In 1902, Arinobu was inspired to introduce the American culture to the Japanese public by bringing the Japan’s first soda fountain. The fortune was on his side as it later grew into the Shiseido Parlour restaurant business which makes him introduce another rare production in Japan at the time, ice cream. The foundation of Shiseido laid over a century ago, its pioneering spirit that combines eastern aesthetics with western science and business technology, continues to live on today to serves as the underlying philosophy of Shiseido’s corporate activities.
Shiseido established it Five Management Principles in 1921. Quality First: Shiseido’s constant quest for the highest possible quality standards has supported its activities for close to a century. Coexistence and Co-prosperity: Shiseido seeks to share its benefits with all companies and individuals associated with Shiseido. Respect for Consumers: Shiseido pursuits must be thoroughly consumer-oriented. Corporate Stability: Shiseido must be built on a firm infrastructure with long-range goals. Sincerity:
Shiseido business transactions must be conducted loyally, honestly, and respectfully. In 1923, Shiseido began forming its chain store network. To meet its five management principles, the storeowners were provided special training to assure that consumers across the nation could enjoy products and service of consistent high standards. With their high spirit and commitment, the network has grown to approximately 25,000 outlets today. On June 14th of 1927, Shiseido, formerly a limited partnership, became a joint stock company under Arinobu Fukuhara’s third son, Shinzo’s leadership.
Shiseido’s first president, Shinzo Fukuhara graduated from Columbia University’s Faculty of Medicine. During his stay in the United States, from 1908, he worked at a suburban New York drugstore and later a cosmetics factory of an American pharmaceutical manufacturer. Under his leadership, the groundwork for a distinctive Shiseido approach to business and creation was formed. To serve Shiseido’s loyal customers better, they have formed the Camellia Club in 1937. Corresponding with formation of the club, Shiseido issued a fashion periodical, HANATSUBAKI (Camellia).
The magazine takes its roots from Japan’s first cultural magazines by a cosmetics company, which were issued by Shiseido from 1924 for distribution to customers through the nationwide network of chain stores. This magazine offered articles on domestic and overseas fashion, travel, and the arts. Essays and commentaries by leading literary figures of the time were also featured in this magazine, which is still issued on a monthly basis by Shiseido today. The Japanese Camellia Club has grown to boast a membership of approximately 9 million members presently.
In the year of Malaysia’s independence, 1957, Shiseido has taken their first step overseas in Taiwan with exports to Singapore and Hong Kong following closely after. In 1962, Shiseido expanded to Hawaii and in 1965; it established Shiseido Cosmetics America to commence sales in the mainland. European sales began with Italy in 1968 and officially in Oceania with New Zealand in 1971. Stepping into 1980’s, Shiseido has realized the importance of brand image and Serge Lutens from France was being appointed as its international image creator in order to support its expanding global distribution network.
Shiseido’s history of advertising and image creation has always been one of evolution and renewal. When Shiseido sought new global imagery for its international marketing it turned in an entirely advanced direction, that of a collaboration with Serge Lutens who established a reputation as a hair and makeup artist for Vogue. As we can see from the brief background of Shiseido in the early years, they have diversified their business from pharmacy to restaurant and gradually into cosmetics and toiletries.
Today, Shiseido sales are mainly generated from its main business category of cosmetics, which makes up about 78. 4% of total sales with toiletries at 10. 7% and other categories such as salon, products, foods and pharmaceuticals at 10. 9%. 26% of total consolidated sales were generated by Shiseido’s international activities in fiscal year 2004. Individual shareholders constitute more than 97% of the total number of shareholders, an exceedingly high percentage for a major Japanese company.
Marketing its products in 65 countries and regions globally including Europe and Americas as well as Asia/Oceania, Shiseido aims to become “a global player representing Asia with its origins in Japan. ” To become a “global player”, Shiseido has taken the international business challenges integrating with the operations performance objectives into their global operations in the early years. Reviewing their 5 management principles written in 1921, it was pretty similar with the operation performance objectives in trend today.