Taping into export potential for personal care, beauty products
The consumption trends across the world have seen people becoming more conscious about their health and well-being than ever before.
Natural products such as natural skin, hair, and dental care are creating trends that are impacting significantly on consumer trends across the world.
These trends are driven by the consumer desire to use natural and organic products, as they are perceived to have more benefits to their skin, do not have long term effects, and are less harmful to the environment.
As the world is looking at natural personal care and beauty products as the in-thing, Zimbabwean businesses have a shot at exploring emerging markets, riding on resources available in the country.
Zimbabwe is naturally endowed with indigenous plants and trees of which by-products such as organic oils are highly sought after in the cosmetic sector both in international and domestic markets.
Today, a growing number of formulators and manufacturers within the cosmetic and pharmaceutical sector are using these organic oils as active ingredients in the manufacture of medical treatments for anti-aging and dermatologic disorders.
Some of the famous and highly demanded organic oils found in Zimbabwe include marula oil, ximenia, moringa, teatree, aloe, avocado and eembeke oil.
All these oils are used as active ingredients in the manufacturing of various cosmetics products.
To tap into the potential of these natural products, President Mnangagwa’s Government is already positioning local producers to value-add local resources into high-end products, that can fetch more on the international markets.
For example, following the identification of Mwenezi as a potential regional hub for marula products, President Mnangagwa commissioned a marula/mapfura processing and value-addition factory at Rutenga, which is a landmark and game-changing investment that has put the rural area on the cusp of industrialisation.
The plant, which is the first industry at Rutenga is expected to rake in nearly $400 million seasonally from marula/mapfura processing and value addition when in full operation.
Undoubtedly, some of the outputs from the plant such as oils have a ready market in international markets, and proceeds from exports will improve livelihoods of rural communities.
Marula/mapfura is one example of the many naturally-growing plants found across the country that have been identified as a potential game changer for Zimbabwe’s exports of personal care, essential oils and beauty products.
To increase capacities around these products, ZimTrade – national trade development and promotion organisation – is developing export clusters across provinces which will help organise producers and improve the quantities and qualities of export offerings.
Along the lines of the Government’s devolution programme, the export clusters currently under development, are expected to increase exports of personal care and beauty products at district and provincial level.
Global markets
The global market for personal care and beauty products has been on an upward trend over the past few years and is projected to continue growing.
According to a report by Grand Review Research, the global beauty and personal care products market size is expected to reach US 937.1 billion by 2030.
The report notes that natural and organic substitutes are gaining traction among a sizable number of consumers, driven by rising consumer awareness related to the harmful effects of chemicals on the skin.
Industry trends are showing that people are now shifting towards beauty products that have no long-term effects and are manufactured using natural and organic materials.
This has led to increased use of new active ingredients, including natural products with defined and specific biological effect.
The shift towards natural products has seen an increase in essential oils, which are produced from plant sources such as flowers and fruits, herbs, resins, and wood oils.
According to Trad Map, the global import value of essential oils and resinoids; perfumery, cosmetic or toilet preparations has been growing over the past five years, from around US$128 billion to US$168 in 2021.
Top markets are China, United States of America, Hong Kong, Germany, France, and United Kingdom, Singapore, and Netherlands.
Of this figure, the global import value of plant-based essential oils has grown from US$5.4 billion in 2017 to US$5.8 billion in 2021.
Top importing markets for plant-based essential oils that offer opportunities for Zimbabwean businesses include France, Germany, China, United Kingdom, and Netherlands.
These countries already enjoy good trading relations with Zimbabwe and local suppliers can leverage on current performing products to introduce personal care and beauty products into the market.
The import value of beauty or make-up preparations and preparations for the care of the skin has also grown from US$48.8 billion in 2017, to US$74.3 billion in 2021.
Further to this, global import value for preparations for use on the hair have been growing over the past five years, from US$13.8 billion in 2017 to US$16.3 billion in 2021.
Countries such as China, Germany, United Kingdom, and Netherlands are among top importers of the products that Zimbabwean companies can target.
Need to grow local capacity
Trade data shows that Zimbabwe’s exports of essential oils have been growing over the past decade, although the country still faces trade deficit in the same products.
As women are often more interested in personal care and beauty products, there is need for deliberate approach to capacitate women-led businesses in the sector.
The cosmetics sector value chain in most countries relies on women who participate from production, manufacturing, marketing, and sales.
This means easier wins could be achieved if capacity building interventions are provided to women-led enterprises, which in turn will increase their participation in the economy, drive trade, and create new jobs.
Financiers also need to come up with solutions that allows small businesses to access capital investments at favourable terms as some small enterprises might not have collateral.
As personal care and beauty products are available in a wide range of variety, businesses also need to capitalise on niche areas where they can enjoy competitive and comparative advantages.
Here, businesses can ride on, for example, natural products available in abundance in their communities, and unique production techniques and product qualities that can differentiate their offerings from competition.
For local producers who are riding on organic and other healthy selling points, there is need to invest in research and development, so that they can effectively communicate the benefits of their products.
Here, producers need to identify specific components in their products, what health benefits they have, and why consumers should be interested.
Investing in e-commerce will also allow local producers to reach consumers across the world.
As most producers in the country are small business, they normally do not have capacity to stock their products in major retail stores in international markets.
They can however make use of digital platforms to market their products and ship when transactions are made.
