Shiseido moves into Middle Eastern market with Dubai base
The company is establishing a partnership with local brand ‘Creation Alexandre Miya Paris Limited’, which has been Middle distributor for the brand for the last 16 years.
Reps say the joint venture will start operations in January 2014, with Shiseido International Europe S.A., Shiseido’s wholly owned subsidiary in France, and Creation to hold equity shares of 51% and 49% respectively.
“In light of the region’s high market potential underpinned by its large population that includes many affluent consumers, Shiseido has been examining the possibility of direct investment with the aim of further enhancing its market presence,” they said in the statement.
Creation Alexandre Miya Paris Limited will oversee Shiseido Middle East FZCO and will import and market products under the global brand SHISEIDO in seven Middle East countries—Bahrain, Jordan, Kuwait, Oman, Saudi Arabia, Qatar, and UAE.
“Creation, which is not only equipped with the expertise for selling skincare-centered high-end cosmetics products and a good relationship with the retail sector, but is also well versed in Arab business practices.”
Aim of venture
While fragrances account for a major portion of the high-end cosmetics market in the Middle East region, Shiseido managed to establish a presence with its signature skin care products, which are now marketed at 140 stores in the region.
In light of the region’s high market potential underpinned by its large population that includes many affluent consumers, Shiseido has been examining the possibility of direct investment with the aim of further enhancing its market presence.
This has resulted in the establishment of the joint venture with Creation, which is not only equipped with the expertise for selling skin care-centered high-end cosmetics products and a good relationship with the retail sector, but is also well versed in Arab business practices, which the Tokyo-based firm sees as important.
UAE market state
Although the Middle East’s economy slowed immediately following the Lehman Brothers’ collapse in September 2008, an almost complete recovery was achieved by 2010, underpinned by rising oil prices. The region’s growth trend recovered in 2011 and stable growth is projected to continue.
The high-end cosmetics market in the seven countries combined boasts a market size of 150 billion yen (2012) on a retail value basis, thus exceeding the market in Russia.
Shiseido says that double-digit growth rates are expected to continue, backed by the existing affluent population as well as by expatriates working for foreign businesses, which are also projected to continue to increase.
