MISTURA BEAUTY SOLUTIONS

Conlon Cash, Brooke McCarter, Sundeep Shamanur, and Cole Welch

OUTLINE

Issue IdentitficationSituation Analysis

InternalExternal

AlternativesRecommended StrategyImplementationRisks & Contingencies

ISSUE IDENTIFICATION

How can Mistura manage growth while considering entering new chains and expanding chain stores given factors such as:

Financial CapacityExternal Financing Outsourcing

Issue

INTERNAL ANALYSIS

• Ottawa Small Business Acheivement Award• One of the Ottawa region’s top 40 under 40• PLM• 1085% sales growth 2009-2011

Strengths

• Bill paying• Marketing process inefficiency

Weaknesses

Analysis

EXTERNAL ANALYSIS

• $2.3 billion market size• Environtmentally consciousness

Opportunities

• Manufacturer producing for another company• Increased competition due to increased industry growth and

low barriers to entry

Threats

Analysis

KEY SUCESS

FACTORS

Simplicty

Brand Image

Natural

Versatility

Analysis

FIVE FORCESMODEL

CompetitionLow

SubstitutesLow

BuyersHigh

New Entrants

High

SuppliersHigh

Analysis

WHAT NEEDS TO HAPPEN

• Examples: • Debt• Venture Capitalism• Public Offering

Obtain Capital

Alternatives

ALTERNATIVE 1: SIX SIGMA

Pro Increased efficiency

Con Time to implement

Focused on increasing efficiency of distribution

Alternatives

ALTERNATIVE 2: VERTICAL INTEGRATION

Pro Increased control over quality

Con Capital intensive facility construction constraints

Focused on quality control and cutting costs

Alternatives

ALTERNATIVE 3: HIRE CMO

Pro Increased administrative efficiency

Con Does not address distribution or production concerns

Expand product line and increase market share

Alternatives

QUANTITATIVE ALTERNATIVE ANALYSIS

Weight Alt 1 Alt 2 Alt 3

Feasibility 25% 3 2 4

Timliness 20% 3 2 4

Cost 20% 3 2 4

Image Improvement 20% 3 4 2

Potential Savings 15% 5 4 1

Total 100% 3.3 2.7 3.15

Scale of 1-5; 1 = Worst; 5 = Best

Alternatives

RECOMMENDED STRATEGY

It is recommended that Mistura implement Six Sigma to increase efficiency in distribution given that the appropriate capital is obtained.

Recomended Strategy

IMPLEMENTATIONShort Term (0-1 Year)• obtain capital• begin Six Sigma process

Medium Term (1-2 Years)• implement Six Sigma process• research and development of extended product lines

Long Term (2+ Years)• review Six Sigma• consider implementation of other alternatives

Implementation

SIX SIGMA PROCESS

Short Term (0-1 Year)Define – unacceptable quality control timeMeasure – process flow map and other analytics

Implementation

SIX SIGMA PROCESS

Medium Term (1-2 Years)Analyze – review collected data & determine best

practices Improve – implement best practices Control – train employees

Implementation

SIX SIGMA PROCESS

Long Term (2+ Years):Evalute Six Sigma processConsistently achieve less than 3.4 defects per million

Implementation

REVENUE INCREASE AFTER IMPLEMENTATION

2010 2011 2012 2013 2014

-1000000

1000000

3000000

5000000

7000000

Product SalesNet earnings (loss)Product Sales*Net earnings (loss)*

Implementation

RISKS & CONTENGENCIES

Risks: Six Sigma doesn’t have desired efficiency

results

Contengencies:If Six Sigma proves ineffective, transfer

capitol allocated to Alternative 1 to Alternative 3Risks and

Contingencies

WHEN TO EXIT?

Test: Fit PerformanceCompetitive Advantage

Risks and Contingencies

QUESTION AND ANSWER SESSION

MISTURA MOTTO

“Beauty Simplified”

POTENTIAL PRODUCT EXPANSION

MascaraEyeliners Eye Care Products

WAYS TO OBTAIN CAPITOL

DebtVenture CapitalistPublic Offering

OBTAINING CAPITAL

DebtMaintain decision making capabilitiesDebtholders have primary claim to CFs which could be problematic if company ever decided to go publicInability to pay bills indicates risk of bankruptcy is higher, increasing Kdat

OBTAINING CAPITAL

Venture CapitalistImmediate access to funds Lose some of the decision powerGain expertise of someone who has had success in the business world