PARIS — France’s beauty business in 2006 registered its largest sales gain in five years, according to the Federation des Industries de la Parfumerie.
Pretax wholesale sales of French beauty products rose 5.7 percent, to 15.23 billion euros, or $19.13 billion at average exchange rates, in 2006 versus 2005.
In France, pretax sales grew 3.5 percent, to 6.54 billion euros, or $8.22 billion. Sales made through selective distribution — namely, Marionnaud Parfumeries, Sephora and Nocibe perfumeries, plus department stores — led growth, which came in at 6.5 percent. Revenues from the mass market bounced back, increasing 3.4 percent after two years of decline. The pharmacy channel’s beauty business in France grew 1 percent in 2006, following 10 years of 6.1 percent average growth per year. The country’s direct beauty sales shrunk slightly, by 1.5 percent, for the second year running. French beauty exports to 202 countries grew 7.4 percent, to 8.69 billion euros, or $10.91 billion. This represented 57 percent of France’s total beauty sales, against 55 percent in the prior year.
“Sales exploded in emerging markets,” said Alain Grangé Cabane, the Federation’s president. Exports to Russia rose 43.7 percent and to China, 39.5 percent. Despite the dollar’s weakness, sales to the U.S. increased 7.8 percent year-on-year. Grangé Cabane said flat sales to Japan were disappointing. Overall exports of French beauty items exceeded beauty imports to France fivefold in 2006, according to the Federation.
Looking ahead, Grangé Cabane said the Federation, which represents 250 French cosmetics companies, would support the implementation of the new European chemical legislation REACH, which stands for the Registration, Evaluation and Authorization of Chemicals law. As reported, it was passed in December 2006 to regulate the use of chemicals in consumer products, including cosmetics and fragrances, across the European Union.
Grangé Cabane said challenges facing the industry included continuing to protect the image of cosmetics products, since French consumer concerns about ingredients began two years ago, when parabens were said to be potentially harmful to human health.
The Federation will launch a big-budget advertising campaign later this year that is intended to highlight the benefits and values of beauty products.