final year marketing project

KIKO Milano B2B Marketing Plan

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International Marketing B2B Project

IBL Year 4

18/02/2016

Adriano Aprile D10123389 [email protected]

Bébhinn McDonnell C12495382 [email protected]

David White C12343281 [email protected]

Ingrid Cazala C12393276 [email protected]


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DECLARATION

We, the undersigned, declare that this report is entirely our own written work, except where

otherwise accredited, and that it has not been submitted for a degree or other award to any

other university or institution.

Signed: _____________________________

______________________________

______________________________

______________________________

Date: ________________


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II. Executive Summary With almost 20 years’ experience in the cosmetics field, KIKO is a brand that is known and loved

worldwide. Although we operate in 500 successful stores branching across Europe and the

United States, the Irish market is one which KIKO has yet to fully capitalise on. By opening our

first Dublin store in the Dundrum Town Centre in 2016 we hope to meet a loyal customer base

who will become passionate about our brand as KIKO continues to spread throughout the entire

country.

Since KIKO was founded by the Percassi Group in 1997, the brand has been adored by

innumerable kinds of customers, from young girls just becoming interested in the cosmetics

world, to professional makeup artists of the highest degree. Consistently praised among the

worldwide beauty blogging community, KIKO is excited to finally arrive and meet the Irish

consumers who have been coveting after our products for years. The phrase which best

encapsulates the beliefs and goals of our brand is “Be who you want to be”, and as such we are

committed to providing customers with the highest quality products and tools which allow them

to express their true selves through a creative outlet, at prices which we believe are accessible

to everyone.

Expecting to confirm an estimated €432 million of revenue for 2015, KIKO is no stranger to

continually increasing profits and believes that fulfilling consumer desires of our much sought

after brand in Ireland will be the first Irish store will be of benefit to other companies trading

within the Dundrum Town Centre, who will surely experience heightened customer influx during

the exciting period of the opening of our KIKO store. We have confidence in the fact that our

KIKO store opening in Dundrum will bring great publicity to the shopping centre, as similar events

have proved in alternative locations where KIKO is available.

Undoubtedly the exclusivity of having this first store in Dundrum will prevail while KIKO

establishes its name in the minds of the Irish consumer, however, with the ensuing success of

KIKO Dundrum, we hope to expand KIKO over Ireland, with a ten year plan accounting for further

branch openings in Dublin City Centre, Galway, Cork and Limerick.


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III. Table of Contents

Contents II. Executive Summary ............................................................................................................................. 3

III. Table of Contents ............................................................................................................................... 4

IV. Current marketing situation ............................................................................................................... 6

A. Current Product Situation ............................................................................................................ 6

B. Company Situation ........................................................................................................................ 10

C. Current market situation ............................................................................................................... 14

D. Consumer Situation ....................................................................................................................... 16

Staffing .......................................................................................................................................... 17

E. Macro Environment Situation ........................................................................................................ 18

V. SWOT analysis ................................................................................................................................... 19

KIKO .................................................................................................................................................. 20

Strengths ....................................................................................................................................... 20

Weaknesses ................................................................................................................................... 21

Opportunities ................................................................................................................................ 22

Threats .......................................................................................................................................... 22

List of all competitors in Dundrum/Other cosmetic retail outlets in Dundrum .................................... 23

MAC (BT2) ......................................................................................................................................... 24

Strengths ....................................................................................................................................... 25

Weaknesses ................................................................................................................................... 25

Opportunities ................................................................................................................................ 26

Threats .......................................................................................................................................... 26

INGLOT .............................................................................................................................................. 27

Strengths ....................................................................................................................................... 27

Weaknesses ................................................................................................................................... 28

Opportunities ................................................................................................................................ 28

Threats .......................................................................................................................................... 28

BOOTS ............................................................................................................................................... 29

Strengths ....................................................................................................................................... 29

Weaknesses ................................................................................................................................... 30

Opportunities ................................................................................................................................ 30

Threats .......................................................................................................................................... 30

VI. Objectives ........................................................................................................................................ 31


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VII. Marketing strategy .......................................................................................................................... 31

The challenge ................................................................................................................................ 31

Customer analysis .......................................................................................................................... 32

Market segmentation .................................................................................................................... 32

Ongoing training ............................................................................................................................ 33

Free product samples and employee discount ............................................................................... 33

Packaging ...................................................................................................................................... 33

Distribution channels ..................................................................................................................... 34

Advertising strategy ....................................................................................................................... 35

VIII. Projected profit and loss statement & Balance Sheet ...................................................................... 37

Profit and loss statement ................................................................................................................... 37

Balance Sheet .................................................................................................................................... 38

IX. Controls ............................................................................................................................................ 38

Monitoring Performance ................................................................................................................... 39

RATIO ANALYSIS 2016 ........................................................................................................................ 39

PROFITABILITY ............................................................................................................................... 39

LIQUIDITY ...................................................................................................................................... 40

ACTIVITY ........................................................................................................................................ 40

X. Conclusion ......................................................................................................................................... 40

XI. Appendix .......................................................................................................................................... 42

REFERENCES ...................................................................................................................................... 46


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IV. Current marketing situation

A. Current Product Situation

KIKO prides itself on its high quality and the affordable, competitive prices of its products, which

is specifically outlined in the company’s mission statement:

“KIKO is constantly committed to a single objective: to allow all women to treat

themselves to the most innovative cosmetics without having to sacrifice their budget. To

give all their customers the chance to experiment in all areas of makeup and treatments

with top quality shades, packaging and formulas which are always on trend. Finally, to

create a beauty care concept which is able to rewrite the rules of cosmetics: quality is no

longer synonymous with high prices. With KIKO, professional luxury is an exciting reality

you can touch. For every budget”. (KIKO cosmetics, n.d.)

The company strives towards achieving brand loyalty amongst our customers by offering

individuals the opportunity to express themselves and their own identity through creativity and

personalisation, realising that not everyone’s beauty requirements and regimes are the same, all

while maintaining affordable prices for our high quality products. Another advantage KIKO holds

over our competitors is our prime location in Europe. Based in Milan, Italy, one of the fashion

capitals of the world, KIKO can remain up to date with all the latest fashion trends and pass on

that knowledge to our consumers through new innovations in our products based on current

fashion trends. An example of KIKO Milano implementing this into our market strategies was

through our application of “fast-fashion” planning in our brand stores. “Fast fashion”, a strategy

copied from the clothing fashion industry, means constantly changing the line-up of products in

our stores to encourage customers to visit more frequently. One of the key aspects for

implementing this innovative selling method into our sales strategy was due to the fact that KIKO

Milano can remain up to date on all the current fashion trends from our advantageous location,

and update our product line as the fashion trends dictate. This strategy is already showing

promising results, with other European cosmetic companies looking to apply similar policies.


