The average Iranian spends 1 million rials ($22) or 2.2% of total expenditure on beauty products annually, the deputy health minister said.
Iraj Harirchi added that the spending hits 1.4 million rials ($31) in cities.
“Smuggling makes up for 63% or two-thirds of the cosmetics market while 90% of the smuggled toiletries are knockoff products made in neighboring countries, which could cause skin damage,” he was quoted as saying by the ministry’s news portal.
Reza Mousazadeh, an official with the Headquarters to Combat Smuggling of Goods and Foreign Exchange, said an estimated $1.5 billion worth of cosmetics are smuggled into the country annually due to the highly profitable market.
Iran is one of the leading cosmetic markets in the Middle East and Africa, which is expected to be the fastest growing region during the next eight years as the number of potential customers (women above 15 years) is increasing year-on-year, according to the Netherlands-based business development group specialized in import/export Alliance Experts.
The Iranian Association of Cosmetics, Toiletries and Perfumery Importers said Iran accounts for $2.1 billion of the Middle East’s $7.2 billion beauty products market—second in the region after Saudi Arabia.
According to a Gallup Institute opinion poll conducted in 2015 of women who had a job and were 15 years and above, they would spend 30% of their income on cosmetics, toiletries and body care products.
Besides, almost 4.5% of Iranian family’s yearly income are spent on cosmetics and skin care products. This rate is 1.5% in Germany, 1.7% in England and France, and 3% in Italy, based on the Gallup Institute data. So, Iranians spend two times more than Italians and thrice the amount spent in England and Germany on cosmetics.
Iran’s cosmetics market value was estimated to be around $4 billion in 2016, according to BeautyWorld Middle East, which makes the country the seventh biggest consumer of cosmetics and skin care products in the world.
As a high consuming country, it is performing poorly in the production sector. Iran produces only about 20% of the cosmetics and a major part of the cosmetics and skin care products are imported from the UAE, Turkey, France, India, Germany, Switzerland, Italy, Spain, South Korea, China, the UK and Indonesia.
Iranian consumers mostly prefer European products, but because of lower purchasing power, consumers have moved toward less expensive products with reasonable quality from Asia (South Korea and India).
