작성일자: 2014.7.2

작성자: 도하 무역관 May Abbas(eltonsi@kotra.or.kr), 김민경(Melissa@kotra.or.kr)

 

 

1. Introduction:

 

 ○ The Qatari market is very vibrant and has been rapidly growing for the past ten years. Moreover, since Qatar is a developing economy, the level of competition in the Qatari market is massive, especially for the cosmetics and toiletries industry. There is a large amount of the Qatari population that depends on cosmetic products and related products massively on daily basis. These products are not necessarily always halal and that is for reasons that shall be discussed throughout the paper.

 

 ○ The purpose of this paper is to explore the factors that determine the success of the Cosmetics and Toiletries clearance into the Qatari market. The assumption that has been made regarding the term cosmetics whilst conducting this research was very broad, as for the toiletries it implied, after shaves, pre shaving products, personal deodorants and toilet preparations, etc.,. Therefore, the research will provide a general view on the demand dynamics of the female and male on demand beauty preparations without becoming involved into many details.

 

 ○ The data collected, was primary and secondary in nature. Market visits to retailers, department stores and shops along with telephonic interviews with wholesalers comprised of the primary data collection methods. All the secondary data was acquired from Qatar Statistics Authority (QSA), which can be considered a reliable source, but its studies are open to flaws and over/under estimations of data. An intuitive assumption based on market visits tells us that approximately 50% of the beauty products for both males and females are imported from Europe.

 

 ○ The focus of this paper is mainly on the process of importing cosmetic and toiletry products. Another focus of this paper is the ways and the means in which the distribution process takes places. Lastly, this paper will examine the prices of such products and the influences on demand.

 

 

2. Import Trend:

 

□ Import Statistics

 

Market Volume (Cosmetics)

             Source: http://www.qsa.gov.qa/eng/index.htm

 

 ○ There is a blatant fluctuation in the market from 2012 to 2014. The vast decrease between the years 2013 and 2014 shows that the market is becoming is not very stable.

 

Major Importing Countries (Cosmetics)

          Note: The data used in the tables above are extracted from the statistics provided by the Qatar Statistics Authority website. This is because the Ministry of Planning conducts the most precise research about the market that could be reliable and could serve our research purposes.

          Source: http://www.qsa.gov.qa/eng/index.htm

 

 ○ The ranking in this table follows the ranking of the top 10 major importing countries of Cosmetics in Qatar. These countries are ranked according to their shares and according to the most recent year in the table.

 

 ○ Notice the high shares France has been maintaining from the total market share for the past 3 years. This is because France has very diverse products that are very well marketed in the Middle East. Further, the United States has the second largest share because the American culture is very popular in Qatar in general and that assists the marketing of the USA's products because it already seems familiar to the consumers.

 

Market Volume (Toiletries)

          Note: Further data on specific imported items related to cosmetics toiletries could not be received nor reached. This is because the request was too broad.

          Source: http://www.qsa.gov.qa/eng/index.htm

 

 ○ There is a blatant fluctuation in the market from 2012 to 2014. Nevertheless, there is a positive increase between the years 2012 and 2013, which shows that the market is very active.

 

Major Importing Countries (Toiletries)

            Note: Above, you shall find the import values for the cosmetics and toiletries category regardless of type. The corresponding dollar values for the respective years are also mentioned. It is also to be noted that we cannot be certain of the figures provided above as the way goods are categorized by the custom authorities is unknown to us and there is a good chance of over or under representation of value of imports.

            Source: http://www.qsa.gov.qa/eng/index.htm

 

 ○ The ranking in this table follows the ranking of the top 10 major importing countries of Cosmetics in Qatar. These countries are ranked according to their shares and according to the most recent year in the table.

 

 ○ Notice the high shares the UAE is receiving from the total shares of the market of Toiletries in general. This is assumed to be a result of the small companies that depend mostly on importing from neighbouring countries in order to avoid the high costs of the whole importing procedure. Second place is Germany, which has very popular brands that are spread in the stores in the shopping malls on a very high demand.

 

□ Tariffs

 

 ○ There tariffs of Cosmetics and Toiletries items are 5% only. They are paid once the shipment is arrived to customs. This import tariff is merely the expenses paid for customs to pass and does not cover any other related expenses.

 

 

3. Price & Distribution Channels:

 

□ Distribution Channel

 

 

 ○ The distribution pattern in Qatar starting from the port is very simple unlike other countries with a long process of distribution with different branches. In Qatar, the distribution is as follows, once the shipment arrives to port and obtains the clearance pass, it is directly sent to companies that were issued with an import license, be that an importing and trading company. From the trading company, the retailers and the selling stores receive their shares and they sell to the consumer. Another way is through a distributer company which does not always have the importing license, but would rely on the concept of B-2-B sort of trade. In other words, its role would start and end within Qatar; it does not become involved in the outsourcing of the products.

 

 ○ The biggest share in regards to both cosmetics and toiletries in the market of prices would be sent to the Blue Salon, which is one of the biggest Beauty Salons in Qatar. Notice that salons in Qatar receive a share of the cosmetics distribution because they deal with different ceremonies where they would need to use their own products as well as sell most of the time.

 

□ Price Trend:

 

 ○ Cosmetics fall under two categories, the low priced category and the expensive category. There are many small businesses that deal with low priced cosmetics that are being imported from Dubai and Philippines. Nevertheless, the Qatari market is founded on quality and hence, the big international shops dominate the market. The market of quality which is dominated by the big stores consumes only European and American brands. This is applied especially on cosmetics.

