MADARA Cosmetics: Analysis of Structure, Strategy, and Environment

This management report provides an overview of MADARA Cosmetics, a Latvian company specializing in eco-cosmetics. It examines the company's structure, decision-making processes, and organizational design, highlighting its mission to produce 100% natural products. The report includes a PEST analysis, exploring the political, economic, social, and technological factors affecting the business environment, as well as a SWOT analysis, identifying the company's strengths, weaknesses, opportunities, and threats. Suggestions for strategic management improvement are offered, focusing on expanding the product line to include men's grooming products and implementing customer loyalty programs. The report concludes that MADARA Cosmetics has established a valuable business by focusing on high-quality, natural ingredients and is committed to international growth and customer satisfaction. Desklib provides access to this and other solved assignments for students.

Running Head: MADARA Cosmetics 0
Management Report on Madaracosmetics
Student Details
11/11/2018

MADARA Cosmetics 1
Executive Summary
This report discusses the structure, organisational design, and strategy of MADARA
Cosmetics. MADARA Cosmetics has become one of the biggest brands in the field of eco
cosmetics in Latvia in very short period of time. All products of MADARA Cosmetics are
manufactured from 100% natural plants and herbs and developed in laboratories of
MADARA Cosmetics. PEST analysis and SWOT analysis tell about the new technologies for
business growth and strengths, weaknesses, opportunities, and threats for the MADARA
Cosmetics.

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Contents
Executive Summary...................................................................................................................1
Introduction................................................................................................................................3
Structure of MADARA cosmetics.........................................................................................3
Decision Making Process...........................................................................................................4
Organizational Design................................................................................................................4
Company’s strategy relates to the environment.........................................................................4
PEST Analyses...........................................................................................................................5
SWOT analyses..........................................................................................................................5
Strengths.................................................................................................................................5
Weaknesses............................................................................................................................5
Opportunities..........................................................................................................................6
Threats....................................................................................................................................6
Suggestions for improvement of strategic management............................................................6
Conclusion..................................................................................................................................6
Reference....................................................................................................................................8

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Introduction
MADARA Cosmetics is a Latvian company which was founded in 2006 by Lotte
Tisenkopfa-Iltnere (Madaracosmetics, Founders, 2018). It is one of the biggest brands in the
manufacturing of organic skin care products. It started from four founders in 2006 and now
has more than 99 employees in 2018. In the field of cosmetics MADARA brand represents a
local pioneer (Madaracosmetics, Madara Organic Skincare, 2018).
Structure of MADARA cosmetics
MADARA Cosmetics is offering more than 80 products. Each and every product of
the MADARA cosmetics is manufactured and developed in its own laboratories of
MADARA cosmetics. It has the 100% control over all its processes. MADARA cosmetics
have passion for the perfection and quality in every single detail as proved by the ECOCERT
certification. MADARA cosmetics is exporting its brand products in all over the world and
also giving contracts for the manufacturing services (Nasdaq, 2017).
Source: (Madaracosmetics, Affordable Luxary In a Growing Market sector, 2017)

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Decision Making Process
All the decisions and actions of the company are taken by the board of “MADARA
Cosmetics”. Board has all responsibilities of maintaining proper accounting records, making
decisions and reasonable steps for safeguarding the assets of the organization, and also
preventing and detecting the company from fraud and other irregularities. Financial
statements are also prepared by the board of the company. The company is expecting a
growth rate of 30% for 2018, which will result in turnover of EUR 10 million.
(Madaracosmetics, Affordable Luxary In a Growing Market sector, 2017).
Organizational Design
MADARA Cosmetics’ mission is focused on producing eco cosmetics that are 100%
natural. All products are manufactured from plants of Latvia, one of the greenest
environments and has suitable climate for growing vulnerary plants (Nasdaq, 2017).
MADARA Cosmetics has adopted creative processes for the development, packaging, and
designing of products to sustain in the competitive environment. Company is now focusing
on developing shareholder benefit program. Its main strategy is to gain growth while keeping
eye on profit margins (Nasdaq, 2017).
Company’s strategy relates to the environment
Entire products range of MADARA Cosmetics is manufactured from 100% natural
plants of Latvia. This cold and harsh northern climate has evolved plants that have
extraordinary properties. These plants have properties of healing wounds and saving lives.
MADARA Cosmetics have adopted this idea from ancient history that nature has solution for
all our problems and has everything that we need (Madaracosmetics, ESG Report, 2018).

