Looking good: Revenue rises despite competition from supermarkets and online-only retailers

Over the five years through 2019-20, revenue is expected to rise at a compound annual rate of 4.5% to reach £4.8 billion. Rising household disposable income has supported demand for premium market goods. The introduction of innovative, niche products has also supported growth. A focus on eco-friendly and organic, anti-ageing, and male-targeted products has developed, providing further opportunities for industry operators. Aggressive marketing, particularly on social media, has been a key driving force behind industry growth thanks to content sharing, video tutorials and ‘influencer' collaborations...read more.

Industry Statistics & Market Size
Revenue
£4.8bn
Annual Growth 15-20
4.5%
Forecast Growth 20-25
Profit
Employment
39,203
Businesses
1,522

Industry Threats & Opportunities

  • Revenue growth has been limited by strong competition for supermarkets and pharmacies
  • Companies are offering in-depth customer service in order to boost sales
  • Video tutorials are expected to become a crucial element of online marketing for cosmetics retailers
  • Industry Report - Industry Locations Chapter

    There are many small operators in the Cosmetics and Toiletries Retailers industry, often operating solely in one town or region. However, there are also national chains with outlets located around the United Kingdom. The spread of establishments largely follows the spread of economic output in different regions, since this is a good guide to people’s wealth, which heavily affects how much consumers spend on cosmetics and toiletries.London and the South EastLondon and the South East have the largest shares of industry establishments, with 22.5% and 13.4% respectively. This reflects the high disposable incomes in the regions and the population density of each area. Fur...purchase to read more.

    Additional Insights for the Cosmetics & Toiletries Retailers Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Cosmetics & Toiletries Retailers Industry are

  • Having a clear market position
  • Production of goods currently favoured by the market
  • Attractive product presentation
  • IBISWorld analysts also discuss how external factors such as Real household disposable income and Demand from department stores in the Cosmetics & Toiletries Retailers industry impact industry performance..

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    What's in this report

    What is the Cosmetics & Toiletries Retailers Industry?

    This industry comprises companies that sell cosmetics, perfumes and toiletries in specialised retail outlets. Online-only retailers and chemists such as Boots are not included (see IBISWorld report G47.730).

    Industry Products
  • Skincare products
  • Cosmetics
  • Hygiene products and toiletries
  • Haircare products
  • Fragrances
  • Industry Activities
  • Toiletries retailing
  • Cosmetics retailing
  • Fragrance retailing
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Real household disposable income
  • Demand from department stores
  • Demand from supermarkets
  • Population aged 18 to 64 years

  • Current Performance
  • External competition
  • Growth strategies
  • Technology and marketing
  • Demographics
  • Natural and ethical skincare
  • Market structure and profit
  • Chart: Revenue Growth

  • Industry Outlook
  • Revenue threats
  • Technology and innovative solutions
  • Demographics and consumer tastes
  • Table: Cosmetics & Toiletries Retailers Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Cosmetics & Toiletries Retailers Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Consumers

  • Key Selling Industries
  • Perfume & Cosmetics Manufacturing
  • Perfume & Cosmetics Wholesaling
  • Soap & Detergent Manufacturing

  • Products & Services
  • Skincare products
  • Haircare products
  • Cosmetics
  • Fragrances
  • Hygiene products and toiletries
  • Chart: Cosmetics & Toiletries Retailers Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • People aged between 35 and 49
  • People aged between 18 and 34
  • People aged between 50 and 64
  • People aged 65 and over
  • People aged under 18
  • Chart: Major Market Segmentation for the Cosmetics & Toiletries Retailers Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
    ProfitIn 2019-20, the industry’s average profit is estimated to account for 15.2% of revenue, an increase from 13.2% in 2014-15. Depressed crude oil prices, a key input for many industry products, between 2014 and 2015 translated into lower purchase costs for manufacturers and retailers, aiding profit growth. The introduction of niche and innovative product ranges, such as organic, free-from and anti-ageing ranges, have also pushed average profit margins upwards. Despite household pressures over the past two years, demand for industry goods has increased as consumers turned to cosmetics as a form of affordable luxury. However, intense competition has restrained margin expansion to some extent. PurchasesWagesMarketingMarketing costs are expected to account for 4.5% of revenue in the current year, reflecting the important role that marketing and merchandising play in attracting consumers. These costs have risen recently. Luxury cosmetics and toiletries retailers have increasingly relied on innovative marketing campaigns, social media influencers and celebrities to retain customer interest, while those at the budget or low-end of the spectrum depend on more deal- and cost-focused promotions to draw in traffic. Rivals such as department stores and chemists have also relied on aggressive advertising campaigns, forcing specialist stores to follow suit. RentRent is a fairly significant cost for industry operators because being located in areas with high footfall can drive growth. Strong competition for these sites increases the cost of rent. Prime retail rent prices have been increasing since 2015-16 and are expected to continue to rise over the current year. For operators in London and the South East, rent is expected to increase as a share of revenue following the revaluation of national non-domestic rates in 2017. Rent costs are anticipated to account for approximately 3.5% of industry revenue. DepreciationUtilitiesOther
  • Chart: Cost Structure Benchmarking – Sector vs Cosmetics & Toiletries Retailers

  • Basis of Competition
    Internal competitionExternal competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Cosmetics & Toiletries Retailers Industry

  • Industry Globalization
    A S Watson (Health & Beauty UK) Ltd, Lush Cosmetics Ltd,
  • Table: A S Watson (Health & Beauty UK) Ltd - financial performance
  • Table: Lush Cosmetics Ltd - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Cosmetics & Toiletries Retailers Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Cosmetics & Toiletries Retailers Industry
    Includes:
  • Industry Revenue (2011-2025)
  • Industry Gross Product (2011-2025)
  • Establishments (2011-2025)
  • Businesses (2011-2025)
  • Employment (2011-2025)
  • Wages (2011-2025)
  • Wages (2011-2025)
  • Purchases (2011-2025)
  • Profit (2011-2025)
  • Depreciation (2011-2025)
  • Marketing (2011-2025)
  • Rent (2011-2025)
  • Utilities (2011-2025)
  • Other (2011-2025)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Cosmeceuticals
  • Cosmetics that contain biologically active ingredients that claim to have medical benefits.
  • Cosmetics
  • Substances used to enhance the appearance of the human body.
  • National Non-Domestic Rate
  • A tax paid on occupied non-domestic properties
  • Toiletries
  • Consumer products designed for beautification and personal hygiene. They are sometimes known as personal-care items.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Cosmetics & Toiletries Retailers market research report provides the latest industry statistics and industry trends, allowing you to identify the products and customers driving revenue growth and profitability. The industry report identifies the leading companies and offers strategic industry analysis of the key factors influencing the market.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Cosmetics & Toiletries Retailers:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Cosmetics & Toiletries Retailers market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Cosmetics & Toiletries Retailers, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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