Market Entry - Beauty Salon Industry in Hong Kong- Analysis of Growth, Trends and Progress (2018 - 2023)
Fast growing and prolific, the beauty salon industry is built on products and services that help us look our best. Consumers driven by social media trends have led to the evolution of the concept of grooming and beauty for both males and females. The beauty salon industry can be segmented into hair, skin, nail, cosmetics, perfumes and colognes, deodorants, antiperspirant, feminine cleaning, oral hygiene etc. Skincare has the highest market share. The growth potential of beauty salons depends on a variety of factors including demographics, population growth, and latest beauty techniques. The majority of global premium cosmetics sales is concentrated within the developed markets (mostly the US, Japan, and France) but cosmetic markets of the developing countries (Brazil, Russia, India, China) have been growing very fast and accounted for approximately 25% of the market. Small salons contribute heavily to the industry while the 50 largest companies draw just 15% of overall revenue. With a growing market, India is witnessing increased number of international players. The market which was earlier women-centric has started concentrating on male grooming as well, resulting in a large number of unisex salons, opening opportunities for business expansions in the segment. Lakme Beauty Salons, Jawed Habib Hair & Beauty, and L'oreal are some of the leading players in the market.
About the Geography
Hong Kong is a special administrative region of the People's Republic of China. It is the world’s freest and eighth largest economy. Hong Kong has no tariffs on imported goods and levies excise duty only on hydrocarbon oil, hard alcohol, tobacco, and methyl alcohol. It is the second largest recipient as well as supplier of FDI in the world. The country was ranked fifth easiest country to do business, by Doing Business.
Hong Kong acts as a bridgehead to China’s production, has an efficient banking system, favorable tax measures, excellent infrastructure, strong government, light legislations, well-educated skilled workers, and freedom of information. In 2003, Hong Kong SAR government launched CIES facilitated entry for foreign investors through investment into permissible assets, without the need to establish or join a business. Foreign companies can be set up freely, register their brands and the director of the company need not be a citizen or resident of Hong Kong. The only drawbacks are the high cost of living, elevated salaries, dependence on the financial sector, and exposure to global market risks.
With the presence of all major firms in the small region of Hong Kong, conducting business becomes very easy. Hong Kong is deemed to be the safest place to invest in the South-East Asia region.
The Market Entry Series
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