Making the cut: Kao to axe 40 percent of cosmetic lines

Making the cut: Kao to axe 40 percent of cosmetic lines

Kao has announced plans to cut up to 40 percent of its cosmetics brand portfolio in order to better focus on its most profitable lines, according to a report published by the Nikkei Asian Review.

Some 20 marques will be discontinued, including Dada and Raphaie, leaving 30 core brands in the stable. The lines axed comprise approximately 10 percent of sales.

Going forward, investment will be concentrated on global brands such as Sensai and Kanebo as well as local heroes such as Evita. All brands will be recategorized into divisions according to whether they are sold via beauty consultants or self-service – previously, the company classified its brands by retail channel.

Kao’s goal is to reach sales of more than ¥300 billion by 2020 and an operating margin of 10 percent, which it hopes to achieve by increased investment in luxury brands.

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