with many brands to takecare of in terms of marketing, distribution and continuousinnovation. With over 400 brands in the United States alone,Elizabeth Arden will have a problem if these brands do not translateinto profits. If the company does not monetize these brandsmaximally, it will not be able to finance the programs that arerequired to sustain these brands into the market. Therefore,Elizabeth Arden will poorly manage the brands and also provideinadequate marketing. Consequently, the market image that thesebrands had will be lost, which will negatively affect the company.

Thethird problem is poor planning and forecasting of the brands that thecompany controls. Due to the lack of profits from the expandedgrowth, the company will lose track of the performance of every brandthat it controls. In a competitive environment, business growth ismeasured in terms of profits or overall incomes that accrue from eachbrand. Therefore, without consistent monetization of a brand intoprofits, Elizabeth Arden will not get the basis of evaluating each ofits brands. Consequently, planning and forecasting of the brandscontrolled by Elizabeth Arden will be difficult. This means that thecompany may lose track of the brands it controls if the firm does notcoordinate with its organizational structure.

Suppliesand Materials Management

ElizabethArden obtained most of its raw materials and production componentsfrom independent manufacturers. The company also outsources theproduction process as well as packaging of products for its licensedbrands. Due to the increased growth and development of its brands,the company faces challenges in managing its materials and supplychain. This case presents a situation that requires properoutsourcing strategies for its products. However, Elizabeth Arden didnot have well established agreements for such outsourcing solutions.

Despitehaving the need to use third party manufacturers to solve thisproblem, the company didn`t have a long-term agreement that couldkeep its manufactures omitted to their supplies. In addition, thecompany did not have exclusive agreements between it and contractmanufacturers who will produce its brands. The company makes itspurchases through general business purchase orders that rely on thebusiness trust with the related manufacturers. This relation is onlybased on an assumption that a good business relationship will lead toa long-term business agreements (Temporal,2011).This challenge presents two main problems to Elizabeth Arden in termsof general business operations and specific brad management.

First,the challenge in material management and supplies presents a problemof personal business touch, especially when the company has todeliver to loyal customers. Under the purchase orders method,Elizabeth Arden orders, products from its manufactures, who are thirdparty manufacturers. The company then plans for the shipping of thefinished products from the third-party manufacture to the customer orits various distribution centers. Therefore, the supply of theproduct to the clients of Elizabeth Arden is at the efficiency or atthe hands of the manufacturers. This means that Elizabeth Ardensometimes used to send products directly to the customer form themanufacture. This may lead to

Thesecond problem is the loss of business from customers who may benegatively affected by failure in logistics. The logisticalactivities involve in the delivery of fragrances and beauty productsare left to the service of the third party manufacturers. This meansthat any delay by the manufacturers could negatively affect thebusiness relationship between Elizabeth Arden and its clients.According to the case, the firm used “Drop shipping” where theproducts were shipped directly to the customer from the source whichis the third party manufacturers (Tarrant,2014).Despite reducing the logistical commitments for the company, dropshipping is potentially risky for Elizabeth Aden.

Logisticalchallenges

Thechallenge of logistics and increased logistical costs is as resultsof a number of reasons in the course of operating its business. Thefirm faces the logistical challenges due to two three reasons. First,Elizabeth Arden has established international market of product linesthrough a range of business diversification strategies. The beautyfirm has established several department stores and outlets indifferent parts of the world most of which require regular stock andmaterial management. Therefore, due to the establishment of marketsin both the local and the international arena, the company attractslogistical challenges that require management (McManus,et al, 2009). Inaddition, the company needs to balance the stock levels of all thelocations of its market to ensure that it experiences balanced stockmanagement practice.

Thesecond reason for the high logistical challenges is thediversification of its brands and line of products. Due to thediversified brands, the management of these brands calls forincreased logistics, especially by the production and marketingteams. With over400 brands to manage in the American market alone,the firm has to worry over the marketing success of each of thesebrands as well as the development of the brands. The use of resourcesof the company to manage these brands will also lead to logisticalchallenges as the company tries to isolate the costs of each of thebrands (McManus,et al, 2009). Thisexplains why the logistical costs of the company increased withincrease in brands of the company.

