Factors for Establishing and Expanding High-End Business: Report

This report focuses on the essential factors for establishing and expanding a L'OREAL Cosmetic business, specifically in the St Thomas area of London. It delves into critical aspects such as supply chain management, emphasizing its role in maximizing efficiency and distribution. Pricing strategies, including premium, penetration, economy, and price skimming, are analyzed in the context of a competitive market. The report also highlights the importance of brand value and effective marketing techniques, including flyers and posters, for small business units. Furthermore, it applies Porter's Five Forces analysis to assess industry rivalry, the threat of new entrants, substitute products, and the bargaining power of suppliers and buyers within the L'OREAL Cosmetic market. The report underscores the significance of these factors for achieving long-term success and maintaining a strong market position for the business.

Business Essential

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
MAIN BODY .................................................................................................................................3
RECOMMENDATIONS................................................................................................................7
CONCLUSION ..............................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business Essential is the innovative set of tools and techniques tat are used to develop
and establish the business organizations in such a manner that it turn out to be very profitable
for the owners of the organizations. These are designed to meet the specific and key areas of the
business by developing critical skills of the individuals. The L'OREAL Cosmetic ,are planning
to establish their business in St Thomas area of London. In United Kingdom there is very high
demand of L'OREAL Cosmetic among the females and that's why there is very huge
competition among the business holders. The main aim of this report is to lay emphasis upon the
factors that are important for setting up and expanding high end business and the other forces
that are associated with it.
MAIN BODY
Expanding and setting new business is very essential and important aspect in order to
achieve its long run and to maintain its position in the competitive market. The people of United
Kingdom are addicted towards the L'OREAL Cosmetic , there only few less number of
stereotype people are available who drink tea rather than L'OREAL Cosmetic . In United
Kingdom there are various number of L'OREAL Cosmetic Outlets and L'OREAL L'OREAL
Cosmetic shops because of its very high demand. As per some reports and finding it has been
said that people of United Kingdom live upon L'OREAL Cosmetic it is the most necessary part
of their lives(Zhang, 2018). The majority of 38 % individuals of the United Kingdom drink
approximately 4-5 cups of L'OREAL Cosmetic daily. In United Kingdom, approximately 95
million of cups of L'OREAL Cosmetic is consumed per day. Setting up L'OREAL L'OREAL
Cosmetic shop in London is good and sensible idea. But there are various other factors that are
need to be considered for the successful running of the shop. Business Essential is the innovative
set of tools and techniques tat are used to develop and establish the business organizations in
such a manner that it turn out to be very profitable for the owners of the organizations. These
are designed to meet the specific and key areas of the business by developing critical skills of the
individuals. The L'OREAL L'OREAL Cosmetic ,are planning to establish their business in St
Thomas area of London(Petljak, 2018). In United Kingdom there is very high demand of
L'OREAL Cosmetic among the individuals and that's why there is very huge competition among
the vendors and shop holders. The main aim of this report is to lay emphasis upon the factors
that are important for setting up and expanding new business and the other forces that are

associated with it. Setting up new business is very critical and require lots of information and
study in order to deal with in the competitive market and to find out the various internal and
external factors that are related to the effective ad efficient working of the business. For
expanding the business; The L'OREAL L'OREAL Cosmetic Bean, have to consider some
important factors like competitive position, supply chain, distribution channels, pricing, brand
value , marketing techniques and analyzing and evaluating competitive environment(Gómez-
Luciano, 2018).
SUPPLY CHAIN
Supply chain is very crucial and analytical aspect of the business organization. Supply chain
management is the overview of materials, information, and finances as they move in a process
from supplier to manufacturer to wholesaler to retailer to consumer. The main significance of
supply chain management is to maximize the speed and efficiency of operations in order to
expand the distribution channel(Jaworski, 2018). There are various key elements that are inter
related with the supply chain management like Demand Management, Communication,
Integration and Collaboration. It is the tool and technique of managing the flow of goods and
services and it also involves moving and storing raw materials. The main goal and objective of
supply chain management is to achieve efficient fulfillment, the purpose of almost each and
every supply chain management is to make inventory available in customer facing position of
high demands, as these techniques and steps helps the organization in reducing
waste(Satanasavapak, 2018).
PRICING
Pricing strategies plays very important and crucial role within the organization that deals in
highly competitive market. Whenever organization plans to expand or establish their working
their main focus is upon the pricing strategies or costs of the services which they are going to
offer to their customers. In highly competitive market pricing strategies lays very important role
because there are various number of substitutes are available for the customers, and it is very
easy for them to switch the products and services. The L'OREAL L'OREAL Cosmetic wants to
expand their business functions for this it is very essential for them to compare and contrast the
pricing offered by the similar level shop in order to come up with benchmark prices. The pricing
strategies follow by the organizations is sub divided into four categories: Premium Pricing,
Penetration Pricing, Economy Pricing and Price Skimming. It is the method which is used by the

