Shiseido Shakes Up US Operations

Shiseido Company, Limited today announced three key changes to its organizational structure in the US designed to strengthen corporate support for its diverse family of innovative brands and provide an improved platform to accelerate their growth both in the US and globally.

Shiseido will align the US finance, legal and human resources functions of its premier consumer brands, including Bare Escentuals, Beauté Prestige International USA, NARS, and Shiseido, into a unified, shared services platform. The company also announced the consolidation of US distribution operations for most of its brands at its distribution center in Columbus, OH, which will become the Shiseido Americas Distribution Center. Finally, the company announced plans to formally merge its US manufacturing business, Shiseido America Inc. (“SAI”), into its Americas umbrella organization, Shiseido Americas Corporation (“SAC”).

“Together these changes create a seamless, world class corporate, manufacturing and distribution platform in the US that will benefit all of our brands in the region,” said Carsten Fischer, representative director and chief operating officer global business of Shiseido Company Ltd. and chairman and CEO Shiseido Americas Corporation.

Commenting specifically on the alignment of back office and administrative functions, which is effective immediately, Fischer continued, “We are committed to preserving each brand’s unique character and individual spirit, and we expect this shared services platform will better position each of the brands for future growth by providing world class support in the US. By combining the back office strengths of our various brands, each can become a stronger player in the US as well as globally, and the company can more efficiently and effectively serve its valued partners and customers.”

The company has also begun the process of streamlining its US distribution operations and expects to complete the facility consolidation by the end of the third quarter of 2013. The Columbus center will expand its operations to handle shipment of products to the Americas and globally for multiple brands. A smaller distribution center to be established at the company’s existing manufacturing facility in East Windsor, NJ, will handle export of US-manufactured Shiseido brand products to Europe and Asia.

Bare Escentuals’ large distribution center in Columbus, OH, has supported BE’s rapid and significant growth from a distribution perspective. Bare Escentuals grew rapidly by deploying a multi-channel model that combined direct marketing such as television shopping with an emphasis on QVC and infomercial, and retail sales at wholesale partners such as Sephora and Ulta, and company-owned boutiques. This ideal location in Columbus in the Midwest provides good access to the US mainland and Canada. To this end, Shiseido will pursue efforts to increase efficiency by sharing BE’s accumulated know-how and experience in handling distribution, thereby realizing distribution synergies and strengthening its distribution foundation in the US, which is a major market.

“The formal merger of SAC and SAI, which are already fairly integrated from an operational standpoint, will further streamline our organizational structure,” said Fischer, commenting on the subsidiary merger that will go into effect on Jan. 1, 2014. “We believe the merger, coupled with the other changes announced today, will promote efficiency, enable more flexible allocation of management resources and result in meaningful synergies that will benefit all of our stakeholders.”

In connection with these organizational changes, Shiseido made several personnel annoucements:
• Pankaj Gupta, who has been serving as executive VP-finance & operations and chief financial officer for Shiseido Americas Corporation since September of last year, will now also serve as regional CFO.
• Deanna Chechile, general counsel for Bare Escentuals, will now also serve as regional head of legal.
• Ginger DeLeo, has joined the company as regional head of human resources.

“Pankaj has been an essential member of the Shiseido Americas Corporation team for the past nine years and is well-qualified to lead our regional financial operations as the organization proceeds with the integration of our U.S. business operations,” said Fischer. “Likewise, Deanna, who has played an integral role as general counsel for Bare Escentuals since 2007, has the right experience and leadership skills to head our regional legal organization. We are also pleased to welcome Ginger to the company and know her career accomplishments over the past two decades position her well to head our regional human resources organization.”