Growth slowed during the recession, but beauty supply stores weathered the storm well
Los Angeles, CA (PRWEB) March 30, 2012
In spite of the recession, the Beauty Supply Stores industry continued to expand over the five years to 2012. The industry includes specialty beauty shops, which distribute either professional- or consumer-marketed cosmetics, hair, nail and skin care products. A high level of product introductions at the manufacturing level and an expanded target market of salon professionals enabled industry revenue to grow at an average annual rate of 0.4% over the five years to 2012. The slow pace of growth over the five-year period is primarily due to weak performance during the economic downturn; in 2008 and 2009, revenue contracted an estimated 0.7% and 2.6%, respectively, as lower per capita disposable income led consumers to purchase cosmetics and beauty care items at discount retailers. In 2012, according to IBISWorld industry analyst Caitlin Moldvay, “the Beauty Supply Stores industry is expected to post growth as expanding per capita disposable income enables consumers to increasingly splurge on higher-value items at both the retail and salon level.”
Over the five-year period, the overall size of the industry grew, with the number of industry operators expanding at an average annual rate of 1.2%. Beauty supply stores offered a wider array of products over the period, expanding their lines of men's grooming products and teen-oriented products in particular. “However,” says Moldvay, “profit margins for the Beauty Supply Stores industry declined over the five-year period as retailers cut prices during the recession and slow recovery period in order to appeal to increasingly price-conscious consumers.” The industry is moderately concentrated, with the two major players – Sally Beauty Holdings Inc. and Ulta Salon, Cosmetics & Fragrance Inc. – controlling almost half of the market.
Over the next five years, industry revenue is projected to post stronger returns. As the economic recovery continues to gain steam, consumers' purchasing power will increase, allowing them to purchase higher-value items. Furthermore, the proliferation of naturally derived products is expected to generate new growth for the industry, as cosmetic and beauty product manufacturers unveil new eco-friendly product lines to appeal to changing consumer preferences. For more information, visit IBISWorld’s Beauty Supply Stores report in the US industry page.
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IBISWorld industry Report Key Topics
Beauty supply stores are specialty retailers that sell cosmetics, hair-care products and beauty tools primarily to salons, licensed professionals and consumers. This industry does not include perfume stores or retailers that primarily provide cosmetic and beauty supplies via electronic mediums.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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