Retail channels
For the six months ended 30 September 2023, Sa Sa International Holdings Limited's turnover increased by 38.3% to HK$2,144 million, of which offline sales in Hong Kong and Macau increased by 64.9% to HK$1,624 million, and the company's net profit was HK$102 million, compared to a loss of HK$133 million in the same period last year.
According to the National Enterprise Bankruptcy and Reorganization Case Information Network, Hangzhou Naturalist Brand Management Co., Ltd., the parent company of OnlyWrite, was filed for bankruptcy liquidation. At present, the Qiantang District People's Court of Hangzhou City, Zhejiang Province has officially accepted the case.
Authoritative release
On December 13, the Guangzhou Municipal Administration for Market Regulation issued a Q&A on the filing of ordinary cosmetics (51st issue) (hereinafter referred to as the "Q&A"), answering questions related to the filing number, children's cosmetics labels, microcrystalline or microneedles, seaweed masks, and efficacy claims. According to the Q&A, claims that microcrystalline or microneedle products, such as the use of tiny needle-like raw materials such as hydrolyzed sponges or corresponding production process technologies, are used by penetrating the skin to produce effects or penetrate the product, and are not applied to the surface of the skin, are beyond the scope of cosmetics.
Regarding seaweed masks, the Q&A shows that the production process and storage conditions of seaweed masks should be strictly controlled for microbial indicators. According to the Announcement of the State Food and Drug Administration on Updating the Catalogue of Prohibited Raw Materials for Cosmetics (No. 74 of 2021), Tianxian (Scopole) is a prohibited plant (animal) raw material for cosmetics, and it is strictly forbidden to mix "Tianxianzi" with "seaweed" for cosmetics production or registration and filing.
On December 1, the Guangdong Cosmetics Quality Management Association issued an announcement on the official implementation of the group standard of "Bath Oil". In accordance with the relevant provisions of the "Regulations on the Management of Group Standards" of the Standardization Administration of the People's Republic of China and the "Procedures for the Formulation of Group Standards of the Guangdong Cosmetics Quality Management Association", the Standardization Committee of the Guangdong Cosmetics Quality Management Association has organized and reviewed the release of the group standard of "Bath Oil", the standard release number: T/GDCQMA003-2023 The standard will be implemented from December 8, 2023.
On December 8, the Certification and Accreditation Administration of the People's Republic of China issued a notice on soliciting opinions on the "Technical Report on the Determination of Preservatives in Cosmetics". According to the notice, the 2023 national inspection and testing agency proficiency testing plan "Determination of Preservatives in Cosmetics" project has been implemented. The technical report of the project is now open to all participating inspection and testing institutions and the public to solicit opinions, and the deadline for feedback is December 16, 2023.
Brands and industries
On November 15, Guangdong Bawei Biotechnology Co., Ltd. sprinted to the Beijing Stock Exchange, and on November 28, the company updated the listing application review dynamics on the Beijing Stock Exchange, and the company has received the third round of review inquiry letters.
According to the cosmetic raw material filing information platform of the State Food and Drug Administration, the "phosphorylcholine polymer-MBH" of Shanghai Oli Industrial Co., Ltd. and the "bakuchiol" of Yunnan Hengjin Pharmaceutical Co., Ltd. have completed the filing and entered the monitoring period. It is reported that phosphorylcholine polymer-MBH is a chemical raw material, and the purpose of the raw material is skin protector and moisturizer, which can be used for all products except spray. The maximum permissible concentration when using cosmetics does not exceed 3%. The purpose of the "bakuchiol" raw materials filed by Hengjin Pharmaceutical this time is skin protectant, emollient and antioxidant, which is suitable for all kinds of facial cosmetics, and the safe use amount needs to be between 0.5554-3.1992%. "Bakuchiol" has been filed with Saisheng Company before, but the raw materials of the two companies are slightly different in terms of purpose, scope and safe use.
