July 9, 2021
“They were in a very uncertain time. We were worried about the company’s survival.” Adrien Geiger, General Manager L’Occitane The heads of sustainable development at en Provence and L’Occitane International do not chop up words.
The cosmetics group was hit hard by the negative effects of the Covid-19 pandemic. At its peak, L’Occitane International was forced to close 75% of its stores worldwide, including a total of 1,569 doors in 60 countries.
The immediate effect was that the group listed on the Hong Kong Stock Exchange announced in October last year that it would develop a restructuring plan that would include reducing the group’s employment of about 300 from 9,000 people worldwide.
Earlier this year, the US division of the group was forced to file for Chapter 11 Bankruptcy Protection under the US Trustees Code. Applications applicable only to the L’Occitane en Provence brand, And allowed the department to continue trading while restructuring internally to reduce its debt.
“Since its inception, the group has never experienced this and was unprecedented,” said Adrian Geiger, son of Reinold Geiger, the businessman behind L’Occitane’s global success. I emphasized.
Nevertheless, in the face of the Covid-19 crisis, L’Occitane International has proven resilient. Cosmetology Group Sales in the First Half of Fiscal Year 2020-21-L’Occitane UnProvence (75% of total sales) is included in its portfolio of brands. Elemis, LimeLife, Elborian And Melvita Despite a 15.2% decline, the overall decline was modest, with sales down 6.5% to € 1.53 billion and operating profit up 17.6% to € 220.2 million.
China is currently the main market for brands
Like many other companies, e-tail is a key growth driver, with channel sales share increasing from 15% before the pandemic to nearly one-third of the 2020-21 fiscal year, at 69.2%. Has increased. In China, L’Occitane’s domestic sales increased 33.7% to € 263.6 million, making it the leading market for L’Occitane ahead of the United States. The share of sales in both countries was 17% and 16% in 2020-21, compared to 11.9% and 18% in the previous fiscal year, respectively.
Adrian Geiger sees the post-pandemic world through a prism of responsibility, without hiding his concerns about his health, which he is still worried about. The latter is strongly associated with more collaborative and mutually supportive business practices. According to Geiger, the last decade has taken a small step in this direction, but now the business world needs to take it to the next level. This means that the way companies are organized has changed significantly. L’Occitane International is certainly beginning to consider options ranging from localized sourcing to smarter logistics.
And while some of these options are just being considered, L’Occitane International is enthusiastically addressing sustainability issues, especially through L’Occitane en Provence. “The issue of biodiversity must be discussed at the political level,” said L’Occitane International as part of the OP2B (One Planet Business For Biodiversity) Association of companies promoting regenerative agriculture and conservation. One Geiger insisted. Natural ecosystem.
Change It is also clear on the consumer side. Symbolic in this regard is the Asia-Pacific region, where awareness of these issues has increased significantly, for example, L’Occitane products can be recycled in-store, Geiger said.
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L’Occitane International says it’s time to make a big difference in how businesses are organized.
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