Shiseido Co. Ltd. announced that it will establish a wholly-owned subsidiary in the Russian Federation in May 2007. Sales for Shiseido (RUS) LLC. are scheduled to begin in January 2008. Shiseido previously served the Russian market via a distributor, established in 1999.
The company stated that the move is in line with its strategy to position its overseas business as a strategic growth area. Shiseido estimated that sales generated by its overseas businesses has exceeded 30% in the fiscal period ending March 2007. The cultivation of promising new markets, according to a press release, is a key issue in maintaining the growth of international businesses, where the cosmetics market holds ever-increasing potential due to economic growth in recent years. The company cites the opportunities avaiable in the BRICs, notably Russia and China.
Shiseido has been realizing steady growth since making inroads into the Russian market via a distributor. The establishment of the new subsidiary is charged with implementing specialized marketing to develop the prestige cosmetics market targeting the affluent class emerging in major metropolitan areas.
