Updates on Revlon and China

Yesterday it was announced that Revlon may be exiting the Chinese market to cut costs. It was assumed by many, and left very unclear by the press, about if this meant that they would no longer be selling in China or not. Revlon, and all of their sub-companies, currently test on animals “as required by law”.

Currently, China has a law in place that requires cosmetics sold there to be tested on animals. There are also other circumstances in which a brand may test on animals “as required by law”. So it’s also unclear if Revlon would no longer test on animals if they were leaving the Chinese market.

The original press release included a statement that was not included in all reports, including the one sourced earlier. Apparently in China, Revlon is not commonly found in drugstores. Instead, it’s typically bought at in-store counters with 3rd party staff. These “beauty advisors” will be the majority of lost jobs. Around 940 of the 1,100 jobs lost will be counter staff. To many, this sounded like promising news that the brand may no longer be available in China.

Revlon has previously pulled out of other countries where it had the same beauty counter set up. In one of them, South Korea, I was able to find out through travel forums that the items were now available at drugstores like they are in the United States. Removing the cosmetics counters and their staff did not mean that Revlon would not continue to sell there.

Most of the press is saying that Revlon is exiting their operations from China. This would also imply that it’s a shift in how they do business there and not necessarily the availability of Revlon products there. But, without an official statement from the brand, it’s hard to tell.

Revlon has lost money in 2013. Declining markets aside, they also bought Colomer Group in 2013. Colomer Group includes brands such as Creative Nail and American Crew. Part of the loss in 2013 is attributed to this business expansion. This expansion also opens up Revlon to taking on more salon based sales – a completely different market than their other lines.

However, at this time, Revlon sales in China currently come in 2nd worldwide. The US is their largest market, China the 2nd largest, Latin America & Canada the 3rd largest, and Europe coming in as the 4th largest market. This is based on 2013 sales provided to the associated press by Revlon.

More updates and news will be posted as it becomes clear. Hopefully the company will issue a press release soon than could help clear up the confusion about what’s really going on.

Sources: Wall Street Journal and Economic Times.

For further updates, please read Revlon Keeps Their Required by Law Animal Testing Stance.