development. While he believes that Dark & Lovely’s Creme-to-Powder foundation–the line’s centerpiece product–will appeal to women, he says that the company is late in getting this particular type of product to market. “Cosmetic consumers are trend conscious, but it’s not necessarily a bad thing that [Carson] waited, because [if the trend was not successful], it could keep them from losing their shirt.”
Other products that Carson plans to launch by the end of this year include Compositions by Carson, a line of salon professional products, a bubble bath under its Beautiful Beginnings product line for pre-teens and a female depilatory called Naturally Soft by Cutex.
Most significantly, however, Carson has aggressively expanded its global market presence and made a number of important acquisitions both domestically and internationally. In 1995, Carson dispatched an in-house sales staff and launched a major marketing campaign in the Caribbean. As a result, sales rose as much as 67% on islands such as Jamaica. In Brazil, Carson recently secured a license to distribute products, and in March, the company exported its first shipment. Though the initial shipment consisted solely of four shiploads of Dark & Lovely hair products, which are salon-exclusive in Brazil, the company has plans to export its other product lines.
Carson also bought a $1 million South African production facility, which became operational in March 1996, as well as a $1 million plant in Ghana, which has been up and running since June of this year. According to John Brown, both plants will produce regionally-specific Dark & Lovely products (which are also salon-exclusive in Africa) as well as country-specific brands such as the recently acquired South African line of skin care products called Nu-Me and a budget relaxer product called Restore Plus.
Prior to purchasing the plants, Carson had contracted a South African- based facility to produce all of its products sold in Africa. But when the company began to expand into new countries, production capabilities and quality control became a concern. “We wanted to gain control over our products,” says Brown. “Also, the economic value far outweighed our continued use of a contractor,” he adds, noting that Carson also plans to purchase production facilities in eastern Africa by early 1998.
Other Carson acquisitions include the $41 million purchase of Cutex, a well-known nail care products company in April 1997. Cutex generated $27.5 million in sales last year and also made a $3 million investment in AM Cosmetics, a New York City-based company that agreed to produce the Dark & Lovely Cosmetic line. In addition, Carson acquired Let’s Jam, a hair styling company, for over $5 million in March 1997.
NEW AND IMPROVED COMPANY GOES PUBLIC
When Carson’s stock went public in South Africa in July 1996, it had an initial offering price of 2.00 rend and generated 20 million rend ($4.6 million) in capital. It has since traded as high as 16.00 rend and the stock’s earnings are financing a $700,000 expansion that will double the production capacity of Carson’s South African plant. Similarly, Carson’s U.S. initial public