16. Kosé
Japan
www.kose.co.jp

Beauty Sales: $1.6 billion

Key Personnel: Yasukiyo Kobayashi, chairman; Kazutoshi Kobayashi, president; Izuo Ikemi, managing director; Masaru Enomoto, managing director; and Shinji Ishikura, managing director.

Products/Brands: Skin care, cosmetics and toiletries under brands such as Beauté de Kosé, Cosme Decorte, Esprique, Grandaine, Prédia, Infinity, Stephen Knoll, Fasio and Rimmel.
New Products: Junkisui skin care.

Comments: Kosé was hit by the slow expansion of the Japanese economy, extensive competition and the high price of crude oil, but corporate earnings improved and consumer spending remained steady. For the year ended March 31, 2008, Kosé recorded sales of $1.6 billion, a 2.2% gain. Overseas sales accounted for about 10% of the total. The company concentrated on its core brands and distribution channels. Cosmetic sales were bolstered by Cosme Decorte, which added a series of makeup and skin care products and Jill Stuart. Sales of its luxury cosmetics line, Albion, were better than expected.
  
Overseas, Kosé said sales initiatives to raise awareness of the Sekkisei brand, mainly in Asia, were effective. Since June, Kosé has been importing, manufacturing and selling Rimmel in China through a deal with Coty. Kosé will customize products to Chinese tastes, and plans to have 300 Rimmel shops in the country within three years.
  
In the cosmetaries business, Kosé focused on the self-selection process. Since 2004, Kosé has partnered with Seven-Eleven Japan on the Sekkisei brand, which consists of cosmetic products containing plant extracts. The firm is now selling Junkisui, a new line of skin care, at more than 12,000 of the convenience stores.
  
In the first quarter ended June 30, net sales decreased 1.4% from the same period last year, to $395 million. While cosmetic sales were up, there was a decline in other areas, including cosmetaries. Kosé focused on increasing sales in Japan at locations with beauty counselors, and concentrated on distributing luxury products in specialty cosmetics and department stores. Sekkisei Supreme was introduced in Japan, and Kosé started selling Jill Stuart products in Taiwan.
  
The Kosé Group has created a medium term management plan that will end in March 2011 to focus on building “a more powerful base for sustaining growth.” Despite concerns about a pending economic slowdown in Japan, Kosé is forecasting an increase of 1.9% in net sales for the fiscal year ending March 31, 2009.