Consumers turn to local cosmetics
Consumers turn to local cosmetics
JAKARTA (JP): Whether there is an economic crisis or not,
cosmetics, in the words of a beauty expert, are "a second skin to
urban women".
Claudia Angelique, a skincare and make-up facilitator at John
Casablanca's Modeling and Career Center, says this need for
cosmetics -- a basic commodity for the image conscious -- "helps
a great deal with one's personality and one's emotional status".
She reiterated that a bright face, good hair and fashionable
wear were all social needs for urban women, particularly those
serious about their careers, to be recognized and accepted in
their own social circles.
Students coming to the modeling center include career women
who want to learn social graces and ways of beautifying
themselves "in order to be socially acceptable", she said.
Noting the effect of the crisis on cosmetics prices, Claudia
said consumers here tend to look down on local products, even
though local brands are well accepted abroad.
"If they (local brands) are popular with foreigners, why
aren't they acceptable to our own people?"
One reason may be that the higher price of imports adds to the
prestige.
But urban women, who have to think of their other needs --
particularly if they have families to feed -- have finally looked
to local brands.
The skyrocketing prices of imported cosmetics by an average of
200 percent to 300 percent for fragrances and 100 percent each
for color cosmetics, haircare and bodycare has led consumers to
make the switch from imported brands to quality local ones.
Coordinator of the Local Cosmetic Producers Association Intony
Yuswanto said that he had received several reports from both
local and imported cosmetic counters that people were opting for
local brands.
The reason: an "incessant need" for cosmetics and the doubling
of prices for imported cosmetics, he said.
Intony, a senior coordinator of local cosmetics at PT Martina
Berto -- a cosmetic firm that is the source of Biokos, Sari Ayu,
Belia, Mirabella, Cempaka, Madonna and Savitri brands -- said the
prices of PT Martina Berto cosmetics would jump 20 percent to 30
percent "some time next month or in the next two months".
"It is being done gradually as we cannot afford to shock local
markets during these times," Intony said.
Prices of PT Martina Berto cosmetics increased 20 percent last
October and another 20 percent price hike came into effect on
Feb. 1.
Intony said that the monthly turnover of PT Martina Berto
cosmetics -- which holds the largest market share (16 percent to
17 percent) of local cosmetics -- was "a good Rp 15 billion to Rp
20 billion" in February.
Despite having enjoyed a growth rate of 20 percent for the
past few years, there was "a big possibility" that PT Martina
Berto might not even be able to break-even this year, Intony
said.
"Among other things, this will be due to the sharp increase in
the prices of raw materials."
He mentioned that with raw materials now more expensive, it
would not take long for small producers of local cosmetics to
fade away.
"Everything has gone up by 100 percent. It is 100 percent more
for packaging materials. Plastic has gone up 100 percent and
others have at least gone up 50 percent."
Intony said there were several cosmetic firms, like Mustika
Ratu, for instance, which were prolonging their terms of payment.
"Some are going from the normal two weeks to a month or more."
Project manager of the Indonesian branch of Loreal cosmetics
Philip Giles said local cosmetics might be on a high at present
but they have huge foreign debts to service in the long run.
"I am sure that the company structures of local cosmetics as a
whole are doing good business now, but they are fast reducing
their investments in media," Giles said.
"They will not be able to afford to make credit payments when
they come due as most of the raw materials used for local
cosmetics are imported as well."
For the first time imported cosmetic and fragrance products
are receiving "a different set of customers", he said
"Opportunists from abroad, like entrepreneurs and mostly
wholesale traders... are buying cheap imported goods here for
reexport.
"I have heard of traders just going to Sogo and buying stocks
or those buying in bulk... prices are still much cheaper here
than Singapore or Hong Kong." (02)