Cosmetic, Toiletry, and Fragrance

Industry
Essential for Brazil

2022
 Some areas of activity
Private entity representing the
Brazilian industry of  Technical and regulatory affairs
Cosmetics, Toiletry, and  Foreign trade
Fragrances  Communication & Marketing
 Innovation & Technology
With approximately 400  Market intelligence
associated companies, it  International Businesses
representing 90% of the sector  Environment
 Social Responsibility
 Institutional relations
ABIHPEC operates in the defense of the
sector interests in the different public  Tax
and private spheres, supports actions
focused on the industry progress
through the development of projects
and programs that promote
innovation, sustainability, regulation,
internationalization, the sector
projection, and socially responsible
corporate attitude.
 An ESSENTIAL*
sector to the country

The Cosmetic, Toiletry, and

Fragrance Sector takes
care of Brazil...

...preventing diseases,
Taking care of health and offering well-being,
well-being is taking care of strengthening self-esteem
and promoting social
Brazil inclusion.

* The CTF sector was considered essential by the federal government: Decree nº 10.329/2020
 Takes care of the environment

 Pioneering in reverse logistics for post

consumption packaging

 Socio-environmental responsibility

 Development of eco-efficient packaging

Takes care of Health
 Sustainable use of biodiversity assets
 Hand hygiene (prevention of Covid-19)  Supply of raw-materials and supplies by
(liquid and bar soap, alcohol gel)
local communities
 Oral hygiene
 Mobilization of the supply chain
 Sun protection
 Insect repellents
 Personal hygiene
(adult and child disposable diapers, wet wipes, sanitary
Takes card of Society
pads, toilet paper)

 Respiratory hygiene and etiquette

 Women empowerment
(tissues)
 Increase of self-esteem, well-being, and life
 Treatment and cleaning of skin, hair and quality
nails  Employability
  4th largest consumer market worldwide (US$
2021 - 2022 22.9 billion*)

 -5.6% real downturn in 2021 (ex-factory#)

The CTF industry mobilizes

 2nd largest market of fragrances, male
and promotes products and deodorants*
development in Brazil
 2nd market in the global ranking of countries
that launch more products yearly
(1st USA)*

Local production prevails,  Exported in 2021 to 173 countries@

leveraging job generation  Imports represent only 6.3% of the total of ex-
factory sales in the CTF Sector in 2021¨

Sources *Euromonitor, 2021 Mintel, 2021 #Painel Dados de Mercado ABIHPEC 2021,
@ Ministry of Economy/Secex 2021 Source: ¨ABIHPEC analysis based on SECEX/ ME, 2021 / Painel Dados de Mercado, 2021
Brazil in the world
DATA TO CONSUMER - 2021 US$ BILLION 1st United States
19.4% | US$ 102,6
BRAZIL CLASSIFICATION PER 2nd China
CATEGORY 16.7% | US$ 88,2
3rd Japan
2nd FRAGRANCES, MALE PRODUCTS 6.2% | US$ 32,0
and, DEODORANTS 4th Brazil

CONSUMER MARKET
4.3% | US$ 22,9
CHILDREN PRODUCTS 5th Germany
3rd

TOP 10
SUN PROTECTION 3.9% | US$ 20,4
6th United Kingdom
4th HAIR CARE 3.3% | US$ 17,6
7th France
5th ORAL HYGIENE 2.9% | US$ 15,5

BATH PRODUCTS
8th India
2.9% | US$ 15,4
7th MAKEUP 9th South Korea
2.6% | US$ 13,8
8th SKIN CARE 10th Italy
2.3% | US$ 12,1
10th DEPILATORY PRODUCTS
SOURCE: EUROMONITOR | 2021
0205
 An Entrepreneur Sector: CTF companies in Brazil

