ECONOMY

Ugly crisis visits beauty centers

The beauty-improvement industry is one of the sectors that is reeling from the financial crisis, with its turnover expected to drop by 35 to 40 percent by the end of the year, while the number of beauty and diet centers to remain standing will be considerably lower. The sector is estimated to drum up business each year worth 60 million euros, with the larger players showing annual sales of around 2 million euros. However, a more accurate picture of annual revenues is difficult to determine due to the large number of companies, the variety of services offered and alternate ways in which they are organized. According to analysts, the beauty-improvement industry is entering a new phase after showing impressive growth rates, with the main characteristic being a slowdown in new companies opening up and lower cosmetics sales. «Due to the fact that the Greek consumer does not have access to the banking products he once had, I believe that this will create particular problems in the sale of services from businesses in the industry that had been promoted via credit cards or other bank products,» Vasilis Galanis, business adviser to beauty centers, told Kathimerini. Another factor contributing to the slowdown in revenues is that the majority of products are aimed at low-income customers. Given that consumers’ incomes have fallen, it is inevitable that there will be a drop in the sales of these products. In regards to the cosmetics sold by beauty centers, the drop in price is largely justified given their high price. Some of the products had markups reaching 150 percent over the cost of production. At the same time, beauty centers are being perceived more and more as a luxury service due to the crisis. [email protected]