Distribution is a serious subject for any cosmetic company in the country, of national or imported products. It is encircling, it involves many questions, from taxes to highways. From recent sales channels to market brands introduce into sale points.

Considering as key point the giant dimensions of this country, it is above all a strategic subject that involves always strong logistic, great volumes, the growing concurrence (national and international) and market to be opened up.

cosmeticos br presents distinct and wide visions about a same subject, which revels that, in spite of the problems faced for all the players of this market, it does exist, in a general way, a great and well succeeded professional effort.

The Brazilian cosmetic market is growing for more then 15 years. It is throbbing and dynamic market and offers good opportunities to those who know how to work well.  It has ripened. The companies, shopkeepers and professionals play their role. However, it doesn’t depends anymore of them the solutions to make better the distribution in the country, but of the own country, which needs to do its role.

O Boticario, one of the greatest and main cosmetic companies that act in the country and abroad, attends weekly 2.400 stores on 1.025 Brazilian cities transporting 15 thousand tons of cosmetic products per year, or, 85 millions of unities.

The company credits the success of this complex operation to an elevated informatics and automation level of its transporter partners, which are chosen for specific criteria, such as: regional specializations, risks management, quality on operations and technological support for the information administration, which guarantees all the cargo tracking.
This work involves monitoring, rigorous year evaluation and for points, and also recognition. “It is an arduous work as a whole together with the logistic partners and that faces great challenges, such as the continental dimensions of the country, the own geographic characteristics where one depends for instance of the river navigation (compromised on drought moments) and of the roads insecurity”, points out Giuseppe Musella, O Boticario´s supply chain director.

Actually this is not the only problem pointed out by the companies, in relation to the delivers. “The freight coast is elevated. It is related to the equipment coast, vehicle depreciation, among others”, says Marcio Macedo Rodrigues Cardoso, Casa Granado´s logistic and distribution manager. Among others it is understandable accidents risks because of the precarious way the Brazilian roads are and yet the risk of cargo robbery, problems which are extended for years without a definitive solution.

According to the executive, the road transport in the country it is only valuable if it is made in a distance smaller then 500 km, after this the road transport starts to raise the products price. “It is what we call Brazilian coast”, says he.

“The major problems are on the states of the North, Center West and Northeast regions”, points out Fabiano Dinizette Barile, the logistic and distribution person in charge of Impala Cosmeticos, one of the majors nail polishes producer of the country. “In many cities of these regions the access roads are not pavimented and in rain epoch the trucks ends up sticking down into the mud, what can delay the deliver”.

In Russia, another country of continental dimensions, 80per cent of the transportation is made by railway, but in Brazil there´s not a good maritim and railway net which oblige the companies to use the highway modal, diminishing in great part the time of use of the pavement.
The transports price is not the unique problem, in a big country such as Brazil, the incidence of the ICMS tax – Services Tax over Merchandise Circulation – can also raise the price of the product for different states of the country.

Some companies inclusive use the policy of the ICMS tax to determine the price of its products for different regions of the country. An example is the Espirito Santo state which charges 7 per cent on ICMS tax, according to the product category.

The taxation, as a matter of fact, is a factor that also raises the hiring price of an exclusive sales team. So the companies in great part of the cases are obliged to work with representatives, which use to work with a varied product’s mix to optimize its visits to clients. The company needs in this case to work with the representative in a way that he compromises himself with the brand, in order it be success in a region.

“The representatives in the country are well structured; they use the informatics to take orders by lap tops, as far as the interior is distant of the centers. In the moment of the visit it is made the sales order, which is sent directly to the company’s management system. Thus, he disposes of technologic resources to be able to analyze information, to dimension them again; in a way that he doesn’t looses great opportunities”, relates Márcio Macedo, from Casa Granado.

These problems are over dimensioned with the companies of small and medium size. Besides the geographic difficult,the taxes and the impossibility of maintaining an exclusive sales team, the entrepreneurs faces the concurrence with the great companies and the difficulty of implanting their brands.

“Nowadays the most difficult is the opening of sales channel. There are several launches promoted by the industry and not necessarily the opening or increase on the same proportion of new sales points”, says José Roberto Scalabrin – Anantha Perfumes e Cosmeticos trade director. “When it is a matter of new enterprises or new products, the work is big. It involves training of a sales team, motivation campaigns and accompaniment in loco to evaluate the difficulties and proposing possible corrective actions”, complements. To Jose Roberto small companies ends up focusing on small distributors, so they get greater contact with the team, realizing thus more punctual actions.

“These days I believe that Sao Paulo be a harder market, because of the great concurrence. But regions such as Mato Grosso, Mato Grosso do Sul and Tocantins also not easy, because are sites where the commerce lives a lot in function of the agriculture business which, if it goes badly, it affects directly the commerce and consequently the cosmetic sales”, he says. José Roberto revels that the company develops actions next to the sale points on the regions South and West-Center, to improve the performance on these regions and to compensate the weigh of Sao Paulo on the total sales.

                          

Imported through the Internet

The distribution of imported products is a little different. More selective, the importers and distributors works with around 450 selective points, that can reach one thousand, depending on the position that the brands with which work wants to have in the country.
 
To Evelize Brito, LVMH general director the Internet is a very interesting option: “Even more in Brazil, which is immense”. We work with it for six years through Sacks (read the interview with the company’s partner on Interview) and Submarino. “It was difficult to convince the head office in France, but nowadays the sales through the Internet are our major receipt”, she revels.

To her, the classic distribution needs to evolutes, as every business, on the contrary, it will be complicated on the next two, three years, because the profit margins are each time lesser. “The shopkeeper needs to treat the client in a different way to conquest him, to offer major services”, indicates and gives the example of a Sao Paulo’s perfumery net which evolves sellers to the client’s house without time or patience to go to the shopping centers.

Certainly more difficult yet to the importors that work with several brands of different market posicions, such as Frajo that works with deodorants, sun products, make-up and now with an exclusive hands and feet line: “Our distribution is by product and each of them demands different distribution channels, into the perfumery category”, says Marcelo Santucci, Frajo Marketing Manager, which also works with Internet company.
 
He points out the pharma channel and the supermarkets as wide alternatives for the distribution.  Our brand of sun products is present on the pharma net. It is where one gets great distribution per volume”, points out. “We have inclusive make-up on some pharma net, as the Iguatemi and Onofre. But the deodorants Fa and Austalian have a greater answer on these channels and are inclusive on some food channels more élitized, such as the supermarkets Pao de Açucar and the Zona Sul, in Rio de Janeiro. And for our line Well Fit, of feet care we are foreseen a small channels differentiation, that are the Spas channels, saloons specialized, clinics of esthetic”, says.

The marketing director of the importer and distributor Monalisa do Brasil emphasize that the main work must be done on the sales points: “Brazil is a very big country and hard to be worked. You need to have a consulter, to apply promotions and training. In order to all of this arrive to every stores of the country it is a arduous work”, says. According to the marketing manager, the profile of the consulter is also changing and he needs to be more then a simple salesmen: “Nowadays the distributors needs professionals graduated in marketing, because he has to reach to the sales point, work on the brands position, to get more space, increase the sales, to have creative ideas and bring to the company the market information”.