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The L'Oréal Group (Euronext: FR0000120321 (http://www.loreal-finance.com/v7/us/index.asp?page=bourse/cours_direct.asp?SRUB=10)), headquartered in Clichy, France, is the world's leading company in cosmetics and beauty. L'Oréal has developed activities in the field of cosmetics, concentrate on hair color, skin care, sun protection, make-up, perfumes and eaux de toilette, and hair care. L'Oréal is also active in the dermatological and pharmaceutical fields.
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History
In 1907, Eugène Schueller, a young French chemist, developed an innovative hair-color formula. He called his improved hair dye Auréole. With that, the history of L'Oréal began. Eugène Schueller formulated and manufactured his own products, which he then sold to Parisian hairdressers.
In 1909, Schueller registered his company, the "Société Française de Teintures Inoffensives pour Cheveux", the future L'Oréal. The guiding principles of the company that would become L'Oréal were put into place from the start: research and innovation in the interest of beauty.
During early twentieth century, Schueller provided financial support and held meetings for La Cagoule at L'Oréal headquarter. La Cagoule was a violent French fascist-leaning and anti-communist group. L'Oréal hired several members of the group as executives after WWII.
In 1920, the small company already employed 3 chemists. By 1950, the research teams were 100 strong; that number reached 1,000 by 1984 and is nearly 2,000 today.
L'Oréal got its start in the hair-color business, but the company soon branched out into other cleansing/beauty products. L'Oréal now markets over 500 brands and more than 2,000 products in all sectors of the beauty business: hair color, permanents, styling aids, body and skin care, cleansers and fragrances. They are found in all distribution channels, from hair salons and perfumeries to hyper- and supermarkets, health/beauty outlets and direct mail.
L'Oréal has five worldwide research and development centers. Two in France: Aulnay and Chevilly. One in US: Clark, New Jersey. One in Japan: Kawasaki, Kanagawa. In 2005, one established in China: Shanghai.
L'Oréal purchased Synthélabo in 1973 to pursue ambition in the pharmaceutical field. Synthélabo merged with Sanofi in 1999 to become Sanofi-Synthélabo. Sanofi-Synthélabo merged with Aventis in 2004 to become Sanofi-Aventis.
Business
Management committee
The management committee includes:
- Lindsay Owen-Jones, Chairman and CEO
- Giorgio Galli, EVP of Coomunications
- Béatrice Dautresme, EVP of Strategic Business Development
- Jean-François Grollier, EVP of Research and Development
- Marcel Lafforgue, EVP of Production
- Christian Mulliez, VP of Finances
- Jean-Jacques Lebel, President of Professional Products
- Patrick Rabain, President of Consumer Products
- François Vachey, EVP of Human Resources
- Gilles Weil, President of Luxury Products
Owen-Jones became chairman and CEO in 1988.
Stockholders
- Breakdown of share ownership: 27.5% by the Bettencourt Family, 26.4% by Nestlé, 3.9% treasury shares, the remaining 42.2% are publically traded.
- Voting rights distribution: 28.6% to the Liliane Bettencourt Family, 27.5% to Nestlé, and 43.9% to the public.
Earnings
In 2003, L'Oréal announced its 19th consecutive year of double-digit growth. Its consolidated sales was €14.029 bn and net profit was €1.653 bn. 96.7% of sales derived from cosmetic activities and 2.5% from dermatology activities. L'Oréal has operations in over 130 countries, employing 50,500 people, 24% of which work in France. 3.3% of cosolidated sales is invested in research and development, which accounts for 2,900 of its employees. In 2003, it applied for 515 patents. It operates 42 manufacturing plants throughout the world, which employ 14,000 people.
- Cosmetics sales by division breakdown: 54.8% from consumer products at €7.506 bn, 25.1% from luxury products at €3.441 bn, 13.9% from professional products at €1.9 bn, and 5.5% from active cosmetics at €0.749 bn.
- Cosmetic sales by geographic zone breakdown: 52.7% from Western Europe at €7.221 bn, 27.6% from North America at €3.784 bn, 19.7% from rest of the world at €2.699 bn.
Joint ventures and minority interests
L'Oréal holds 10.41% of the shares of Sanofi-Aventis, the world's number 3 and Europe's number 1 pharmaceutical company. The Laboratoires Inneov is a joint venture in nutritional cosmetics between L'Oréal and Nestlé; they draw on L'Oréal's know-how in the fields of nutrition and food safety. Galderma is another joint veture in dermatology between L'Oréal and Nestlé.
Brands
Brands are categorized by their targeted markets, which are consumer, professional, luxury, and active.
Consumer products
- L'Oréal Paris
- Garnier
- Maybelline
- SoftSheen-Carson
Professional products
- Kérastase
- L'Oréal Professional
- L'Oréal Technique
- Matrix
- Mizani
- Redken
Luxury products
- Biotherm
- Cacharel
- Giorgio Armani Parfums and Cosmetics
- Guy Laroche
- Helena Rubinstein
- Kiehl's Since 1851
- Lancôme
- Paloma Picasso
- Ralph Lauren Fragrances
- shu uemura
Active cosmetics
- Dermablend
- La Roche-Posay
- Vichy
Trivia
One of L'Oréal's advertising slogans is "Because I'm worth it". It replaced the former slogan "Because you're worth it".
The slogan for Maybelline is "Maybe she's born with it. Maybe it's Maybelline".
External links
- Official website of L'Oréal (http://www.loreal.com)
- Forbes article on L'Oréal (http://www.forbes.com/global/2000/1127/0324130a.html)
- Forbes article on Liliane Bettencourt (http://www.forbes.com/billionaires/2005/03/18/cz_sh_0318oreal_bill05.html)
- Book Review of Bitter Scent (http://www.js.emory.edu/BLUMENTHAL/Bar%20Zohar.html)
- L'Oréal a pris ma Maison (http://www.amazon.fr/exec/obidos/ASIN/2012356877/qid%3D1112028570/402-9236689-4971336)
- Time Article On L'Oréal's Nazi Connections (http://www.time.com/time/archive/preview/0%2C10987%2C1101910701-157348%2C00.html)
References
- Michael Bar-Zohar, "Bitter Scent: The Case of L'Oréal, Nazis, and the Arab Boycott" (London, Dutton Books: 1996) pp. 264.
- Waizfelder, Monica, "L'Oréal a pris ma Maison: Les secret d'une Spoliation (Paris, Hachette: 2004) pp.217. (http://www.amazon.fr/exec/obidos/ASIN/2012356877/qid%3D1112028570/402-9236689-4971336)
- L'Aventure L'Oréal by François Dalle Ed Odile Jacob
- La Saga des Bettencourt : L'Oréal, une fortune française Bruno Abescat (2002) PLONde:L'Oréal