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Kantar Worldpanel, a research firm, also reports that French 15-24 year olds now buy as much

from KIKO, in terms of volume, as they do from Sephora, a larger more luxurious cosmetics brand

with revenues estimated at €4.6 billion (A shake-up in make-up, 2015). Similar brand popularity

results within this age group were also confirmed in our consumer survey results:

Figure 1: Age of survey participants

Another aspect of our business that KIKO is proud to promote is our makeup advice service

provided in our own-brand stores. As well as offering customers the chance to express

themselves freely through our products, KIKO also offers informed advice on thousands of our

available cosmetic products from professional employees with many years’ experience in the

cosmetics industry. Unfortunately, as there are no current B2B operations between KIKO Milano

and the Irish market, and KIKO cosmetic products are only available to the Irish consumer through

our online store, this consultancy service is unavailable to Irish customers as there are no own-

brand KIKO stores in Ireland at present. However, in opening our first Irish store we aim to rectify

that situation and make that service available to Irish consumers through the opening of a KIKO

store here in Ireland.


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Primarily, KIKO products are manufactured mainly in Italy, with some minor manufacturing

conducted in France, Germany, the US and some Asian countries. The products are then

distributed for sale amongst our various stores. As a result of manufacturing and distributing

cosmetic products across Europe, KIKO must adhere to the European rules and regulations for

this particular industry. The HPRA (Health Products Regulatory Authority) is the Irish organisation

responsible for enforcing these EU cosmetic product regulations in the Irish market, regulations

which KIKO will have to adhere to when conducting B2B operations in Ireland. The new

regulations were introduced in July 2013, and we will examine these regulations in closer detail

further on in the marketing plan (Health Products Regulatory Authority, n.d.).

As well as following these European regulations, companies selling cosmetic products in Ireland

must also apply for a Certificate of Free Sale for Cosmetics. Companies selling cosmetic products

in Ireland, as defined by the HPRA, must submit an application form along with an excel

spreadsheet listing the products intended for sale and their product codes. Companies applying

for the first time, as we will be in this instance, must also provide a copy of the Company’s

Registration Office certificate, a notarised declaration of the products intended for sale and a

letter of responsible person designation where the applicant is not the manufacturer. A standard

set of four certificates are issued with a limit of 300 cosmetic product entries per application. A

standard application will cost €147 and will be issued within 3-5 working days (Health Products

Regulatory Authority, n.d.).

KIKO also works in full cooperation with the EU laws regarding animal testing; “KIKO does not

carry out or order testing on animals, pursuant to the relative European laws” (KIKO Cosmetics,

n.d.). Since 2004, EU regulators in the cosmetics industry have banned animal testing on finished

products, and as of March 2011, further enforced those laws by also prohibiting products

containing ingredients tested on animals outside of Europe. KIKO maintains that they have never

engaged in this practice even prior to the introduction of these laws, and not only do they prohibit

their final products from animal testing, but also in their raw materials. Both KIKO and the EU

take a strong stance on the issue of no animal testing on cosmetic products.


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As of December 2013, KIKO made annual sales valued at €417,772 million, making a profit of

€54,088 million in the process (Consonni, 2014). Net revenues for that year were valued at €418

million, whilst currently net revenues for the company are estimated at €432 million for 2015.

The success of 2013, which saw their profits increase by 19.1%, further encouraged their growth

internationally with new stores opening across Europe, and saw the company venture for the

first time out of the European market, and into the US market (Bottoni, 2014). In 2016, we hope

to improve upon that policy of international expansion and break ground in the Irish market for

the first time, as 2015 was another good year for KIKO.

In terms of brand recognition in Ireland at present, Irish consumers are already familiar with the

KIKO brand and our cosmetic products. In our consumer survey (see appendix 3), the question

was posed to participants “Which is your preferred brand of makeup?” with the results illustrated

in the diagram below:

Figure 2: Preferred Makeup Brands amongst Irish consumers


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The survey was conducted on 100 consumers, with 98% of consumers responding to this

question. Given in this particular instance that MAC and INGLOT are KIKO’s direct competitors

(the three highest ranked answers), Irish consumers already prefer KIKO brand products to

INGLOT brand products, even though INGLOT already has an established presence in the Irish

market, whilst KIKO has virtually no presence with exception to the online store. In terms of

online volume of sales, the best-selling KIKO makeup and cosmetic products include; KIKO

“Cream crush lasting colour eyeshadow” (€3.40, currently 50% off), KIKO “Long lasting stick

eyeshadow” (€6.90), KIKO “Volume and definition top coat mascara” (€3.60, currently 50% off)

and KIKO “Deep black eye marker” (€2.30, currently 70% off) (KIKO cosmetics, n.d.). As a result,

these and many other best-seller online products will be our main focal points during initial

promotion, given it is more likely that Irish consumers are already familiar with these cosmetic

products due to their popularity in the online store.

B. Company Situation

KIKO is a makeup and cosmetics company based in Milan, Italy, and defines itself as a “cosmetics

brand that features a range of cutting-edge makeup, face and body treatments, with safe and

effective products of the highest quality, created to satisfy the beauty requirements of women

of any age” (KIKO cosmetics, n.d.). The company was founded in 1997 by Antonio Percassi, former

Italian footballer and entrepreneur, and his company the Percassi Group, with his son Stefano

Percassi the current CEO of KIKO.

The Percassi Group, parent company of KIKO, oversees the business operations of its various

subsidiaries and categorises its operations into three different areas; House of Brands (the

category in which KIKO, one of the company’s most well-known brands, operates), retail

development and real estate. The Percassi Group, based in Bergamo, Italy, is one of the most

reputable and active companies (other subsidiaries include Madina, Vergelio and Atalanta

Football Club) operating both within its domestic market, and through its numerous international

business ventures. Percassi Group describes its own business operations as follows; “A solid and


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dynamic business society that successfully anticipates market trends with a vision that goes

beyond Italian borders” (Percassi, n.d.).

The Percassi Group and all of its subsidiary companies also pride themselves on conducting their

business activities through the values and beliefs of the “Made in Italy” brand name, which

promotes the qualities and ideals of Italian business etiquette throughout the world. The “Made

in Italy” values that one associates with a company operating under this brand name include;

producing goods or services with pride and care to ensure high quality, the knowledge of

traditional artisanal methods passed down through generations and promoting creative Italian

intelligence and manufacturing on the international scene (Made in Italy, n.d.).

