Oriflame to launch 150 cosmetics

The Sweden-based cosmetics company Oriflame is set to introduce 150 more products in India by next year, as competition among direct-selling companies in India rises with the entry of more multi-national players,.

The proposed launch is aimed at scaling up business in India, which now contributes only 6 per cent. The ¤ 971 million company aims to generate the biggest chunk of business from the country in eight years.

Oriflame's rival, Mary Kay set shop in India recently with investments of $20 million. The company has already begun test marketing its products here. Other direct-selling cosmetic brands in the country include Avon and Amway.

Speaking to Business Standard, Fredrick Widell, managing director, Oriflame India said, "We are scaling up capacities at our factory near New Delhi, which also serves as an export base of select products to the 59 countries where we operate. We would have to increase our sales force in India by 10-fold. We are also planning to make India our research and development hub for our toiletries and make-up range."

The company has begun work on these products at its R&D hub in Europe. Oriflame takes about 12-18 months to develop a product.

Russia is currently Oriflame's biggest market. Within India, the company has zeroed in on north-east, where the consumption of hair colour is higher than the rest.

Keeping in mind the diversity in consumption across the country, the company's aims to expand its product portfolio to have products at several price points and in all segments. India currently has about 590 Oriflame products imported from Europe, Poland and Sweden.

The company started operations in the country 12 years back and has a presence in 1,200 cities. It is planning to enter newer categories such as hair-removal and cellulite-removal products for women, through its product launch next year.

It would also introduce its accessories range in India within the next two years, that would include products such as jewellery, handbags, mirrors and razors.

Oriflame is also looking at manufacturing some of its products locally on sub-contractual basis, to ensure ease in logistics. Oriflame also intends to manufacture toiletries and colour cosmetics in the country as it is the major market for these products.

The beauty and wellness sector in India is growing at 13 per cent, according to AC Nielsen. This is fuelled by the emergence of new segments such as male skin care.

Companies such as Oriflame are of the opinion that their unique selling point (USP) is the direct-selling model. Unlike other companies which sell through retail outlets, Oriflame consultants profit from every sale.

The number of direct selling consultants world-wide has grown to over 60 million.