Shiseido-Company's Background

SHISEIDO

COMPANY’S BACKGROUND

Shiseido is a long history company established by Arinobu Fukuhara in 1872. It had been originally founded as a Western-style pharmacy then started to include cosmetics in its product line and Shiseido’s Eudermin, an advance skin lotion that is still sold today, since 1987, is a marking for this transformation. The company’s strength in both areas has got it through the Great Earthquake of 1923 and World War II.

The company, with its efforts to become “Global No.1”, has introduced many pioneer products in Japan. The backbone of Shiseido, the chain store system, was established in 1905. In 1957, the company deployed its international expansion plan by launching sales in Taiwan with exports to Singapore and Hong Kong thereafter. In 1962, Shiseido expanded to Hawaii and in 1965, it established Shiseido Cosmetics America. Expansion of Shiseido in Europe started with Italy in 1968 and officially in Oceania with New Zealand in 1971. Up to March 31, 2011, Shiseido has been represented in 85 countries with more than 25000 outlets.

In 1987, Yoshiharu Fukuhara, grandson of the founder, became the president. During this transformation, Shiseido suffered a 6 percent decrease in sales and a write-off in inventory worth $239 million; net income dropped by 34 percent to $72 million. Separate sales volume budgeting for sales companies and retail outlets was also nullified. In 2010, Shiseido products was in the top positions of skin care segment, which accounted for 70% share of beauty consumption (Pao ), and color cosmetics segment in China ("China’s cosmetics market, 2010" ).