Mistura Beauty Solutions is experiencing rapid growth and must determine how to manage expansion. A situation analysis identifies strengths like award recognition but also weaknesses in processes. Opportunities exist in the large market size but threats include increased competition. Three alternatives are considered: Six Sigma to increase efficiency, vertical integration for quality control, and hiring a CMO to expand product lines. Quantitative analysis recommends Six Sigma given its feasibility and potential for increased savings. Implementation would obtain capital and begin the Six Sigma process over several years to evaluate results and control quality. Risks and contingencies are identified around the effectiveness of Six Sigma.

1. MISTURA BEAUTY SOLUTIONS
Conlon Cash, Brooke McCarter,
Sundeep Shamanur, and Cole Welch

2. OUTLINE
Issue Identitfication
Situation Analysis
Internal
External
Alternatives
Recommended Strategy
Implementation
Risks & Contingencies

3. ISSUE IDENTIFICATION
How can Mistura manage growth while
considering entering new chains and
expanding chain stores given factors such as:
Financial Capacity
External Financing
Outsourcing
Issue

4. INTERNAL ANALYSIS
• Ottawa Small Business Acheivement Award
• One of the Ottawa region’s top 40 under 40
• PLM
• 1085% sales growth 2009-2011
Strengths
• Bill paying
• Marketing process inefficiency
Weaknesses
Analysis

5. EXTERNAL ANALYSIS
• $2.3 billion market size
• Environtmentally consciousness
Opportunities
• Manufacturer producing for another company
• Increased competition due to increased industry growth and
low barriers to entry
Threats
Analysis

6. KEY
SUCESS
FACTORS
Simplicty
Brand
Image
Natural
Versatility
Analysis

7. FIVE FORCES
MODEL
Competition
Low
Substitutes
Low
Buyers
High
New
Entrants
High
Suppliers
High
Analysis

8. WHAT NEEDS TO HAPPEN
• Examples:
• Debt
• Venture Capitalism
• Public Offering
Obtain
Capital
Alternatives

9. ALTERNATIVE 1: SIX SIGMA
Pro Increased efficiency
Con Time to implement
Focused on increasing efficiency of
distribution
Alternatives

10. ALTERNATIVE 2: VERTICAL INTEGRATION
Pro Increased control over quality
Con Capital intensive facility construction constraints
Focused on quality control and
cutting costs
Alternatives

11. ALTERNATIVE 3: HIRE CMO
Pro Increased administrative efficiency
Con Does not address distribution or production concerns
Expand product line and increase
market share
Alternatives

12. QUANTITATIVE ALTERNATIVE ANALYSIS
Weight Alt 1 Alt 2 Alt 3
Feasibility 25% 3 2 4
Timliness 20% 3 2 4
Cost 20% 3 2 4
Image
Improvement
20% 3 4 2
Potential Savings 15% 5 4 1
Total 100% 3.3 2.7 3.15
Scale of 1-5; 1 = Worst; 5 = Best
Alternatives

13. RECOMMENDED STRATEGY
It is recommended that Mistura
implement Six Sigma to increase
efficiency in distribution given that the
appropriate capital is obtained.
Recomended
Strategy

14. IMPLEMENTATION
Short Term (0-1 Year)
•obtain capital
•begin Six Sigma process
Medium Term (1-2 Years)
•implement Six Sigma process
•research and development of extended product lines
Long Term (2+ Years)
•review Six Sigma
•consider implementation of other alternatives
Implementation

15. SIX SIGMA PROCESS
Short Term (0-1 Year)
Define – unacceptable quality control time
Measure – process flow map and other analytics
Implementation

16. SIX SIGMA PROCESS
Medium Term (1-2 Years)
Analyze – review collected data & determine best
practices
Improve – implement best practices
Control – train employeesImplementation

17. SIX SIGMA PROCESS
Long Term (2+ Years):
Evalute Six Sigma process
Consistently achieve less than 3.4 defects per million
Implementation

18. REVENUE INCREASE AFTER
IMPLEMENTATION
-1000000
1000000
3000000
5000000
7000000
2010 2011 2012 2013 2014
Product Sales
Net earnings (loss)
Product Sales*
Net earnings (loss)*Implementation

19. RISKS & CONTENGENCIES
Risks:
Six Sigma doesn’t have desired efficiency
results
Contengencies:
If Six Sigma proves ineffective, transfer
capitol allocated to Alternative 1 to
Alternative 3
Risks and
Contingencies

20. WHEN TO EXIT?
Test:
Fit
Performance
Competitive Advantage
Risks and
Contingencies

21. QUESTION
AND ANSWER
SESSION

22. MISTURA MOTTO
“Beauty Simplified”

23. POTENTIAL PRODUCT
EXPANSION
Mascara
Eyeliners
Eye Care Products

24. WAYS TO OBTAIN CAPITOL
Debt
Venture Capitalist
Public Offering

25. OBTAINING CAPITAL
Debt
Maintain decision making capabilities
Debtholders have primary claim to CFs which
could be problematic if company ever decided to
go public
Inability to pay bills indicates risk of bankruptcy is
higher, increasing Kdat

26. OBTAINING CAPITAL
Venture Capitalist
Immediate access to funds
Lose some of the decision power
Gain expertise of someone who has had success in
the business world