On November 30, the Guangdong Provincial Drug Administration issued a notice on cosmetics sampling inspection information (Issue 7, 2023). In order to strengthen the supervision of cosmetics and ensure the safety of cosmetics used by the public, according to the Guangdong Provincial Cosmetics Sampling Inspection Plan, the Guangdong Provincial Drug Administration organized a sampling inspection of cosmetics in the province's cosmetics production and operation links, and the Guangdong Provincial Food and Drug Administration sampled a total of 302 batches of products, of which only 4 batches of products were unqualified. The non-conforming products involved two hair dye creams, a shower gel and baby baby skin cream. Among them, the non-compliant "Nobixing Baby Baby Cream" was named because of the illegal addition of terbinafine. Terbinafine is an acrylamine ingredient commonly used for fungal infections on the body. For cosmetics that do not meet the requirements for random inspection, relevant enterprises and units have been required to take risk control measures such as suspension of sales and recall, and carry out investigations and rectifications of the reasons for non-compliance.
On November 28, the official website of the China Securities Regulatory Commission released the "Report on the Initial Public Offering and Listing Guidance of Wanxiang Technology Group Co., Ltd." According to the report, on November 9, 2023, Wanxiang Technology signed a mentoring agreement with CITIC Securities. According to the counseling schedule, the counseling period will last from November 2023 to May 2024. This is Wanxiang Technology's second IPO.
On November 27, Green Biotechnology Co., Ltd. (hereinafter referred to as "Green Biotech") updated its prospectus and announced its financial data for the first three quarters ended September 30. In the first three quarters of this year, Green Biotech's revenue was 541 million yuan, an increase of 15.38% year-on-year, operating profit was 81.3323 million yuan, an increase of 47.36%, and net profit was 70.1939 million yuan, an increase of 45.62%.
On November 25, according to the official website of the Shenzhen Stock Exchange, Guangzhou Uniasia Cosmetics Technology Co., Ltd. submitted the "Application of Guangzhou Uniasia Cosmetics Technology Co., Ltd. on Withdrawing the Application Documents for Initial Public Offering of Shares and Listing on the Growth Enterprise Market" to the Shenzhen Stock Exchange, terminating the IPO.
Recently, according to foreign media news, Disco, a skin care brand focusing on men, filed for bankruptcy protection on November 16 and officially closed. The brand was founded with 7 gluten- and preservative-free "vegan" skincare products, all of which were infused with natural and pure ingredients such as aloe vera, coconut oil, caffeine, and avocado.
According to user data monitoring, between September and October 2023, the sales volume of hand cream products increased by 150% year-on-year, with sales exceeding 2 billion.
It is learned that Bombay Shaving Company, a DTC men's care brand, recently revealed that it is focusing on the layout of physical distribution business, and plans to expand the physical distribution points from the current 70,000 to 300,000 in the next two years.
It is reported that Nat Habit, an Indian DTC personal care brand, has received a $9 million Series A financing led by Bertelsmann. It is reported that this is Nat Habit's first round of financing since 2023 and the second round of financing in the past year and a half. Currently, Nat Habit is valued at Rs 3 billion (about $36 million).
On December 7, the General Administration of Customs released the statistics of key national import commodities in November. In November, the import volume of beauty cosmetics and toiletries was 29,529.1 tons, down 14.23% year-on-year, and the import value was 9.59 billion yuan, down 23.7% year-on-year. From January to November, the cumulative import volume of beauty cosmetics and toiletries was 334,881.6 tons, down 13.8% year-on-year, and the cumulative import value was 117.51 billion yuan, down 14.8% year-on-year.
On December 4, face mask brand Chunyu Papa Recipe announced that it would cease operations in China. According to the announcement, the Papa Recipe store will stop selling operations on December 31, 2023.
According to user data monitoring, the sales of Perfect Diary's "Bionic Film" essence lipstick exceeded 10,008,100 yuan on the Taobao Tmall platform during October ~ November this year, and the sales volume reached 64,200 yuan.
