Cosmetics and perfumery

Cosmetics and perfumery

The global cosmetics market gets widely differing valuations, one of which was quoted in a 2021 Bloomberg article at USD 380 billion in 2019, supposedly at retail price value. Separately Forbes valued the market at USD 532 billion, with the U.S. having the leading share at 20%.

According to Cosmetics Europe, an association, the European cosmetics and personal care market was valued at EUR 76.7 billion at retail sales prices in 2020. The association further estimates that the cosmetics and personal care industry brings at least EUR 29 billion in added value to the European economy annually. Out of this added value total, EUR 11 billion is contributed directly by the manufacture of cosmetic products and a further EUR 18 billion indirectly through the supply chain. The vast majority of Europe, North American or South East Asian consumers use cosmetic and personal care products every day. Ranging from antiperspirants, fragrances, make-up and shampoos, to soaps, sunscreens and toothpastes, cosmetics play an essential role in the household. The Cosmetics Market is segmented across categories including Deodorants & Fragrances, Skin and Sun Care Products, Hair Care Products and Makeup. It is further segmented by Gender, and its segmentation and positioning further reflect Distribution Channels including Supermarkets, Specialty Stores, Pharmacies and Online Sales Channels, not to mention vastly different consumer markets. While Cosmetics and Perfumery sales took a serious hit during the Covid-19 pandemic as millions of households were under lockdowns, the situation in 2022 has evolved very differently as a result of rising inflation, supply chain disruptions against the background of the war in Ukraine, which has sent some key raw material prices soaring. In particular a key personal care ingredient, palm oil, saw its price for Rotterdam delivery in May 2022 balloon to USD 1,700 per ton, or 70% higher than the average spot price in 2021, partially as a result of Russia and Ukraine respectively rationing and discontinuing their exports of vegetable oils such as rapeseed oil and sunflower oil. To make matters worse Indonesia, the leading palm oil exporter has announced a ban on export set to come in force on April 28 th .

For cosmetics and personal care manufacturers such as Unilever or P&G, this upcoming rationing and anticipated price hike could prove tricky to pass on to hard-pressed consumers as overall inflation has crept up everywhere and bills keep mounting. The perfumery industry is another major end user of fragrances. According to a 2019 study co-authored by the International Fragrance Association, IFRA and PwC there were 3,000 raw material suppliers to the global fragrance and flavour companies such as Firmenich, Givaudan, Symrise, Mane, Robertet and IFF. While fragrance such as essential oils or natural extracts is usually a small element in the finished product’s cost and composition it is often a major factor influencing consumers’ purchasing decisions. While global sales generated by the fragrance industry totalled EUR 7.3 billion, the global sales generated by consumer product manufacturing and sales were estimated by IFRA at EUR 357 billion in 2019.

Keywords

Keywords: cosmetics, fragrances, perfumery, essential oils, natural extracts, flavours, flavour companies, personal care, fragrance companies, perfume manufacturers, perfumery industry, fragrance blenders, Unilever, P&G, palm oil, raw material suppliers, antiperspirants, fragrances, make-up, shampoos, soaps, sunscreens, toothpastes, cosmetics, skin care, hair care, sunscreens, Givaudan, Firmenich, IFF, Symrise, Mane, Robertet