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New Blood Adds A Blush To Cosmetics Business
 

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The chic world of the cosmetics industry always celebrates youth, but lately it has shown a few of its own jowls and wrinkles. Sales in 1983, adjusted for inflation, were actually lower than they were in the late 1970s. Nevertheless, a group of brash upstarts is betting that the industry is poised to take off again.

Six cosmetics companies turned up last month on the INC. 500 list of the fastest-growing private companies in America. They have a medicine cabinet full of approaches to the market, including franchising aloe vera markeup products, supplying cotton balls and swabs, and manufacturing a cosmetics line that sells for 99 cents an item.

Their market timing may be just right. Some analysts predict increased use of hair and skin products by men, and they say that the radical, new-wave look popular in punk bars could catch on in more conventional quarters, spurring sales of decorative makeup.

Newness is critical for success in cosmetics, says Brenda Lee Landry, a vice-president with Morgan Stanley & Co. Even better are new products that actually do what they promise. "Nothing works right now, and everybody knows it," says Landry. "You've got shampoos that don't really clean hair and skin creams that don't do for skin what Vaseline does."

That sounds like a come-hither appeal for entrepreneurs, but only for those prepared for certain hard truths about the $10-billion-a-year business. Sharp increases in the number of working women spurred much of the industry's growth in the past, but the trend may have peaked. And the behemoths at the top of the industry -- including Avon Products, Revlon, and Estee Lauder -- still control almost half of the total market.

Last updated: Jan 1, 1985




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