Business

India to lead Nivea owner’s global business expansion

India has outpaced growth of China, Asia Pacific: Schimpf

German skin and personal care company Beiersdorf, the maker of Nivea Cream, says the India business, that has been growing at a CAGR (compounded annual growth rate) of 25% in the last three years, will spearhead the company’s global business expansion.

Dr. Ralph Schimpf, global vice-president, quality management, Beiersdorf, told The Hindu that, “We set up our direct presence in India only in 2006, but in a short time, the country has emerged as the fastest-growing single geography for us in the entire world. India has outpaced the growth of China and the entire Asia Pacific (APAC) region.’’

To intensify its presence outside Europe, Beiersdorf had acquired Coppertone, a sunscreen brand in the U.S., from Bayer for $550 million in May this year.

Europe currently accounts for 55 to 60% of the company’s market, while the rest of the world, including the U.S., Asia-Pacific, are currently in the 40 to 45% range. `This revenue ratio is changing for us with India growing at a rapid pace. We also see good growth momentum across APAC. In the US we acquired a company to accelerate growth,’’ he added.

Nivea India currently employs close to 700 people at its manufacturing plant at Sanand in Gujarat and the R&D centre in Mumbai.

As per Mr. Schimpf, skincare requirements across the globe are quite the same but skincare habits and beauty regimens are very diverse. The company tailor-makes products for India using local ingredients such as gram flour, saffron and rose petals. It does a lot localisation for India and other geographies.

Responding to a query on why Beiersdorf delayed its India foray, Mr. Schimpf said the company was set up by pharmacist Paul C. Beiersdorf in 1880 at Hamburg. The trademark “NIVEA” was expropriated in many countries which have been harmed by Germany in World War II. That caused a huge business disruption and company lost licenses all over the world as a penalty. The confiscated trademark rights were to be bought back later. Today, Beiersdorf has direct presence in 180 geographies.

Beiersdorf posted a global turnover of €7.23 billion in 2018. “We expect a 3 to 4% jump in our revenues this year. India, in particular and Asia Pacific in general are going to be significant contributors to this.’’

As per AC Nielsen, India’s skincare, deodorants and shower gel market is approximately ₹13,000 crore.

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Printable version | Feb 22, 2020 3:54:27 AM | https://www.thehindu.com/business/india-to-lead-nivea-owners-global-business-expansion/article30197154.ece

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