How do consumers benefit from the partnerships

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Reference no: EM132722830

Read carefully the case given below and answer all the questions that follow

L'Oreal
L'Oreal is the world's largest cosmetics maker, with 23 global brands ranging from Maybelline and Kiehl's to Lancome and Redken. Lo'Oreal's extensive supplier network-which supplies everything from polymers and fats to spray cans and packaging to production equipment and office supplies-is crucial to its success.

As a result, L'Oreal treats suppliers as channel partners. On the one hand it expects a lot from suppliers in terms of design innovation, quality and socially responsible actions. The company carefully screens new suppliers and regularly assesses the performance of current suppliers. On the other hand, L'Oreal works closely with suppliers to help them meets is exacting standards. Whereas some companies make reasonable demands of their suppliers and "squeeze" them for short term gains, L'Oreal builds long-term supplier relationships based on mutual benefit and growth.

According to the company's supplier website, it treats suppliers with "fundamental respect for their business, their culture, their growth and the individuals who work there". Each relationship is based on "dialogue and joint efforts. L'Oreal seeks not only to help its suppliers meets its expectations but also to contribute to their growth through opportunities for innovation and competitiveness". As a result, more than 75 percent of L'Oreal supplier partners have been working with the company for 10 years or more and the majority of them for several decades. Says the company's head of purchasing, "The CEO wants to make L'Oreal a top performer and one of the world's most respected companies. Being respected also means being respected by our suppliers".

Q1. Explain how do L'Oréal's channel partnerships benefit the company?

Q2. Can these kinds of partnerships be financially profitable to all the companies ? Give reasons to support your answer.

Q3. How do consumers benefit from the partnerships described in this case?

Reference no: EM132722830

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