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2018
THE L’OREAL SUPPLY CHAIN
L’ORéAL VISION
2
OUR MISSION
BEAUTY FOR ALL
OUR STRATEGY
UNIVERSALIZATION
MAKING LIFE MORE BEAUTIFUL
OUR PURPOSE
L’Oréal, A GLOBAL LEADER
3
26.02
BILLION
SALES
7Bn
PRODUCTS
150
COUNTRIES
#1
BEAUTY COMPANY
WORLDWIDE
PURE PLAYER IN BEAUTY
€2.1
BILLION
E-COMMERCE SALES
(+34%)
5TH
WORLDWIDE
ADVERTISER**
8TH
PREFERRED COMPANY
FOR BUSINESS STUDENTS***
60TH
WORLDWIDE MARKET CAP*
WITH A SOLID SHAREHOLDER
STRUCTURE
82,600
EMPLOYEES
2017 key figures – L’Oréal Annual report
*12/31/2017. MSCI ACWI INDEX- **Adage 2016 - ***Universum Ranking 2017
LEADERSHIP IN CSR AND ETHICS
4
SUSTAINABILITY
1 out of 2 worldwide
company with 3 “A”
ETHICS
1st company worldwide for
personal & household goods
category
2nd company worldwide for all
industries combined
8th year
One of the most ethical
companies in the world »
DIVERSITY
& INCLUSION
1st company worldwide
for Gender Equality,
out of 3,000 companies
#1
Newsweek Green
Ranking 2017

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Unilever restructured its supply chain management practices to become more efficient. It reduced its brand portfolio from 1600 to 400 brands to focus on top brands. It also consolidated its 380 manufacturing plants down to 150 key factories. The restructuring involved changes to sourcing, distribution networks, and increased use of e-procurement and IT systems. The restructuring helped improve Unilever's operating margins and financial performance.

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L’Oréal STRATEGIC PILLARS
5
MORE…
UNIVERSAL
GLOBAL coherence
LOCAL relevance
#1 BEAUTY COMPANY worldwide
150 COUNTRIES
7 R&I LOCAL HUBS
MORE…
DIGITAL
MORE…
SUSTAINABLE
DISSOCIATE GROWTH
FROM ENVIRONMENTAL
IMPACT
+33% production increase
- 73% reduction in CO2
emissions from plants and
distribution centers since 2005
ECOMMERCE SALES*
€2.1Bn (+34%)
> 38% OF OUR MEDIA
dedicated to digital
* Source: L’Oréal 2017 Progress Report
Anything, ANYWHERE, ANYTIME
6
ALL
BEAUTY
PRODUCTS
Haircare
Fragrance
Skincare
Make-up
Hair color
Anything, ANYWHERE, ANYTIME
7
ALL
DISTRIBUTION
CHANNELS
Mass market
Department Stores - Perfumeries
Pharmacies - Drugstores - Medispas
Branded retail
Hair and beauty salons
E-Commerce
Travel Retail
Deep Trade
Anything, ANYWHERE, ANYTIME
8
ALL
PURCHASING
BEHAVIORS
Direct to consumer
Mobile-Commerce
E-Commerce
Points of sale
Click & collect

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This document provides information about Zara, the largest clothing company owned by the Spanish fashion group Inditex. It discusses Zara's business model, strategies, and supply chain management approach. Zara aims to continuously innovate and provide new, affordable designs made from quality materials to satisfy customer desires. Through its fast fashion model, Zara is able to design, produce, and distribute new collections to stores within weeks, allowing it to stay on top of the latest trends. Zara has over 1,900 stores globally and is a leader in the fast fashion industry due to its ability to quickly replicate designs at low prices.

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This document provides an overview of the Spanish apparel company Inditex and its flagship brand Zara. It discusses Zara's history and founding, Inditex's financial performance, Zara's unique business model centered around rapid design, production and distribution, and Zara's positioning within the global apparel industry. Key aspects of Zara's model include in-house design teams that produce new collections bi-weekly, local Spanish and Portuguese production facilities allowing for quick fulfillment, and a vertically integrated supply chain.