According to the data, during this year's Double 11, the sales of facial care sets occupied the first place on the dual platforms of Taobao, Tmall and Douyin, contributing more than 2% of the market size to the platform skin care market. In addition to well-known brands such as L'Oreal, Helena, and Estee Lauder, the performance of domestic brand Han Shu is also quite good. In the TOP20 list of Douyin facial care sets, Han Shu topped the list, with a market share of 13.55% and a sales of more than 500 million yuan.
According to statistics, from January to October 2023, the overall number of filings for cosmetic products reached 215,000, a year-on-year increase of 24.48%. Among them, the increase in April was the most significant, reaching 50.37%.
On December 1, the China Institute for Food and Drug Control issued the "Technical Guidelines for the Definition and Research of New Cosmetic Raw Materials (Draft for Comments)" and the "Working Mechanism for Communication and Exchange of New Cosmetic Raw Materials (Trial)". In the Guiding Principles, the definition of new raw materials is clarified, and the categories that do not belong to the category of new cosmetic raw materials are listed.
According to the "Weibo 2023 Q3 Beauty Industry Popularity Report", the volume of the beauty industry in Q3 this year increased by 49%, and the number of hot topics increased by 357% quarter-on-quarter. Under the topic of tens of millions of readers, three user discussion trends were also disclosed, "skin care subtraction", "celebrity imitation makeup" and "skin care correction".
According to the latest "Youth Inventory" report released by consumer research agency Piper Sandler, the overall consumption of makeup, skincare products and perfumes by Gen Z consumers in 2023 will increase by 23% year-on-year, led by the makeup category, which will increase by 33% year-on-year. In beauty spending, makeup spending accounted for the highest proportion, at US$127, or about RMB 917, the highest level since 2019.
According to the filing information platform of new cosmetics raw materials of the State Food and Drug Administration, on December 7, the new raw material "α-dextran hydroxypropyltrimonium chloride" of the International Fragrance Group Corporation (hereinafter referred to as "IFF") completed the filing and entered the testing period. On December 11, Yunnan Bethany Biotechnology Group Co., Ltd. (hereinafter referred to as "Bethany") completed the filing of two new raw materials, "Candida bee / glucose / flat kernel wood oil fermentation products" and "Bee Candida yeast / glucose / coconut oil / flat kernel wood oil fermentation products" and entered the monitoring period. BETHANY HAS FILED A TOTAL OF 3 NEW RAW MATERIALS THIS YEAR, AND ANOTHER "LUDWIGIA ADSCENDENS" EXTRACT WAS FILED ON JULY 26.
Procter & Gamble said in a statement that it plans to restructure its business operations in select markets to cope with "challenging macroeconomic and fiscal conditions" and expects to increase restructuring costs by $1 billion to $1.5 billion, including foreign exchange translation losses recognized at the time of liquidation of businesses in affected markets, including Argentina and Nigeria. In addition, P&G will make a non-cash impairment charge of $1.3 billion on intangible assets acquired at the time of its acquisition of Gillette in 2005, which is expected to total between $2.0 billion and $2.5 billion, combining the restructuring plan with impairment charges.
Ulta Beauty recently released its third-quarter earnings report, with sales up 6.4% year-on-year to $2.49 billion, beating analysts' expectations of $2.47 billion, and earnings per share of $5.07, also higher than Wall Street expectations. Thanks to the positive performance, the group raised the lower end of its annual sales guidance to US$11.1 billion, up from US$11.05 billion previously.
Recently, Beijing Peptide Biomedical Technology Co., Ltd. (hereinafter referred to as Peptide Bio) announced the completion of nearly 200 million yuan in Series B+ financing. The leading investors are Aimeike, Sino-US Green Fund, and other investors include Jiayuan Fund, Chengdu Science and Technology Venture Capital, Jincheng Fund, etc., and the old shareholder Lanchi Venture Capital continues to increase its weight. CEC Capital acted as exclusive financial advisor.
