The rapidly growing Provencal developer and producer of cosmetics based on natural materials, L'Occitane, which is forecasting a 25% increase in sales this year, is reorganising its production and distribution facilities both on-site at Manosque (Haute-Provence) and in Belgium and the UK.
A new €3m logistical base has been put into operation while centres in the UK and Belgium and elsewhere in Europe will close. Frederic Leroux for L'Occitane, said that "for us it is vital to have control of our logistics in order to cope with peaks of activity, notably at Christmas".
The company is steadily increasing the production of creams, soaps and shampoos, having tripled its production area at Manosque since 1987. Sales have risen from about €55m in 2000 to €402m in 2007, with a 27% rise in 2007 over the previous year. Net profitability is currently over 7%. The company's president Reinold Geiger, said he expected sales in 2008 to reach €500m this year despite the strong euro which has had the effect of lopping 20% off profits over the past 20 months.
Around 86% of L'Occitane's business is now centred outside France with a network of 950 boutiques in 85 countries. The leading market is the US which accounts for 25% of sales which include best-selling products directed towards the Afro-American segment of the US population. Japan accounts for 15% and France for 14% of sales.
Geiger said that the intention is to expand from 70 shops in the US to 350 or more. There was also potential in China where the French enterprise now has 35 points of sale. The company has also indicated that it will relaunch itself in Europe, notably in Germany, Spain and Italy.
L'Occitane is now launching about 150 new products a year and removing almost as many from its range in order to keep the total at around 1000 reference products. Development times have been cut to nine months compared to an average time for the cosmetics sector of 18, helped by the presence on-site of an R&D team and marketing and production staff.