KIKO is one of the Percassi Group’s most profitable subsidiary companies, with current revenues

estimated at €432 million since its establishment in 1997 (A shake-up in makeup, 2015). The

company operates through a combination of selling our products through our worldwide online

store (KIKO cosmetics, n.d.), and through a chain of more than 500 own-label stores located

throughout Europe and the US. Currently, consumers in Ireland may only purchase KIKO brand

cosmetic products through the online store, as there is no KIKO store based anywhere in Ireland.

Shopping for KIKO products online includes a minimum purchase order of €25 (not including

online discounts) to be eligible for online delivery, and a waiting period of 6-7 working days for

shipping and delivery. We at KIKO know that cosmetics consumers prefer to test the finished and

true colours of our products in person, which is a notable factor in our need for opening an Irish

store. Furthermore, having our own stores operating in Ireland will let Irish consumers

experience our makeup application services and in-store tutorials. Our aim with this

development is to expand the KIKO cosmetics brand into the Irish market, thus making our

products readily available for Irish consumers. The brand has seen a lot of success throughout

the European market and we pride ourselves on targeting international market opportunities,

and we believe the Irish market (specifically the Dublin market) can be one of those international

opportunities as it garners a lot of potential consumers in an already successful cosmetics market.


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KIKO does not operate through franchises in the market, instead preferring to distribute our

products through a directly managed chain of single brand stores. As a result, we are looking

towards the possibility of opening a store in Dundrum Town Shopping Centre, Dublin, given the

affluent and prestigious location and its reputation as a popular shopping destination. In

September 2015, Dundrum Town Centre, Ireland’s largest shopping centre, was sold to foreign

investors as part of the NAMA-run Project Jewel Loan Portfolio. The deal saw the shopping centre

sold for €1.85 billion to Hammerson and Allianz real estate agencies, based in the UK and

Germany respectfully, making it the biggest single transaction carried out by NAMA to date

(Sheils McNamee, 2015). This acquisition by new investors could mean potential for further

growth as regards to retailers within the shopping centre as they look further increase their

portfolio. Our decision to consider the possibility of opening a KIKO store in Ireland also came as

a result of a consumer survey which we carried out in order to determine potential consumer

interest and opinions. One of the questions posed in the survey was “Would you be interested in

a KIKO cosmetics store opening in Ireland?” and the promising results were as follows:

Figure 3: interest in the Irish market regarding the opening of a KIKO Ireland store

The survey was conducted on 100 consumers, with 84% of participants responding to this

question.


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Our enquiries about the availability of a retail unit in Dundrum Town Shopping Centre began in

January 2016, when we contacted Bannon and Savills retail agencies who handle all queries

regarding the lease of units within the shopping centre. From there, we were put in contact with

Jennifer Mulholland, Retail Surveyor at Bannon Retail Agency, who was able to provide us with

the necessary information regarding the costs and processes of leasing a retail unit in the

Dundrum Town Centre. The particular retail unit she provided us with information is the unit

currently occupied by Sisley (located on the second floor of the Dundrum Town Centre), which

will soon be available for lease;

· Units in Dundrum Town Shopping Centre are available for rent only

· The particular unit we are interested in is 128.3 metres squared

· Rental costs are €315,000 + 23% V.A.T. per year (V.A.T. can be claimed back once the

company is V.A.T. registered)

· There is a €16,890 service charge on top of rental costs (i.e. key money, for use of the store

space and store facilities) which is paid quarterly

· Insurance costs are €1,240 per annum

· Authority rates of €35,241 must be paid to the Dundrum Town Authorities and are usually

paid biannually. These payment schemes can be arranged with Dun Laoghaire-Rathdown County

Council

· Store utilities (i.e. electricity and heat) are to be paid for by KIKO

· The minimum commitment is a 10 year lease ( compared to other Dublin shopping centres

which offer two 5 year leases allowing a company to leave the unit after 5 years, however,

Dundrum Town Centre does not offer this)

· These units are of high quality, and in such an affluent area and are in great demand; It is

requested that those wishing to rent must either be a notably successful company or one which

is willing to offer a large deposit


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· If we choose to apply for the unit, our solicitor will contact the Bannon or Savills letting

agencies, where a lease is drafted between our solicitor and their solicitors, and as such the lease

is negotiated between the two parties, reviewed again and then signed once all parties come to

an agreement

These prices and conditions, implemented before the acquisition of Dundrum Town Shopping

Centre in 2015, may be subject to change under the new management of the shopping centre.

As this will be KIKO’s first venture into the Irish market and there are no existing B2B operations

between KIKO and the Irish market at present, we will initially focus primarily on the Dublin

market, with particular emphasis on targeting closer-by South Dublin consumers (although we

do expect the excitement surrounding our new store to attract customers from all over the city).

We hope in the future with the success of the company in the Dublin market to expand the

company and target more areas and opportunities within the Irish market.

C. Current market situation

One of the most vital aspects of introducing KIKO into the Irish cosmetic industry is that we must

carefully research in detail the current situation of the cosmetic market in Ireland. There has been

an impressive increase of interest over the past years in the cosmetic sector which is mainly

represented by multinational companies with their manufacturing bases located in Ireland. These

are small to medium sized multinationals which have led to one of the most successful innovation

examples in the SME sector therefore showing how fast the global market for cosmetics is

evolving.

According to Euromonitor, the Irish skincare market accounted to €110 million with an increase

to around €130 million in 2014 showing positive signs for potential foreign cosmetic companies

such as KIKO, to enter the Irish market as it shows continuous growth. The value of the European

cosmetics market for the same period was around €67 billion. Although Irish cosmetic companies

are being overshadowed in the market by the more popular foreign brands such as MAC, INGLOT

and L’Oréal, Irish home grown companies have taken an approach towards selling more natural


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products. New Irish brands such as Voya have had success in exporting their products in cities

such as Dubai and London, as they have doubled their turnover over the past four years by

introducing natural and organic products. Irish companies have had to take a different approach

to the quality of products sold, as the competition with the multinationals is far too difficult to

contest.

According to Eurostat, Ireland exported €157 million worth of cosmetics in 2010. This is largely

accounted for by multinationals with an Irish manufacturing base. This shows that even though

Irish cosmetic companies are taking the more natural approach to their products, the

multinational companies are still by far the most consumed in the market. This is why we believe

that KIKO entering the Irish market would be a huge success, supported by our survey results

which show that 92% of consumers questioned are interested in a KIKO store opening in Ireland.

Market legislation

All multinationals must comply with the EU legislations set out, including labelling and the list of

ingredients used in their products. The IMB (Irish Medicines Board) make sure all the products

comply with the law before the companies are allowed to introduce their products to the market.

The new legislations set out by the EU have made it far more challenging for Irish cosmetic brands

to compete with multinationals as they have opened up the market for foreign investment, which

of course on the plus side is exactly what companies such as KIKO are ecstatic about as it opens

up their possibilities of expanding their global market.

