Ever since the first lockdown that began in Mar. ‘20, most services retail businesses such as salons, restaurants among others, have slipped in to the red. In India, there are an estimated 65 lakh barber shops and beauty parlours of which less than 10% of them fall under the organised segment. Among those is HUL owned and run Lakme Salons.
The 485 salons strong retail network of Lakme slipped to a loss of Rs. 19 Crores on a turnover of Rs. 230 Cr. during FY 20-21 as against a profit of Rs. 6 Cr. over a turnover of Rs. 284 Cr. during the same period in the previous year. The Salon Industry in India is estimated to be Rs. 20,000 Cr pa.
Due to incessant lockdowns, many consumers have limited their visits to beauty parlours, especially since many offices have remained shut and are in the WFH mode. In smaller towns, where the company has a good network, consumers feared visiting salons due to an imminent spread of the virus from the stylists since most services happen in close proximity between people and especially within the confines of an a/c environment.

Lakme Lever has a total turnover of around Rs. 1,000 Cr pa which includes sales arising out of lipsticks, eye-liners among others. Mostly considered as discretionary purchases, these cosmetics have seen a much lower offtake during the pandemic year that was FY 20-21. In the current financial year, things don’t look any better, especially with Q1 written off with lockdowns at most top cities in India.