Beauty and personal care products made by Dao Đỏ Community Cooperative in Lào Cai Province. — Photo courtesy of the cooperative
Many cooperatives are taking the opportunity to enter the beauty and personal care segment, creating jobs and increasing income streams for members.
The Tâm Ngọc Cooperative in Hà Nội's Sóc Sơn District said it has joined the personal care sector, in addition to the growing, cultivating and processing of medicinal herbs.
The director of the cooperative Trần Thị Thuần, told business.vn that the cosmetic arena has been developing strongly in recent years, and her cooperative has invested in this field, which has facilitated the participation of many female members.
A suitable direction
Thuần said most of her cooperative's beauty and personal care products are made from oriental medicine. This is also an advantage as her cooperative can use available medicines provided by members.
Also investing in this field, the HCM City-based Tâm Vĩnh Phát Cooperative is developing a system of mini spas. It aims to open about 500 small spas from now to 2030, creating jobs for up to a thousand workers who will earn a monthly income of between VNĐ6-15 million.
Many other cooperatives have also taken advantage of abundant raw materials from agricultural products, investing in machinery to provide products for the beauty and personal care segment.
The Việt Yên Agricultural Cooperative in Bắc Giang Province is a good example.
In addition to developing a large growing area of gấc fruit (red sweet gourd), it has also invested in machinery to turn the fruit into beauty and personal care products, such as gấc powder and gấc oil.
Meanwhile, the Trường Sơn Medicinal Herbs Cooperative in the central province of Quảng Trị has teamed up with schools and institutes to research and produce cosmetics from avocado oil.
The cooperative's director, Lê Thanh Huệ, said investing in this segment has also opened up opportunities for his cohort to foster the consumption of agricultural products and other goods.
Huệ told business.vn that avocado is a popular fruit in many localities, but when harvested, the fruit quickly spoils, resulting in reduced prices, which in turn impacts the economy of growers.
Processing avocado oil has solved the problem of having a good harvest but low price, increasing the value of this agricultural product, Huệ said, adding that each litre of avocado oil is sold at a price ofVNĐ20 million.
Overcoming challenges
Many cooperatives, however, have still encountered challenges in investing in the beauty and personal care segment.
Currently, every year in Việt Nam, about 2,000 spas and beauty salons are set up so that means cooperatives that go down this commercial route are facing fierce competition.
Thuần from the Tâm Ngọc Cooperative outlined a shortage of skilled workers as one of the main reasons that has reduced the competitiveness and affected the development of cooperatives in the market.
In addition, many cooperatives are facing difficulties in investing in processing medicinal and agricultural products into high-end cosmetic products. Most of them currently only produce basic products like oils, herbal shampoos, dried herbal medicines and herbal face masks.
Deputy President of the Vietnam Association of Natural Products Sciences Nguyễn Xuân Hoàng said that cosmetic products made by Vietnamese businesses can only account for about 30-40 per cent of the total number of products in the local market.
That means there is plenty of untapped potential in the personal care market in Việt Nam, offering plenty of room for growth and opportunities for cooperatives to become huge, he said.
According to trade experts, opportunities will also come with challenges. Therefore, cooperatives should focus on training their workers.
In addition, they suggested that the State develop support policies and create conditions for cooperatives to access modern and imported machinery and equipment, which normally require large investment capitals, increasing costs for cooperatives.
The revenue in the beauty and personal care market in Việt Nam is projected to reach US$2.66 billion by 2024, with an annual growth rate of 2.97 per cent in 2024-28, according to Statista, a global data and business intelligence platform.
Using extensive statistical models, the company forecasts that the per-person revenue in Việt Nam is projected to be at $26.77 in 2024.
Furthermore, online sales are expected to contribute 20.2 per cent of the total revenue in the beauty and personal care market by 2024.
Statista said Vietnamese consumers are increasingly embracing natural and organic beauty products, driving the growth of the beauty and personal care market in the country. — VNS