Recessionary declines did not stop the industry from posting overall gains since 2007.
New York, NY (PRWEB) July 24, 2014
Over the past five years, the Perfume and Fragrance Manufacturing industry recovered from its recessionary trough. Industry players develop and manufacture perfumes and fragrances for men and women. During the recession, increasing unemployment caused per capita disposable income and consumer confidence to decline. As a result, demand for discretionary goods like perfumes dropped. However, as the economy improved and incomes inched up, so has demand for perfume and fragrance products. Nonetheless, revenue has yet to reach prerecession levels as shaky economic growth, market saturation and import competition hampered industry growth. Therefore, in the five years to 2014, industry revenue is expected to increase at an annualized rate, with a jump in 2014.
Profit has followed a trend similar to that of revenue. As consumer purchasing power waned during the recession, shoppers opted for lower-priced fragrances, which at first reduced the industry's profit margins. However, rebounding spending and consumers' need for small luxuries have helped profit rebound over the past few years.
Nonetheless, as a result of relatively lackluster demand at home, industry operators have increasingly turned to foreign markets for growth. Consequently, exports are expected to increase at an annualized rate in the five years to 2014. However, imports took up an increasing share of domestic demand, because they are considered to be of higher quality and have added brand appeal.
The Perfume and Fragrance Manufacturing industry has a high level of market concentration. Over the five years to 2019, industry revenue is forecast to increase at an annualized rate. As the economy improves and unemployment declines, wage pressure will drop. Consequently, per capita disposable income and consumer confidence are anticipated to rise, causing more consumers to spend on discretionary goods like perfumes and colognes. Furthermore, industry operators are projected to increase their focus on exports, particularly among growing emerging markets. As a result, exports' share of industry revenue is forecast to climb higher in 2019. Industry operators will also increase their focus on new product development such as natural and sustainable ingredients and product customization.
For more information, visit IBISWorld’s Perfume & Fragrance Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
Companies in the Perfume & Fragrance Manufacturing industry manufacture men's and women's perfumes and fragrances. Perfume is a mixture of fragrant essential oils and aroma compounds, fixatives and solvents used to give the human body a pleasant scent.
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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