Women still are buying beauty products,they’re just buying cheaper ones.
That’s led Costa Mesa-based cosmetics retailer Planet Beauty to lose ground to discount sellers such as CVS Caremark Corp. and Wal-Mart Stores Inc., according to Chief Executive Bahman Fakhimi.
Sales are down 20% from a year ago, he said. Planet Beauty expects to do more than $20 million in 2009 revenue, according to Fakhimi.
So Fakhimi is playing up Planet Beauty’s mix of products, from posh to affordable.
A tube of lipstick can go for $5 to $20, he said.
“People don’t realize we don’t just sell upscale items,” Fakhimi said. “We have a wide variety of things.”
Fewer shoppers at Pla-net Beauty’s 22 stores (15 of which are local) have pushed the chain to change marketing tactics. It’s now staging events and offering discounts.
It recently took part in an event where several local cosmetics makers were invited to share their hair and skin products with shoppers.
About a half dozen makers, including Irvine’s Too Faced Cosmetics Inc. and Newport Beach’s AminoGenesis took it as an opportunity to get their names out.
“They share the same passion for Orange County as we do,” Fakhimi said. “It helps the community when we can get their names out.”
About 5% of Planet Beauty’s sales are with smaller, lesser known products made locally.
|
|
Planet Beauty’s Bahman Fakhimi, left, John Dick, right, with Carson-based Dermologica Inc.’s Rae Lynn Cook: cosmetics chain planning more events |
Despite the downturn, Planet Beauty has held on to its 250 workers, 180 of which are local.
Fakhimi also said he’s been working to renegotiate leases, many of which were made two and three years ago when real estate prices were near their highs.
Earth Friendly Bags
Irvine-based shopping bags maker EarthPack has taken another step toward being environmentally friendly with biodegradable, disposable shopping bags.
Laguna Beach’s 225 Forest store is the first to carry its biodegradable bags for shoppers.
The bags look like and are as strong as other shopping bags, according to EarthPack founder and Chief Executive Dave Bock.
“There’s definitely a market for this,” he said. “This is something new.”
The bags are made mostly from tapioca, which is mixed with a natural plastic resin to create the material. The idea came from a similar process done in Indonesia.
Because they’re all natural, they’re not a threat to the environment as are other plastic bags, Bock said.
They’re also competitively priced, he said, but didn’t give specifics.
EarthPack’s sales are less than $10 million a year. They’ve grown more than 20% a year for the past five years.
The company’s mainstay bags are made of recycled material. Customers include Hun-tington Beach-based Quiksilver Inc., Anaheim-based Pacific Sunwear of California Inc., Cypress-based Vans Inc., Paul Frank Industries Inc. and Volcom Inc., both of Costa Mesa.
Grandma’s Growing
Growing upscale pet treat maker Grandma Lucy’s has tripled its space with an Irvine lease.
Its new 15,000-square-foot operation is a long way from its original 900 square feet in Aliso Viejo that Grandma Lucy’s started in 10 years ago.
The past two years have been the company’s best after doubling sales every six months thanks to a line of dog food it began offering. The upscale dog food uses restaurant-quality freeze-dried beef, chicken and fish.
Yearly sales are less than $5 million.
Dog lovers began seeking higher-quality alternatives after the massive recall of pet food made in Asia, which drove up Grandma Lucy’s sales.
“We use local restaurant suppliers for our products,” said co-owner Breann Shook, who named the company after her finicky English Cocker Spaniel Lucy.
Its line of treats, which makes up about 60% of its business, has been flat in the past years.
Most of its sales have been to boutique pet stores, though it began selling to Petco Animal Supplies Inc. a year ago.
Its treats for cats and dogs tend to run about $5 to $7. A three-pound bag of cat food would be about $20. A five-pound bag of chicken flavor for dogs would be $64 and $70 for lamb.
