According to preliminary data from Euromonitor International
, health and beauty specialist retailers of Georgia has seen 2.2% growth in 2020, as compared to the prior year. Pharmacies were the main drivers of the mentioned growth, since COVID-19 affected value sales of beauty retailers operating in Georgia, as outlets were closed for several months. In terms of value share among health and beauty specialist retailers in 2020, PSP Group was the market leader.
Retail value of health and beauty specialist retailers in Georgia excluding sales tax, amounted to GEL 1,545 500 000 in 2020, up from GEL 1,512 100 000 from the previous year.
Market shares among health and beauty specialist retailers has been distributed as follows: PSP Group, Georgian Pharmacy JSC, Aversi-Pharma Co Ltd, Clean House Ltd and People's Pharmacy Ltd.
“There was a slight overall increase in current value with health and beauty specialist retailers. However, COVID-19 affected value sales of beauty retailers, as outlets were closed for several months. Pharmacies, on the other hand, performed well, as consumers stocked up on preventative health products. Pharmacies also were permitted to stay open for all of 2020, whereas beauty retailers closed for several months.
There was also an increase in online sales through pharmacies and while pharmacies were not prepared for the huge increase in demand, they used delivery services such as Wolt and Glovo to get over the hump,” Lilija Vladykina, Senior Analyst at Euromonitor International
told to BM.GE.
Pursuant to the research of Euromonitor International, “PSP Group continued to lead in terms of value share among health and beauty specialist retailers in 2020, using its significant financial resources to boost growth and brand awareness through the funding of strong marketing and advertising campaigns. The company’s strong financial position also allowed it to fund frequent discounting programs and lotteries for its customers”.
“Currency devaluation has less impact on health products than on other products,” said Vladykina, adding that “demand for medicines has not declined over the short term; medicines are essential to good health and few consumers consider cutting expenditure on medicines. As medicines are less price elastic, overall value sales of chemists/pharmacies continued to grow in 2020, supporting value growth for health and beauty specialist retailers overall.”
If economy recovers, beauty specialist retailers are expected to register higher value growth than pharmacies during upcoming years. “Health and beauty specialist retailers are expected to register healthy value growth over the next five years. If the economy recovers quickly from the fallout of COVID-19, beauty specialist retailers will register higher value growth, especially if foreign tourists start visiting again. Beauty specialist retailers will also benefit from the growing number of shopping centers,” Vladykina added.
Overall, pharmacies were not negatively affected by COVID-19 and in Vladykina‘s words, “they will register steady growth over the next five years and will continue to open more outlets. Chemists/pharmacies will also continue the growth in line with increased health awareness. E-commerce value sales will also increase.”