Supply Chain of ... Everything
The idea of Supply Chain of … Everything came to me when I was shopping in Priceline (one of the chemist shop in Adelaide) with one of my friends. My friend is into skin care products and always tells me the importance of sunscreen. Walking through an aisle, we saw a brand called La Roche Posay and she exclaimed that it is one of the best brand available. A 50ml sunscreen bottle costs close to 55 odd AUD!!
My immediate question was why is it so costly? Her reply was the ingredients used, quality checks done, and maybe it comes from France. Being a supply chain geek, my immediate action was looking behind the bottle, not to know which ingredients are used (I don’t know any of the chemicals or solutions) but my focus was on who is the immediate supplier here in Australia and is it possible to track back the entire supply chain of La Roche Posay’s sunscreen.
This curiosity led to me think, OK! There are more than 500 products we come across daily in our life, may it be shampoos, deodorants, shoes, electronics, etc. and we don’t know where it is from. I know it’s not everyone’s job to know how’s the supply chain but as a Supply Chain professional this is quite intriguing and the Supply Chain of … Everything series is based on this idea of knowing the supply chain of common but not so common products we use in our daily life.
The purpose is not to brag about how much I know or to get any social attention but to learn different intricacies of supply chain and logistics and would be happy if someone is learning with me or getting something new from my content here on LinkedIn. Always open to constructive criticism and new product suggestions.
To begin with La Roche Posay’s supply chain, we should know the origin of this brand and their product lines. You’ll can guess by the name that this brand is from France indeed and the company functions in these 3 sub-sections of skin care products – Face care, Body Care and Skin Concern.
The supply chain process begins when the suppliers provide raw materials after having the procurement contracts sorted by L’Oreal, who happens to be the parent company of La Roche Posay.
The most important ingredient which is also one of the important selling points is Ecamsule or Mexoryl SX which is water soluble in nature and doesn’t make your skin oily when in sun.
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This is also the main ingredient which protects our skin against UVB and UVA (2 UV rays which damages skin). La Roche Posay, which falls under 欧莱雅 's umbrella had this patented in 1982 making them easy to produce and supply in house.
La Roche Posay’s products are manufactured in France from 1975 and the supply chain begins from there which is then controlled by L’Oreal who has wider distribution network, hence supplied to Australia under L’Oreal name.
Supply Chain of L’Oreal was named 9th best in the world 2 years ago due to its ability to react to consumer behavior in uncertain times. Working in a fast-fashion environment, L’Oreal always believed in resilience and agility when it comes to aligning their supply chain. During Covid19 times, the idea was to adopt digitalization of supply chain and logistics and move from Covid19 resistant to Covid19 resilient supply chain.
For example, distribution centers continued to fulfill the online mayhem despite the sanitary issues and increasing covid19 cases in the company. The company quickly opened up dark stores after studying demand by data collection and physical stores were converted into stock reservoirs.
Third party retailers like Priceline were given concessions when buying products and despite the challenge of sales reduction due to lockdowns, different advertisements strategies were used to portray the importance of sunscreen even when we are not heading out (that worked apparently). L’Oreal focused on the concept of 20/50/100 sales method where 20% stands for sales from E-commerce, 50% for personalized interaction and 100% engagement with consumers through social media (try talking about L’Oreal, you will get ads on Instagram the next day!)
The supply chain of L’Oreal is considered as jack of supply chain digitalization and proved that if executed in a correct way supply chain could be a strategic element in company’s success. L’Oreal has majority stakes when it comes to La Roche Posay’s success story because developing a quality product is one thing and getting it delivered in the right time frame is another.
If I have to give L’Oreal supply chain a name it is definitely going to be Jack of Supply Chain Digitalization and Master of One!
Let me know your views on L’Oreal and please apply sunscreen before leaving the house?