The US Estee Lauder Restructuring Plan Is About To Be Implemented And Thousands Of People Will Be Laid Off.

This Tuesday, the United States

Estee Lauder has released a restructuring plan of $600 million to $700 million, which is called "Leading Beauty Forward". The goal is to cut costs, improve R & D, supply chain and e-commerce capabilities, and optimize resource allocation to invest in those areas that are growing faster.

Estee Lauder Co wrote in a document to the securities and Exchange Commission that optimizing the supply chain, other supporting structures and poor performing businesses cost $89 million 700 thousand. The company expects to save 48 million 700 thousand dollars in the cost of employees. Therefore, in the three years of the implementation of the restructuring plan, the company will selectively reduce 900 to 1200 jobs in specific areas around the world, involving 2.5% of the total number of employees.

The company expects "Leading Beauty Forward".

It will bring a net profit of 200 million to 300 million dollars per year for the company.

Estee Lauder Group Chairman and CEO Fabrizio Freda said that training and research and development is the main content of the plan, which will involve digital media and retail activities.

The purpose of training is to enhance the sensitivity of employees and meet the company's values; secondly, to establish a flexible organizational structure for quick decision making in the future.

She believes that upgrading digital capabilities will enable its beauty brands to spread information to all teams in the world in the shortest possible time.

Fabrizio Freda stressed that the final result of the plan will help companies develop more investment funds, and those additional investment funds will help companies invest in advertising, independent stores and store activities.

Although the plan requires a higher amount of one-time investment, in the long run, the plan will save the company $200 million to $300 million a year in the future.

according to

Third quarter earnings data showed that net sales rose 3% to $2 billion 660 million, up from $2 billion 580 million in the same period last year, in line with analysts' expectations.

Net profit fell by 2.4% to $265 million compared with last year's 272 million US dollars, and diluted 71 cents per share, which is basically the same as the same period last year.

A company spokesman pointed out that the negative impact of exchange rate factors led to a 3 cent decrease in earnings per share.

Excluding exchange rate effects, earnings per share rose 4% and net sales increased by 6%.

By sector, net sales of skin care products fell by 3% to $1 billion 70 million from $1 billion 100 million a year ago, and sales of skin care products on the e-business platform showed double-digit growth.

Among them, the brand new products of La Mer attract consumers, and Yuet wood's good sales performance, but its brand Estee Lauder and Clinique sales performance is particularly poor.

In addition, the company official said that the performance of its skincare brand in Hongkong market is worrying.

Fabrizio Freda said that following the success of Yuet Mu's source and Estee Lauder's new products, the company plans to focus on developing the mask line and keep innovating.

He points out that the mask product is systematic, different in shape, without a sense of quality, and the possibility of a lot of innovation.

The make-up division benefited from strong sales of its brands M.A.C, Smashbox, Tom Ford and Bobbi Brown, and sales rose by 7% to $1 billion 160 million.

According to the company's third quarter earnings data, Asian women's demand for cosmetics is increasing. Fabrizio Freda points out that the company will make full use of this trend to promote the sales of cosmetics in Asia, and it is expected that cosmetics will have double-digit growth in Asia.

The perfume division benefited from the popularity of Jo Malone London and Tom Ford, and net sales increased by 5% to 275 million US dollars over the same period last year.

In recent years, Estee Lauder has acquired several luxurious hand adjusted perfume brands, which indicates that the company will focus on developing perfume business in the future.

Fabrizio Freda stressed that it is time to turn perfume into the fastest growing category of the company.

Jo Malone has become the second largest perfume brand in the UK, but in South Korea with only 8 Jo Malone stores, Jo Malone has developed into the second largest perfume brand in South Korea.

High quality hand-made perfume not only embodies the personal taste of the perfumer, but also reflects the personal understanding of perfume and brings new perfume experience to consumers. The company hopes to push the perfume trend to the highest point.