(Yicai Global) Jan. 5 – Some cosmetics companies have launched their special New Year sales period in China, announcing up to one third price reductions for their products. Both US cosmetics company Estée Lauder Inc. and South Korean cosmetics maker AmorePacific Corp. have cut their product prices in the Chinese market by up to 30 percent, also citing new lower tax policy.
Both firms said the price cuts are in response to China's move to adjust consumption tax policies on cosmetics products.
The Chinese government's new arrangements in consumption tax on cosmetics and its earlier move to lower tariffs on makeup products are only one of the factors triggering the price drops in foreign-branded cosmetics, said Chen Min, an insider in the cosmetics industry. Other factors include the rapid development of cross-border e-commerce and the rise in purchases made overseas via the internet, which make cosmetics prices increasingly transparent, forcing foreign companies to lower prices in China.
Since domestic and overseas prices can differ by as much as 50 percent for some foreign-branded makeup products, the latest price cuts are not large, insiders pointed out.
Effective from January 15, AmorePacific will lower suggested retail prices for 327 products under its four major brands by 3 to 30 percent, the company said on Jan. 3. Estée Lauder announced that effective from today, its brands, including Estée Lauder, Clinique and MAC, will slash the suggested retail prices for some of their makeup and fragrance products by 7 to 18 percent.