Jequiti

Silvio Santos Group works in the beauty and personal hygiene market with the brand Jequiti, whose products are offered through catalogs, in a direct selling system (door to door). In only three years in business, Jequiti has more than 118 thousand sales consultants – a figure some companies took 20 years to reach. In 2009, the Jequiti network of consultants grew by 236%, compared to 12% of the overall industry, according to data released by the Brazilian Association of Direct Sales (ABEVD).

Jequiti consolidated itself
in the Brazilian market of
perfumery and cosmetics

Boosted by growth in sales channel, the number of orders also soared, recording an increase of 335%: in 2009, 730,434 orders were processed, compared to 218,019 in 2008. Invoicing followed the other indicators and was 191% higher than the previous year. Therefore, Jequiti is rapidly consolidating in the competitive and profitable Brazilian market for personal hygiene, perfumery and cosmetics, which, according to a survey by Euromonitor, moved about US$ 28.4 billion in 2009, and is already the third largest in the world.

It is characteristic to the direct sales channel a large number of new products at every sales cycle. In 2009, Jequiti’s portfolio grew average 8 launches per cycle, to offer a more comprehensive proposal, and more specific functionalities, with products developed to meet the wishes and needs of every consumer profile. In line with this, at the year end, Jequiti’s portfolio featured 384 products, in the lines of fragrances, make-up, children’s, face, hair, body and bath, treatment, and sunscreen – a 62% increase over 2008. Additionally, in April 2009, it made its debut in the non-cosmetic segment, with Vila Jequiti line.

Vila Jequiti is an extension of Jequiti brand name for non-cosmetic products related to wellbeing, comfort and beauty, such as semi-jewels, bijouterie, accessories, utensils and home products, among others. The high rate of 11 product launches per cycle made the portfolio jump from 17 items, at the beginning, to 185 items in December 2009. This growth, along with great public acceptance, justified the development of an exclusive catalog for the product line.

HIGHLIGHTS OF THE YEAR

Innovation

The project “Innovative Model for Excellence in Management for Application in the Productive Chain of Personal Care, Cosmetics and Perfumery” was certainly a major fact in the year, for the gains of productivity promoted in the management of the chains for development, production and logistics, and for the consequent acceleration of results in several areas of the company.

Developed with incentive from FINEP (Studies and Projects Funding Body), which at the end of 2010 will have granted resources to the tune of R$ 38 million, the project aims at implementing an innovative model for management of knowledge, based on the best practices in management of complexity in each of the key areas of the cosmetics productive chain:

  1. Research & Development;
  2. Supplies;
  3. Manufacturing; and
  4. Logistics.

Deserving highlight are also advancements in the model of open innovation, achieved with the partnerships entered into with universities, research institutes and companies, aimed at bringing innovation not only for new product research and development processes, but also for disseminating it throughout the productive chain.

Launches

The meaningful advancement of Jequiti’s share in the category of perfumery was distinguished with the launches of colognes “Diva”, “Oro”, “Uzon Black”, “Elo por Claudia Leitte” and refreshing fragrances of the “Corais” line.

Other two important moves in the portfolio were the launches of “EU” line, consisting of moisturizing lotions, soaps, oil and splash cologne; line “Óllio”, which marked the entry of Jequiti in the segment of body moisturizing oils, with high growth rates.

Marketing

Leveraging the operation through synergy with other Group businesses, the performance of the brand and its consultants is further strengthened with the space in SBT:

  • Roda a Roda Jequiti is a weekly TV show, hosted by Silvio Santos himself, whose objective is to attract new sales consultants and consolidate the Jequiti brand name. Every week, 2 houses and gold bar prizes are drawn for Jequiti consumers and sales consultants, in addition to the draw of two cars per month. The show is aired on Saturdays and replayed on Sundays and, in 2009, the show enjoyed an average audience of 10 points.
  • Ganhe Mais Dinheiro com Jequiti [Earn More Money with Jequiti] is a weekly TV show aimed at training consultants and propagating the Jequiti brand name to SBT viewers. With debut in June 2009, its average audience was 3 points.

Logistics

In logistics, highlighting goes to the plan for qualification and implementation of the new picking system, which tripled the capacity for processing orders, reduced order cycle time, and led Jequiti to world-class level in technology and order processing.

Another highlight was the creation of the concept of internal intelligence, resulting in more effective management of the complex chain of development, production and logistics, assisted by market knowledge in every ring of the chain, and strengthening of the Quality area.

Sales Force

The year 2009 was marked by development of the sales channel, through significant investment in hiring and training Sales Managers throughout the country. This has allowed for increased brand name and product penetration, reaching more consultants and end users.

Also deserving mention was the implementation of an online ordering system, allowing for Jequiti consultants to place 25% of their orders through the internet.

Cash Flow

In spite of the global financial crisis began in September 2008, which directly impacted Jequiti with the scarcity of credit lines for working capital and significant increase in interest rates, cash flow has improved as from the second half of 2009, with the extension and negotiation of new credit lines and reduced interest rates.

Hydrogen

In 2009, aimed at focusing the company’s efforts in the direct sales channel, Silvio Santos Group sold the Hydrogen brand, through which it did business in the children’s cosmetics retail. The sale included all brand assets, such as patents, formulas, molds and inventories, in addition to the licensing contracts with Disney and Warner Bros.