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To increase its market share in Brazil, L’Oréal will invest R$500 million in infrastructure by 2016

Even in a year of economic downturn and uncertainty in the market, as a result of the stagnation of the GDP and a fierce electoral battle that saw the re-election of president Dilma Rousseff, Brazil will continue to be a significant part of L’Oréal’s expansion plans. With a population of 200 million, “Brazil is a very strategic market for L’Oréal and, despite the current economic turmoil, we are confident that we will continue to grow”, says Didier Tisserand, president of L’Oréal Brasil.

Didier Tisserand, president of L'Oréal Brasil

Didier Tisserand, president of L’Oréal Brasil

Operating in the Brazilian market for 55 years, with a portfolio of 25 international brands, the world’s leading beauty company had a turnover of more than R$ 2.2 billion in the country in 2013 – an increase of 13.3% in relation to the previous year – and it hopes to keep that momentum going. Brazil is L’Oréal’s 6th largest market and is aiming for “at least 4th place, very soon,” reveals Tisserand.

To achieve this goal, the 4th largest cosmetics industry in Brazil (after Natura, O Boticário and Unilever), which today operates with two factories, two distribution centers, and one research and innovation center, decided to increase its investment in infrastructure to R$ 500 million by 2016. “We are strengthening our strategy and working to improve our infrastructure,” he says.

The contract for the construction of a new headquarters for L’Oréal Brasil was signed at the end of September, and the works began this year. Strategically located in the port region of the center of Rio de Janeiro, the building will have a built area of more than 20.000 sqm, with 22 floors, and capacity for 1,500 people. With views of the Bay of Guanabara, it was planned in line with sustainability, comfort and health practices.

The plan of the new headquarters is a milestone. This building will bring modernity and efficiency and will provide the best working conditions for our teams, in an exceptional and inspiring environment. The choice of this new headquarters for L’Oréal will accompany the ambitious plans for the company’s development in the country,” says Tisserand.

Sketch of L'Oréal Brasil's new headquarters - CREDIT Archigraph Apresentações (...)

Sketch of L’Oréal Brasil’s new headquarters - CREDIT Archigraph Apresentações Gráficas

The headquarters building should be ready by the end of 2016, when L’Oréal Brasil’s new research and innovation center will also be inaugurated. Located in the technological park of Ilha de Bom Jesus, also in Rio de Janeiro, the laboratory, which has a total area of 29.500 sqm will intensify the development of hair, make-up and skin care products. The current research center, which operates at the Pavuna factory, in Rio de Janeiro, employs 100 people, “but we need more space, as we intend to double our number of employees,” he forecasts.

To grow its market share in Brazil, L’Oréal also plans to increase investments on diversifying its product range in the country. Researches by L’Oréal show that the number of middle class Brazilians aged between 18 and 59 will increase by 40% by 2020. Looking at this market, and at the promising hair care category in Brazil, which should reach a value of R$ 12.45 billion in 2017 according Mintel, L’Oréal recently announced an acquisition agreement with Niely Cosméticos, the largest independent group of hair care and hair coloring in Brazil, which recorded a net income of R$ 405 million in 2013.

Its two main lines, Niely Gold – hair care – and Cor & Ton – hair color – can be widely found at retail stores, supermarkets, pharmacies and perfumeries at affordable prices. “We are very excited. Niely has an excellent position and high penetration in the growing Brazilian middle class,” says Tisserand. The acquisition is still awaiting approval by the CADE (Administrative Council for Economic Defense).

Renata Martins

Portfolio

© 2014 - Brazil Beauty News - www.brazilbeautynews.com

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