In an uncertain economic climate, it is imperative for large beauty companies to streamline their costs in strategic, forward-thinking ways that protect the innovation and equity of their portfolio of brands, while ensuring long-term resilience. In recent times, beauty conglomerates, including Unilever, have navigated a turbulent economy through restructuring plans, with the intention of sustaining business growth even when consumers are less willing to part with their dollars.

Coty, which has stakes in brands including Covergirl, Kylie Cosmetics, and Sally Hansen, is in the midst of a restructuring development and has been targeting $130 million in fixed cost savings since launching its “All-in to Win” program in 2020 amid pandemic disruptions. All-in to Win is an initiative aimed at establishing a simplified and scaled operating model, reducing complexity across functions and markets, and sharpening focus on top innovation and market priorities. The operation additionally plans for $240 million of ongoing productivity savings over the next two years.

“We are committed to building a stronger, more resilient Coty that is well-positioned for sustainable growth,” said Sue Nabi, CEO of Coty, in a company statement. “When we first announced our All-in to Win Program in FY20, at the peak of COVID disruptions, our goal was to boost our margin profile and brand reinvestment firepower through a significantly lower fixed cost structure, supply chain simplification, procurement savings, and strategic revenue management initiatives.”

Despite the challenging macroeconomic backdrop of the past few years, cumulative savings of the All-in to Win operation are expected to reach $1.2 billion since the program initiation in FY21. According to Nabi, the program generated over $700 million in savings between FY21 and FY24, with over 400 basis points of gross margin expansion, 400 basis points of A&CP investment expansion, and 130 basis points of EBITDA margin expansion, all while delivering a CAGR of 13% LFL, according to the company.

“With the cyclical and structural changes in the beauty industry and the global economy in recent years, including the rapid acceleration of e-commerce, the consolidation of retail channels and customers, and the new ways of consumer brand discovery, Coty must once again adapt and evolve,” Nabi added. 

The next phase of the All-in to Win transformation program focuses on Coty’s operating model and simplifying its fixed cost structure. The key pillars of this transformation include:

• Scaled Markets and Regions: Coty is focusing on streamlining its organizational structure across key markets, aiming to unlock operational efficiencies, reduce duplication, and better align with consolidation in the local and regional retail landscape. As part of this process, regional leaders will be encouraged to accelerate decision-making with faster execution to keep up with the rapidly evolving modern global beauty markets. 
• Streamlined Support Functions: Coty plans to consolidate and centralize support function activities to better align with new regional structures. The conglomerate has already begun consolidating demand planning into a single hub, enabled by an AI-driven demand planning system. 
• Boosted Innovation Impact: Coty will identify key launch priorities early in this phase, focusing organizational efforts and resources on fewer, yet more impactful initiatives. These will be supplemented by smaller innovations that plan to capture short-term opportunities.
•  Optimized General and Administrative Spending: Coty will aim to reduce non-people fixed costs across all areas of spend.

Nabi believes that the next phase of transformation will further strengthen Coty’s operating model and simplify its fixed cost structure. “We fully anticipate these changes will strongly position Coty to outperform the beauty market in the coming years, cementing our global leadership position in fragrances while expanding into certain growing and profitable beauty categories, all while steadily expanding our gross margins and EBITDA margins,” she added.

The newly announced stages of All-in to Win will begin execution in the first half of FY27. The program is estimated to generate an annual fixed cost savings of $130 million before taxes, comprising $80 million in FY26 and $50 million in FY27.

Coty reported there will be a one-time cash cost of $80 million as a result of the program, which will roughly split evenly between FY26 and FY27. It is predicted that this will impact 700 positions, “following all necessary regulations.”

According to the company, FY25 savings are on track with its original target of $120 million across P&L, and the conglomerate is committed to the same targeted productivity savings for FY26 and beyond, with a primary focus on supply chain and procurement. The combination of the fixed cost savings program and ongoing productivity savings is expected to deliver close to $500M of savings between FY25 and FY27.

As Coty advances to the next phase of its All-in to Win program, it enters a critical moment not just for internal cost discipline but for navigating complex global trade dynamics. As geopolitical tensions continue to mount, streamlining operations and localizing supply chains is a strategic imperative. For Coty’s roster of brands, building a more agile business is key to weathering future uncertainties. Today, operational efficiency is no longer just about growth; it is about staying competitive when the road ahead is uncertain.