Thirdly,the increase in the logistical costs and related challenges is theuse of third-party manufacturers for packaging and distribution tocustomers, especially through drop shipping. This is challengingbecause the company has to establish measures to make sure that theneeds of the customers are met despite using the third parties.Consequently, Elizabeth Arden spent a lot of financial resources intransporting finished goods. For instance, Elizabeth Arden spent $3.2million in 2007 as air freight costs and over 0.3% of the sales of2007 on material planning (Tarrant,2014).This led to the increase of the logistical costs to a higher level,more than the industry.

ActionPlan and Recommendations

Toaddress some of the issues and challenges identified in this case,Elizabeth Arden needs to adopt pragmatic and functional strategiesthat will see its brands develop and expand globally. The companyneeds to adopt plans that will have two-tier effect. First, thestrategies adopted must maintain its market leadership and sustainits competitive edge in the market. Secondly, the strategies thatimplemented by Elizabeth Arden should improve its market share,increased its sales volumes and develop its brands. This means thatthe company should develop and implement all-inclusive strategies.The action plan will illustrate the key areas that the company shouldtarget in its strategy as well as in its brand development.

BrandManagement

ElizabethArden should invest in brand management by establishing strategiesand programs that will work towards developing its brands. This isnecessitated by the diversity of the brands that the companycontrols. Through the ambitious expansion program, the company hasover 400 brands in the American market alone. This means that each ofthe brands presents challenges in terms of production, distributionand competition in the market. This necessitates direct management ofthe company as it seeks the success of each of the brands (Grosse,2000).Through appropriate strategies for managing the brands, ElizabethArden will improve its market share and competitiveness. In addition,effective brand management will increase the incomes and profits ofeach of the brands controlled by Elizabeth Aden. To successfullyachieve this, it is recommended that the company implements thefollowing.

AutonomousBrands

Thecompany should establish organizational structure of its businessoperations that gives each of its brands with autonomous management.Autonomous brands give the management of each of the brands theauthority to make decisions that relate to the brand and implementthem with little input of the overall management of the company. Thismeans that the Elizabeth Arden management will only need to approvethe decision made by the independent brands. Through independentmanagement of each of its brands, the Elizabeth Arden management willsignificantly allow each of the brands to face competition in themarket without necessarily considering the dynamics of the company.

AutonomousManagement of Acquired Companies

Thebrands controlled by Elizabeth Arden are part of the firms that thecompany acquires or merges with. This means that Elizabeth Ardenneeds should not interfere with the management of these e companies.The strategy of autonomous brands will be an appropriate plan forElizabeth Arden since it is involved in diversification throughacquisition of companies. To achieve the autonomous nature of thebrands that Elizabeth Arden acquires, the firm needs to retain themanagement of the companies that it acquires. For instance, with theacquisition of Liz Claiborne, Elizabeth Arden should have left themanagement of the target company intact, without changing itsstructure. The only influence is to inform the management of thebrand expectation requirement to meet competitive positions of thecompany.

Managingthe newly acquired companies is still needed so as to meet theexpectations of the Elizabeth Arden with the newer brands. Theseexpectations include compliance with product standards, marketdemands and financial management guidelines. The regulation of theseexpectations by Elizabeth Arden can only be achieved throughcentralized management. However, the centralization of management forElizabeth Arden and all its subsidiaries should not extend toinfluencing the brand management activities of the acquiredcompanies. The acquired companies such as Liz Claiborne should beleft to manage the brands under its control before its acquisition.This means that the new company will be required to meet the targetsof the brand by the Elizabeth Arden management.

