Written By: Resham Daswani

Wondering how the cosmetic products industry has performed over the last few years?  Well, it won’t be alarming to say that this is an industry sector which has overgrown over the last decade.  Read this blog to understand the Cosmetic Products Industry in India, factors enhancing the growth of the cosmetic product business and why 2024 can be a promising year for aspiring entrepreneurs to start a cosmetic product franchise right away!

Evolution & Growth Of The Cosmetic Business in India 2023

Yes.  You heard that right.  The personal care and cosmetics market in India has experienced consistent growth over the past decade, as evidenced by the expansion of retail and boutique shelves throughout the nation.

The usage of cosmetic goods and their application has been documented in India dating back to the culture of the Indus Valley. In the years leading up to the year 2000, the majority of beauty products were created at home, with regional herbs and ingredients.

The entry of numerous multinational brands into the Indian market has been facilitated primarily by their respective pricing strategies and specialised support structures.

The Indian cosmetics industry can be classified into segments:

1. Color cosmetics
2. Skincare
3. Hair care
4. Oral care
5. Fragrances
6. Makeup cosmetics
7. Organic, Herbal and Ayurvedic products

Moreover,  it is projected that the aggregate market share will increase at a Compound Annual Growth Rate (CAGR) of 25%, reaching $20 billion by 2025. Conversely, with a CAGR of 4.3%, the worldwide cosmetics market is projected to attain a valuation of CAD 450 billion by the year 2025.

In addition to this expansion, India will attain the fifth position globally in terms of revenue and account for 5% of the overall cosmetics market by 2025.

But what is enhancing this growth?

The presence of an expanding number of international companies venturing into the Indian personal care and cosmetics market is intensifying competition for domestic brands. With ayurvedic and medicinal cosmetics included in their respective product lines, however, industry titans such as Dabur and Marico continue to exert market dominance.

Global cosmetics brands have exerted a substantial influence on the Indian market as a result of consumers' general perception that such brands offer superior quality.

The brands in question have garnered the attention of aspirational consumers, thereby stimulating the expansion of the Indian market. The transition of Indian consumers from functional essentials to specialised and sophisticated cosmetics is increasing the country's demand for luxury goods.

A considerable number of international fashion houses have established a presence in India, including Revlon, Avon, Burberry, Calvin Klein, Cartier, Christian Dior, Estee Lauder, Elizabeth Arden, Lancome, Chambor, Coty, L'Oreal, Oriflame, Yardley, Wella, Schwarzkopf, Escada, Nina, Ricci, Rochas, Yves St. Laurent, Tommy Hilfiger, Max Factor, Max Mara, Shiseido, Body Shop, Maybelline New York, MAC, and many others.

The Indian cosmetics industry remains one of the most rapidly expanding sectors globally. Owing to its expanding disposable income and population exceeding one billion, India is a highly appealing nation for multinational corporations seeking to augment their market presence.

Indian enterprises seeking to penetrate this market continue to encounter challenges, despite this advancement. In recent years, the Indian cosmetics industry has experienced significant consolidation due to the efforts of multinational corporations to enter this lucrative market. This has resulted in a more competitive environment, making it difficult for many lesser competitors to remain competitive and sustain business growth.

Future Of The Cosmetic Business in India in 2024

The cosmetics sector is one of the industries experiencing the most rapid expansion in India, and this trend is expected to continue in the coming years. This industry includes services and products related to the production and distribution of cosmetics and beautification products.

As an increasing number of individuals incorporate skincare and haircare products into their daily routines as an alternative to visiting physicians or taking medications, the beauty sector has expanded beyond cosmetics and cosmetics to pose a threat to the treatment solution industry.

By 2025, the beauty, cosmetics, and hygiene industry in India will be worth $20 billion.

Key Drivers Enhancing The Growth Of The Cosmetics Business in India.

1. GenZ: The growing interest in cosmetics and skincare among Generation Z has gradually transformed this industry. Because of having unrestricted access to social media in order to express their needs, customers can acquire the products and services they desire.
2. Online Availability Of Products: The COVID-19 pandemic has forced the industry to move online, eliminating premium items. Customised items may help businesses attract more customers because consumers want to buy from companies that fulfil their demands and preferences.
3. Availability of Natural & Organic cosmetics: India's cosmetics industry will focus on natural and organic products. Chemical cosmetics damage skin, and it shows a better grasp of this. Natural cosmetics are abundant in India, therefore this age's preference is admirable.
4. Shift in consumer preferences: A compelling driver behind this expansion is the changing landscape of consumers, which is one of the most compelling forces. For the first time in history, Indians are more picky and quality-conscious than ever before. At the same time that disposable incomes are increasing and urbanisation is accelerating, the market for cosmetics is growing.
5. More use of E-commerce platforms: There has been a substantial shift in the landscape of the cosmetic industry as a result of the information technology revolution. As a result of the proliferation of e-commerce platforms, consumers all around the country now have convenient access to a wide product selection.

