French beauty sales enjoy mini boom

By Simon Pitman

- Last updated on GMT

Related tags Cent Retailing

Sales of cosmetics, toiletries and fragrances in France grew at 5.7
per cent in 2006, the fastest rate of increase in five years and a
figure that puts it well ahead of average industry growth, both
within France and the European Community.

According to the Federation des Industries de la Perfumerie, total sales figure for the industry reached €15.23bn during the year, with 43 per cent of this figure accounting for the domestic market, the rest being exported to 202 markets globally.

Sales in the domestic market, which is the third biggest in the world and also has one of the highest rate of expenditure per head, came in at €6.54bn, an increase of 3.5 per cent - a figure that puts expenditure at over €200 for each person every year.

Exports increased by an even higher margin, up 7.4 per cent to €8.68bn, helping it to maintain the title as world's leading exporter of beauty products.

The figure positions the industry as France's fourth biggest exporter, behind the automobile, aeronautical and drinks industries, underlining its important contribution to the country's economy as a whole.

Breaking the exportation figures down, in Western Europe there were strong increases in sales to Italy, up 7 per cent, Italy, up 6.6 per cent, Spain, up 6.6 per cent and Germany, up 6 per cent.

However, particularly strong increases were witnessed for exports to developing and new markets. In Eastern Europea exports to the Czech Republic rose 41 per cent, by 23 per cent in Poland and by 43.7 per cent in Russia.

In Asia the phenomenal economic growth currently being experienced in both China and India was mirrored by an increase in beauty sales exports of 39.5 per cent and 11.3 per cent respectively.

However, sales in Japan were described as 'disappointing' reflecting a highly competitive but slow retail market and the erratic performance of the country's economy recently.

The Federation also reported a significant disparity between the various distribution channels for beauty products. For selective distribution, which entails beauty dedicated retail stores such as Sephora, sales boomed by 6.5 per cent.

Likewise revenues from mass market retailers, which includes major supermarket chains such as Carrefour and Auchun, also bounced back 3.4 per cent, following a two year decline.

Contrary to the increases, figures for the direct sales distribution channel fell by 1.5 per cent, a second successive year of decline, while sales in the all-important pharmaceutical channel increased by 1 per cent, following four years of strong increases.

Looking ahead the Federation said that it was expecting that 2007 would be a challenging year, particularly due to the implementation of the REACH programme, with it is continuing to support.

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