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17 August 2020

Polish cosmetics are conquering the world

The cosmetics industry is one of the most diverse. Various cultural norms and changes in fashion trends, require manufacturers to adapt their products to local requirements.

However, thanks to the support of the Polish Investment and Trade Agency, Polish companies are managing to successfully enter new markets, both those close to home, such as Hungary or Denmark, and more distant ones: Taiwan, China, Saudi Arabia, Malaysia or Kuwait. Twenty export contracts - this is the result of PAIH’s recent activities in the cosmetic sector - among the companies that, thanks to our help, have appeared on new markets are Yope, Miraculum and Uroda Polska. In recent months, despite the difficult situation on world markets and the never-ending pandemic, two Polish companies have started selling their cosmetics to Malaysia and Georgia.

Demand for Polish cosmetics in Malaysia is growing constantly

The Malaysian cosmetics market is valued at $ 5 billion, and most importantly, it is growing by an average of 4.3% each year. This trend will continue until at least 2023, thanks to an overall increase in wealth in the country, which is accompanied by a rise in demand and consumption.

It is not without significance that Malaysian society is constantly getting richer, thus increasing its purchasing power - about 50% of consumers have an average or higher income. - Malaysians are more willing than ever to spend money on better-quality cosmetics, and men are successively joining this group of consumers - says Przemysław Zaręba, head of the PAIH office in Kuala Lumpur. - Organic and ecologically natural products are growing in popularity in Malaysia. This has results in more inexpensive local and international products coming onto the market. Which has created a niche for Polish producers.

Halal cosmetics are also an important element of the market puzzle. Malaysia is one of the largest beneficiaries of the global market for products that meet the standards of Islamic certification. At the same time, in 2012-2017, exports of halal cosmetics increased by 68%, i.e. from $ 433 million to over $ 725 million. - The development of the Malaysian cosmetics industry will be strongly stimulated by the good economic situation in the halal products segment. This is the perfect moment to enter the local market with this type of offer. Malaysia is at the forefront of building the global potential of halal cosmetics, which is driving the growth of the entire sector. The strict certification regulations constitute a barrier to entry. On the other hand, companies interested in participating in this market can be facilitated by the attractive system of government incentives, such as exemptions and tax breaks - adds Przemysław Zaręba.

Successes in July - despite the pandemic

In July of last year, PAIH organized a trade mission to Southeast Asia for Polish cosmetic companies, which resulted in Malaysian contracts for five of them. Fragrances, of one of these producers are already to be found in over 50 stores of a local cosmetic chain, and the products of the other four companies will also enter the market, this summer. However, everything indicates that this year will not be full of new contracts, due to, the global situation. Nevertheless, in July of this year, the Polish manufacturer of men's and women's perfumes, “Cote d'Azur” from Zabrze, signed an export contract with a cosmetics distributor in Malaysia introduced by us. Thanks to this agreement, the company will launch 19 products (5 for men and 14 for women) on the Malaysian market, and sales will start at the end of September or early October 2020.

So far, we have exported Cote d'Azur perfumes to countries in the European Union . Malaysia is a very attractive market and the entry of Cote Azur Parfum products into stores there, is an opportunity to develop our company and gain new sales opportunities. Thanks to our cooperation with the Polish Investment and Trade Agency, we have gained such an opportunity. We appreciate their help in establishing contact with the client and further support, at the contract signing stage- says Edyta Liszka from Cote d'Azur

Georgia - imported cosmetics and no customs duties

Georgia is another market where the opportunities there, are being turned into success for Polish companies, by the Polish Investment and Trade Agency. Although it is not the largest of markets, local conditions make it extremely attractive.

- There is no domestic cosmetics production in Georgia, and imported products are often re-exported. Georgia is a good base for exports to neighboring countries, mainly Armenia and Azerbaijan - says Karolina Zaręba, head of the PAIH office in Tbilisi.

The Georgians make up for the lack of local production with imports. Particularly important for Polish cosmetics manufactures, should be the fact, that Georgia does not require any additional product certification. Another advantage is the lack of customs duties for Polish products - the zero rate applies, after presenting the certificate of origin.

- Poland is the 3rd largest supplier of cosmetics to Georgia (about 12% of the market), after Russia and France. Cosmetics with a Polish label meet the Georgian purchasing criteria, are of high quality and at affordable prices. The choice of a product is mainly determined by the low price of the product. However, Georgians are becoming more and more aware as customers, especially when it comes to quality of ingredients and packaging - adds Karolina Zaręba, head of the PAIH office in Tbilisi.

One of the most recent Polish successes in Georgia, is a trade agreement signed by PAESE Cosmetics, with one of the largest pharmaceutical chains in Georgia - over 200 locations.

The decisive factor behind the willingness to introduce Paese and Nanorevit cosmetics to the Georgian market was the fact that this market has great potential, resulting from the small number of producers. An additional determinant was the openness of the population of this country to novelties and the growing consumer awareness of Georgians. The PAIH office in Georgia gave us a lot of substantive support and provided us with the necessary information, for us to able to learn about the market and consumer expectations. We are in constant contact, with almost all the PAIH offices in the world and we assess the work of the people who provide us with the necessary guidance very highly - Paulina Janda, Export Manager PAESE Cosmetics.

About the Polish Investment and Trade Agency

The Polish Investment and Trade Agency (PAIH) is an advisory institution that is part of the Polish Development Fund Group (PFR). It is the first point of contact for exporters and investors. It operates both in Poland and through its Foreign Trade Offices (ZBH) all over the world. It works to strengthen the recognition of Polish brands on international markets, promotes domestic products and services, as well as technological solutions that are “made in Poland”. The agency helps entrepreneurs choose their optimal expansion path abroad. It also supports the inflow of direct foreign investments to Poland and the implementation of Polish investments at home.

Polish Investment and Trade Agency

Krucza St. 50

00-025 Warsaw

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