In 2011 Ukrainians spent UAH 19.87 bln on cosmetics and perfumery (approx.$2.4 bln). Within a year the hryvnia volume of the market has grown by 12.4% and exceeded the results of 2008 1.5 times. 

Market in figures

According to the estimates by Euromonitor Research Company, cosmetics companies earn as a rule 25–30% of their annual turnover in the period preceding the New Year. One of the reasons of the market growth is an increase in prices. “Both importers and home producers raised prices, - Elizabeth Savenko, Head of Marketing, Development and Innovations Department, Management Board Member of “Aesthete” company, notes. – In particular, importers considerably raised prices in the hope to compensate the margin narrowings of 2009-2010 due to the devaluation of hryvnia.”According to the expert, home producers raised the prices slighter and thus won back a considerable share of the market – the sales volume of Ukrainian cosmetics has grown 15–20% within a year.

In 2011, just like in 2009-2010, hair care and skin care products formed the largest segments of the Ukrainian perfumery-cosmetic market. According to Euromonitor analysts, sellers of shampoos and styling products boosted their gain by almost 12 % year on year to UAH 4.2 bln (around $525 mln). Ukrainians spent around UAH 3.52 bln (around $440 mln) on skin care products, which is 11.8% more compared with the previous year. But it was the perfumery that showed the highest growth rates: the volume of the segment increased by 14.1 % year on year to UAH 2.49 bln (around $312 mln). It is not surprising, however. Perfumery products constitute one of the most expensive segments of the market. In the times of crisis the demand for perfumery as well as for expensive cosmetics has considerably fallen — the segment will be recovering in 2012 too.

Where do Ukrainians buy?

In 2011 a number of large mergers and takeovers took place in specialized perfumery-cosmetic retail. In February the Chinese Watson Group acquired 100% of the retail chain “DC” (since March — Watsons). In June the Russian Group “L’Etoile” announced the plans to purchase Ukrainian chains Brocard and Bonjour and also voiced the plans for further expansion of the unified chain, Watsons additionally opened 28 new outlets in the first half of 2011. Other chains and shops of the drug store format (shops which offer perfumery-cosmetic products together with household goods and household chemicals) also actively expanded their networks: Еvа, ProStor, Kosmo.

Nevertheless, the share of chains accounts just for around 30 % of sales. According to Elizabeth Savenko ( "Aesthete" company), out-of-store retail – i.e. sellers at markets – comprises the larger market segment (approximately 40%), direct sales campaigns make for around 30%.

The majority of market participants are certain that the tendencies of 2011 in perfumery-cosmetic retail will prevail in 2012 too. Euromonitor company forecast a market growth of at least 10% due to a new rise in prices — to UAH 22 bln (around $2.75 bln).

Based on the materials of kontrakty.ua

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