Why 2024 is the right time to Start a Cosmetic Franchise in India?

Throughout the past few years, the cosmetics business in India has witnessed a spectacular transformation, transforming from simple beginnings into a thriving industry that is worth several billions of dollars.

As the economic landscape of the country continues to expand, the beauty sector has become a blooming field for aspiring businesspeople who are looking to leave their mark on the world.

In this part, we will delve into the dynamic world of Indian cosmetics, illuminating the reasons why this year is an excellent time for prospective entrepreneurs to launch a cosmetic franchise and laying the groundwork for a brilliant voyage into the world of entrepreneurship.

1. Expansion of the Cosmetics and Beauty Industry: Over the past few years, the beauty and cosmetics business in India has been undergoing significant expansion. There is a growing demand for cosmetic products and services as a result of the growing emphasis placed on personal care and appearance.
2. Changes in consumer tastes: There is a growing awareness among consumers in India regarding their physical appearance, and they are eager to make investments in high-quality beauty services and cosmetic items. Because of this change in consumer behaviour, cosmetic franchises now have the opportunity to respond to consumer preferences that are always shifting.
3. Influence of Global Brands: Consumers in India are becoming more and more affected by beauty trends from around the world. The introduction of a cosmetic franchise that incorporates international brands or adheres to global beauty standards has the potential to attract a large number of customers.
4. Diverse Options: Cosmetic franchises typically provide their franchisees with a diverse selection of products and services, which enables them to broaden the scope of their offers. The provision of different revenue streams can be achieved by the provision of beauty treatments, makeup, haircare, and skincare products.
5. Use of E-commerce: The proliferation of e-commerce in India has opened up new channels via which cosmetic franchisees can communicate with their target audience. It is possible for franchisors to have already developed online platforms or to provide franchisees with assistance in developing a robust online presence.

Best Cosmetic Franchises To Consider in India 2024

Forest Essentials

Through the incorporation of Ayurvedic principles, Forest Essentials has revolutionised the concept of luxury skincare in India. Its premium goods, which are packed with powerful botanical extracts, have attracted a devoted client base comprised of individuals who place a high value on the combination of tradition and elegance.

Lakme

This brand continues to be a major force in the Indian beauty market, thanks to its long and illustrious history that spans more than half a century. Lakmé has managed to keep its fascination among the contemporary Indian audience and is renowned for its inventive product line as well as its trendsetting collaborations with major fashion stars.

ColorBar

With its vivid makeup lines and creative formulations, Colorbar has earned a name for itself in the industry by catering to the dynamic lifestyle of the modern Indian lady. The company's commitment to diversity and inclusiveness has increased in its popularity across a wide range of customers, which has contributed to the company's consistent growth and profitability.

The Body Shop

The Body Shop has attracted the interest of Indian consumers who are looking for cruelty-free and environmentally responsible cosmetic options. The Body Shop is focused on ethical beauty and sustainable operations. Due to the combination of its global brand reputation and its dedication to social concerns, the company has been able to achieve tremendous success and solidify its place in the Indian cosmetics industry.

Amway India

Amway India has become identified with premium personal care and cosmetic products as a result of its extensive distribution network and a global reputation for producing high-quality products. Amway has made it possible for a great number of business owners to enter the cosmetics sector by providing them with a lucrative opportunity to promote their products through its direct selling approach.

To Conclude,

Get in touch with us at FranchiseBazar to find out more about the latest cosmetic franchise opportunities in India or click here if this blog has helped you decide to grow your cosmetic business in India right away!

Disclaimer: The brands mentioned in this blog are the recommendations provided by the author. FranchiseBAZAR does not claim to work with these brands / represent them / or are associated with them in any manner. Investors and prospective franchisees are to do their own due diligence before investing in any franchise business at their own risk and discretion. FranchiseBAZAR or its Directors disclaim any liability or risks arising out of any transactions that may take place due to the information provided in this blog.