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PEST Analyses
PEST analyses describe new opportunities for the organization by changing business
environment. Legal factors decides how a company will operate, cost and demand of its
products. The consumer protection law gives right to consumers for choosing product that fit
their purpose and product quality too. This makes MADARA Cosmetics to manufacture
products that are suitable for customers and of high quality. Tax rate also has major impact
on the organization. Higher tax rate will affect the cost structure of MADARA and its cash
positions too. Economic factors mainly affect purchasing of consumers such as
unemployment rate, interest rate, economic growth rate and so on (Mindtools, 2018).
SWOT analyses
SWOT analyses tell about the strengths, weaknesses, opportunities and the threats of
any organization. After conducting the SWOT analyses for the MADARA Cosmetics,
following strengths, weaknesses, opportunities and the threats are discovered for the
company:
Strengths
MADARA Cosmetics manufactured all its products from the high quality raw
materials obtained in the Baltic region, therefore these products are 100% natural. Company
has high skills in marketing as it promotes products by own through e-commerce web stores
(Jansone-Slava, 2017).
Weaknesses
One of the weaknesses of the organization is that it’s been in the market for very short
period of time. It will take longer time for the company to make its impact internationally.

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Second disadvantage is expensive price of its products because all its products are 100%
natural ingredients (Jansone-Slava, 2017).
Opportunities
Company has large number of opportunities for its business growth as it has created a
new technology in the cosmetic industry by introducing 100% natural products that has super
beneficial results for the skin, body, hair and so on (Jansone-Slava, 2017).
Threats
Threats to the organization are from the cosmetics that are giving tough competition
from the international ecological cosmetics. And another threat is customers have less trust in
cosmetic line (Jansone-Slava, 2017).
Suggestions for improvement of strategic management
MADARA cosmetic is focused only on female consumers, so company has to extend its offer
to beauty line for men. It will ensure effective functioning of company as it is important to
give them chance to see how they control employees, shops and other functions. Second
suggestion includes offering loyalty cards to customers as it will develop closer relationship
with consumers.
Conclusion
MADARA cosmetics has cerated a high value business in very short span of time.
The company is focused and dedicated to produce products that are manufactured from 100%
natural ingredients. All the products of the company are dervied from plants that are grown in
northen climate of Latvia that is suitable for producing extraordinary herbs. These products

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are safe for consumers. Company is still working to grow its business internationally and
providing high quality products to customers.

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Reference
Madaracosmetics. (2017). 2017 Annual Report. Retrieved from Nasdaqbaltic:
http://www.nasdaqbaltic.com/upload/reports/mdara/2017_ar_en_eur_00_ias.pdf
Madaracosmetics. (2017). Affordable Luxary In a Growing Market sector. Retrieved from
https://cns.omxgroup.com/cds/DisclosureAttachmentServlet?messageAttachmentId...
Madaracosmetics. (2018). ESG Report. Retrieved from issuu:
https://issuu.com/madaracosmetics/docs/2017-esg-report
Madaracosmetics. (2018). Founders. Retrieved from Madaraorganicskincare:
https://www.madaracosmetics.com/en/founders
Madaracosmetics. (2018). Madara Organic Skincare. Retrieved from madaracosmetics:
https://www.madaracosmetics.com/en/about-us
Nasdaq. (2017). MADARA Cosmetics. Retrieved from Nasdaqbaltic:
http://www.nasdaqbaltic.com/market/?
instrument=LV0000101624&list=6&currency=EUR&pg=details&tab=company
Sauka, A., & Welter, F. (n.d.). Born Green and Global: The Case of Madara Cosmetics.