ImprovingCompetitive Position

Dueto the fierce competition in the industry, Elizabeth Arden shouldconstantly implement plans that will consistently keep its brandscompetitive in the market. Through properly implemented strategies,Elizabeth Arden should maintain its market leadership in the industryby remaining a competitive entity in relation to other players in theindustry. Through a competitive position, Elizabeth Arden willenlarge its market share and still maintain the market performance ofthe brands under its control. In addition, the firm will increase itsincome and profits as a whole and also for the individual brands.Consequently, the company will have the financial resources tofinance the activities involved in the maintenance of the company’sposition in the competitive environment. The following are therecommendations for Elizabeth Arden to establish a competitivenature.

Continuousinnovation

Throughcontinuous innovation of its existing products, Elizabeth Arden willdevelop its brands to match the changing demands of the market. Thismeans that the company needs to identify the areas of improvement forthe products that it controls. Therefore, Elizabeth Arden shouldengage in regular review of its products so as to continuallyidentify the improvements that the products need. This will providethe basis for innovation of its products and regularly provide newfeatures. Through innovation, the company will remain competitive andgain more market through the addition of new customers. Consequently,the company will find new customers who seek new products that areresponsive to new changes in the market.

Respondingto Customer Demands

Toremain competitive, the company should gather market information inrelation to the changing demands and expectations of the customers inrelation to every brand. By using such information, the company willdevelop new brands that reflect the demands of the customers as wellas the market. In addition, the company will change or modify theexisting brands to match the changing customer needs. Some of thedevelopments that can be done without necessarily innovating theexisting products are packaging styles, the colors, the fragrance andproduct sizes among others. This will make the company’s products,competitive by attracting new customers as well as new distributors.Moreover, the company will be able to retain its existing customers,thereby developing loyal customers.

ExpandingDistribution Lines

Thecompany needs to establish new distribution channels that will takeits products to the existing market as well as new markets. This canbe done by establishing strategic locations where Elizabeth Ardenwill identify the new distribution channels. Temporal(2011)argues that such means will expand a company’s market reach as wellas sales. Through the distribution channels, the company will be ableto gain a competitive edge in two ways. First, the new distributorswill introduce the products of Elizabeth Arden to their consumers andretail outlets. Secondly, Elizabeth Arden will have locked the newdistributors from engaging in similar distribution agreements withthe competing players in the cosmetics industry. This is possiblewhere the company has included exclusivity clauses in suchdistributorship agreements.

NewPromotional Tactics

Despitebeing a market leader, the company requires consistent promotion ofits products to the mainstream media aggressively to remaincompetitive. Despite being well advertised, Elizabeth Arden needs toadopt new mechanisms of reaching into the market and interacting withcustomers. While the current success of the company has been achievedthrough the conventional media, Elizabeth Arden needs to incorporatenew promotional and advertising strategies to the gain new markets.This means that the company will use the modern media, advertisingagencies, promotional tactics and marketing strategies. For instance,the company can use online advertising tactics that are important inthe modern social life of the consumers.

OnlineStrategies

Withthe world’s market shifting to the online platforms, ElizabethArden should strive to gain a competitive edge in the onlinecompetition for consumers and publicity. There are two maindimensions that Elizabeth Arden can gain an overall competitiveposition through online strategies. First, is through the creation ofawareness and publicity of its brands and its position as a company.For instance, the company can work to optimize its brands throughonline search engines and promoting its presence in the social mediaplatforms. This is achieved through online advertising andoptimization of its brands to appear as the most appropriate productsfor customers seeking cosmetics. This will present the company’sbrands as the best in the market.

Secondly,the company will gain from online strategies through the developmentof eCommerce and online selling platforms. Through eCommerce,Elizabeth Arden will expand its sales and even reach theinternational market. To expand its market globally, online sellingis an important strategy since customers will order for cosmeticsfrom virtually any location in the world that is served with internetconnection. This means that the company will achieve two main resultsthrough eCommerce. The goal of increasing its sales and profitabilityand the goal of expanding its markets while retaining the currentmarket. This way, the company will remain competitive in relation toother competitors who have adopted online strategies as part of theirlong-term plan.