RR
AP
1
0

2021/2020
AM PA CE
Growth 25 23
MA
109
11 PI RN - 15
12
5.4% AC
RO TO
5 AL - 11
14 5 SE - 16
BA
MT 102
20
DF
21
Midwest 229 GO
172 MG
Northeast 386 293 ES - 66
MS
North 73
16 SP
Southeast 2,011 1.385 RJ - 267
PR
South 698
263
Brazil 3,397
SC – 207
Updated October 30th, 2022
RS
228
 Generates around 5.5 million work opportunities

• Industry
• Franchise
• Direct Sales Consultancy
• Beauty Salons

Sources: ABIHPEC, ABEVD, ABF, and PNAD-IBGE (May/2022)

A 4.5% increase in direct

job generation in 2021,
against 2022, corresponding
to 6,000 direct jobs in the
industry.
 Work opportunities per channel

JOB OPPORTUNITIES ('000)

CAGR
2022 Variación
2014 2015 2016 2017 2018 2019 2020 2021 últimos 8
(3 TRIM) 22/ 21 años

INDUSTRY 126,0 122,2 118,3 120,5 125,7 130,7 133,4 139,4 145,9 4,6% 1,8%

FRANCHISE 200,7 214,2 214,6 219,6 236,4 248,5 230,4 107,1 100,7 -6,0% -8,3%

DIRECT SALES
4.053,6 4.140,0 4.140,0 3.690,0 3.690,1 3.292,9 3.248,5 2.733,0 2.733,0 0,0% -4,8%
CONSULTANCY

BEAUTY SALONS 1.803,2 1.823,8 1.884,9 2.107,1 2.211,7 2.325,4 1.800,7 2.350,6 2.551,0 8,5% 4,4%

TOTAL 6.183,5 6.300,2 6.357,8 6.137,2 6.263,9 5.997,5 5.413,0 5.330,1 5.530,6 3,8% -1,4%

Sounce: ABIHPEC, ABEVD, ABF, e PNAD-IBGE-november 2022

 Job and work opportunities
Direct Jobs (000’s) Work Opportunities (000’s)

4,6%
(2022-2021)

3,8%
(2022-2021)

6.357,8
6.300,1

6.264,0
6.183,5

6.137,2

5.997,6
145,9
139,4
133,4
130,7
126,0

125,7
122,2

120,5
118,3

5.530,6
5.413,0

5.330,1
2014 2015 2016 2017 2018 2019 2020 2021 2022 2014 2015 2016 2017 2018 2019 2020 2021 2022
3º Trim (3º Trim)

CAGR (2014-2022): 1,8% CAGR (2014-2022): -1,4%

After recording fall in the number of direct jobs in Still as reflex of the pandemic, in 2021 there was
2015 and 2016, the sector has recorded downturn in work opportunities in practically all
continuous growth in the following years, closing channels, resulting in fall in the total number,
2021 with 4.5% increase against 2020, closing the year with 1.5% downturn. In 2022, the
corresponding to 6,000 direct jobs. scenario is more favorable. The 3rd quarter of the
year grew by 3,8% vs. 2021.
 Sector x Economy
annual variation (%) The table compares the GDP
evolution to that of the industry
ANNUAL VARIATION (%) in general, and indices from the
YEAR GDP GENERAL INDUSTRY DEFLATED SECTOR CTF product industry. Until 2014,
the sector reported growth
2012 0.9 -2.5 10.5
stronger than that of the rest of
2013 2.3 1.2 3.6
2014 0.1 -1.2 6.4
the industry. In 2015, the sector
2015 -3.8 -8.3 -8.4
faced strong downturn, superior
2016 -3.6 -6.6 -5.1 to the GDP and the general
2017 1.0 0.2 4.0 industry fall. In 2017 and 2018,
2018 1.1 0.4 1.7 the sector growth overcame,
2019 1.1 0.5 -1.3 once again, the GDP
2020 -4.5 -4.5 2.2 performance, however,
2021 4.6 3.9 -5.6 insufficient to recover the 2015-
2016 losses.
CAGR - 10 years -0.1 -1.8 0.8
SOURCE: IBGE – CENTRAL BANK , ABIHPEC/ DEFLATOR: ÍNDICE IPCA-HP IBGE