ALLY OF ALL BRANDS
9
10
2017 operations’ KEY FIGURES
14,000
3D-Printed
product mock-ups
91
Packaging
& Processes
Patents
> 70,000
Suppliers
41
Manufacturing
plants
> 500,000
Delivery points
24 Carbon-neutral sites
8
Types of distribution
channels
> 20%
Additional
production capacity*
7 BILLION PRODUCTS
* Stable industrial footprint
> 48,600
People benefited
from Solidarity
Sourcing Program
~ 19,000
E M P L O Y E E S
130
NATIONALITIES
47%
F E M A L E
53%
M A L E
> 90%
S I T E S W I T H
DISABLED
ACCESSW O R L D W I D E
41 MANUFACTURING PLANTS
• A worldwide footprint and high-performance industrial
• equipment specialized by technology and close to markets
NORTH
AMERICA
5
LATIN
AMERICA
6
ASIA
PACIFIC
7
AFRICA
MIDDLE
EAST
3
EASTERN
EUROPE
4
WESTERN
EUROPE
16
Incl.
FRANCE
11
Consumer Products
& Multi-Divisions
Professional Products
L’Oréal Luxe
Active Cosmetics
Raw Materials
INDUSTRIAL AGILITY & FLEXIBILITY
12
FROM LUXURY KNOW-HOW…
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combining luxury crafts and agility
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13
8 types of distribution channels
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SALONS
DEEP TRADE
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MARKET
DEPARTMENT
STORES
PERFUMERIES
PHARMACIES
DRUGSTORES
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DATA
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Information management
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CONSUMER
EXPERIENCE
NEW
TECHNOLOGIES
COBOTS
IOT-
BLOCKCHAIN
AUGMENTED-
VIRTUAL REALITY
3D PRINTINGDATA - SIMULATION
MACHINE LEARNING
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Internet of Things
0
NOW
BEFORE
SCARCE
EXPENSIVE
WHICH DATA ?
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WHICH USAGE ?
CORRELATION LOGIC
Big
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Data 2016
∑ Data
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Shampoo bottle squeezeMold injection Transport impact Plastic spray
Resistance to pressure
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DATA FROM MoLDS 4.0
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QUICKER HOMOLOGATION
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History
Packaging Formula
DATABASE
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3D PRINTING - PRODUCTION
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New design opportunities for our brands
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L'oreal Presentation from the Supply Chain Insights Global Summit 2018

  • 2. L’ORéAL VISION 2 OUR MISSION BEAUTY FOR ALL OUR STRATEGY UNIVERSALIZATION MAKING LIFE MORE BEAUTIFUL OUR PURPOSE
  • 3. L’Oréal, A GLOBAL LEADER 3 26.02 BILLION SALES 7Bn PRODUCTS 150 COUNTRIES #1 BEAUTY COMPANY WORLDWIDE PURE PLAYER IN BEAUTY €2.1 BILLION E-COMMERCE SALES (+34%) 5TH WORLDWIDE ADVERTISER** 8TH PREFERRED COMPANY FOR BUSINESS STUDENTS*** 60TH WORLDWIDE MARKET CAP* WITH A SOLID SHAREHOLDER STRUCTURE 82,600 EMPLOYEES 2017 key figures – L’Oréal Annual report *12/31/2017. MSCI ACWI INDEX- **Adage 2016 - ***Universum Ranking 2017
  • 4. LEADERSHIP IN CSR AND ETHICS 4 SUSTAINABILITY 1 out of 2 worldwide company with 3 “A” ETHICS 1st company worldwide for personal & household goods category 2nd company worldwide for all industries combined 8th year One of the most ethical companies in the world » DIVERSITY & INCLUSION 1st company worldwide for Gender Equality, out of 3,000 companies #1 Newsweek Green Ranking 2017
