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A t-a-Glance

A t-a-Glance. Brands Originally Founded in 1981 by John S. Scherer formally headquartered in Rochester Hills, Michigan Sold to CQ Cosmetics, LLC (a Euvera Holdings, Inc. subsidiary) in November of 2013 now headquartered in Burlington, WA.

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A t-a-Glance

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  1. At-a-Glance • Brands Originally Founded in 1981 by John S. Scherer formally headquartered in Rochester Hills, Michigan Sold to CQ Cosmetics, LLC (a Euvera Holdings, Inc. subsidiary) in November of 2013 now headquartered in Burlington, WA. • For almost 30 years, the brands have introduced a multitude of successful new products to the cosmetic market, many of them highly innovative, such as PETITES half-size nail polish. Our goal has always been to provide the consumer with outstanding quality, packaging, and fashion at truly affordable prices. • Our company is vertically integrated where it makes economic good sense (liquid filling, labeling, and assembling) and horizontally integrated where it is beneficial specifically to our retail partners purchase finished goods from outside sources. In all cases, final packaging, inspection, quality control, and shipping are accomplished in our facilities. • CQ Cosmetics sells nail polish (approx. 75% of sales) and other cosmetics (approx. 25% of sales) under three brand names: Chameleons – nail polish, Petites nail polish (1/2 size bottle .25oz), & CQ – full cosmetics line, including eyeliner, eye shadow, lip liner, lipstick, and nail polish.

  2. At-a-Glance Historical Annual Performance Top two accounts Sales by Product Chameleons $264 $587 3% $674 6% 7% CQ $3,808 39% 45% Petites $4,409 Total Gross Sales = $9,742

  3. Goals & Primary Focus • CQ Cosmetics is a manufacturer and distributor of nail polish and color cosmetics. • We pride ourselves on delivering quality products through teamwork, • attitude, and creativity. • Our Mission is to deliver the highest quality products, as efficiently as • possible, at a price that consumers can afford. • Our core values are: • Integrity – Commitment to promises made and expectations set. • Excellence – commitment to continuous improvements and • advancements in all areas of our business, at all times. • Quality – commitment to obtaining the best product components available • then using the most skilled workers to produce the final products. • We always ship 100% of all orders 100% on time.

  4. Summary of Category Situation • Advantages: • High interest for new solutions. • Opportunity for market share. • Extensive product line diversity. • Multiple products means more product offerings to solve consumer needs. • Affordable high quality products. • Challenges: • Category stagnant… looking for changes. • Current brands/offerings just more of the same old same. • Consumers looking for alternatives and choices in nail care and fashion. • Education still needed. • There is a barrier to entry & category difficult to navigate.

  5. Why CQ Cosmetics Nail Polish Brands • CQ Cosmetics Nail Polish formulas hold polish 7 – 14 days without chipping • (on average) longer than any other brands! • Quality enhanced formulas at affordable prices with Argan Oil • and Tea Tree Oilto nourish and strengthen nails. • Quick Drying leaving an ultra shiny top coat. • None of our formulas contain any of the “Big Bad Five” • formaldehyde, formaldehyde resin, toluene, camphor and DBP. • No Soaking required to remove polish which can weaken nails. • Best results when used together with Base and Top Coat.

  6. Products • CQ Cosmetics has four proprietary branded lines that are positioned in the market as premium quality products sold at competitive retail prices. • Retailers are committed to the product lines because they can earn a strong profit margin on CQ Cosmetics merchandise compared to other market leaders such as Cover Girl and Maybelline • CQ Cosmetics four product lines: • Petites – Nail Polish Chameleon– Nail Polish • CQ – Nail Polish & Color Fever – Nail Polish • Color Cosmetics

  7. Petites Nail Polish • Petites is a high quality entry level priced nail polish with a wide color range and age appeal. The line was created for all ages, and is appealing to retailers because of the high profit margin and fast turnover. Petites represents the latest fashions in nail color, with color updates being introduced twice per year.

  8. CQ Nail Polish • CQ nail color utilizes high quality packaging and formulations that are sold at very competitive retail pricing with high profit margins for retailers. The sophisticated bottle and elegant color selections make this polish line fashionable but not trendy.

  9. Chameleon Nail Polish • Chameleon is a nail polish line that uses a special holographic formula that creates a highly pearl-like effect. Compared to other CQ Cosmetic lines, it sells at higher retail and has provided consistently strong sales since its inception over 10 years ago.

  10. Petites Color Fever Nail Polish • Color Fever is a new brand of Petitespositioned for the younger generations, on-trend with design and nail art in mind. • Four Color Fever Formulas: • Stargazer: an elegant collection of rainbow inspired shades • - Each shade is created with a smooth pearl to highlight its natural color. • Envy: smooth and brilliant, with white and silver micas, to create a diamond effect. • - classy, not flashy. • Chameleon: iridescent, chameleon-like effect • - altered by light, shades that quickly change hue. • Hybrid: Earthy, neutral tones • - crème based shades for a more sophisticated appearance.

  11. CQ Color Cosmetics CQ is a full nail and facial cosmetic color line featuring upscale high quality packaging and formulations. We use the industry’s leading suppliers for a final product that is department store quality yet sold at competitive retail pricing while maintaining high profit margins for our retail partners. Product selection includes our suggested best sellers: Eye Shadows Single, Double, Triple, Quad, Eye Pencils & Liners, Mechanical, Wood Clenched, Liner with Applicator, Liquid Liner Lip Products, Mechanical Pencil, Lipstick, Silk, & Brow Pencils

  12. CQ Cosmetics Program • Brand Block in-line • Run promotions frequently driving awareness; (Rotate) • In-store / Outside store • On-Line • GWP • Circular / Beauty Buy • QR Codes – Education at shelf • In-Line Displays – Holiday, etc. • Bonus or On-pack promo’s • Samples • $1.00 off brand coupons • Program Launch: • End Cap – focused on “Alternative Choice” featuring Tea tree & Argon Oil’s and their unique benefits. • Supported with: • strong on-line couponing • Exclusive print media; (Subscription base) • People • Entertainment Weekly • Cosmopolitan • Elle • In-Style • Marie Claire • Harper’s Bazaar

  13. CQ Cosmetics Marketing Plan Overview Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 In-Market and In-Home In-Store opportunities


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