Recently, the Central Institute for Inspection and Inspection issued the "Working Mechanism for Communication and Exchange of New Raw Materials for Cosmetics (Trial)" and the notice of public solicitation of opinions on the "Technical Guidelines for the Definition and Research of New Raw Materials for Cosmetics (Draft for Comments)", of which the feedback on the "Guiding Principles for New Raw Materials" is as of December 18.
Brazilian cosmetics giant Natura is planning to sell a majority stake in its beauty brand, Avon International.
On December 12, Wuxi Jinghai Amino Acid Co., Ltd. was listed on the Beijing Stock Exchange.
Cross-border e-commerce platform Shopee's "Double 12 Birthday Promotion" opened on December 12. According to platform data, as of 2 a.m., the number of cross-border orders has increased to 17 times that of the same period on weekdays, the performance of new cross-border sellers is outstanding, the number of orders has risen to 95 times that of the same period on weekdays, and the number of orders of Shopee Mall has increased to 30 times that of the same period on weekdays. Categories such as beauty, mobile phones, tablets and accessories, women's clothing, fashion accessories and home life are the most popular cross-border categories.
According to the Administrative Licensing Law of the People's Republic of China, the Regulations on the Supervision and Administration of Cosmetics and the Measures for the Supervision and Administration of Cosmetics Production and Operation, the Guangzhou Municipal Administration for Market Regulation has cancelled the cosmetics production licenses of 17 cosmetics manufacturers, including Guangzhou Xinji Cosmetics Co., Ltd. and Guangzhou Yimei Cosmetics Co., Ltd., according to the application of the enterprise.
On December 7, the General Administration of Customs released the statistics of key national import commodities in November. In November, the import volume of beauty cosmetics and toiletries was 29,529.1 tons, down 14.23% year-on-year, and the import value was 9.59 billion yuan, down 23.7% year-on-year. From January to November, the cumulative import volume of beauty cosmetics and toiletries was 334,881.6 tons, down 13.8% year-on-year, and the cumulative import value was 117.51 billion yuan, down 14.8% year-on-year.
According to the data monitoring of users, although the sales volume of Taobao Tmall essence oil in 2023.10MAT is only 3.31% of the facial essence market, it is 1.16% higher than the proportion of 2022.10MAT, in addition, with the blessing of the big promotion, the GMV of essence oil in October increased by more than 35.32% year-on-year, while the GMV of liquid essence fell by 27.63% year-on-year in the same period. On the Douyin platform, the GMV of essential oil in the past 11 months has even reached 121% year-on-year. It can be seen that essence oil, as a fast-growing category, although the overall volume is far less than that of liquid essence, its development growth rate is obvious, and it is expected to rise rapidly in the future, seize share, and become a core category to compete with liquid essence.
It is learned that the domestic makeup brand "Blankme Half Share" recently received investment from L Catterton, a private equity fund under the LVMH Group, and the amount has not been disclosed.
Unilever announced that it has agreed to sell Elida Beauty, a business unit of more than 20 non-core personal care brands including Q-Tips, Caress, Timotei and Tigi, to investment firm Yellow Wood Partners LLC on undisclosed terms, with the acquisition expected to close in mid-2024.
Rambutan is a common fruit, but the amount of waste generated in agriculture is huge. A recent study found that rambutan seed extract contains arbutin, which, in synergy with kaempferol compounds, has the effect of inhibiting the activity of melanin and tyrosinase, which can be a sustainable solution to the problem of pigmentation.
On December 15, the National Bureau of Statistics released the retail sales data of consumer goods in November 2023. In November, the total retail sales of consumer goods reached 4,250.5 billion yuan, a year-on-year increase of 10.1%. From January to November, the total retail sales of consumer goods 427945 billion yuan, a year-on-year increase of 7.2%. In terms of cosmetics, the total retail sales of cosmetics in November 2023 were RMB54.8 billion, down 3.5% year-on-year, and from January to November, the total retail sales of cosmetics were RMB384.3 billion, up 4.7% year-on-year.