  • 5. L’Oréal STRATEGIC PILLARS 5 MORE… UNIVERSAL GLOBAL coherence LOCAL relevance #1 BEAUTY COMPANY worldwide 150 COUNTRIES 7 R&I LOCAL HUBS MORE… DIGITAL MORE… SUSTAINABLE DISSOCIATE GROWTH FROM ENVIRONMENTAL IMPACT +33% production increase - 73% reduction in CO2 emissions from plants and distribution centers since 2005 ECOMMERCE SALES* €2.1Bn (+34%) > 38% OF OUR MEDIA dedicated to digital * Source: L’Oréal 2017 Progress Report
  • 7. Anything, ANYWHERE, ANYTIME 7 ALL DISTRIBUTION CHANNELS Mass market Department Stores - Perfumeries Pharmacies - Drugstores - Medispas Branded retail Hair and beauty salons E-Commerce Travel Retail Deep Trade
  • 8. Anything, ANYWHERE, ANYTIME 8 ALL PURCHASING BEHAVIORS Direct to consumer Mobile-Commerce E-Commerce Points of sale Click & collect
  • 9. ALLY OF ALL BRANDS 9
  • 10. 10 2017 operations’ KEY FIGURES 14,000 3D-Printed product mock-ups 91 Packaging & Processes Patents > 70,000 Suppliers 41 Manufacturing plants > 500,000 Delivery points 24 Carbon-neutral sites 8 Types of distribution channels > 20% Additional production capacity* 7 BILLION PRODUCTS * Stable industrial footprint > 48,600 People benefited from Solidarity Sourcing Program ~ 19,000 E M P L O Y E E S 130 NATIONALITIES 47% F E M A L E 53% M A L E > 90% S I T E S W I T H DISABLED ACCESSW O R L D W I D E
  • 11. 41 MANUFACTURING PLANTS • A worldwide footprint and high-performance industrial • equipment specialized by technology and close to markets NORTH AMERICA 5 LATIN AMERICA 6 ASIA PACIFIC 7 AFRICA MIDDLE EAST 3 EASTERN EUROPE 4 WESTERN EUROPE 16 Incl. FRANCE 11 Consumer Products & Multi-Divisions Professional Products L’Oréal Luxe Active Cosmetics Raw Materials
  • 12. INDUSTRIAL AGILITY & FLEXIBILITY 12 FROM LUXURY KNOW-HOW… Lassigny Plant – France combining luxury crafts and agility …TO HIGH-SPEED AUTOMATION Karlsruhe Plant – Germany connected and automated
  • 13. SERving consumers worldwide 13 8 types of distribution channels HAIR & BEAUTY SALONS DEEP TRADE E-COMMERCE TRAVEL RETAIL MASS MARKET DEPARTMENT STORES PERFUMERIES PHARMACIES DRUGSTORES MEDISPAS BRANDED RETAIL 1 ORDER SHIPPED EVERY 2 SECONDS to > 500,000 DELIVERY POINTS
  • 14. A business driver SUPPLY CHAIN 14 • Deliver the best experience and service to retailers and consumers CUSTOMER CARE Tailored service 24/7 retailer interaction DATA Real time analysis Information management Social networks & Points of sale OMNICHANNEL Product availability Consumer experience
  • 15. KEY SUPPLY CHAIN EXPERTISE 15 • To satisfy consumers' expectations worldwide, speed to market and deliver on time PHYSICAL DISTRIBUTION & TRANSPORTATION CUSTOMER CARE RETAIL & E-COMMERCE SALES & OPERATIONS PLANNING DATA MANAGEMENT
  • 19. connected devices GROWING EXPONENTIALLY Smartphones Wearables 35 Mds Number of connected devices Source: BI Intelligence Estimates Internet of Things
  • 20. 0 NOW BEFORE SCARCE EXPENSIVE WHICH DATA ? DEDUCTION LOGIC EVERYWHERE ACCESSIBLE WHICH USAGE ? CORRELATION LOGIC Big Data Data 2016 ∑ Data DATA IS EVERYWHERE 2015 0 >
  • 21. 3D PRINTING SPREADING EXPONENTIALLY ➢ FUEL NOZZLE 20 PARTS TO 1 PIECE DURABILITY: X5 ➢ 2 700 PIECES➢ IN 24H
  • 22. AUGMENTED/ VIRTUAL REALITY DEVELOPMENT ➢ CONCEPTION ➢ PRODUCTION ➢ MAINTENANCE
  • 23. ROBOTS : new members in the family ➢ COLLABORATIVE ROBOT (COBOT) ➢ MUTIPLE TASKS ➢ ARTIFICIAL INTELLIGENCE ➢ NATURAL LANGUAGES ➢ EMOTIONS
  • 24. 5 KEY prioritIES identifiED ACCELERATED DEVELOPMENT CONNECTED PRODUCTS AGILE FACTORIES/LINES PERSONNALISATION SUPPLY CHAIN BUSINESS DRIVER IMPATIENT CONNECTED ANYTHING VERSATILE IMPATIENT INDIVIDUAL SOLUTIONS ANYWHERE ANYTIME NEW CONSUMERS
  • 25. DIGITAL SIMULATION 27 Shampoo bottle squeezeMold injection Transport impact Plastic spray Resistance to pressure Digital to accelerate development….
