No

Categories

Factors

1 Social

Men are increasing becoming more concerned with their looks and the stereotypes of men
using skin care products are diminishing.

3 Social

Aging US population opens new markets for developing skin care products for the elderly.

4 Technological
2 Social
8 Economics

Increasing numbers of people are buying products online for convenience, cost savings, and
confidentiality.
Growing trend among sections of the population for a more natural look and reduction in
their use of make up and related products.
Weak US Dollar makes US based products more affordable to customers in Canada and
Europe.

16 Competitors

Many new start up companies with specialty products are created each year.

5 Technological

FDA plans to enforce cosmetic corporations to add a label stating the safety of this product
has not been determined.

11 Customers

Customers tend to be extremely brand loyal.

Top competitors in the cosmetics industry are diversified with many brand names and a wide
range of products.
Products can be purchased at significantly lower cost over the Internet cutting into revenues
7 Technological
and harming traditional distributors.

17 Competitors

10 Economics

In 2006, China experienced a 15 percent growth in professional skin care sales.

15 Customers

Consumer complaints and inquires into the use of animal testing for new products.

6 Technological

Concerns about the use of aerosols, fluorocarbons and other chemicals in the production of
cosmetic products.

12 Customers

Hispanic population in the US is rapidly growing.

14 Customers
13 Customers
9 Economics

Customers are becoming more interested in herbal products that are derived from natural
sources.
Customers are demanding products not tested on animals and which are environmentally
friendly.
Interest rates remain low in the US.
Total
Legend : "O" = Opportunity & "T"= Threat

Importance
(1-10)
9

Weighted
Impact Capability
(Score)
0.069
9

Weighted
Capability
(Score)
0.618

Differences Remarks
/ Gap
"O" /" T"
O

0.069

0.618
O

0.069

0.618

0.069

0.550

0.061

0.489

0.069

0.344

0.061

0.244

O
O
O
T
T
8

0.061

0.244

0.061

0.305

0.053

0.214

T
T
T
7

0.053

0.214

0.053

0.214

0.046

0.137

0.053

0.267

0.053

0.267

0.046

0.229

0.053

0.427

-1

131

No

Group

Financial

Financial

Marketing

Marketing

Operation

Financial

14

Management

11

Operation

13

Management

Marketing

12

Management

10

Operation

Marketing

Marketing

Factors
Revenue increased 40 percent from $5 billion to $7 billion in the five year period.
Stock price has been stuck between $25 and $50 trading range since 1996.
Sold under several name brands including Tommy Hilfiger, Donna Karan, Missoni,
and Sean John.
Purchase interest in start up and established companies such as Bumble and Bumble
Products.
Wholly owned and operated offices in 43 countries and territories and sold in over
135 countries.
Net sales of fragrance products decreased 4 percen.
Confusing organizational structure; it is unclear whether group presidents have
control over product lines or geographic areas.
In 1990, 75 nameplate department stores sold Este Lauder; today that number is
only 17.
Este Lauder lacks clear mission and vision statements.
Company does not offer enough brand names tailored to lower budget consumers.
Detailed succession plan in place for Fabrizio Freda to take over as CEO in March
of 2010.
Test products on animals only when required by law.
Este Lauder operates under numerous brand names including Clinique, Origins,
Bobbi Brown, Flirt! among others.
Company specializes in mid level and upper end cosmetics products; markets over
9,000 products.
Total
Legend : "S" = Strength & "W"=Weakness

Importance
(1-10)

Weighted
Importance
(Score)

Capability
(1-10)

Weighted
Capability
(Score)

0.077

0.692

0.077

0.692

0.077

0.615

0.077

0.615

0.068

0.547

0.077

0.308

0.077

0.308

0.068

0.274

0.060

0.179

0.068

0.342

0.068

0.342

0.060

0.239

0.077

0.538

0.068

0.479

117

Differences
/Gap

Remarks
"S" / " W"

Growth Rates %
Sales (Qtr vs year ago qtr)
Net Income (YTD vs YTD)
Net Income (Qtr vs year ago qtr)
Sales (5-Year Annual Avg.)
Net Income (5-Year Annual Avg.)
Dividends (5-Year Annual Avg.)
Price Ratios
Current P/E Ratio
P/E Ratio 5-Year High
P/E Ratio 5-Year Low
Price/Sales Ratio
Price/Book Value
Price/Cash Flow Ratio
Profit Margins
Gross Margin
Pre-Tax Margin
Net Profit Margin
5Yr Gross Margin (5-Year Avg.)
5Yr PreTax Margin (5-Year Avg.)
5Yr Net Profit Margin (5-Year Avg.)
Financial Condition
Debt/Equity Ratio
Current Ratio
Quick Ratio
Interest Coverage
Leverage Ratio
Book Value/Share
Investment Returns %
Return On Equity
Return On Assets
Return On Capital
Return On Equity (5-Year Avg.)
Return On Assets (5-Year Avg.)
Return On Capital (5-Year Avg.)
Management Efficiency
Income/Employee
Revenue/Employee
Receivable Turnover
Inventory Turnover
Asset Turnover

Este
Industry
Lauder
7.3
8.7
-32.6
22.2
-32.6
18.4
8.36
10.99
18.81
13.5
20.11
12.66

SP-500
15.3
17.5
24.7
12.35
21.79
9.47

20.8
NA
NA
1.17
6.82
12.8

22.1
25.1
15.8
2.63
6.98
16.6

22.5
20.2
4.3
2.53
4.15
13.7

74.8
9.5
6.1
74.4
10.2
6.3

50.3
16.7
12.2
51.2
16.1
11

36
18.3
12.9
34.6
16.2
11.2

1.19
1.4
0.9
14.4
3.8
6.34

0.9
0.9
0.7
15.6
2.9
16.62

1.32
1.2
1
37.1
4
20.17

30.6
10.2
17
23.9
10.4
16.3

30.5
9.3
12.7
48.9
10.4
13

28.4
8.4
11.1
20.7
7
9.3

15,242
251,021
7
2
1.7

63,525
495,679
10.3
5
0.8

112,357
954,553
14.3
9.3
0.8

Date
7-Jun
6-Jun
5-Jun
4-Jun
3-Jun

Date

Avg. P/E
19.8
24.8
24.2
24.3
23.1

Book
7-Jun Value/$6.17
6-Jun Share$7.66
5-Jun
$7.68
4-Jun
$7.62
3-Jun
$7.84

Price/Sales Price/Boo Net Profit

1.34 k
7.38 Margin 6.4
1.3
5.05 (%)
5
1.42
5.09
6.5
1.97
6.4
6.6
1.54
4.28
5.9

Debt/Equi ROE (%) ROA (%) Interest

ty
0.91
37.4
10.9 Coverage
NA
0.32
20
8.6 NA
0.42
24.2
10.5 NA
0.31
21.8
10.2 NA
0.16
18.3
9.7 NA