It is reported that Nat Habit, a DTC personal care brand, announced the completion of a $10 million Series B financing, led by Bertelsmann India Investment Company (BII), followed by old shareholder Fireside Ventures, Amazon India Fund, Mirabilis Investment Trust and Sharp Ventures.
On December 18, the filing information of new cosmetic raw materials of the State Food and Drug Administration showed that the "sea cucumber peptide (record number: national makeup original preparation 20230064)" of Xi'an Hewlett-Packard Biotechnology Co., Ltd. has completed the filing and entered the monitoring period. "Sea cucumber peptide" is used as a skin protector and moisturizer, and is applicable to all cosmetics (except spray products), and the safe use amount is ≤2%. According to public information, Xi'an Hewlett-Packard Biotechnology Co., Ltd. was established in 2010 and is a medical biological manufacturing enterprise engaged in R&D, production and sales integration. Focus on the development and application of high-quality medical repair technology, and its main business: R&D, production and sales of new biomaterials, Class II and Class III medical device repair dressing products.
On december 14, according to the filing information of new cosmetic raw materials of the state food and drug administration, guangdong perfect life and health science and technology research institute co., ltd. (hereinafter referred to as "guangdong perfect") "gynura procumbens leaf/stem extract (record number: national cosmetics original preparation word 20230061)" completed the filing and entered the monitoring period. This is also the first cosmetic raw material of Guangdong Perfect to complete the record. According to public information, Guangdong Perfect was established in 1994, mainly selling health food, small kitchenware, cosmetics, cleaning supplies and personal care products, from the "bioactive peptides", "natural plants", "traditional Chinese medicine" and "microecology" four major fields, the development of the health industry.
According to incomplete statistics from the cosmetics newspaper, since the beginning of this year, a total of 7 domestic beauty brands have withdrawn one after another, including 5 makeup brands, 1 skin care brand, and 1 fragrance brand.
Han Hou was forcibly held for 150 million, and Wang Guoan's tens of millions of real estate were auctioned. It is reported that from 2018 to 2020, Han Hou has been applied for compulsory enforcement many times due to arrears of advertising fees, and there have been rumors of using cosmetics to offset advertising fees, and in 2018, Wang Guoan was also applied for a freezing of 24.45 million shares by Jiaolong Asset Management Co., Ltd. (hereinafter referred to as Jiaolong Asset Management) for a period of three years, and Jiaolong Asset Management is also the applicant for the above-mentioned real estate auction.
It is worth noting that on December 19, Panyu Branch of Guangzhou Rural Commercial Bank Co., Ltd. applied to Wang Guoan, Ni Suting, An Xin Cosmetics and other companies related to the Hanhou brand for compulsory enforcement of 149.9 million yuan on the grounds of loan contract disputes.
E-commerce platforms
On November 29, Pinduoduo rose by more than 3%, surpassing the market value of Alibaba's U.S. stock market and becoming the largest Chinese concept stock in the U.S. stock market. As of now, Pinduoduo has a market capitalization of $192 billion, and Alibaba has a market capitalization of $191.5 billion. Since the beginning of this year, Pinduoduo has risen by more than 77%.
On November 29, Bilibili released its Q3 financial report for 2023. Total net revenue for the third quarter of 2023 was RMB5.8 billion, unchanged from the same period in 2022. Net loss for the third quarter of 2023 was RMB1.3 billion, narrowing 22% from the same period in 2022. Bilibili users and community continued to grow actively, with daily active users exceeding 100 million for the first time and monthly active users reaching 341 million.
As of November 29, Pinduoduo's share price rose more than 3%, surpassing the market value of Alibaba's U.S. stock market, reaching $192 billion, a cumulative increase of more than 77% from the beginning of the year.