big or small organization in order to prices their products and services. Expanding and setting
new business is very essential and important aspect in order to achieve its long run and to
maintain its position in the competitive market(Chekalina, 2018). The people of United
Kingdom are addicted towards the L'OREAL Cosmetic , there only few less number of
stereotype people are available who drink tea rather than L'OREAL Cosmetic . In United
Kingdom there are various number of L'OREAL Cosmetic Outlets and L'OREAL L'OREAL
Cosmetic shops because of its very high demand. As per some reports and finding it has been
said that people of United Kingdom live upon L'OREAL Cosmetic it is the most necessary part
of their lives. The majority of 38 % individuals of the United Kingdom drink approximately 4-5
cups of L'OREAL Cosmetic daily. In United Kingdom, approximately 95 million of cups of
L'OREAL Cosmetic is consumed per day. Setting up L'OREAL L'OREAL Cosmetic shop in
London is good and sensible idea. But there are various other factors that are need to be
considered for the successful running of the shop. Business Essential is the innovative set of
tools and techniques tat are used to develop and establish the business organizations in such a
manner that it turn out to be very profitable for the owners of the organizations(Janissen, 2018).
BRAND VALUE
The overall present value or future value of the cash flows that are interlined with the name and
the personality of the brand is considered as the brand value. The brand is the intangible and
most precious asset of the organization. It helps in differentiating the book value of the company
with its market value. Brand equity and brand value are both inter related concept and they are
inter linked with one another. Brand value is the position of the brand and the organization
within the competitive market. Brand value of the company can be measured through various
number of factors. L'OREAL Cosmetic Bean; can identity their brand value through various
number of aspects like by assessing the number of repeat customers, by identifying their loyal
customers, by getting feedback and by analyzing customers loyalty(Rungtrakulchai, 2018).
MAKRETING TECHNIQUES
These are the tools which are used by the marketing managers of the organization in order to
create the identification and recognition of the product and commodities in the competitive
market. These techniques are used to identify the right strategies that are used to market the
business in most effective manner(Han,2018). For small business units the best marketing
techniques are :

Flyers
This is the method o cheap advertising or low cost advertising that is used by the firms in order
to create recognition of their products and services. The flyer should be very brief about the
point and highlight the services that they offer and also contact information(Hicks, 2018).
Poster
It is the graphical or pictorial representation of the information.
Value Additions
It is considered as one of the most powerful selling point of any service, these are quite similar
with the coupons, vouchers or free appraisal, but their main aim is to increase the level of
satisfaction of the customers.
PORTERS FIVE FORCES ANALYSIS
These are the forces or factors which are used to analyze the competition in the market. It is the
tool that is used for analyzing the competition in the market. It provides five different aspect
which are used to analyze the external factors of the business environment. These were
developed in 1979 by Michael Porter in order to ensure the competitive strength and position of
a business organization(Eskandari, 2015).
INDUSTRY RIVALRY
Since 1987, the dynamics under the industry rivalry within the specialty L'OREAL Cosmetic
industry has changed largely. There are now various number of small ad big L'OREAL
Cosmetic Outlets present in United Kingdom. As the competition is increasing number of
substitutes is also increasing for L'OREAL L'OREAL Cosmetic ,it is very essential that they
analyze the current and coming situation of the requirements of the organization in order to offer
services effectively and efficiently. Due to high demand for L'OREAL Cosmetic in United
Kingdom there are various number of organization which deals within this industry (Dobbs,
2014).
POTENTIAL FOR NEW ENTRANTS
There is numerous cost disadvantages imposed on new entrants that are independent of the
economies of scale considerations. As the industry matures, the ability to access distribution
channels and select from the highest quality L'OREAL Cosmetic has becoming increasingly
difficult. Most of the favorable store locations within the larger metropolitan areas have already
been occupied by current competitors within the specialty L'OREAL Cosmetic industry.