The EU sets out rules and regulations to follow for every cosmetic brand in the EU, no matter

how big or small the channels of distribution, cosmetic products placed on the EU market must

be safe. The manufacturer is responsible for the products they offer on the market, therefore

must be scientifically tested and undergo certain assessments before being sold. In order to

assure the companies are on the right path, the EU set out a database in which they can follow

to ensure the best possible outcomes for the product results called the ‘CosIng’ which shows the

substances allowed with the legal restrictions and requirements. There are four more steps

required to follow such as all products must be registered in the Cosmetic Products Notification

Portal (CPNP) being the product is placed on the market. If a cosmetic product has a scientific


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complexity or higher risk to consumer health the regulators have the right to spend more time

researching and examining the product. They must also ensure that there is a ban on animal

testing for cosmetic purposes which is something KIKO continuously highlight throughout their

website and marketing strategies and finally the EU is responsible for the market surveillance at

a national level in order to collect any valuable information they demand

KIKO is already established in most major European countries such as the UK, France and

Germany, therefore it is quite evident that we have correctly followed all the product safety and

legislation set out by the EU. Because of this, opening up our store in Dublin will not be as

challenging considering that we shall follow the steps and procedures already set out by KIKO in

terms of opening up another store in the EU.

Of course as of today, there are no KIKO stores in Ireland, so we must comply with the Irish

legislation set out by the HPRA as they have different rules and regulations than other EU

countries. The HPRA is responsible for the regulation of cosmetic products in Ireland. Their aim

is to ensure all cosmetics on the Irish market are safe and comply with the new laws. They identify

and address cosmetic product safety issues, in conjunction with the HSE, so that a cosmetic

product will not compromise the health and safety of the consumer or the person applying the

product. On 11 July 2013, new laws came into force impacting all those who sell cosmetic

products in Ireland. All retailers who sell cosmetic products should be aware of these new laws

and the legal requirements now in place (Health Products Regulatory Authority, n.d.). They have

listed possible scenarios or problems that a new retailer in Ireland may face and how to overcome

the situation in the correct manner, and of course KIKO will use this resource in any situation

deemed necessary.

D. Consumer Situation

A great draw for KIKO in operating in Dublin is the ever growing community of makeup lovers in

Ireland, both male and female, and of varying age groups. In recent years, Irish consumers have

been becoming more and more creative with their cosmetic use, constantly searching for new,


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exciting products that they can use to express themselves. This trend is best demonstrated by

the continually expanding community of Irish beauty bloggers, and the popularity of various

cosmetic review websites such as beaut.ie. Naturally Irish consumers value the advice and

opinions of popular Irish beauty bloggers such as Chloe Boucher, LetzMakeup (Siobhán

McDonnell) and BeautyLifeMichelle (Michelle Crossan), however, the boundary cutting nature of

the internet leaves Irish consumers watching vloggers from overseas, desiring foreign brand

names that are not currently available in the country. We strongly believe that KIKO is one of

these brands, and that the reputation of the Italian brand is one which will intrigue and excite

Irish consumers. Awareness of the KIKO brand will continue to be spread via the

#kikotrendsetters hashtag, a social media campaign which encourages KIKO customers to share

their makeup looks by listing the products they use.

As mentioned, our consumers often put a lot of research into which products they purchase, and

the cosmetic industry thrives on good reviews and word of mouth endorsement. Our low price

point matched with a high quality product is one which will pull consumers who have already

heard of our brand, whilst also charming new customers who can afford to test our products and

form their own opinions without breaking the bank. It is important for KIKO to open a store in

Dublin, as whilst the e-commerce industry is becoming universally stronger, we know that

cosmetics consumers are less likely to spend their money on a colour or finish of a product that

they cannot test out on their own complexion in person.

Staffing To begin with our store will have a total team of seven members, including a Store Manager and

Deputy Manager, two full-time workers and two part-time workers to provide support during

busy weekend hours. However there is a possibility of increasing the number of part-time

workers to three during sale periods. We feel confident that in a city such as Dublin which is

home to such prestigious makeup academies such as LA College of Creative Arts, Vanity X,

Makeup Forever and The International Makeup Academy we will have a large pool from which

to discover our potential employees. We will hire employees who are adept of working in a fast

and dynamic environment, who are confident in their cosmetics knowledge and capabilities.


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E. Macro Environment Situation In the third quarter of 2015, the Irish economy grew by 7%, with an increase in output seen across

all business sectors (Beesley, 2015). This comes as an increase from the estimated 6% growth

predicted in November of last year, making it the fastest growing rate in the EU according to the

European Commission. Whereas in the past Irish economic recovery was driven by net exports,

growth “is now firmly based on domestic demand across economic sectors” (The European

Commission). However, the EU commission warns against the “volatile” nature of these figures,

and assumes that all of their findings comes with the expectation that Britain will remain in the

EU, with the ESRI (Economic and Social Research Institute) reporting that a British withdrawal

from the EU could cost Ireland billions of euro (Lynch, 2015)

As per the Irish Department of Finance’s annual budget of 2016, CSO statistics show that in 2015

Irish consumers had become wholly more confident in spending their earnings. The Irish

Department of Finance predicts GDP, GNP and Nominal GNP to increase by 4.3, 3.9 and 6.2

percent respectively in 2016. An estimated 42% of the overall Irish GDP is accounted for by Dublin

(Dublin: Facts and Figures, 2016).

Date GDP in €Mill Quarterly % Change GNP in €Mill Quarterly % Change

Q3 2015 50,904 1.4 42,311 -0.8

Q2 2015 50,131 1.9 42,839 1.9

Q1 2015 48.849 1.4 41,803 -0.8

(Quarterly National Accounts, 2015)

In August 2015, Irish retail sales had risen 9% year over year. September 2015 saw Ireland’s

unemployment rate recorded at 9.4%, which is lower than the current European average of 11%.

As of 2013, an estimated 840,000 people were employed in the Dublin region, accounting for

over 40% of the total number of people employed in Ireland (Dublin: Facts and Figures, 2016). In


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the last CSO Census (2011) Dublin city’s population was 1,273,069, consisting of 619,902 males

and 653,167 females.

Dublin is currently undergoing a phase of expansion, with essential construction work being

carried out on the Luas system, one of Dublin’s most used forms of public transport. This work

does not affect the Green Line which currently runs from Stephen’s Green and is used by many

North-Dubliners to reach Dundrum Town Centre. This point is positive as it will not deter those

who wish to visit our new KIKO store, and furthermore once the construction work has been

completed in 2017 the entirety of the city will be better linked, allowing customers to visit our

store even more effortlessly.