In 2019, there was a new downturn, while GDP recorded slight growth. In 2020, despite the
pandemic, the Sector’s products’ essentiality in the fight against COVID-19 was consolidated,
enabling 2.2% growth, while the GDP fell -4.5%. In 2021, the sector was severely affected by
the high inflation that demanded great effort to absorb the constant rises in costs, whose
transfer to prices were difficulted. Despite growing 3.4% in volume, sales in Brazilian R$
presented strong downturn of -5.6%.
 Socio-economic impact of the CTF sector

 The matrix effect shows

When R$ 1 million is allocated in the CTF sector*, in one year, in
the sector relevance
the Brazilian economy are generated:
throughout the
production chain
o Value added in the
other sectors
o Sectorial interrelations PRODUCTION OCUPATION TAXES WAGES

(Units, for 1 year) (R$) (R$)

 Production multipliers and (R$)

GDP higher than those of 3.85 38 601 450

Million Jobs Thousand Thousand
agriculture and the CTF
industry average
In comparison, allocating R$1 million in agriculture or
 High capacity of income general industry:
generation (wage mass 2.96 80 171 340
multiplier) Million Jobs Thousand Thousand

Agriculture
 High capacity of tax
collection (seen in the tax 2.40* 37 354 422
Million Jobs Thousand Thousand
multiplier) Industry

FSource Estudo LCA, *Dados CNI

 Tax Map

RR AP
Law nº 1.949/15 Since 2015, the sector
has suffered with
increases in ICMS (state
AM MA
tax) aliquots in
LC nº 158/2015 Law nº CE – Law 16.177/16 practically all federative
PA 10.329/15
RN – Law nº 9.991/15 units, as shown in the
PI PB – Law nº 10.507/15 map. Besides, it feels the
AC Law nº 6875/16 PE – Law nº 15.599/15 strong impact caused by
LC 323/16 TO AL – Dec. nº 40.762/15
IPI (industrialized
Law nº 3.015 SE – Law nº 8039 e 8042/15
RO
Law nº 3699/15 MT Law nº 3.019 BA SE – Law nº 8499/2018 products tax)
Law nº 10463/16 Law nº 13.461/15 displacement from the
DF industry to the distributor.
Law nº 5.548/15
GO
Law nº MG The risk of consecutive
19261/16 Law nº 21.781/15
MS Dec. nº 46.859
and indiscriminate
Law nº 4.751 ES - Dec 4084R (RBC) measures (IPI and ICMS),
Dec. nº 14.303 SP on the grounds of
Law nº 17.293/20 RJ
LC nº 61/15 increase of resources to
PR
Law nº 18.371
Decree nº 47.032/2020 public funds, has
overthrown the sector
SC ICMS increase sales and, therefore,
RS reduced the collection
Law nº 15.576/20
SOURCE: ABIHPEC
curves, effect contrary to
that intended by
governors.
Atualizado 04/04/2022
 7 STATES
Taxes ICMS Aliquot
UF
From - To

12 STATES AM 17% - 18%*

ICMS Aliquot
UF FECOP
From - To AC 17% - 25%
BA 2% 17% - 18%* 25% - 29%
ICMS aliquot AP
17% - 18%*
CE 2% 17% - 18%* increase
DF 17% - 18%*
MA 2% 17% - 18%*
ES 17% - 25%
MG 2% 12% - 25%
17% - 18%*
MS 2% 17% - 20% PE
17% - 25%
ICMS
aliquot PB 2% 17% - 18% SP 12% - 13.3%
increase
+ PR 2% 12% - 25%
FECOP 4 States
RJ 2% 20% - 25% UF FECOP