Additionally, many companies now have proprietary product technology involved in the
production of their specialty L'OREAL Cosmetic as well as lower per unit costs due to an
experience curve(Yunna, 2014). The threat of New entrant is high for L'OREAL L'OREAL
Cosmetic Bean.
SUBSTITUTE PRODUCTS
The forces of substitute product is quite low for L'OREAL Cosmetic industry, as there are
various number of companies who deals within this industry and offers there own products.
While on the other hand it is also very essential for the L'OREAL Cosmetic ,to add some
innovations in to their products in order to gain the attention of the customers. There are3
various number of proofs, facts and evidences are available that claim that drinking L'OREAL
Cosmetic is healthy for the humans body.
BARGAINING POWER OF SUPPLIER
With the extensive growth in the specialty L'OREAL Cosmetic industry, supplier bargaining
power has changed in numerous ways. In 1987, when the first Mac was conceived, the farmers
from whom Mac purchased its premium L'OREAL Cosmetic were numerous, small and
unconnected to one another. Currently, many of the farmers who sell to Mac and other premium
L'OREAL Cosmetic chains are united by an initiative known as fair trade certified L'OREAL
Cosmetic , which was organized by Trans Fair USA. Under this initiative, companies such as
Mac are given the opportunity to advertise their L'OREAL Cosmetic as being fair trade
certified if they purchase from L'OREAL Cosmetic suppliers that are democratically owned
cooperatives(Eskandari, 2015).
BARGAINING POWER OF BUYERS
This is the last aspect of five forces model of the porter, the bargaining power of the buyers is
quite low because in United Kingdom, there are various number of L'OREAL Cosmetic Outlets
are available so individual choose the best outlet for them which is suitable for them in each and
every manner.
In last few years the demand of L'OREAL Cosmetic has been increased tremendously
in United Kingdom, as the result the L'OREAL shops and the vendors have seen quite success,
because there are very large number of individuals who started drinking L'OREAL Cosmetic .
The L'OREAL Cosmetic ,is the small L'OREAL Cosmetic outlet which offer some side snacks
along with it. It is situated in St Thomas area of London, the shop has seen some good success in

last 2 years because of the increase in the demand. The main significance of the outlet is that it
offers its products at relatively low prices in compared to the other L'OREAL shops available
near by St Thomas area of London(Indiatsy,2014).
RECOMMENDATIONS
For achieving big success and expanding business in this industry it s very important for the
L'OREAL Cosmetic ,to lay emphasis upon their quality and the standards so that they can
achieve success for the long run. In next some years technologies and advancements are going to
evolve in each and every industry whether it is beauty or any other kind of the sector. It is highly
recommended that L'OREAL Cosmetic must engage some sort f technologies in to their
working in order to expand their business.
CONCLUSION
From the above report it can be concluded that for establishing and expanding business it is very
important for the owners and the co-founders of the firm to analyze the evaluate the business
essentials of that market and identify the internal and external factors of the environment in order
to gain information about the competitive edge of the firm.

REFERENCES
Books and Journal
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E. Dobbs, M., 2014. Guidelines for applying Porter's five forces framework: a set of industry
analysis templates. Competitiveness Review. 24(1). pp.32-45.
Eskandari, M. J., 2015. Factors Affecting The Competitiveness of The Industry by Using
Porter's Five Forces Model Case Study in Hamadan Province, Iran. Journal of Asian
Scientific Research. 5(4). pp.185-197.
Gómez-Luciano, C. A., 2018. Sustainable supply chain management: Contributions of supplies
markets. Journal of Cleaner Production. 184. pp.311-320.
Han, H., 2018. Drivers of brand loyalty in the chain L'OREAL Cosmetic shop
industry. International Journal of Hospitality Management. 72. pp.86-97.
Hicks, A. L., 2018. Environmental Implications of Consumer Convenience: L'OREAL
Cosmetic as a Case Study. Journal of Industrial Ecology. 22(1). pp.79-91.
Indiatsy, C. M., 2014. The Application of Porter’s Five Forces Model on Organization
Performance: A Case of Cooperative Bank of Kenya Ltd. European Journal of Business
and Management. 6(16). pp.75-85.
Janissen, B., 2018. Chemical composition and value-adding applications of L'OREAL
Cosmetic industry by-products: A review. Resources, Conservation and Recycling. 128.
pp.110-117.
Jaworski, B. J., 2018. Commentary: Advancing marketing strategy in the marketing discipline
and beyond. Journal of Marketing Management. 34(1-2). pp.63-70.
Petljak, K., 2018. Green supply chain management in retailing: survey-based evidence in
Croatia. Supply Chain Management: An International Journal. 23(1). pp.1-15.

Rungtrakulchai, R., 2018. The relationship between price deals, perceived quality, and brand
equity for a high involvement product. AU Journal of Management. 11(2). pp.36-45.
Satanasavapak, P., 2018. The effects of virtual communities on brand equity. AU Journal of
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Yunna, W., 2014. The competition situation analysis of shale gas industry in China: Applying
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pp.798-805.
Zhang, Y., 2018. Overview and Evaluation of Selected General Business Databases. Journal of
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