In terms of the socio-economic landscape, Ireland is entering a new, modern era. On Friday May

22nd 2015, Ireland voted 62% in favour to amend the constitution and extend civil marriage

rights to same-sex couples, making Ireland the first country in Europe to provide that right by

popular vote (Same-sex Marriage Referendum, 2015). This was a monumental day in Irish history,

further strengthening the belief that Irish people are welcoming and accepting of all lifestyles.

The vote proved that Irish society is adhering less and less to preconceived social conventions

and prejudices, making it easier for individuals in our society to express themselves personally.

This could prove advantageous to our marketing plan, as one of the main aspects of KIKO makeup

is the ability to express oneself through our cosmetic products, thus providing individuals in the

Irish society the ability to express their personalities and identities in a visual manner, regardless

of gender or sexual orientation.

V. SWOT analysis Since KIKO began operating in 1997, we have been focused on maintaining standards which allow

our business to run as effectively as possible. We base these guidelines on the merits and issues

raised in our comprehensive SWOT analysis. We constantly strive to conserve our strengths,

nourish our weaknesses, search for new opportunities and find solutions to our threats, which

are listed below.


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KIKO

Figure 4: Proposed floor plan for KIKO Milano store, Dundrum

Strengths KIKO is an internationally popular brand name, with over 500 stores across Europe and 25 stores

within the United States. KIKO provides high quality products at affordable prices, suiting both

those who want to experiment on a budget and those more experienced makeup users who

require a large variety of colour. KIKO’s price range is suitable for Irish consumers who are

continuing to carry out their price-conscious, post-recession consumption habits.

KIKO price range by product

The product range available at KIKO is vast with over 1,000 products to choose from and is

constantly expanding. The most inclusive foundation product made by KIKO is available in 21

Face €2.20-€15.90

Lips €1.20-€8.90

Eyes €1.20-€15.90

Nails €0.50-€8.90


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different shades, allowing our brand to cater to consumers of diverse origins and ethnicities.

KIKO’s Clics Palette system is innovative in allowing customers to personalise their makeup

palettes by tailoring each palette to suit their needs as with most pre-designed palettes have

certain colours that are never used.

KIKO Milano is an Italian brand, with a respected Made in Italy reputation which is synonymous

with the generalised public view of luxury, high quality goods. Regardless of the price KIKO is

well known for their quality that rivals that of their high-end competitors.

As KIKO operates in standalone stores, consumers shopping in our store are likely to find all that

they are looking for in one convenient location, and are unlikely to be drawn in by thoughts of

competitors as they would be in locations where various brands are available, for example, Boots.

In terms of sales, KIKO is focused only on the sale of cosmetics. All KIKO Sales Advisors are trained

in makeup artistry. Customers can shop confidently knowing that KIKO Sales Advisors are

knowledgeable about various products. Customers can also make appointments to have their

makeup applied by one of our trained makeup artists which will in turn help them to find out

about new and interesting products and see them put into use.

Weaknesses KIKO may not initially be as well known amongst Irish consumers, particularly with older

customers who do not spend as much time comparing brands online. Irish people can be

reluctant to try new products and unfamiliar brands. KIKO’s campaigns are often target only at

young women and girls as this would be our main target audience. However the company could

do more to promote their range of anti-ageing products and should also consider their strong

male base of consumers, as times are changing so are the habits of the male population as it is

not such faux-pas to discuss a man’s skin care regime and accepting the fact that some men do

actually wear makeup. Currently, KIKO does not offer a specific discount for professional makeup

artists or students. There is also no opportunity for customers to have their orders delivered to

a KIKO store, which usually is preferable for consumers who wish to avoid home-shipping costs.


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Opportunities

Figure 5: Irish consumer awareness of KIKO brand

First and foremost it is quite clear to see that even though KIKO has not yet been introduced into

the Irish market over 60% of people questioned have heard of the brand, according to figure 5.

The KIKO brand would be fresh and exciting for Irish consumers as it has previously never been

sold in Irish stores. The brand is already popular amongst Irish cosmetics consumers and within

the Irish beauty blogger community (beaut.ie and various other outlets often write articles noting

KIKO as one of the top brands to purchase while on trips abroad). KIKO currently runs the

#kikotrendsetters social media campaign which should be familiar with Irish consumers.

Threats The cosmetics industry is highly competitive and there is already much competition in terms of

cosmetics retailers in Dublin. Consumers may be more likely to stick with their trusted, more

familiar brands initially. KIKO’s low prices could be associated with low quality to consumers who

are not familiar with the brand. The cosmetics industry is full of rapid changes in market trends

and consumer preferences, all of which could differ throughout international markets. In

accordance with the research we have carried out within the Dundrum Town Centre we believe

our main competitors to be MAC, INGLOT and Boots Pharmacy. Each company has positive and


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negative attributes that we will now examine in depth to demonstrate why we believe that

Dundrum Town Centre would be an optimal location in which to open KIKO’s first store in Ireland.

Dundrum Town centre is the largest and undoubtedly the best shopping centre in Ireland with

over 100 stores and 40 restaurants and cafés, attracting visitors from all over Dublin and

elsewhere in Ireland. The Dundrum Town Centre has an admirable reputation for being

constantly on trend and providing high quality products to consumers who wish to express

themselves via well-known, reputable brands.

List of all competitors in Dundrum/Other cosmetic retail outlets in Dundrum

Boots

BT2

Harvey Nichols

House of Fraser

INGLOT

MAC

Marks & Spencer

McCabe’s Pharmacy

Penneys

The Body Shop

Primarily we identify three leading competitors for our brand which currently operate in

Dundrum Town Centre, which are MAC, INGLOT and Boots. The following notes detail the

strengths, weaknesses, opportunities and threats of each respective company, supplemented by

table 1, which is a comprehensive view of our competitor’s price ranges by median.


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Table 1: Median list of competitor prices

Face

Eyes

Lips

Nails

€10.50 €9.15 €5.65 €4.95

€45.50 €47 €29.50 €10

€23 €13 €11.50 €8.50

€30 €44.50 €20.50 €45.50

MAC (BT2)


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MAC is a Canadian cosmetics company, sold in Ireland through Brown Thomas and BT2 stores.

Although Brown Thomas has a beauty hall comprising of various high-end brands, we believe

MAC to be one of our main competitors as it has comparable products to KIKO, and it was the

preferred makeup brand mentioned in our market research survey, as seen in figure 2.

