TOKYO — Shiseido Co. Ltd. said Monday that Carsten Fischer, the 52-year-old executive who spearheaded the company’s international expansion efforts over the past eight years, will leave his post next year.
This story first appeared in the November 11, 2014 issue of WWD. Subscribe Today.
In an interview, Fischer said that during his tenure, in which he had risen to the number two position in the company, he had been “the longest serving executive member and the longest serving board member.” Yet Fischer ended up serving under three chief executive officers in a span of three years. “It was clear there would be no ceo position for me at Shiseido,” he said, adding that he decided not to renew his contract, which will expire on March 31.
His notice of departure comes seven months after Masahiko Uotani became Shiseido’s president and chief executive officer. Uotani is embarking on a major overhaul of the company with an emphasis on modernizing and internationalizing Shisiedo’s approach to organization, operations and marketing.
A Shiseido spokesman said the company has not yet decided on whether Fischer will be replaced in his current role. He confirmed that Fischer chose not to renew his contract, but he declined further comment.
A German national with past experience at Wella and Procter & Gamble, Fischer joined Shiseido in 2006 and took the helm of its international business in 2007, as corporate executive director. He moved up to corrporate senior executive director in 2010 and served on the board. Over the course of his tenure, he worked to transform the company from a predominantly Japanese player into a global brand with a presence in some 89 countries. He also helped broker Shiseido’s $1.7 billion acquisition of Bare Escentuals in 2010.
Under Fischer, Shiseido’s international business grew substantially. It now accounts for about 52 percent of the company’s total sales. It comprised just 32.4 percent of Shiseido’s sales for the year ending March 31, 2007. The company’s international net sales totaled 384.8 billion yen for the year ended this past March, or $3.84 billion at average exchange rates for the period.
Fischer said the international division will grow by a double-digit rate for the second half of this year. He also pointed out that Shiseido’s professional business in Japan is growing for the first time in 10 years and expanding through Asia with 20 percent increases in most countries. “We have some things to do,” he conceded, “but the point is we have some momentum.” Fischer posed the question, “Is the work I have to do now as rewarding as [the previous work] I have done, and can I do a different challenge? I decided to go for the different challenge.”
Still, there have been setbacks for the company. Shiseido has issued profit warnings in recent quarters and flagged that its business in China, a key market for the brand, has been underperforming.
Just two weeks ago, when releasing first-half figures, Shiseido slashed its full-year targets for the year ending March 2015. The company said it now expects net profit to grow 14.7 percent to 30 billion yen, or $275.08 million at current exchange rates. This is down from a previous forecast of 38 billion yen, or $348.44 million. Shiseido said it expects full-year sales to grow 1 percent to 770 billion yen, or $7.06 billion. Previously, the company had predicted sales growth of 2.4 percent to 780 billion yen, or $7.15 billion. Also the integration of Bare Escentuals after the acquisition had proved bumpy, although Fischer now predicts that the business will grow “tremendously” over the next couple years.
Shiseido has said that it is positioning fiscal 2014 as a year of preparing for Uotani’s “drastic reforms” that will be put in place the following year ending March 2016.