Minutes of the Department Heads Meeting

----------------------------------------------Date: 5 April 2016, 2 p.m.

Venue: Pelagos conference room, Radnicka 2
Present: Renata Orec, Petra Mucic, Anamarija Matic, Irina Vasiljev, Viktor Galabov
1.Budget cuts
Following the decision about the merger between ALIS PAFREMI d.o.o. i SO
Cosmetics the representatives of SO Cosmetics decided that it is necessary to make
certain budget cuts, raise revenue and increase profitability. In order to achieve
objectives SO Cosmetics pushed the decision to make capital investment in production
department and discharge 25 % of ALIS PARFEMI d.o.o. production workers because
of the expected technological improvement of 35 % due to capital investment.
We all agree that is necessary to improve profitability but representatives from ALIS
PARFERMI were strongly against letting people go, so it was decided that the
financial plan with certain cuts in wages will be made.

RO, End
of
the
month

2. Product design
SO Cosmetics argued that the design of the flagship product *Burgundy* looks too
cheap and it is not enough competitive on the market so it cannot raise expected
revenue. It was proposed that the product packaging needs to be changed and
marketing department should rearrange their marketing activity and these
arrangements should be sent to the SO Cosmetics head marketing department.
3. Introducing new product
Following the market research and analysis SO Cosmetics representatives recognized
that there is existing need for the new Perfume line for male market. ALIS PARFEMI
d.o.o. expressed a doubt that launching a new product line would not be a good idea.
We agreed that if financial plan goes through there will be possibility that new line of
the perfume for men will be introduced to the market by the end of the year because of
the expansion to the Central European market as a direct consequence of the merger.

Next meeting: 1 May, 11 a.m.

Venue: To be confirmed

AM, By
25 April
2016