RN 2% 17% - 18%* AL +2%

+
RO 2% 17% - 17.5%* FECOP
GO +2%
17% - 25% MT +2%
SE 2%
17% - 18%*
TO 2% 17% - 18%* PI +1%

* Modal rate 1 State

- UF ICMS Aliquot From - To
Reduction
Updated 04/04/2022 RS 18% - 17,5%
 Trade Balance January - December 2014-2022
Brazilian Exports and Imports of CTF (Values in US$ million – FOB)

35,5
2022 741,0
776,5
11,6
2021 688,4
700,0
23,4
2020 585,9
609,3
-105,9
2019 704,0
598,1
-81,1
2018 748,3
667,1
-123,9
2017 771,7
647,8
-66,2
2016 684,8
618,6
-221,5
2015 938,6
717,1
-294,2
2014 1.093,0
798,7

Balança Comercial Importação Exportação

Source: ComexStat/Ministry of Economy

 Brazilian exports of CTF – TOP 15
Per country – January- December 2021/2022
Value US$ Million FOB Volume Thousand Ton

Rk Country 2021 2022 Var (%) Part (%) 2021 2022 Var (%) Part (%)
2022 2022

1 Argentina 138,0 145,2 5,2% 18,7% 36,8 35,1 -4,5% 18,3%

2 Mexico 71,3 86,5 21,3% 11,1% 16,0 15,3 -4,3% 8,0%
3 Colombia 61,2 82,8 35,4% 10,7% 14,0 16,1 14,7% 8,4%
4 Chile 87,0 78,2 -10,1% 10,1% 25,3 19,5 -23,0% 10,2%
5 Paraguai 54,6 51,2 -6,2% 6,6% 37,9 26,2 -31,0% 13,7%
6 Peru 41,1 45,2 10,0% 5,8% 11,1 10,1 -9,1% 5,3%
7 Uruguay 34,3 37,9 10,5% 4,9% 26,9 19,6 -27,1% 10,2%
8 United States 23,0 36,3 57,7% 4,7% 2,7 4,5 63,1% 2,3%
9 Portugal 15,6 24,0 53,4% 3,1% 3,2 3,9 19,9% 2,0%
10 Venezuela 27,5 21,0 -23,6% 2,7% 23,1 13,0 -43,8% 6,8%
11 Bolivia 18,2 18,5 1,7% 2,4% 5,7 5,1 -9,5% 2,7%
12 Ecuador 14,2 15,8 10,9% 2,0% 3,0 3,1 3,7% 1,6%
13
United Arab Emirates 9,2 11,3 22,2% 1,5% 0,8 0,9 13,2% 0,5%
14 Netherlands
(Holand) 3,7 7,2 92,5% 0,9% 0,5 0,6 34,9% 0,3%
15 Guatemala 4,6 7,1 54,4% 0,9% 1,4 1,8 26,4% 1,0%
Top 15 603,6 668,2 10,7% 86,1% 208,3 174,7 -16,2% 91,1%
Grand Total 700,0 776,5 10,9% 100,0% 227,2 191,7 -15,6% 100,0%
Source: ComexStat/Ministry of Economy
 Brazilian Imports of CTF – TOP 15
Per country – January- December 2021/2022
Value US$ Million FOB Volume Thousand Ton

Part (%) Part (%)

