Introduction
Sephora is a multinational beauty brand, first established in France in 1969. It has its branches and franchises in all over the world. It launched its first store in the Middle East in 2007. By offering unique services and a friendly environment for women and men, this organization has become the leader of all other organizations in this domain. It offers services like the most advanced skincare, make-up and fragrances from around the world. Sephora Middle East has grown exponentially in 31 total stores in 5 markets of the United Arab Emirates, Saudi Arabia, Kuwait, Qatar and Bahrain, along with its main store in UAE (Dubai Mall), considered as number 2 in ranking in all beauty stores worldwide. I chose this organization because it is one of the organizations that best meets the standard retail standards in the market; it attracts customers and clients through its good quality products and best marketing strategies. This well-reputed organization has earned its repute as a beauty pioneer with its expertise, modernism, and commercial spirit.
Dependencies Of Sephora Middle East
Sephora as an organization possesses dependencies, which can be defined as a Sephora relationship of separate but mutually dependent organizational units. The dependencies of Sephora lie between the capacities required by the roles and services that comprehend them. It includes Sephora’s resources and capacities. By representing a large variety of products and brands, one can find one exclusively at Sephora. Sephora also possesses its own brand: It offers a variety of beauty products and accessories related to it.
Supply And Chain Issues Of Sephora
- Slim stock As the biggest challenge
Sephora faced one of the unique challenges in supply and chain issues when they approached Slimstock. Its rapid growth had put its Middle East franchise under great pressure. Head of Supply and Chain Sandeep Walia stated that the Dubai Mall flagship alone sees five times more retail products than the Sephora European market.
- Launch of Omni channel
When Sephora launched Omni channel retail operations, with its online stores in the region, this company faced another tough phase for its supply and chain. It was not only from its logistics operations that the company chain and supply became more proactive than reactive. The head of chain and supply said that Sephora required new state-of-the-art demand planning.
- Challenge of Globalization
Besides other impacts of globalization, its effect on the market and multinational organizations is obvious. Globalization has brought a few critical issues related to supply and chain, such as reducing costs across the supply chain. As a result, organizations offer lower labour costs, lower taxes, and lower raw materials. The same issue is true with Sephora; this organization is facing this issue with different parts of its product. Another supply and chain issue of sephora is facing that its expand its sales in to international market, due to it local products requires huge changes in supply and chain as company has to adapt their products to different culture and preferences.
- Quality and Compliance
One of the challenges Sephora faced was trying to meet local and international regularity standards in compiling the manufacturing and packaging of its products. Besides that, the preparation of compliance documents, including licenses and permits, is another issue for Sephora’s supply and chain management.
Strategies For Improvement
- Management of the supply and chain of Sephora Middle East needs to handle and must bring such technology for their company to meet all forms of communication created due to globalization.
- Sephora Middle East needs to address issues created by fast-changing markets. For that, the company should be asking if they have the proper data needed to make planning decisions. For example, Omnichannel retail has reacted silos of sales data which have to be coordinated to detect demand signals and processes.
- The Manager of Sephora’s supply and chain department should consider where investments make sense if the business is consuming based on Mirco services or heavy data lifting requirements.
Conclusion
Sephora, as one of the most well-reputed and largest companies in the Middle East, has few supply and chain issues. Slimstock was one of the major issues that the company faced. The head of the supply and chain of Sephora himself agrees that prices are high due to a hit in oil prices, and this fact has had an effect on the company, but the company is seriously looking at optimization. He further accepts slow growth and cash flow problems and considers optimization as a solution for them.
