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Asia;ADB Country: Philippines Divisions [Province]: Manila
-------------------------------------------------------------------------------Industry: Consumer Goods & Home Furnishings Sector: Cosmetics/Toiletries
-------------------------------------------------------------------------------by: Dey Robles approver: David Fulton Report Date: 08/07/2003 Expires: 08/01/2006 -------------------------------------------------------------------------------INTERNATIONAL COPYRIGHT, U.S. & FOREIGN COMMERCIAL SERVICE AND U.S. DEPARTMENT OF STATE, 2004. ALL RIGHTS RESERVED OUTSIDE OF THE UNITED STATES. The brief provides a market overview of the Philippine market for U.S. manufacturers and suppliers of cosmetics, personal care products and toiletries. The report includes market size, competition, distribution, trends and best prospects that will help U.S. exporters determine the feasibilty of doing business in the country. Market Overview. The Philippines' importation of Cosmetics and Toiletries rose by a phenomenal USD 19 million or 40%, from USD48 million in 2001 to USD 67 million in 2002. This may be attributed to the reduction in tariff rates and on the increased number of women with purchasing power. Imports supplied 30% of total market. (In USD Millions)
Total Market Size 200 225 12 10 B.2001 2002 Growth Rate in % Projected Growth in % A. Total Exports 21 23 11 5 D. Total Imports 48 67 40 . Total Local Production 131 181 38 15 C.
principals. Clinique. cosmetics. Many local manufacturers import raw materials. body sprays) are gaining popularity even among young (below-13-year-old) consumers. Avon. Distribution Channels. Maybelline.S. Make-up preparation for the skin (such as colored pressed powder. These brands are well established and have distributors/representatives.10 E. On the other hand. The recession in major markets will cause exports to grow by only 5%. Imports 7 19 170 10 The U. Industry players predict a moderate 10% increase in imports in the next 2 years as the economy slows down and purchasing power shrinks. popularity and acceptability of U. Local manufacturers are expected to cut their importation of raw materials to save dollars and use local raw materials to augment imported stocks. . Some cosmetic brands are Revlon. Scents (toilet water/colognes.S. is expected to grow by a modest 10% the following year. rouges and blushers) and preparations for skin care (cleansers. brands. which increased by 38% in 2002. most domestic producers are into toiletries (soaps. Best Prospects. Max Factor. Mary Kay and Nu Skin. are manufactured in the Philippines under licensing agreements with their U. U. Some U. toners and moisturizers) have the best sales prospects. shampoos and hair conditioners) and other personal care products. market share is a strong 28%. is the leading source of foreign-made cosmetics and toiletries. Local production. Elizabeth Arden. liquid foundation. owing to the high quality. Total U.S.S.S. such as Avon and Sara Lee. Avon is the biggest domestic manufacturer of cosmetics. Estee Lauder.S. personal care and toiletries products.
The Bureau of Customs (BOC) has the full responsibility for all customs valuation. drugs and cosmetic products. they will also take care of advertising and promotion through sales personnel and dealer networks. pharmacopoeia when regulating cosmetic products and raw materials for cosmetic production. In some instances. This will ensure broad exposure for their products. The Philippines imposes 3%-5% tariff duty and a 10% value-added tax (VAT) on imported cosmetic products. Companies wanting to introduce new products in the market should appoint a distributor with a sales network covering the entire country.. The Bureau of Food and Drugs monitors and regulates the cosmetic industry in the Philippines. The following are the regulations on cosmetics and raw materials/ingredients for cosmetic products: . including insurance and commissions). Cosmetics may be distributed only after having been officially registered with the Bureau of Food and Drugs. Distributors not only help facilitate the product's entry into the market. classification. charges on imports prior to release from customs custody. plus those duties themselves. and other charges (i.S. The distributors handle all aspects of importation from registration. which will then process these entries through its Automated Customs Operating System (ACOS). The local Bureau of Food and Drugs. and clearance functions. Regulatory Issues. Print and broadcast media are important when introducing a product.Generally. local and imported cosmetic products are sold in retail outlets -department stores and most drug stores and supermarkets. these are also sold through direct marketing or through dealer networks. The BOC has issued a series of regulations governing the implementation of transaction value and outlining procedural steps importers need to follow. Distributors must register with the Bureau of Food and Drugs before operating. Cosmetics importers or their agents are required to file import entries with the Bureau of Customs (BOC). to obtaining a license and a clearance for the products. which monitors and regulates food. excise taxes. The registration process at the Bureau of Food and Drugs is from 6 to 18 months. adopted the U.e. Media helps build brand name and product recall. Foreign suppliers usually appoint a local distributor to represent their interests in the Philippines. The VAT is based on the valuation determined by the Bureau of Customs for the application of customs duties.
