Retail chains driving cosmetics distribution in Poland

According to estimates presented in market researcher PMR’s latest report entitled “Retail market of cosmetics in Poland 2012. Market analysis and development forecasts for 2012-2014”, ​this channel contributed 41.2 per cent of sales generated by the market as a whole.

Retail chains, such as market leader Rossmann, are just one of the channels used; with the other being represented by traditional beauty stores, which are managing worse and worse, while their number and market share is waning every year.

Promising market​

With a population of almost 40 million people, Poland offers an important and promising market for cosmetics.

More than 90 per cent of the Polish cosmetics market is filled by so-called mass market goods at low and medium prices. Imported luxury cosmetics embody only a small amount of the entire market, and about 60 per cent of these imports represent perfumes, followed by skin care and make-up cosmetics.

Chains of cosmetics stores are the fastest growing distribution channel, thanks to the increasing number of stores run by individual chains. In addition, cosmetics store chains have increased per store sales.

Aggressive expansion​

According to PMR’s estimates, in 2011 the sales of cosmetics within the channel exceeded PLN 7.8bn (€1.9bn), which is an increase of 11 per cent compared to the year before. This indicates that the share of cosmetics stores in the Polish cosmetics market grew to 41.2 per cent in 2011.

The aggressive expansion of the chains, combined with the development of supermarkets and discount stores across the country, is leading to the shrinking number of traditional stores, as they cannot compete with such strong players.

As a result, between 2007 and 2011 more than 1,500 independent cosmetics stores disappeared from the market and their share in the market dropped to 7 per cent in 2011.

Consequently, PMR expects that in 2012 sales in chains will increase by another 16 per cent to PLN 7.6bn, while sales of cosmetics in the segment of cosmetics stores as a whole will expand by approximately ten per cent, to PLN 8.6bn.