Nivea to triple turnover to Rs 600 crore by 2010

Nivea India is expected to generate profits in the next three years. The company is in the investment phase ever since it broke off the joint venture with distribution partner JL Morison in December 2007 and became a 100 per cent subsidiary of Germany-based Beiersdorf. It is eyeing a turnover of Rs 200 crore this year and Rs 600 crore by 2010.

Soma Ghosh, marketing head, Nivea India, said, "We will be building on our current products portfolio, which consists of mainly women's face care, deodorants and men's skin care. We will launch more improved variants and new products in these ranges."

Nivea is present in 600 stores across the country. It's the number-two deodorants brand with a market share of 12 per cent following Hindustan Unilever's Axe. One of its offerings, Nivea for Men, an advanced whitening cream, has a market share of 50 per cent in big markets such as Delhi and Mumbai.

Nivea as a brand has presence in 2.5 lakh retail outlets, according to AC Nielsen retail measurement services. The market share for all its brands is below 5 per cent in each category, except for Nivea for Men, which has a 14.6 per cent share.

Nivea has woken up to the Indian market a little later than its European peers such as L'Oréal India, which had formed a subsidiary way back in 1994 and has a turnover of Rs 600 crore in 2007.

Nivea recorded a turnover of Rs 40 crore in the first quarter (January-March) of 2008, jumping 172 per cent over the same period last year.

It sources 70 per cent of its products from Germany and other Asian locations and 30 per cent from contract manufacturing. It is now evaluating whether to set up its own manufacturing facility or to increase production through third-party manufacturers.

Mumbai-based Nivea India currently has a workforce of 160, headed by Managing Director Kai-Boris Bendix.

Nivea's latest addition to its portfolio is an oil control variant of its whitening cream for men. This addition was based on a finding that 40 per cent of male consumers of whitening cream were dissatisfied because they had oily skin. It will be spending 35 per cent of its projected sales for 2008 on advertising its products through two agencies "� Media Edge and TBWA.

The company's parent, Beiersdorf, registered worldwide sales of Rs 33,042 crore (¤5507) in 2007 and a growth of 9.1 per cent.About 85 per cent of its sales were contributed by its flagship brand Nivea. Its other major products include Eucerin and La Prairie and a services retail venture Nivea House.

The company plans to consistently evaluate products from its global stable to be introduced here. The company has identified Brazil, Russia, India and China (Bric) countries as growth markets.

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FAIR NUMBERS

600 stores Countrywide

2.5 lakh Retail outlets

70 per cent Of its products are sourced from Germany and other Asian locations and 30 per cent from contract manufacturers

160 Employees in India

35 per cent of its projected sales for 2008 will be spent on advertising its products