Lush, producer and seller of personal hygiene products and cosmetics, intends to increase by 2017 the share of products made in Russia to 35% of its Russian division’s turnover, said the representative of the latter to Vedomosti. According to him, now 10% of Lush Russia sales are of local production. The company intends to expand the facilities of its plant in Domodedovo where it intends to produce solid shampoos and solid bath products and soaps beside fresh masks and skin cleaning products, says the representative of Lush Russia.
According to hin, the total investments into the project will amount to 150 mln rubles, of which one third will be invested in the expansion.
After the sharp ruble devaluation in December 2014 many foreign producers began to actively develop their Russian assets. L’Oreal will invest 2.5 bln rubles in the expansion of its production in Kaluga, as its representative reminds, the project will be launched in the second half of 2017 and targeted on the domestic market. The plant produces shampoos, rinses and hair-dyes branded L’Oreal Paris and Garnier, says the company web-site. 20% of the sales of Oriflame, another cosmetics producer, are of the Russian production, says the representative of the company. In 2015, Oriflame started a new plant in Russia which cost €150 mln, it hasn’t gained it’s full capacity, he says. Henkel also increased the capacity of the Noginsk plant: the shampoo and hair dye production lines will be updated, says the Henkel representative. Avon also intends to develop production in Russia, which is a key market for the company, assures its representative.
Lush, a personal care and cosmetics producer and distributor, has decided to fully localize production in Russia so as to remain in the market, a spokesperson for the Russian branch, Lush Russia LLC, told Vedomosti.
At this point, only 10% of all Lush products sold in Russia are produced locally, said General Director of Lush Russia Dmitry Azarov via a spokesperson. The remaining 90% is imported from the United Kingdom. The company’s current goal is to expand Russian production to 100% thus reducing the prime costs by 30%, which, in turn, will help the company keep retail prices in check, Azarov observed.
Currently, Lush Russia has a production facility in the Greater Moscow area (Domodedovo) which produces certain masks further distributed through the company’s retail network, but most of the product range is imported. A facility producing an entire range of Lush products for distribution in Russia is expected to be headquartered in the Greater Moscow area as well, and to be launched in 2016. At this moment, the company is picking a site.
Investment are projected at RUB 100m, a Lush Russia spokesperson said. The source attributed the low figure to the fact that the Lush cosmetics products are handmade.
The local production facility of Lush Russia will run partly on Russian raw materials.
Company's website: lush.co.uk
T: 01202 668545