상품DB/러시아 화장품 시장동향(2014.1)//General market review//Russia’s largest perfume and cosmetics retailers: trends and expansion outlook

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제목	러시아 화장품 시장동향(2014.1)
게시일	2016-03-22	국가	러시아	작성자	김주선(모스크바무역관)
품목	기타
품목코드	330499
작성일자: 2014.1.14 작성자: 모스크바 무역관 오명훈(oh.hoon@kotra.or.kr), Lia Tedeshvili(lia@kotra.ru) 1. Russia □ General market review  ○ The perfume and cosmetics market of Russia is currently one of Europe’s top 10 markets, ranking sixth after France, Germany, the U.K., Spain, and Italy.  ○ The country’s perfume and cosmetics market is one of the fastest growing retail segments. The market experienced steady growth in 2010-2011 due to the recovery of purchasing power and rising demand for perfumes and cosmetics. At the end of 2011, the market recorded the highest growth since 2004.  ○ Perfume and cosmetics retail sales began to decline in May 2012 due to a decrease in purchasing power and higher prices owing to a weak ruble.  ○ Russia’s perfume and cosmetics market is heavily dependent on imports. Perfume and cosmetics imports decreased in monetary terms and physical volumes in 2009. However, as early as 2010, imports of most product categories returned to the pre-crisis level or were above the level of 2008 in monetary terms. It is noteworthy that suppliers started importing less expensive goods than in 2008 because the average price per ton of imports fell in nearly all product groups.  ○ The monetary value of perfume and cosmetics imports continued to increase in 2011, as the post-crisis period ended and the ruble strengthened. A decline in imports was registered starting in March 2012. Imports resumed growth in June-July 2012 but again fell sharply in September 2012. Import growth recovered in October-December 2012 on the strength of seasonal purchases ahead of the New Year holidays. □ Russia’s largest perfume and cosmetics retailers: trends and expansion outlook  ○ Perfume and cosmetics retail chains experienced a decline in the pace of sales growth and new store openings during the economic meltdown, but the situation noticeably improved in 2010-2012. Retail operators boosted their market share as of end 2011. Retail chains grew their revenues by means of aggressive marketing policy and opening new stores, and also due to a gradual recovery of effective demand.  ○ The large players in this segment include such chains as Magnit Kosmetik, Podruzhka, Ol!Good, Sangi Stil, Rubl Boom, Ulybka Radugi, Yuzhny Dvor, many of them have already expanded all across the country.  ○ Consolidation of the market continued due to fiercer competition, regional expansion and M & A deals. Rive Gauche substantially increased its market footprint as a result of the acquisition of Douglas, L’Etoile completed the takeover of Bon Joli.  ○ The last several years have been characterized by rapidly growing demand for high-quality and individualized cosmetics.  ○ Both foreign and local manufacturers created the awareness of different skin and hair types, as well as the advantages of using a full range of skin and hair products. Cosmetics started to be viewed as a means not only to achieve beauty and a general improvement in health. Beauty and spa salons are becoming more and more popular.  ○ Due to the recent economic downturn, however, visits to spas and beauty salons became less regular, but, still, women are trying to continue to spend money to make their skin look better.  ○ According to the latest observations by the Russian Cosmetics and Perfumery Association, in the general meaning, home female consumers are presently keen on two kinds of new cosmetic products: anti-aging ones, capable of producing quick visible results, and spa cosmetics of home use which are helpful for relaxation. Professional products of home use are in good demand too.  ○ Russian women spend a significantly higher portion of their disposable incomes on cosmetics than do their counterparts in other countries. According to market research firm COMCON, the average Russian woman spent 12 % of her income on cosmetics even during the economic downturn of several years ago.  ○ The rouble depreciation usually triggers a rise in prices for imported cosmetics and toiletries, thereby intensifying demand for mass-market products with a combination of price and quality.  ○ Anxious to promote their sales, domestic producers are reported to be giving much prominence to new products, thus trying to renew 30 % - 40 % of their product lines every year.  ○ The “lion share” of the home-originating cosmetics, that comes up to 90 %, is taken by the skin-care products (including those for face and body skin care, sunbathing, face cleaning and make-up removing, etc.).  ○ Cosmetics of daily use, particularly hair-care products, are estimated to be making up the largest 18.3 percent share in total sales.  ○ Regional expansion with the role of regional markets on the rise and their interest in the mass segment products is regarded a highlight of the entire market situation.  ○ Source: RBC Research □ Competition  ○ A number of leading foreign suppliers, for example Procter & Gamble, Schwarzkopf & Henkel, Unilever and Beiersdorf (Nivea brand), have entered the low-end segment and are very successful. Russian consumers traditionally trust foreign brands more than local ones because they guarantee good quality.  ○ Competition in the Russian beauty products market has also intensified in the last few years because the market share of local brands, priced comparatively low, increased. As a result, the cost of entering and developing the market is now higher. Finding a niche is also becoming more difficult, and success in the market requires large investments in advertising, marketing and promotion, including participation in cosmetics trade shows.  ○ In terms of total sales, L'Oreal, LVMH and Procter & Gamble are the leaders. The group of TOP-10 vendors also embraces such foreign brand names as Estee Lauder Companies, COTY, Puig Beauty & Fashion Group, Shiseido, Chanel, Avon, Oriflame, and Mary Kay.  ○ Domestic manufacturers have almost 50 percent of the mass-market and middle-market brands. The biggest manufacturers, like Kalina, Nevskaya Kosmetika, Svoboda, and Faberilic, manufacture both mass-market and higher-end skin care products, which are very close to the quality standards of Western luxury market products.  ○ The competition between foreign and local manufacturers in the mass-market and middle-market segments is intense. Generally, foreign producers outpace local ones with higher rates of new technology commercialization and large marketing and advertising budgets. A number of leading foreign suppliers, for example Procter & Gamble, Schwarzkopf & Henkel, Unilever and Beiersdorf (Nivea brand), have entered the low-end segment and are very successful. Russian consumers traditionally trust foreign brands more than local ones because they guarantee good quality.  ○ Competition in the Russian beauty products market has also intensified in the last few years because the market share of local brands that are sold at a comparatively low price has increased. □ Distribution  ○ The last five-seven years have been marked by profound changes in the distribution and retailing of cosmetics in Russia.  ○ Many foreign companies have opened representative offices in Russia to be therefore are able to conclude agreements directly with retailers without the help of distributors or any other mediators involved.  ○ Retailers have become the key players in the market, reducing the role of distributors. According to Discovery Research Group, in 2011 the key role in the cosmetics distribution was played by direct selling, or the marketing and selling of products directly to consumers away from a fixed retail location (31 % of the total sales), cosmetics retail chains (27 %), Internet (8 %).  ○ The main other kinds of retailers are department stores, outdoor markets and pharmacies.  ○ The popularity of the direct selling must have resulted from the recent economic crisis. Using company catalogues, customers came to realize that they could find fairly and good products. The direct selling is chiefly practised by Oriflame, Avon, Faberlic, Mary Kay, Amway. Having increased by about 6.5 % over the past two years, the number of active distributors, to be possibly called “peddlers”, must have neared 4.7 million.  ○ As for the cosmetics retail chains, they were reported to have around 4,594 outlets all over the country in 2012 while their Moscow number reached 707 shops.  ○ In terms of outlet numbers, L'Etoile, "Sangi style," "Ruble Boom" rank as the leading federal chains. "Smile of the Rainbow," "Seven Days," "Bath & Beauty" have the most developed networks at the regional level. Among the most known local chains there are "Girlfriend," "Spectrum (St. Petersburg)," "Good Day-Cosmetic."  ○ In the aspect of revenue and share in total sales, L'Etoile is the best, accounting for some 30% of the total sales of cosmetics retail chains. The others at the top are Ile de Beaute (20%), the Rive Gauche (16%). □ Certification  ○ Russian regulatory authorities - GOST standards (http://www.gost-r.info/gost-r.php)   - In Russia there are used several types of technical standards: national standards (GOST R), interstate standards (GOST) and other standards (OST, TU, etc.). The national and interstate standards have designations GOST R (or GOST) plus a numeric designator, consisting of a serial number and a year the standard becomes effective. GOST is an acronym for "gosudarstvennyy standart", which means "state standard." At present, the collection of GOST standards includes over 20,000 titles used extensively in conformity assessment activities in 12 countries.    · GOST or GOST R (Russian: ГОСТ) refers to a set of technical standards maintained by the Euro-Asian Council for Standardization, Metrology and Certification (EASC), a regional standards organization operating under the auspices of the Commonwealth of Independent States (CIS).    · In the beginning of 2010, Russia started replacing the system of mandatory certification of conformity of major consumer goods, including imported food, alcohol, and cosmetics, with a system of declaration of conformity. The move is intended to ease the bureaucratic burden on business and to allow producers to vouch for their goods based on their own verification.  ○ Obligatory certificate   - Certifies quality of actually supplied goods and their compliance with contractual terms. A quality certificate contains a profile of goods or confirm‎s their compliance with certain standards or specifications of a delivery order. A certificate of compliance is intended for certification of goods produced by Russian companies or shipped to Russia by an importer-company. A certificate of compliance can be issued for a batch of goods and on a series production. In the former case a certificate is legalized for a company engaged in supplying goods to the Russian market. Its validity varies with terms of a sale contract. In the latter case a foreign manufacturer of supplied goods is both an applicant and a recipient of a certificate. This type of a certificate is valid for a period identified in a certification document. Certification is carried out by our specialists on production premises of a company seeking certification of goods it manufactures. On the basis of results obtained during testing samples of goods in a laboratory an appropriate certificate of series production compliance is issued. There are cases where GOST certificate is issued when documents like: a hygienic report, a veterinary certificate, fire safety certificate, etc. are available. These all mean that we must receive all these documents for you before. □ Prices 2. Belarus  ○ Currently, the consumption of perfumes and beauty products increases at a faster pace in the whole world, including the Republic of Belarus. Growth of paying capacity of the population and infrastructure development leads to development of perfumes and cosmetic products market.  ○ Cosmetic industry of Belarus - one of the youngest segments of the industry of the republic, but production of Belarusian enterprises managed in a relatively short period of time to get a share not only in the domestic market - 30-35%, but also abroad.  ○ The main direction of sales for export is Russia. However, the Belarusian supplies of makeup products are carried out on markets in countries such as Lithuania, Latvia, Estonia, Azerbaijan, Georgia, Turkmenistan, Kyrgyzstan, United States, Canada, Germany, Israel, Czech Republic, Armenia, Netherlands, Slovakia, Lebanon, Uzbekistan, Cyprus Iran, Tajikistan, New Zealand, Macedonia, United Arab Emirates, South Africa, Afghanistan, Egypt and others. □ The largest enterprises of the industry:  ○ "Belita-Vitex" is a joint Belarusian-Italian venture. According to various estimates, the group "Belita-Vitex" accounts for about 25% of the Belarusian cosmetics market. Other than that, there are "Belkosmex", "Modum - National Cosmetics", "Floralis", Brest Household Chemicals Factory, and "Sontsa," Perfume and cosmetic factory. □ Import Policies and Tax        Source: www.alta.ru (Russian Custom Tariff Website)