Kenya’s beauty industry is estimated to be worth Sh100 billion. It is an industry that is growing at a rate of almost 400 percent per annum. As attestation to the growing sector, many foreign investors have established presence in the Kenyan market.
Fenty Beauty by Rihanna entered the Kenyan market this year. A few days after the launch of Fenty, L’ oreal, a global beauty chain, launched a leading product in Kenya.
The 2013 acquisition of Interconsumer Products Limited by L’oreal also defined the growing interest in the Kenyan beauty market.
Such investments and deals grow incomes and create jobs.
The Kenyan beauty market includes beauty schools, salons, barber shops, spas, retailers, distributors, and manufacturers.
While there are a few foreign global brands with manufacturing lines in Kenya, many of them operate through distributorships and importing models. They partner with local businesses that stock their goods. A lot of foreign brands have this arrangement with local distributors.
I feel that in addition, franchising has a great potential as a means of market entry, especially in services. I am looking forward to the launch of franchise arrangements between high-end global salons or spas with local ones. This will give the Kenyan market access to high-end global spas locally.
Other than distributorships, there are retailers who stock global and local brands. Retailers do not have a deal with the owners of the brands but sell the brands based on market demand for profit.
Some brands manufacture cosmetic and beauty products locally, including makers of artificial hair extensions. A lot of these have manufacturing plants in Kenya.
There is a rise of Kenyan beauty brands, boosting the cottage industry in the beauty sector.
Despite all these, this market requires tighter regulation. While the Kenya Bureau of Standards (Kebs) published some regulations on cosmetics standards, these are not sufficient to cater for the growing regulatory need, partly with the thriving growth.
There are no defined professional standards to protect consumers from quacks. The idea is to have a professional body licensing beauty practitioners under various categories.
Consumer welfare is endangered by sub-standard and counterfeit goods. While there is the Consumer Protection Act, there ought to be a law that criminalises sale of harmful beauty products. Consumers have been hurt by dangerous goods, for example substandard bleaching products.
The government loses a lot of revenue from illegal imports. This should change to bring sanity.
Intellectual property infringement is rampant in the sector where unscrupulous traders seek to ride on the goodwill of established brands. The intellectual property laws are sufficient to handle this. I handled a case where a global hair brand had 25 of its brands locally infringed!
A law would streamline the sector for public good and collect billions in revenues by criminalising some offences.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
