{
  "docId": "019dd923-622c-750b-8b99-721c68819c81",
  "docSlug": "82a42fe61ec9",
  "documentTitle": "e.l.f. Beauty, Inc. (ELF)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Spruce Point Capital Management",
  "documentKindSlug": "activist-deck",
  "documentKindLabel": "Activist deck",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2023-11-09 00:00:00",
  "orientation": "landscape",
  "aspectRatio": 1.3333334,
  "pageNumber": 11,
  "pageCount": 28,
  "prevPage": 10,
  "nextPage": 12,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "overcrowded",
  "nDataPoints": 3,
  "notes": "Uses a 'Warning' callout to emphasize the lack of long-term purchase obligations from major customers.",
  "elementsJson": [
    "headline_text",
    "callout_box",
    "screenshot",
    "data_table",
    "footnote"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b99-721c68819c81/11",
  "deckHref": "/decks/019dd923-622c-750b-8b99-721c68819c81",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b99-721c68819c81.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b99-721c68819c81#slide-11",
  "components": [
    {
      "bbox": {
        "h": 0.1,
        "w": 0.9,
        "x": 0.05,
        "y": 0.16
      },
      "kind": "callout",
      "text": "60% of ELF's sales are through Target, Walmart and Ulta Beauty. ELF must adhere to Supplier Codes of Conduct that reference ethical conduct and standards that are open to the interpretation of their customers, none of which have any obligation to continue purchasing products from ELF.",
      "attrs": null,
      "subkind": "primary",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "a33cad19-461c-4109-a996-bcd100a51fa1",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "callout",
      "text": "60% of ELF’s sales are through Target, Walmart and Ulta Beauty. ELF must adhere to Supplier Codes of Conduct that reference ethical conduct and standards that are open to the interpretation of their customers, none of which have any obligation to continue purchasing products from ELF.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-64d3-706e-a45a-2d7770c8c27d",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.05,
        "w": 0.9,
        "x": 0.05,
        "y": 0.5
      },
      "kind": "legend",
      "text": "Warning: As is customary in the industry, none of our customers is under any obligation to continue purchasing products from us in the future.",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "01f2e88c-2975-4a1b-a56d-add67fdb0faf",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "metric",
      "text": "net sales concentration: 60%",
      "attrs": null,
      "subkind": "primary",
      "toolName": "Quantification",
      "toolSlug": "quantification",
      "confidence": null,
      "componentId": "019dd953-64d3-706e-a45a-3380525be952",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.2,
        "w": 0.85,
        "x": 0.13,
        "y": 0.3
      },
      "kind": "paragraph",
      "text": "ELF's Major Customers: Along with our direct e-commerce channels, we have strong relationships with our retail customers such as Target, Walmart, Ulta Beauty and other leading retailers that have enabled us to expand distribution both domestically and internationally. Target, Walmart and Ulta Beauty accounted for 25%, 20% and 15%, respectively, of our net sales in the year ended March 31, 2023.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "78ffe817-3d89-48a9-bd7d-1d66ab147a31",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.7,
        "x": 0.01,
        "y": 0.96
      },
      "kind": "source-note",
      "text": "Source: ELF 10-K, Target Code of Conduct, Ulta Beauty Supply Chain Transparency, Walmart Standards For Suppliers",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "a74affc0-b42f-47b9-a121-8672a5e36267",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.3,
        "w": 0.9,
        "x": 0.05,
        "y": 0.62
      },
      "kind": "table",
      "text": "ELF's Major Customers Have Codes of Conduct For Suppliers: Walmart vs Ulta Beauty",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "124ec309-f9c8-4e91-9092-b58611e18380",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.08,
        "w": 0.65,
        "x": 0.32,
        "y": 0.03
      },
      "kind": "title",
      "text": "ELF's Sales Are Highly Dependent On Retail Channel Partners With Conduct Codes",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "732fd646-1c13-49ed-aca6-524b8e84b984",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "989e6451-d06d-47f3-b72a-a848758416d1",
      "evidence": "Highlights concentration risk and potential for contract termination as a business risk.",
      "confidence": 0.9
    }
  ],
  "arcBeats": [
    {
      "to": 18,
      "from": 11,
      "beatId": "4ec56834-8bc8-4b0d-8db1-0840988051e7",
      "arcName": "Overcoming the Monster",
      "arcSlug": "overcoming-monster",
      "beatName": "The Struggle",
      "beatSlug": "overcoming-monster-the-struggle",
      "evidence": "Highlighting dependence on retail channel partners and workforce demographics",
      "position": 1,
      "confidence": 0.8,
      "parentBeatName": "Development",
      "parentBeatSlug": "development"
    }
  ],
  "loops": [
    {
      "to": 26,
      "from": 5,
      "name": "Pattern Hunter",
      "slug": "02-pattern-hunter",
      "bestFor": "Time-pressed audiences, building consensus, when data is strong",
      "matchId": "ec04b634-4265-403a-bac6-3c330a34b97e",
      "evidence": "Repeatedly highlighting connections between ELF's marketing partners and NXIVM",
      "position": 0,
      "objective": "Exposing contradictions and problematic connections",
      "structure": "Evidence A -> Evidence B -> Evidence C -> Pattern/Conclusion",
      "confidence": 0.7,
      "description": "Group multiple pieces of evidence that together point to a pattern or conclusion"
    },
    {
      "to": 28,
      "from": 1,
      "name": "Cost Of Inaction",
      "slug": "27-cost-of-inaction",
      "bestFor": "Urgent budget requests, compliance, risk mitigation",
      "matchId": "906b8199-6870-4f23-b268-c2cf94bad587",
      "evidence": "Presenting a clear and detailed short thesis",
      "position": 1,
      "objective": "Emphasizing the potential downside risk",
      "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point",
      "confidence": 0.6,
      "description": "Quantify what happens if the audience does nothing"
    }
  ],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}