Strengths MAC has long been one of the most commonly used makeup brands in Ireland, popular amongst

both young consumers and makeup artists (who receive a professional makeup artist’s

discount). MAC also has a strong website and online presence, and through Brown Thomas offers

a click and collect service by which customers can collect their orders in store free of a delivery

charge. MAC has an extensive range of shades unrivalled by any other brand in Dundrum. Their

most inclusive foundation includes 46 shades. As a part of the Brown Thomas store, MAC is

constantly on display to customers who may not have been shopping for cosmetics. MAC Sales

Advisors are trained makeup artists which have a dedicated focus and training towards

cosmetics. Makeup application services are an essential draw for MAC customers. MAC has

endorsement contracts with many popular celebrities such as Ellie Goulding, Lorde, as well as the

ambassadors for their Viva Glam MAC AIDs fund campaigns. MAC has also drawn in customers

with their special edition pop culture ranges which have included themes such as Disney, The

Simpsons and the Rocky Horror Picture Show. Charitable efforts are a top merit for MAC. The

MAC AIDs fund was set up in 1994, and 100% of revenue from the brand’s Viva Glam lipsticks go

towards helping people with HIV and AIDs.

Weaknesses One of the things that deters clients away from MAC would be their considerably high prices

which have been noted below.

Face €18-€55

Eyes €9.50-€75

Lips €15.50-€28

Nails €10


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Even though MAC offers discounts for professional makeup artists, no discount is given to

students which along with their high prices would be quite difficult to justify spending that

amount. As MAC was originally created for professionals, their products and shades were

created for professionals. This in turn could be double Dutch to their consumers and can deter

clients from asking for help. It is of no secret that MAC retail artists work from commission. It

can be quite difficult for a client to look around without being approached numerous times and

then once a client has been helped they have no chance to change their mind as their item is

brought behind the counter until you are ready to pay

Opportunities From our research, figure 2, shows that MAC is the best known brand among those surveyed and

from that a presumption could be made to say that the majority of makeup owners have at least

one MAC product in their collection. For the few customers that have not heard of MAC or do

not own one of their products new customers are constantly being drawn in by celebrity

endorsements. Even though MAC doesn't necessarily have a loyalty card of sorts they do have a

scheme called “Back-to-MAC” in which customers are encouraged to keep their empty packaging

and after collecting 6 items they can then be swapped for a lipstick, with an R.R.P. of €19. This is

MAC’s version of a loyalty card that does seem to be working quite well.

Threats There are constantly new brands being introduced into the market and with that comes new

competition. MAC is a brand that seems to have found good formulas and simple, recognisable

packaging. They don’t change or add to their collection with the exception of their celebrity

collaborations which in turn means that their products can seem quite boring and can lack a bit

of innovation. With brands such as KIKO being introduced into the market that share similar

quality products and services this will definitely be a big rival for MAC continuing in the Irish

market.


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INGLOT

INGLOT is a Polish cosmetics brand that has been operating in Ireland since 2009, with a current

total of 9 stores across the country.

Strengths INGLOT has the most comparable price point to the KIKO brand whilst also having a competitive

standard of quality. Below is a list of INGLOT’s competitive price range by product.

INGLOT also operates as a standalone store, which in the Dundrum Town Centre is located on

Level 1. Their store is not in a closed premises, but rather a kiosk layout. This can be considered

a strength for them as customers can browse without commitment, and can be drawn into their

Face €3-€40

Eyes €6-€20

Lips €4-€15

Nails €2-€15


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product range while passing by. INGLOT has a very wide range of colour choice. Their foundation

with the broadest offer includes 22 shades, catering to the needs of many customers of various

ethnicities. Furthermore, INGLOT offers over 200 shades of eyeshadow, 200 nail polish colours,

and 150 lipstick shades. INGLOT products can be purchased on their “Freedom System”, a

magnetic palette which is desirable as products are cheaper due to reduced packaging costs, and

furthermore because customers can customise their palettes to suit their own taste. INGLOT is

solely a cosmetics store, and can focus all of its efforts towards optimal knowledge in the

cosmetics industry. Similar to MAC, sales advisors at INGLOT are trained makeup artists, trusted

by customers to perform makeup application services and provide qualified advice on

products. Not only this but they also perform personalised tutorials and group

masterclasses. There are two types of INGLOT customers who can avail of special discounts.

Qualified makeup artists receive a discount of 20%, and students receive a discount of 10%.

Weaknesses However, unlike MAC, INGLOT does not offer a click and collect service even though consumers

can have their products delivered to their door. As there are not many stores in Ireland many

consumers would be hesitant to not only pay for shipping but also the fact that makeup can’t be

returned adds to the pressure of buying something online. While many companies choose to pay

celebrities to endorse their products, INGLOT steers away from this and since their creation has

yet to form a collaboration with any celebrity.

Opportunities Many students especially are drawn to bargains so by offering a 10% discount this helps to

encourage many students to part with their cash. There is always the possibility that INGLOT will

offer a Click and Collect service as they continue to progress with their online presence.

Threats Like every other makeup brand a new and exciting one can be brought onto the market and deter

clients with something new and exciting. Especially in today’s economy where the quality of

brands is increasing while the price seems to be decreasing.


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BOOTS

Boots Ireland is a subsection of the British pharmacy chain which has been operating in Ireland

since 1996. Currently there are 80 branches of Boots stores across Ireland.

Strengths Boots sells a vast amount of different brands, allowing customers with no brand loyalty to shop

between brands at their pleasure, constantly discovering new products for clients with any

budget. Not only this the pharmacy is also a one stop shop for a vast range of common household

essentials such as plasters, pain relief and soap. In turn this encourages customers to pick up a

few extra cosmetic products that may not have been originally on their ‘’to-buy’’ list. The

Dundrum store is notably large, and the range available consists of a large price range.

Face €2.79-€54.50

Eyes €2.50-€84

Lips €2.50-€38.50

Nails €0.50-€89.99


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Boots offer an advantage card system by which customers earn 4 points for every €1 spent. Each

point equates to 1 cent, and can be spent in the purchase of a whole product in Boots stores.

This is a great loyalty incentive for customers. A further incentive for customer loyalty offered

by Boots is the 10% student discount available in Irish stores, and discount vouchers given to

customers post-purchase.

Weaknesses Boots is a pharmacy and therefore does not have a complete focus on cosmetics in the same

sense that KIKO does. Furthermore, sales assistants are not specifically trained in each makeup

brand. Which in turn means that they have a much more diluted product knowledge than one

would have in one specific brand along with the fact that they are not brand loyal as their

objective is to sell regardless of the brand. Currently, Boots do not offer a discount for

professional makeup artists. Also, the fact that Boots has such a vast range of products and

brands may be overwhelming for some customers with little cosmetics knowledge.

