BW Confidential - Issue #5 - March/April 2011 - (Page 56)

Market watch: Brazil Analysis High-rise beauty Brazil’s beauty category continues to boast high growth rates and retail is improving, but many obstacles remain. BW Confidential analyzes what’s next for the market by Renata Ashcar & Sueli Ortega razil continues to dazzle foreign beauty companies with its growth rates. In 2010 the cosmetics and toiletries market saw growth of 12.6% to reach sales of R$27.5bn (US$16.57bn), a figure that is predicted to reach R$35bn (US$20.9bn) in 2014, according to ABIHPEC, the Brazilian personal hygiene, perfumes, cosmetics and toiletries association. Growth of the cosmetics market was also one of the highest among 10 of the most important retail categories in the country, according to IBGE, the Brazilian institute of B geography and statistics. Euromonitor now puts Brazil as the third largest country in terms of consumption of beauty and personal care, with an 8.6% share of the global market. Snapshot Brazil C&T wholesale sales 2010: R$27.5bn (US$16.57bn), +12.6% vs 2009 Forecast sales 2014: R$35bn (US$20.9bn) Source: ABIHPEC The challenge is still the high tax burden. One of the problems is the different taxes covering the movement of products in each state, which make logistics difficult and expensive for brands selling throughout the country This growth is in part down to rising incomes, more women in the workplace, greater life expectancy and initiatives from the Brazilian government to promote the inclusion of poorer citizens in the C class (Brazil’s social classi- fication goes from A class, the richest of the population to E, the poorest). Some 30 million people who were once classified as being in the D and E classes can now afford to buy new types of products. According to the Latin Panel Institute, those in the lower economic class in the north and north east are also now consuming more than in the south east, which was always considered the richest part of the country. Between September 2009 and September 2010, D and E classes in the north and north east spent a total of R$8.8bn (US$5.25bn) on food, personal care and household products, a figure that is 5% higher than A and B class consumers who live in the south east. Taxing growth Nevertheless, a challenge for Brazil is still the high tax burden. One of the problems is the different taxes covering the movement of products in each state, which make logistics difficult and expensive for brands selling March-April 2011 - N°5 - BW Confidential 56

Table of Contents for the Digital Edition of BW Confidential - Issue #5 - March/April 2011

Cover
Comment
Contents
Update
- Brand & retail news recap
- Digital digest
- Companies on the move
Take note
- Market facts, figures & trends
Best of BW
- Highlights from our e-publication
Launches
- The latest in fragrance, skincare & make-up
Interview
- Marionnaud CEO William Koeberlé
Insight: Make-up
- Category overview
- The latest trends
- Retailing strategy
Wellness
- Retail Sales
- Spa case studies
Retail
- New store concepts
Travel retail
- Market analysis: Americas
- Interview: Dufry's José Carlos Rosa
Radar
- Six up-and-coming beauty brands
Market watch: Brazil
- Country overview
- Industry roundtable
- Prestige retailing
Packaging
- Trends in secondary pack
Last word
- The Doneger's Group's Jamie Ross

BW Confidential - Issue #5 - March/April 2011