  • 26. DATA FROM MoLDS 4.0 28 • In-mold sensors, datas in the cloud New Customer ServiceAccelerated developement Optimal performance QUICKER HOMOLOGATION QUICKER MOLD TRANSFER ACCURACY & REPETABILITY FLEET MANAGEMENT
  • 27. BIG DATA for COMPATIBILITY TESTS 29 History Packaging Formula DATABASE WINNERS Digital to accelerate testing….
  • 28. 3D PRINTING - PROTOTYPING 30 3D printed mold for simple pack S/T 3D printing : 15 days - 4 000 € 100 pieces S/T traditional machining : 60 days - 20 000 € 1000 pieces Mold proto standard simple & complex pack CCZ – 3D Lab
  • 29. 3D PRINTING - PRODUCTION 31 New design opportunities for our brands
  • 30. ACCELERATED DEVELOPMENT FROM 18 TO 6 MONTHS IMPATIENT ▪ Test in VIRTUAL before moving to REAL ▪ Leverage AI to use past DATA, EXPERIMENTS ▪ Explore 3D Printing
  • 31. CONNECTED PRODUCTS to MEET NEW CUSTOMERS EXPECTATIONS BAs productivity Automated cash-out Anti-theft A unique product identified Traceable Connection with its environment Automation enabler EXPERIENCE TRANSPARENCY CUSTOMERS COMMITMENT - stock outs Stock accuracy Automatized replenishment Traceability Product information Authentification RFID/NFC technologies
  • 32. PROMISING FIRST RESULTS Technology Productivity ➢ >3000 laboratory tests ➢ > 4000 live use cases Reading rate : 100% Current with RFID 70’’ 8’’ 35’ 5’ -85% Warehouse Stock take POS incoming controls - Examples -
  • 33. PROMISING FIRST RESULTS New use cases Product Information Dialogue with smartphonesAutomated cash-out - Examples -
  • 34. NEW PARADIGME AGILE MULTI MODELS MULTI PRODUCTS « BATCH OF 1 » TO LARGE BATCHES MAKE TO NEEDS SMART FACTORIES NEXT BIG MONO PRODUCT LARGE BATCHES MAKE TO STOCK MEGA PLANT BEFORE
  • 35. Agile LINE - LASSIGNY • DESIGNER BRANDS PERFUME LINE TANGIBLES RESULTS UNITS4.4M FORMATS 30 FORMAT CHGE FR. 4H TO 15’ OEE 65% ELECTRICAL CONSUMPTION 3,5 KW DIVIDED BY 23 CAPACITY LOSSES -20% CAPEX FR. 1,5 M€ TO 0,75 M€
  • 36. AGILE FACTORIES/LINES AGILITY : THE ONLY OPTION IN A VUCA WORLD ANYTHING VERSATILE IMPATIENT ▪ Consumer benefits at the centre ▪ New approach : new mindset, new partners, think out of the box ▪ It’s not one technology, it’s a combination ▪ Human-Machine interface is key ▪ ‘Dare’ and ‘test and learn’ are key
  • 37. PERSONNALISATION LIGNE AGILE AT FACTORY LEVEL AT POS LEVEL AT DISTRIBUTION CENTER LEVEL AT POS LEVEL LE TEINT PARTICULIER MY FABLAB COLORIGHT - SKINBLENDER
  • 38. AT POS LEVEL LE TEINT PARTICULIER CUSTOM MADE FOUNDATION Dispenser • Skin-tone measurement • Mini-factory at POS • Control engineering • Peristaltic pumps • Miniature Load Cell • mg range precision • Training / maintainability Mixer • Embedded solution • Mix in pack Viral Buzz 35M views in 24h 53M after 1 week 307K likes
  • 39. A Supply CHAIN, AS A Business DRIVER Limited complexity Slow trends evolution Manual management of exceptions SKUS 3500 FROM MANUAL FORECASTING MONO MODEL TO MACHINE LEARNING Multiple factors Constant evolution of models (IA) Forecasting by correlation Complexity Acceleration
  • 40. CONCLUSION Suppliers Develop Source Produce Distribute Consumerss Distributors 5 KEY PRIORITIES IDENTIFIED A DISRUPTIVE TRANSVERSAL PROJECT AGILE LINES PERSONNALISATION SUPPLY CHAIN BUSINESS DRIVER ACCELERATED DEVELOPMENT CONNECTED PRODUCTS