InternationalStrategies and Globalization of its Brands

Thecompany is already operating in the international markets and willhave to employ more than one international strategy of solving theissues of diversity. The company should, however enhance its globalpresence by adopting some of the following recommendations

Thecompany should expand its operations in the high-growth markets thatare rising with increased populations and a growing middle class.These markets include countries in the Asian countries and Africanmarkets. The expansion of the company could be done through newmarket venture or through partnerships with distributors in suchmarkets. However, the company can expand through its conventionalstrategy of acquiring brands in these markets and then investing intheir success. Moreover, such markets can be approached throughlicensing opportunities as well as franchising.

SolvingLogistical Challenges

Outsourcingof the non-essential operational activities could be important forthe company to solve some of the logistical problems in distributingthe products. The outsourcing agreements can be done with companiesthat are not the manufacturers. This will leave the manufacturer withthe production as the only service that Elizabeth Arden outsourcesfrom them.

Tosolve the problem of high logistics costs and challenges, the companyneeds to employ appropriate international strategies. This is becausesome of the logistical challenges are as a result of thediversification of the firm’s operations to cover over 100countries. These strategies would be the use of distribution channelsand independent departmental stores. More particularly, the companycan enter into franchising agreements with international firms todistribute its products.

Prudentmaterials management

Thecompany should enter into long-term contracts with specific suppliersof raw materials and components of its products so as to negotiatefor consistent supplies. These agreements will give the company anassurance of consistent supplies and stock of raw materials for theproduction of its products. In addition, such arrangements will allowthe company to secure consistent production of its brands whereElizabeth Arden enters into long-term agreements with manufacturers.

CostMinimization

Oneof the challenges that the company faces is turning its expansivemarket growth in profits. This is because of increased costs ofproduction, administration and distribution. Therefore, the companycan implement the following recommendations.

ElizabethArden should adopt prudent internal operations that are aimed atreducing costs of its production, administrative and distributionprocesses. Through the prudent costing mechanism and appropriateauthorization of its activities, the company will reduce costs fromboth internal organizational structure and marketing expenses. Thiswill substantially reduce its costs, thereby increasing the profitmargins for the company.

Thecompany should employ the use of independent distributors for itsproducts in areas ad markets that the operating costs are high. Thiswill reduce the logistical costs that are related to such markets. Inaddition, the company should seek long-term relations withdistributors, in addition to the existing ones. This will allow thecompany to concentrate on production and branding, thereby avoidingthe costs involved in distribution. This will substantially reducethe costs of distributing its products, which will increase profitsrealized by the company.

Conclusion

ElizabethArden is a company that operates in the competitive beauty andcosmetics industry at both local and global perspectives. As a marketleader in the industry, Elizabeth Arden has established national andinternational markets for its brands and products that range up toover 400 brands. However, the company faces the challenges ofcompetition, logistical management, brand management and monetizingits expansion in the market. To increase its competitive edge andimprove the performance, the company needs to manage autonomousbrands, establish new distribution channels, engage in long-termcontracting of manufacturers, prudent cost management and establishexpansive online strategies. These recommendations will make thecompany competitive in the current and future competition.

References

ElizabethAden, 2014. Retrieved From, &lthttp://www.elizabetharden.com&gtJuly 15, 2014

Grosse,R. E. (2000). Thunderbirdon Global Business Strategy.New York: John Wiley &amp Sons

Tarrant,F. 2014. ElizabethAden: Executing Global Supply Chain Re-engineering.MGMT, 4002-Dalhouse University, Ivey Cases

Kent,J. C. (2003). BusinessBuilders in Cosmetics.Minneapolis, MN: The Oliver Press, Inc.

McManus,J. T., White, D., &amp Botten, N. (2009). ManagingGlobal Business Strategies: A Twenty-First-Century Perspective.London:Reed Elsevier plc

Temporal,P. (2011). AdvancedBrandManagement: Managing Brands in a Changing World. NewYork: John Wiley &amp Sons

Appendices

Appendix1.Market share of other companies in the beauty industry in 2004

Appendix2.Global sales of cosmetics, beauty industry in 2007