 

 ○ For the market of prices, there are different brands, but they cannot be compared to the European ones. India, China and Thailand are the three most powerful Asian exporters of cosmetics and toiletries in Qatar since they belong to the market of prices. Nevertheless, their products and brands are not known or well consumed by the Qatari citizens. This is because the consumers of the market of prices especially in regards to any products that deal with skin care are most of the time tend to lean towards the European products.

 

 ○ In addition to this, based on the telephonic surveys with representatives of the wholesalers, there are individuals that are working for established wholesale distribution companies in UAE, who are flying to Qatar, and after negotiating contracts, directly exporting to retailers in Qatar. This actually pushes the competitors forward because the market here needs a nearby agent that could be physically present when necessary.

 

Competing Cosmetics Brands

 

Competing Toiletries Brands

      Note: Price ranges above are subject to fluctuation and retailer initiatives. Hence, there may be a change in the future.

      Source: Brand Shops, retail prices

 

 

4. Import Regulations:

 

                            Note: The information may not be as accurate as it should due to the lack of

update of this information since 2013. Hence, there is a good chance of

over or under representation of the value of the import costs.

                           Source: http://www.doingbusiness.org/data/exploreeconomies/qatar/trading

-across-borders/

 

 ○ This table shows the procedure of the importing procedure in general. The table demonstrates the duration period that each action would take along with the expenses that would need to be covered through every action. These expenses are calculated based on the length of the duration the procedures may take.

 

 ○ Import procedure Diagram:

 

 

 ○ Theoretically, Import regulations on Cosmetics and Toiletries always need documents when arrived to the Qatari customs as well as when arrived to the distributers. Practically, most Qatari importers claimed that documentations are not always necessary. Hence, there is a contradiction between the theoretical and the practical claims about the documentations in regards to toiletries and cosmetics. Furthermore, following the theoretical order, there are certain documents that should be provided by the manufacturer of the products in order for the products to be passed. For example, there should be a DOC which is the declaration of Conformity. This DOC is very important because it provides the Qatari consumer a guarantee that this product has been tested by entities that are trustworthy in regards to the certain products at hand.

 

 

 ○ The basic requirements of a DOC are as follows:

  - To identify the directive(s) with which conformity is claimed.       

  - To identify the manufacturer of the equipment being supplied.

  - To identify any European representative of non-EC manufacturers.

 

 ○ The Certificates of Conformity issued by specialist third party organizations similar to Intertek or SGS are basically stating that they consider the equipment to meet the requirements of the consumer from a technical side rather than to be used as it is for its purposes. In Qatar, the procedures are somehow different from other Middle Eastern countries. Moreover, the Ministry of Business and Trade in union with the Department of Consumer Protection and the Qatar General Organization for Standards and Metrology (QGOSM) are the entities who supervise and decide on the lists of products which require a Certificate of Conformity. The certificate may only be valid for 12 months. Afterwards the company should request for a renewal.

 

 ○ The products that are being exported to Qatar must have a test report issued from the ISO 17025 accredited laboratories with the testing based on applicable standard requirements. In some circumstances, Qatari Customs will accept Gulf Standard Organization (GSO) Conformity Certificates instead of Certificates of Conformity. In 2012 Qatar General Organization for Standards and Metrology (QGOSM) initiated new clearance requirements for two types of cosmetic products. This is because they thought there should be more intense regulations on the conformity for the following types of cosmetic products: Shampoo and Black Henna.

 

 

5. Other Factors

 

□ Public Influence:

 

 ○ The demand on cosmetics is not affected by whether the product is halal or not. The public consumes the products that are more luxurious and that fit the European standards. The kinds of products that the public consumes are mostly non halal because they are under the European standards. Most of the Qatari population is depending on European cosmetics on daily basis. Furthermore, the products that they mostly consume in cosmetics are foundations and skin color bases and secondly, they depend on other cosmetic products. During marriage ceremonies only, beauty salons make double their income to provide the bride and the families attending the ceremonies with makeup sessions. Hence, the marriage rate in Qatar affects the consumption of the salons' consumption of cosmetics and beauty products.

 

 ○ Moreover, for the toilet preparations, such as, deodorants, after shaves, etc., it is very common to find them in most of the stores and small supermarkets. This spread of the toilet preparations is due to the nature of the atmosphere in Qatar. Since the temperature in Qatar most of the time, during the summer, is above 40 degrees Celsius, it is very important to find such products easily. Personal hygiene for Qatari males, especially, is very important.

 

 

6. Conclusion:

 

 ○ The Qatari market is open to receive new products; however, the level of competition coming from Europe does not allow other non-European brands to exist for a long time. Perhaps the non-European exporters exist only in the market where prices are the priority rather than quality. This is because the Europeans have proven themselves to be the most trusted exporters of such products. Furthermore, it is not always necessary for the products to be certified as halal. This is also a result of the massive demand on European products.

 

 ○ Furthermore, the cosmetics and toiletries market is very vibrant nut not stable. The distribution in the Qatari market is between very few entities, such as, beauty salons, big brand stores and a few other small entities. The documentations in order to get approvals for the cosmetic and toiletry products are not plenty but very necessary for the procedure. Finally, these documentations also determine in a way the prices of the items, and this relates back to the European standards that the Qatari market respects.