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Wednesday, 23 April 2014

Mahmoud & Abdel Khalek Saeed Co - Cosmetics and Toiletries - Saudi Arabia

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Mahmoud & Abdel Khalek Saeed Co - Cosmetics and Toiletries - Saudi Arabia

 

Mahmoud & Abdel Khalek Saeed Co



Strategic Direction

·         The company aims to strengthen its position within premium fragrances through focusing on its premium image and brand strength with further new launches predicted in coming years. The company also aims to broaden its presence in other product groups within the cosmetics and toiletries industry and to strengthen its Casanova brand through the launch of a number of other products. Improved distribution among a larger network of local outlets and exports represent the company’s main focus.


Key Facts


Full name of company:
Mahmoud & Abdel Khalek Saeed Co
Address:
P.O. Box 17013 Jeddah 21484 – Saudi Arabia
Tel:
966 2 636 0020
Fax:
966 2 637 9090
www:
www.msgroup.com, www.spci-sa.com, www.jcasanovaparis.com
Activities:
Manufacturing huge ranges of mass and premium fragrances and other cosmetics and toiletries products. Manufacturing of packaging materials needed for fragrances. Retailing through a chain of specialist/perfumery outlets, shopping malls and restaurants
Source:           Euromonitor International from company’s sources and websites


Year end December
2005
2006
2007
Net sales (SR million)
110
130
145
Number of employees
125
145
160
Source:           Euromonitor International from trade press (Arab news Daily)
Note:               Sales and number of employees above are for group’s facilities related to cosmetics and toiletries only



Company Background

·         Mahmood Saeed Group, also known as Mahmood Saeed Collective Company, is a privately owned Saudi group of companies established by Sheikh Mahmood Saeed. The company was first commercially registered in 1948. During the 1970s and early 1980s the Sheikh diversified the business and ventured into more manufacturing, trading and real estate operations, all gathered under one umbrella under the name Mahmood Saeed Collective Company or Mahmood Saeed Group of Companies in 1998. The group is currently a partnership between Mahmood Saeed’s sons: Mahmood M. Saeed Gasim and Abdul Khalek M. Saeed Gasim. (NB: for the purposes of reflecting the overall performance of the group within the cosmetics and toiletries industry, the companies’ brands were placed under Mahmood and Abdel Khaleq Saeed Co, as a national brand owner for all).
·         The group’s business structure is diversified into four core areas: manufacturing, trading, shopping centres and real state and restaurants, and includes the following business units:
·          Mahmood Saeed Glass Industry (MSGI)
·          Mahmood Saeed Beverage Industry (MSBI)
·          Saudi Perfumes & Cosmetics Industry (SPCI)
·          Mahmood Saeed Furniture Division (MSFD)
·          Mahmood Saeed Plastic Company (MSPC)
·          Mahmood Saeed Trading Division (MSTD)
·          Mahmood Saeed Oasis Mall (MSOM
·          Mahmood Saeed Group Office (MSGO)
·         Saudi Perfumes & Cosmetics Industry (SPCI) is the manufacturing arm of the company, responsible for the production of most of the company’s products that are present in the cosmetics and toiletries industry. The group is also responsible for J Casanova LLC located in Paris. The establishment of J Casanova in the early 1980s was aimed at the creation and marketing of prestigious perfume and cosmetics brands, and the adoption and launch of the Casanova trademark as a unique and genuine perfume and cosmetics line. J Casanova’s portfolio now covers many types of cosmetics and toiletries, including skin care, bath and shower products, hair care, men’s grooming products, fragrances, colour cosmetics and depilatories.
·         The group produces over 1,000 different products in the field of perfumes and other cosmetics and toiletries. However, despite its expansion into other areas within the cosmetics and toiletries industry, fragrances, mainly mass brands, remained the group’s core business, generating 90% of the group’s total sales (excluding sales of packaging materials) at the end of the review period. The group mainly sells its products into the domestic market, but also exports to other neighbouring countries in the Gulf region. In addition, J Casanova’s range of perfumes and other cosmetics and toiletries are distributed through selective outlets throughout the Kingdom, and also through many overseas countries and Europe.
·         Mahmood Saeed Trading Division is the sales arm for the company’s products, which are produced locally by SPCI, or purchased from foreign and local suppliers. Its activities include import, export, wholesale as well as retailing of perfumes, cosmetics, beauty care products and household products. Around 80% of its sales come from SPCI products, and the remaining 20% from foreign imports and local purchases of its world renowned perfume products.


