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| The Ukrainian Retail |
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On the Ukrainian cosmetic market retailers become more and more significant players - they begin to dictate their conditions to the producers and distributors. The relationship between suppliers, distributors and retailers on the cosmetic market becomes rougher. It is connected to the fact that the Ukrainian perfumery and cosmetic market has already gained a definite level of development. Now it’s more profitable for trade agents to work with producers directly. Summing up 2006, the biggest volume of perfumery and cosmetics selling accounted for direct sale companies - 21,1% of total volume; the second place is gained by supermarkets, stores, discounters, drogeries - 17, 8%; sales in specialized chains are 10,6%; drugstores sales are fixed at 13,1%. In all, civilized stores occupy more than 57% of perfumery & cosmetics sales volume. In spite of this, the open markets in Ukraine still didn’t lose their actuality. The experts say that sales volume at the open markets will continue to decrease. There is a clear division onto luxury and mass retail in Ukraine. The main retail players of premium class are such chains as Brocard, L’Escalle, Roxolana, Bonjour and Jan. In the near future the Russian luxury chain Arbat Prestige will enter the Ukrainian market. According to the owners’ words, they are planning to open 8 stores simultaneously in the capital of Ukraine. The assortment of these chains is selective cosmetics mainly, though in some stores high mass market products are brought in for increasing of turnover. Among medium level chains we can distinguish such chains as COSMO, Eva, DC, Belaya Vorona, proStor. In the stores of these retailers mass market products prevail, though some of these players have so called luxury stores, the assortment of which includes premium class perfumery and cosmetics. It is significant that today retailers have the greatest influence on the perfumery and cosmetics sales in Ukraine. The development of retail chains is extra important nowadays. In 2006 the retail chain Eva has demonstrated the greatest dynamic; the chain develops mostly in regions. The intensification of regions’ importance is confirmed by high interest to regions from the side of foreign network operators; for example in 2006 A.S.Watson has bought a 65% stock share of retail chain DC. The main DC’s business rival - COSMO - intends to attract a foreign investor up to the end of 2007. The negotiation with the potential investor will be held in April-May of 2007. The aim of attracting the capital is financing of long-term investing projects within five years; in particular growing of the retail chain to 250 stores mostly in regions up to 2010. Drogeries have become one of wide spreading sales format in 2006. These stores draw a part of customers from specialized mass market shops. That’s why specialized shops have to pay attention at more clearly positioning and circumspect assortment policy to advancing quality of work with a customer. The sales through open markets in Ukraine are of low importance, it is the evidence of standards approchement of Ukrainian and foreign markets. The drugstores sales volume is growing, but their share is still not very considerable for the market. Drugstores are perspective sales channel of specialized cosmetics Ð medical and professional, but not mass one. Nevertheless, the market development tendencies, incident with the individualization, innovation of products, act in favor of those companies that are looking for a possibility of sales widening in this format; because exactly in a drugstore a person can get a professional consultation and advice. The popularization of this channel also promotes the appearance of a new format in Ukraine Ð pharmaceutical supermarkets; the share of cosmetics in the assortment of such stores can exceed 50%. The quantity of on-line stores in Ukraine is growing. Through internet the mass well-known to a customer cosmetics can be sold or, quite the contrary, specialized cosmetics, which is difficult to be bought somewhere else. Meanwhile the on-line sales are not considered to be a serious sales channel in Ukraine. One of the trends of 2007-2008 in Ukraine will be the development of monobrand stores, because for this moment only 4 brands of this retail channel are present in Ukraine, these are: L’occitane, Lerbolario, Yves Rocher, Colors&Beauty |
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