Luxury cosmetic salons, an opportunity for start up business in Central and Eastern Europe
The first such cosmetic salons were opened over a decade ago by ESTEE LAUDER in Budapest, Bucharest and Prague. They have been operating in the flagship store of ESTEE LAUDER as small salons with facial and body cosmetic treatments, most of them with 2 or 3 treatment rooms.
Recently such branded salons have opened in Warsaw (Poland), the leading ones being DIOR, SHISEIDO and KANEBO. They are monobrand salons with small treatment rooms. Unlike Estee Lauder which is operated directly by the US company, these salons are franchised with local partners.
Speaking to owners of these salons we were recently told they are fully booked sometimes talking more than a week for a lady to set up an appointment for a treatment. The majority clients are women in their mid 40′s but there are also men who are clients of such salons.
These salons are obsviously different than the salons which only use the products of the known luxury cosmetics brands. They present the advantage that they provide a luxurious environment which reflects the philosophy of each brand with their original furniture and branding. Unlike the regular salons, they also offer more confidence to customers as they are certain to get a quality service by personel which have been trained by the top luxury brands.
The investment in such as salon is around EUR 2.000/sqm and there are royalty and franchise fees which are paid to the brands. These fees are calculated depending on the estimated turnover and of course potential of the market they are in. This is a winning business model for cosmetic companies as they can position themselves are more upmarket therefore distance themselves from the regular shelves at Sephora’s or Douglas’s.
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