1971 Regulation Part D-4 Cosmetic: Listing of Cosmetic Specialties Administrative Order No. 1995 List of Permissible Claims for Cosmetic Preprations Memorandum Circular No.Administrative Order No. Cosmetics and Medical Devices" Bureau Circular No. 1999 Use of Hydroquinone and Tretinoin (Retinoic Acid) *Bureau Circular No. 1999 Revised BC 4 s. 21 s. 19-A s.1992 List and Amount of All Ingredients Used As a Component of the Finished Cosmetic Specialty *Memorandum Circular No. Cosmetics and Medical Devices for Physico-Chemical Analysis Bureau Circular No.ph/BFAD Update on Asia's Cosmetics Markets Plus Cosmoprof Asia 2003 . 150 s. 23 s. Drugs. Foods. Information on these regulations and registration requirements for cosmetics. 1992 Specific Standards and Requirements *&nb sp.gov. 29-A s. 1997 1997 Updated Listing of Cosmetic Ingredients Bureau Circular No. 6 s. 1999 "New Protocol for Registration of Drugs. 13 s. 8-A s. 3 s. 1994 Regulation Part D-5 Cosmetic: Listing of Cosmetic Specialties Administrative Order No.doh. 12 s. 1999 Guidelines in the Collection and Submission of Samples of Foods. 1999 Exfoliant and Exfoliate as Permissible Claims for Cosmetics Bureau Memorandum No. These circulars are subject to change upon the implementation of the ASEAN Harmonized Cosmetic Regulatory System. toiletries and fragrances are available on the Bureau of Food and Drugs website: www.
The following figures reflect substantial and growing demand in Asia for American cosmetics.6 billion 10% $49 million Hong Kong $500 million 2% $92 million India $600 million 20% $120 million Korea $3.6 billion 25% $157. toiletries and beauty supplies.S. Imports Australia $770 million 5% $101 million China $5. Commercial Service.S. . 2002-2003) Access Asia's Booming Beauty Markets Via . Country Market Size 2002 Projected Annual Growth Value of U. (Source: U.1 million Philippines $225 million 10% $67 million The Commerce Department Initiative at Cosmoprof Asia 2003! . Industry Sector Analyses. .
The Department of Commerce can assist companies in these endeavors. customized.S. Please use the following link to indicate your interest in participating in this opportunity: http://www.buyusa. Commercial Service offices throughout Asia are organizing buyer delegations to Cosmoprof and will match delegation members with U.gov or www. with the help of the U. reliable answers to your inquiries about a market and its receptivity to your products and services.As a U. For additional information regarding market research specific to your products and services.gov/hongkong/en/cosmoprofasia. small & medium sized companies that wish to reach multiple markets in Asia at one time.buyusa.html .S. November 12-14. This new program-called Asia Now--focuses on U. The Department of Commerce does not take responsibility for actions readers may take based on the information contained herein.buyusa. Department of Commerce. at Cosmoprof Asia 2003. See http://www. Hong Kong--the most prominent beauty trade show in Asia. The Commerce Department's U.S. .com.html.S. you can access these and other Asian markets. the information contained in this report is accurate as of the date published. Both reports provide timely. Readers should always conduct their own due diligence before entering into business ventures or other commercial arrangements. However.gov/hongkong/en/cosmoprofasia.export. companies exhibiting at this key industry event. ask about our Flexible Market Research and Customized Market Analysis programs by contacting us at 1-800-USA-TRAD(E) or www.S. To the best of our knowledge. cosmetics business.
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