Shiseido to end global distribution agreements with Burberry

By

Sandra Halliday

Published
Apr 4, 2017

It may not have come as a shock but Japanese beauty giant Shiseido said on Tuesday that it has decided to terminate distribution agreements (including those in Japan) with Burberry.

The news came just a day after the UK luxury firm and global beauty giant Coty announced a major deal under which Coty would handle the British firm’s £203 million beauty operations. That will include its growing fragrance portfolio as well as its skincare and colour cosmetics.

Shiseido said the termination decision is in line with its mid-to-long term management strategy, VISION 2020. This promotes restructuring of its brand portfolio “through implementation of selection and concentration policies to improve business productivity and profitability.”

What that means in plain English is that in the future, it will focus on  nurturing the existing fragrance brands it handles, including Dolce＆Gabbana and Narciso Rodriguez. And, as a company with comprehensive operations, from manufacturing to marketing, will aim for long-term licensing or brand acquisition deals “in order to further expand the fragrance business.”

While the company did not comment on the Coty acquisition of the Burberry business, its earlier acquisition of the Dolce & Gabbana license must have been quite satisfying given that Coty had also been in the running to handle the business.

Shiseido had signed a deal to distribute Burberry beauty products in Japan back in 2015 and at the time was already sole distributor of the brand’s fragrances in a number of countries through its Paris based fragrance subsidiary Beauté Prestige International.