Opportunities Recently Boots has added Los Angeles brand NYX cosmetics to their online store. Like KIKO, this

foreign brand was previously not widely available in Ireland and if this range was to be brought

into stores it could generate a similar excitement, drawing more customers to visit Boots

stores. Along with this fact Boots has such a strong presence in the UK and Irish markets that

there is always the possibility of the brand being introduced into other new markets which has

been aided by their alliance made with the American pharmacy called Walgreens.

Threats There is always possibility of further competition entering the market, specifically from stores

specified only in cosmetics. Along with this there is also a large increase in the number of

discount competitors that have started to sell branded toiletries which would definitely have a

negative impact on their currents sales figures.


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VI. Objectives Our objective in opening this Dundrum store is to give Irish consumers the opportunity to

experience and fall in love with the KIKO brand. We feel that despite a healthy amount of

competition we can offer a new and exciting brand which will suit Irish consumer’s tastes at

reasonable prices, and it is our aim to communicate this to the community of cosmetics users in

Dublin. We feel that our unique products, which are innovative and of top quality, will garner a

following that could draw customers from all over Dublin to this exclusive Dundrum store. Our

brand shall be promoted by KIKO Sales Advisors who are passionate about the brand and can

express all of our company morals and performance objectives effectively in order to acquire and

maintain a loyal following of customers who can in turn spread awareness of our brand.

VII. Marketing strategy

Having a well-structured marketing strategy is vital to the success of the company as one aspect

of a marketing plan affects all others. Coordinating our activities is critical for overcoming the

competitors and maximizing our profits. Our marketing strategy looks at all of the areas of our

selling activities and helps each one support the next, making sure all of our departments are

aware of what each is doing. As this represents our first venture into the Irish market, it is pivotal

we implement a successful marketing strategy in order to promote our products to our targeted

audience and maximise initial profits as much as possible within the first year, with the view to

expand the company even further in the near future.

The challenge KIKO is well known for selling original and high quality skin care products, foundations, eye

makeup and lip products that is unique and can meet customers, who are continuously searching

for the perfect makeup collection that matches their skin tones and textures, demands. KIKO

strives to become one of the world's leading makeup brands and by doing so have always

produced products of the highest quality and competitive price.


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Customer analysis Research shows that the cosmetic market is growing at a fast rate, and given that KIKO is already

well established in foreign markets, its products within the product life cycle are already entering

a mature stage. KIKO’s main aim is to produce safe, natural and high quality products as

customers in today’s market now demand more information, while at the same time becoming

more aware of the health issues. For example, in 2007, a campaign to raise awareness for

cosmetic products was launched, and surprisingly one-third of the samples studied in accordance

with the campaign exceeded the legal limit, which included major brands such as L’Oréal and

Christian Dior. From the results gathered from our own consumer survey, we established that

92% of the participants were interested in a KIKO store opening here in Ireland. We are confident

that as soon as we open a store in Dundrum Town Centre, it will immediately attract a large

number of potential customers to the store and maximise a high footfall to sales conversion rate.

Market segmentation Effective market segmentation research provides our company with clear direction on which

group or groups represent the best target that will account for a high share of potential profits

for the company and can easily be identified in the population or in customer databases. If our

market segmentation meets those requirements, then it will pay for itself many times over. If it

does not, then it will become a quickly discarded waste of resources.

Based on the results of our consumer survey, we determined that the age group that had most

interest in the KIKO brand was those aged 18-24. We believe that this is due to the fact that KIKO

advertise and sell products at a more affordable and competitive price, while maintaining high

quality standards. We believe that the majority of 18-24 year olds fall either under the category

of students or part-time workers, and therefore the KIKO range is a perfect fit for their budgets.

Dundrum Town Centre is also a well-known social area for 18-24 year olds to spend their free

time, and with other notable brands such as MAC and INGLOT stores already in the shopping

centre, this demonstrates that the demand for purchasing makeup is popular, so with KIKO’s

favourable price differences, we believe that we can be very competitive with the top brands in

the shopping centre. Due to our potential high costs of leasing a unit in Dundrum Town Centre,

we believe it is important to target our time and resources at this particular age demographic. It


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is important that we enter the market with our strongest marketing strategies by focusing on the

most interested groups (18-24), and cannot afford to waste time, money or energy as we cannot

emphasize enough the importance of a positive and profitable start.

Ongoing training Ongoing training for employees offers a way to make sure that skill used are constantly improved.

It offers opportunities to trust employees on feedback such as recent product line changes or

upcoming improvements. If, for example, KIKO’s latest lipstick range has a special ingredient that

makes it more moisturizing and longer lasting than other similar competitor products, the sales

staff should be aware of the product change as well as obtaining an understanding of the

benefits.

Free product samples and employee discount Giving employees free samples of new products and a 20% discount on those that we already sell

well lets them experience the products first-hand. For example, if KIKO develops a new innovative

foundation, a sample may help members of the sales staff (especially new employees) gain

knowledge of its advantages. This also provides an opportunity to receive feedback. An internal

survey is a good way to gather information and to indicate whether employees truly believe in

the product. We want to make sure that our employees show a high level of enthusiasm when

selling the KIKO products to the customers.

Packaging Since KIKO is an already established brand around the world, we will not have to create our own

specific packaging for Ireland as all product packaging is the same throughout the globe. All

products are sold in English speaking countries so we will not have any issues of translating any

ingredients or instructions that our found on any KIKO goods. KIKO manage to combine form and

function to create appealing and efficient packaging for cosmetics, skin care, eye makeup and

other personal care items. Due to the highly competitive market, consumers must be attracted

to the packaging as much as the product itself. KIKOs packaging is also very eco-friendly, and as

consumers are growing increasingly aware of the impact that the products that they use have on

the environment they want to reduce this impact as much as possible. Some examples of KIKO’s

environmental efforts are the use of recyclable materials in the packaging itself, lightweight


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packaging in which less material is used to create the products, the use of bio-resins in certain

plastics and finally packaging material that is easy to clean and recycle when the product is empty.

Packaging for KIKO is a vital aspect of implementing our market targeting strategy. KIKO aims to

constantly showcase our products in a fresh and exciting manner which is particularly

comparable to luxury brands (see figure 6 comparing KIKO packaging to luxury brand NARS’

packaging). This packaging is designed to be wholly appealing to our target market of the 18-24

age-group, who should feel glamorous and confident in using our products. The sleek silhouettes,

monochromatic labelling and innovative design features of our products are all aspects which

should increase our consumers’ desire.

