The personal hygiene, perfumery and cosmetics industry increased 1.5% between January and July 2019, compared to the same period last year.
The data were released by the Brazilian Association of the Personal Hygiene, Perfumery and Cosmetics Industry (ABIHPEC) during the in-cosmetics Latin America fair, which takes place in São Paulo, between 18 and 19 September.
Although sales revenue increased, production volume decreased 10.9%, with a total of 1,200 tons of items produced in the personal hygiene, cosmetics, perfumery and tissue categories.
According to the association’s CEO, João Carlos Basilio, the results of the first seven months of the year follow the same level of 2018 and still reflect the numerous challenges that the sector has been facing since 2014, due to the country’s economic crisis.
“The numbers are not just effects of economic difficulties, but also of a period of brutal increase in the tax burden that significantly impacted industry results,” says Basílio da Silva. In 2015 the federal government increased by 15% in the IPI – Tax on Industrialized Products – for distributors. “It is a tax on distributors, who do not industrialize absolutely anything at all and that mainly impacted the cosmetics industry. “A misconception from the federal government, which did not result in increased revenue, on the contrary, brought recession,” he added, noting that the sector is trigging against government since then.
“The Personal Care and Beauty industry has been reacting with continuous efforts across the value chain to overcome barriers. Still, we are not resilient to prices and consumption declining. Today we have 14 million unemployed people. Without jobs, people stop buying products that are essential for disease prevention and health and well-being, ”Basilio explained.
From January to July 2019 the cosmetics sector had revenues of R $ 30.400 billion, a nominal growth (excluding inflation) of 5.3%, compared to 2018, with Personal Hygiene growth of 8.8%, 0.5%, Perfumery 0.6% and Tissues 7.2% in July. In volume, recalled the president of Abihpec, “the numbers are not at all exciting: The first 7 months of the year, compared to 2018, had a volume drop of 10.9%, and personal hygiene the drop is 19, 3%, cosmetics is 0.6% in Perfumery the fall is 8.5% and in Tissues there was a growth of 2.8%. Deflated in these 7 months of 2019, there was a real growth of 1.5%. ”
For the remainder of the year expectations remain positive, with a likely sales boost generated by Christmas and consumers’ access to benefits such as collective bargaining, 13th salary and FGTS (Severance Pay Fund) withdrawals. According to ABIHPEC’s CEO, the second half represents approximately 60% of the sector’s sales.
An indicator that the cosmetics sector innovates, despite the challenges of the Brazilian economy, is in the amount of products launched in 2018. According to Mintel, 7,481 items were launched throughout the year, which puts the Brazilian HPPC industry as the the 3rd most innovative in the world, behind only China and the USA.
The figures released during in-cosmetics make up the market intelligence platform “ABIHPEC Market Data Panel”, which today already reaches 80% of the sector with the participating companies.
“This platform keeps pace with industry movements and anticipates what will happen in retail. It is strategic information for companies to be able to target their business and marketing actions more assertively, ”says Basilio.