Accessories make up 10% of Oriflame’s turnover

“Our target clientele has changed, and this is why these products are now in demand. Because the chasm between rich and poor is widening, you have two options: either turn your company into a niche company or into a mass market company,” General Manager of Oriflame Romania, Monica Tatoiu, told Business Standard. Monica Tatoiu did not indicate the absolute value of the segment, but based on a turnover of over €30 million in 2007, accessories could exceed €3 mln.

The company’s General Manager added that this year’s business strategy involves a concentration on consumers aged 18-23. At the end of last year, Monica Tatoiu announced that the company had budgeted turnover growth for 2008 of 10 percent, above the general rhythm of growth of the market, estimated by her to be 6 percent this year. She did not indicate estimated turnover for 2007, but the company posted net sales in 2006 at €28.6 mln. In terms of profitability, the local branch of Romania is second in Europe at the group level.

“The behavior of Romanian consumers is different than that of western consumers. More recently, the Romanian consumer has also become more educated, more refined, and trends that did not catch on several years ago are now highly valued by Romanians,” added Monica Tatoiu.

Oriflame Romania’s General Manager indicated last September that the Swedish company is planning to build a cosmetics product factory in Romania. “They want to invest in the construction of a regional center. Now it is only us and the Russian branch left on the list of possible candidates for this center,” added Monica Tatoiu.

Oriflame Cosmetics Romania is part of the international Oriflame Holdings group, which has 55 branches in Europe, Asia, America, and Africa. Principal players on the Romanian cosmetics market are international direct sales giants Avon, Oriflame and Amway, and fast moving goods companies P&G, Unilever and Henkel.