Distribution channels A distribution channel is a plan created by the management of a manufacturing business that

specifies how the firm intends to transfer its products to intermediaries, retailers and end

consumers. Larger companies involved in making products will usually also put together a

detailed production distribution strategy to guide its entry into its intended market. Since KIKO

are already operating in other major European countries, we believe that we could follow similar

distribution channels to the UK. All products will be transported from Italy to the UK, and from

there we will organise transport from the UK to Dublin, shipping from Liverpool port to Dublin

port, and then transporting the products via vans to our store in Dundrum. Since we will be the

only store in Ireland and new to the Irish market we will not have direct shipments from Italy due

Figure 6: KIKO packaging vs. NARS packaging


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to costs, so we believe to minimise the costs at the beginning, KIKO will organise extra shipments

to the UK for our Dublin store which will be later shipped to Dublin via Liverpool. We will contact

and negotiate an agreement with JMC van delivery service to collect the goods from Dublin port

and deliver them to Dundrum Town Centre. We plan on forming a contract with JMC on receiving

shipments from Liverpool every two weeks, but if our store needs more stock and extra

shipments from Liverpool we will negotiate a separate contract with JMC based on any additional

transport needed to our store.

Our distribution strategy will not require customs duties or an export declarations due to the free

trade agreements set out within the European Union. However, as we are shipping our products

between destinations, a bill of lading is necessary. This is a legal requirement which informs us

of the type, quantity and destination of the produce being transported and must be included

with the products while being transported and will be signed by our company at the arrival. In

order to control and monitor our goods we have decided to adapt an online tracking system to

make sure the products are arriving on time and we are able to communicate with the JMC

drivers to collect the goods at Dublin port at a specific time. We also will not have to adapt any

incoterms for now, as KIKO in Italy are covering all insurance expenses for us since we are a new

store, but in the future we believe we may have to receive our products directly from the

producers and therefore will have to adopt the right incoterm in order to divide the costs of

international business transactions and define the responsibilities of both the buyer and seller,

while reflecting the current practices in the international transport of goods.

Advertising strategy A well-structured advertising strategy can distinguish the difference between a prosperous and

successful company and its competitors. It is vital that we target the right customers through the

correct forms of advertising media best equipped for our company.

We have agreed on releasing a 15-20% sale on our products for the first six weeks of opening and

also including deals such as “buy one get one free” whereby the customer can choose a certain

product for free to go with their purchase. KIKO in Italy will send us a large quantity of products

which will be on sale in order to attract new customers to the brand. In order to promote these

sales we will be using our Facebook, Instagram and Twitter page to raise awareness to any


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potential clients. It is vital when promoting on social media that when creating a makeup

advertisement, use words or phrases that will attract the consumer to the product and choose

the KIKO brand over our competitors. Such words can include long lasting, new, hot etc. These

eye catching words can play a more crucial role than just selecting a symbol or picture of a model

on the advertisement. For our first month we will organize a special guest or makeup artist to

come in once a week and give tutorials on how to use the KIKO makeup, this is a strategy we

could continue to adopt in the future whereby we will organize special events for the customers

to walk into our store and follow any advice given by the guests.

Our plan is to contact TV shows such as Expose’ and editors like beaut.ie to help us promote our

store and the KIKO brand by introducing our new facility in Dundrum Town Centre and writing

articles to show the high quality and value of the KIKO brand compared to our competitors.


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VIII. Projected profit and loss statement & Balance Sheet Profit and loss statement


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Balance Sheet

IX. Controls

KIKO expects each of its branches to operate in a manner whereby all of our customers will

receive the best possible quality of service which will in turn increase our sales conversions and

drive profits, allowing us to expand the brand globally. Throughout all KIKO branches worldwide

our level of standards is expected to be equally superior, and these standards are reinforced in

various methods.


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Monitoring Performance 1. Selecting and training of new employees will initially be managed and supervised by the

nearest responsible KIKO Human Resources department (KIKO UK Head Offices, London).

In the beginning period whereby there will be no Area Manager needed to supervise the

single Irish store, KIKO Dundrum’s management will report to the Area Manager

responsible for Central England.

2. KIKO Dundrum will be subject to several scheduled and impromptu inspection visits from

KIKO HQ managers in order to ensure that the overall company guidelines are being

continually met. We will also send our head of Profit Protection for two visits per year.

3. KIKO employees will be required to work within the expected employee guidelines which

are set out in our Employee Handbook, which is given to each employee on signature of

their contract. These guidelines include notes on service standards, product knowledge

requirements, and employee appearance expectations. The guide also includes essential

information for employees which can be used individually to refresh their training on

health and safety aspects, customer service techniques, etc.

4. KIKO receipts are issued with unique codes allowing customers to rate their in-store

shopping experience online. These reviews will be monitored by KIKO Head Office staff in

order to exemplify exceptional employee service and identify negative issues occurring in

stores.

5. Biennially, all employees will be invited to take part in our Employee Experience online

survey, in order to ensure that our stores are being run in accordance with the highest

possible standards.

RATIO ANALYSIS 2016

PROFITABILITY

Gross profit margin available in Trading, Profit and Loss Account for 2016

Return on Capital Employed

147,707 X 100 = 34.41%

429,244 1


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Percentage Mark-Up on Cost

750,000 X 100 = 3750%

20,000 1

Net Profit Margin

147,707 X 100 = 18.46%

800,000 1

LIQUIDITY

Current Ratio

424,044 :0 = 424,044:0

Acid Test Ratio

424,044 - 20,000 :0 = 404,044:0

ACTIVITY

As our store is stocked and funded by the existing KIKO company, there are no debtors and

creditors figures available for the activity ratios.

Across all areas of financial performance our store is expected to perform well. Due to the funding

of the store from existing KIKO profits and Percassi Group capital, possible debt repayments are

not viewed at this time to be threatening. We note a significantly high return on the capital which

we are to receive from the group, supported by our noted mark-up percentage and net profit

margins. As previously mentioned, the in-company funding leaves us with no creditors, and as

such the liquidity of this store will be in prime position. It is our intention to use our continuing

profits to keep our store operating without needing intervention, loans or having to owe money

to creditors.

X. Conclusion We believe that if implemented that the marketing plan we have detailed above would ensure

the successful introduction of the KIKO brand into the Irish market. Further than this Dundrum

store, KIKO could use this plan to effectively spread the brand to all four corners of Ireland.


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We have learned about the importance of taking into consideration every minor detail while

considering the formation of a comprehensive B2B marketing plan. As such we have enhanced

our knowledge of EU requirements surrounding trade and the cultural nuances which affect

international marketing strategies.

For each of us this has been our most rewarding experience of working in a group. We feel that

we have maximised our time keeping skills, communication skills and exploited each member’s

full working potential in order to present you with a project of which we are extremely proud.


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XI. Appendix Appendix 1: KIKO MILANO logo

Appendix 2: Current KIKO stores in the UK & Ireland


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Appendix 3: Survey conducted among 100 participants


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Appendix 4: Projected Profit and Loss Account & Balance Sheet for 2018


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