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L’Oréal establishes Saudi Arabian subsidiary to build market presence

By Andrew McDougall , 16-Nov-2012

Cosmetics giant L’Oréal has looked to bolster its presence in the Kingdom of Saudi Arabia by establishing a new subsidiary based on a joint venture with Al Naghi Group; a move which will create local jobs.

L'Oréal KSA's scope will include implementing best practices on developing the local market, increasing consumer proximity to better understand the Saudi woman's needs, ensuring greater reach for the Group's products to more Saudi consumers.

The move will also see jobs open up to many Saudi women with a commitment to training, education and nurturing local talent within the team.

Improve position

Having had some form of presence in the Kingdom of Saudi Arabia since 1982, the newly established brand will manage a portfolio of brands including amongst others L'Oréal Professional, Kerastase, L'Oréal Paris, Garnier, Maybelline New York, Vichy.

"This union of two strong organizations with shared values, both contributing individual expertise to the partnership, makes us confident that we will significantly improve our positions in the Saudi market," said Geoff Skingsley, managing director, Africa & Middle East Zone L'Oréal.

L'Oréal appointed Al Naghi Group as its sole distributor for its Consumer Products, Active Cosmetics and Professional Products Divisions in 2000.

"Our partnership with L'Oréal for more than ten years has enabled the access of this great company's brands to millions of Saudi consumers across the Kingdom. We are very proud to be associated with such an ethical, consumer and community enabling Group and look forward to build the business further", added Sheikh Mohamed Yusuf, Chairman Naghi Group.

Market strength

The cosmetics market in the Gulf nations has experienced a boom in the last few years, and according to market research by Epoc Messe Frankfurt, Saudi Arabia has one of the highest consumption rates.

Skin care sales in Saudi Arabia were estimated at $397.2 million (€310.5m) in 2010 and are expected to reach $502.9 million in 2015, marking a 26 per cent increase.

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