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Still reeling from the impact of the 2020 crisis, Mexico’s cosmetics industry is nonetheless making a recovery. The sector is firmly entrenched in the Latin American country. And signs point to future growth.
Mexico offers a diverse blend of specialties, technologies, and sub-sectors relating to beauty products and cosmetics production. The manufacture of these products supports a robust domestic market as well as a growing export market abroad.
The cosmetics industry is considered a best prospect industry sector by Export.gov. Due to growing domestic demand and expanding global access, Mexico is the 2nd largest market for cosmetics in Latin America and is among the top 10 in the world. In 2019 alone, Mexico imported about $1.3 billion USD of beauty and personal care products. But with more than $570 million USD worth of exports, Mexico is also the world’s 5th largest cosmetics exporter.
Mexico’s cosmetics industry is a mature one, with numerous sub sectors like:
Approximately 20% of the personal care market is devoted to skin care products to help consumers avoid or repair solar damage, maintain youthful skin from a young age, and to cultivate a well-groomed look. This latter emphasis has greatly expanded the market for men.
Also representing 20% of the overall market, this sub-sector greatly benefits from targeting men – their beards, particularly. Extensions among women have also become a popular Mexican cosmetic product.
Representing approximately 14% of the market, this sub-sector is growing in popularity. Online retailers like Amazon Mexico and Mercado Libre have made perfumes and body splashes a very profitable segment for Mexican cosmetic producers.
15% of Mexico’s cosmetics industry is comprised of makeup and nails and related accessories. These are marketed directly to the domestic market primarily through local retailers.
Mexico’s domestic consumer market has greatly expanded due to free trade relationships with over 50 nations. Brands from Europe, Asia, and South America remain popular there, in addition to Mexican-based brands.
Some of the largest cosmetics brands in the world invest millions of dollars annually into Mexican research and development facilities for the creation of new beauty products. Some of these heavy hitters include the following:
Many others of the world’s largest multinational cosmetics companies operate distribution and manufacturing facilities in Mexico. Some of these major cosmetics manufactures and retailers doing business in Mexico include:
The 2020 crisis was a real blow to Mexico’s cosmetics industry. In that year, the industry reported a 5.3% contraction. However, this was better than the total global contraction of 8% felt by the world cosmetics industry that year. And in spite of mass store closures by major cosmetics and personal care retailers, these same stores have adapted to online shopping. Demand for Mexico’s personal care products is climbing post-COVID, too.
And in 2021, Unilever doubled down on their Mexico investment with a 3-year plan to invest an additional $277 million USD to increase production at their four Mexican plants. This greater production is aimed at increasing exports out of Mexico for the company.
In addition to the United States – a top trading partner – Mexico exports cosmetics products to around 100 other nations. It is this diversified export base, coupled with a strong and growing domestic base, that will help Mexico recover from the recent contraction and continue to exceed pre-COVID numbers.
According to recent projections, Mexico’s beauty and personal care market will grow at 3.53% CAGR 2022-2026. 11.8% of that increased revenue will come from online shopping. Mexico’s cosmetics industry has taken a hit. But through renewed investment from global stakeholders and increased innovation and adaptation, the market is set for sustained growth in the near future.