According to data from third-party platforms, from January to November this year, the overall GMV of Douyin Beauty has exceeded 150 billion yuan, with a year-on-year growth rate of 43.66%. During the period, the GMV of Han Shu's single brand has exceeded 2.8 billion yuan, and it is about to enter the "3 billion club", and at that time, it will be the first beauty brand on the Douyin platform to reach the level of 3 billion, which is expected to set a new historical record.
According to the data of Qingyan Intelligence, the GMV of makeup/perfume/beauty tools reached 546 million yuan during this year's Tmall Good Price Festival, a year-on-year decrease of 22%, and the GMV of beauty and skin care/body/essential oil reached 1.416 billion yuan, a year-on-year decrease of 27%.
Recently, the official opening of the "Xiaohongshu flagship store" of the Korean cosmetics brand EDI House was announced, and at a time when Chinese consumers have faded their Korean makeup filters, the "opening notes" have unexpectedly received the support of many netizens, who have posted congratulations on Xiaohongshu, "Congratulations! I have liked the brand from college to now for almost 10 years", "I love you so much, I hope to synchronize the new Korean products", "Your eyeliner and eyebrow pencil are the first in the world"......
It's not just the House of EDI that is in this situation. Since the end of 2022, the discussion of Korean skincare products on platforms such as Xiaohongshu has picked up, and brands such as Face Shop, innisfree, and Heryan that have withdrawn or closed stores offline in China have recently started Xiaohongshu.
On December 13, Japanese cosmetics brand CEZANNE and Korean cosmetics brand BBIA suddenly announced the closure of their overseas flagship stores on Tmall.
According to the emergency announcement issued by BBIA, due to the adjustment of brand operation, the store products have been removed from the shelves and cannot be purchased, and customers who have purchased can contact customer service to solve relevant problems. Cezanne said in the announcement that the store will stop operating on December 13, and will no longer accept new orders from now on, and the goods that have been ordered will be delivered as planned.
On December 11, Douyin officially announced that from December 12, 2023, Indonesian consumers can purchase goods directly through shelf displays, short videos, or live broadcasts on TikTok.
According to data from third-party platforms, from January to November this year, some beauty brands have exceeded 1 billion in Kuaishou, and many brands are also on the road to hitting 1 billion.
Specifically, Kuaishou Beauty is still the world of fast brands (generally referring to brands that grew up on the Kuaishou platform), with Delai Hui and Dora Duoshang leading the way, with GMV exceeding 1 billion earlier than last year. At the same time, the old domestic product Osman and the cutting-edge brand Gu Yu began to exert their strength, and they have squeezed into the top five this year, and the GMV is also moving closer to 1 billion.
International conglomerate
L'Occitane announced its financial results for the first half of fiscal year 2024. As of September 30, 2023, the brand's revenue for the first half of the year was 1.07 billion euros, up 19% year-on-year. This rally was mainly due to the strong growth of Sol de Janeiro and L'Occitane en Provence, especially in the Chinese market.
Despite the decrease compared to the same period last year, L'Occitane's gross margin remained at a high level of 78.3%, mainly due to the higher wholesale sales contribution from brands such as Sol de Janeiro and Elemis.
Operating profit reached US$84.33 million, down 11.8% year-on-year, mainly due to the significant increase in the Group's marketing investment in strategic markets and key brands. L'OCCITANE en Provence has the largest marketing budget, investing in key markets, particularly China, as well as other strategic markets and channels, such as the United States, Japan, South Korea and Travel Retail.
In a conference call following the release of the 2024 interim results, L'Occitane executives reaffirmed their plans to open 10 to 5 stores per year in the Chinese market for the next five years. This time, L'Occitane has set its sights on China's sinking market, such as L'Occitane recently opened a new store in Xinxiang, Henan Province, and the lineup of more than 250 stores listed on the brand's official WeChat account has also expanded to Qinghai and Xinjiang.