Production

·         Saudi Perfumes & Cosmetic Industries, the manufacturing arm of the group, is the largest company of its kind in the Middle East, and was established in 1982. It is a fully integrated production facility for perfumes and cosmetics combining six operating units under one structure: aluminium aerosol container production and colouring; aluminium tube production and colouring; glass bottle colouring and printing; can-end and bottles metallization in gold and silver; plastic cap production; perfumes and cosmetics blending, filling and packaging.
·         The factory produces 20 million perfume bottles and more than 1,000 product references including perfumes cosmetics and household products. The group’s portfolio mainly comprises a large range of mass men’s and women’s perfumes, such as Casanova, Beethoven, Michelangelo and Pandora. The company also produces a large range of premium fragrances including Ana Wel Shooq, Mothhela and Ahibbini.
·         Besides serving Saudi Arabia, the domestic market where it achieved notable success, the company also exports to many other countries, such as the UAE, Oman, Yemen, Egypt, Lebanon, Jordan among many other countries in Asia and Africa.

Location
Brand
Jeddah
Casanova
Jeddah
Beethoven, Michelangelo, Athena and Pandora among other hundreds of mass brands
Jeddah
Bit Al Nour, Ana Wel Shooq, Mothhela and Ahibbini and Al Sultan among other premium brands
Source:           Trade press, company research, trade interviews



Competitive Positioning

·         Mahmoud & Abdel Khalek Saeed Co positioned itself as the leading producer of perfumes in the Middle East, pioneering the local production of French-style fragrances on a mass scale. Despite its diversification into other cosmetics and toiletries, fragrances remained at the core of the company’s interests. The company held the fourth leading position in fragrances and was present in most other product groups with its Casanova brand, although its share remained very low in 2007. Its strength in fragrances stems from its massive production of hundreds of mass fragrances that are sold at very competitive prices. The company also benefits from its glass manufacturing facility, which is considered one of the largest for the production of glass bottles needed for fragrances and other industries.
·         Within fragrances, the company dominated sales of mass fragrances with a 23% value share in 2006, unchanged on the previous year but up nearly four percentage points on 2002. The company appeared very dynamic in terms of new product launches where dozens of new fragrances were introduced every year. Major threats to the company within mass fragrances generally came from manufacturers from the UAE. These include Rasasi Perfumes Industry LLC, which is able to offer similar and sometimes more competitive prices for its mass fragrances. The company also appeared strong in depilatories, where it held fifth position, and also featured in deodorants, hair care, bath and shower products and men’s grooming through its emerging Casanova brand.
·         The major headway made by Mahmood Saeed since 2004, when it entered premium fragrances, is due to impressive launches of many premium brands with a localised image such as Velvet Rose, Tedallal, Mothhela, Bit Al Nour and Ana Wel Shooq and Ahibbini. TV advertisements continued to support many of these in 2007 with further new launches also introduced. A main unique selling point behind the success of such brands is that they are named after the most popular songs popularised by famous Arab singers in the Gulf region, such as Mohammad Abdel and Abdul Majeed Abdullah. The TV advertisements for these brands featured the original song that is related to each fragrance. With this range, the company saw its value share of premium fragrance sales increase from zero in 2003 to 2% in 2007 – a share that placed the company in sixth place in premium fragrances in 2007.

Product type
Value share (%)
Rank
Cosmetics and toiletries
1.5
19
Fragrances
4.8
4
Depilatories
4.1
5
Source:           Euromonitor International



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