Rk Country 2021 2022 Var (%) 2021 2022 Var (%)
2022 2022

1 France 133,5 143,0 7,1% 19,3% 5,4 5,3 -1,1% 6,4%

2 China 102,1 122,5 19,9% 16,5% 23,1 25,1 8,6% 30,4%
3 Spain 54,3 70,9 30,6% 9,6% 3,6 3,6 -0,1% 4,4%
4 United States 65,8 63,8 -3,1% 8,6% 6,1 5,7 -5,6% 6,9%
5 Mexico 36,2 33,7 -6,8% 4,5% 6,4 6,6 3,3% 8,0%
6 Sweden 17,5 28,7 63,6% 3,9% 0,2 0,3 74,3% 0,3%
7 Colombia 22,3 28,5 27,8% 3,8% 8,4 9,5 13,2% 11,5%
8 Argentina 38,1 25,4 -33,5% 3,4% 5,8 3,1 -47,2% 3,7%
9 India 25,8 21,1 -18,1% 2,9% 3,2 2,9 -7,4% 3,6%
10 Italy 14,8 20,9 41,1% 2,8% 0,8 0,8 0,1% 0,9%
11 Swiss 23,2 19,5 -16,0% 2,6% 0,6 0,5 -29,5% 0,6%
12 Germany 19,3 16,0 -17,0% 2,2% 3,2 2,4 -24,5% 2,9%
13 Thailand 10,5 15,9 51,0% 2,1% 0,6 0,9 40,3% 1,1%
14 Ecuador 12,0 12,7 5,5% 1,7% 4,2 3,8 -9,7% 4,6%
15 South Korea 7,6 12,3 61,0% 1,7% 0,5 0,9 65,9% 1,1%
Top 15 583,1 634,8 8,9% 85,7% 72,1 71,4 -1,0% 86,3%
Grand Total 688,4 741,0 7,6% 100,0% 87,1 82,7 -5,1% 100,0%
Source: ComexStat/Ministry of Economy
 Post-consumption responsibility
Reverse Logistics
Since 2006, Dê a Mão para o Futuro (Give a hand to the future)
Program promotes activities turned to the appropriate post-
consumption destination of packaging, providing job generation,
income improvement and social inclusion.

From 2013 to 2021 it recovered and sent for recycling 802,500 thousand
tons of post-consumption packaging, achieving annual goals
established in the Sectorial Packaging Agreement.

In 2021 the Program was present in 27 FUs and 125 municipalities,

supporting 179 organizations of collectors involving around 131 million
reais with the trading of materials for recycling.

6,074 cooperated collectors participate in the program.

In 2019, acknowledged by UN –CEPAL (Economic Commission for Latin
America and the Caribbean) as case of Sustainability Big Push in Brazil.
In 2021, was once again chosen as case of success and is
contemplated as highlight in the report: “The Big Push for Sustainability
and the employment dynamics: the work in the context of Brazilian
economy’s social and ecological transformation”
Estados em que o
States where
Meets seven Sustainable Development Goals (SDG) of UN 2030 Agenda. Programa Dê a Mão
theo Futuro
para Programjá está
are present
presente

Atualizado maio 2022

 Social Responsibility
De Bem com Você – a Beleza contra o câncer*
| Institucional

The Program “De Bem com Você – a Beleza contra o câncer”,

(Ok with you – Beauty against cancer) brings self-makeup
workshops to patients under oncological treatment, with the
support from the Cosmetic, Toiletry, and Fragrances industry.

Today the program counts on 52 partner hospitals in 10 states, 30

municipalities and, since the beginning (2012), the program
served over ,36 thousand patients, involving over 70 volunteers.

The program currently offers in-person and virtual self-makeup

workshops, and also via video-classes.

In 2021 5,338 women participated in 573 workshops, and also an

agenda of lives with special guests that brought subjects
connected to oncology, self-esteem, self-care, beauty, and well-
being reaching over 4,900 people on the program official
channels on the internet.

www.institutoabihpec.org.br *Look Good, Feel Better Atualizado Abril 2022

 Social Responsibility
Education For Life - Childhood Brasil – Beleza Negra

The Education, Dignity, and Beauty project

aims at promoting employability and
entrepreneurship.

The project was designed to encourage, support,

Childhood Brasil supported by Instituto ABIHPEC
since 2017, acts to ensure the defense of the
rights of children and adolescents, focused on
the prevention and fight against sexual
violence.
and sponsor Afrodescendant entrepreneurs, owners
of beauty shops that offer services to black people.
It was born from the initiative by the Council of
Participation and Development of the Black
Community, body of the Department of Justice and
Citizenship – SP, FIESP Committee of Social
Responsibility – SEBRAE CORES, and Instituto
ABIHPEC.
Atualizado Abril 2022
www.abihpec.org.br