First, competitive rivalry is high for The Body Shop. There are many huge cosmetic brands such as Procter & Gamble, L'Oral or Unilever, all competing for the highest market share. The top 10 cosmetics brands represent more than 50% of the market. (Grigore A, Bagu C, Radu C, Catanet A, 2011).
The threat of new entrants on the cosmetics' market is low. First, barriers to enter it are rather important. Indeed, it is a luxurious market so it is difficult to get lower production costs and consequently a cost advantage. Moreover, people use to buy always the same products when it comes to cosmetics so it will not be easy for new entrants to impose their brand. Last but not least unless a new comer is able to propose a completely new offer, there are so many cosmetic brands on the market, that it is unlikely a new one could penetrate it.
In the cosmetic market, the threat of substitute is low. Indeed, The only real substitute to commercial skin care products are home-made skin products but only a few people use these last ones as preparing them requires a lot of time and their conservation is difficult to manage, most of them must be kept in the fridge.
The supplier power is also low as there are many different suppliers with a low power. They are even less powerful in The Body Shop's case because the company sources ...
