🇳🇬 Lagos Fashion Week initiatives aim to strengthen the industry value chain. Designer brands from Nigeria and the wider West Africa region presented their collections at the latest edition of the B2B event from Oct. 23-27, including Orange Culture, Imad Eduso, Lagos Space Programme, Emmy Kasbit, Maliko, Iremitide, Babayo, Kente Gentlemen, Ajabeng, Awa Meité, Boyedoe, Oshobor, Ugo Monye and Loza Maléombho. Event founder and CEO Omoyemi Akerele showed her commitment to helping designers broker deals that strengthen the value chain by partnering with the likes of Prosper Africa, an American government initiative catalysing two-way trade and investment flows between the US and countries on the continent. The biannual event, which this season featured initiatives with mentorship programme Q Rising (formerly Qasimi Rising), The Bicester Collection and the Heineken 45 CL collection, also highlighted the power of collaboration in fostering innovation, craftsmanship and responsible business objectives. [BoF Inbox]

🇧🇩 Adsum Capital Management eyes Bangladesh’s troubled giant Beximco. The Dubai-based firm is leading a consortium of investors who filed an expression of interest in buying some of the subsidiaries of Bangladesh’s largest private sector conglomerates, including its textiles and garment manufacturing division Bextex which lists Target, PVH and Zara among its clients. The troubled banking-to-pharmaceuticals multinational founded in 1972 is contesting a court order demanding that its assets be placed under receivership after it became heavily indebted and embroiled in a corruption scandal surrounding its co-founder Salman F Rahman, the firm’s vice-chairman who was a former advisor to the country’s ousted prime minister Sheikh Hasina. [Sourcing Journal]

🇮🇳 Indian gold demand expected to surge during Diwali despite high prices. According to Sachin Jain, the World Gold Council’s regional India CEO, “despite gold prices touching record highs…anecdotal feedback from industry indicates a resurgence in gold buying due to various ongoing festivals with demand largely driven by investment sentiment and wedding-related purchases. [Jewellery retailers factoring in high gold prices] have also invested in new designs and innovative usage of technology to make daily wear [and] lighter jewellery.” Dhanteras, which kicks off the festive period, falls on Oct. 29 this year and Diwali on Oct. 31 during the Hindu calendar month of Kartika which is a busy time in India’s retail calendar. [Economic Times]

🇨🇳 China’s Li Ning inks joint-venture with HongShan for overseas expansion. The Beijing-based company founded in 1989 by the Olympic gymnast of the same name will hold 55 percent interest in the new British Virgin Islands-based venture through two subsidiaries, LN Co and Founder Co, while the venture capital fund formerly known as Sequoia Capital China will hold the remaining 45 percent interest through its units HongShan Venture and HongShan Motivation. The deal amounts to a total capital contribution of $20 million. [Deal Street Asia]

🇦🇺 Australia’s Mosaic Brands enters voluntary administration. The listed apparel group operating more than 760 stores and employing around 3000 staff across Australia and New Zealand said: “the board wishes to reiterate its belief to those who supported the restructure…that the business has a long-term future,” asserting that the company would continue to trade throughout Christmas. In a bid to turn around the business last month, it discontinued the Rockmans, Autograph, Crossroads, W.Lane and BeMe brands, focusing instead on core brands Millers, Noni B, Rivers and Katies and Mosaic. [Ragtrader]

🇧🇩 Post-Hasina protests cost Bangladesh garment industry $400 million. The labour unrest that followed the August 5 resignation and ousting of prime minister Sheikh Hasina have led to the production loss in the country’s ready-made garment sector. But earlier this month Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Khandoker Rafiqul Islam said: “we expect that work orders that shifted to other countries will return as normalcy is restored in the sector.” The BGMEA’s board of directors has since been dissolved by the new interim government, according to local reports. [Financial Express Bangladesh]

🇨🇳 Swiss beauty group Galderma posts sales increase amid China gains. The parent of Cetaphil said it had logged sales of $3.26 billion during the first nine months of the year, up 9.2 percent from the same period a year earlier in constant currency terms. Noting double-digit growth in the injectable aesthetics and dermatological skincare categories and robust Europe market performance, CEO Flemming Ornskov said that China was one of the fastest growing markets, also highlighting Latin America and the broader Asia Pacific region. [BoF]

🌍 Afreximbank doubles African creative sector financing including fashion. The Egypt-based financial institution officially called the African Export–Import Bank has said it will increase funding to the Creative Africa Nexus (CANEX) programme from $1 billion to $2 billion for the next three years. Bank president Benedict Oramah said: “This will enable us to support significant infrastructure investments for film production, stadia, arenas, manufacturing facilities for fashion, and training centres.” [BoF Inbox]

🇨🇳 L’Oréal Group Q3 sales miss expectations as China buys less. The group, which owns Maybelline and Lancôme among others, reported sales of €10.28 billion ($11.11 billion), a 3.4 year over year percent rise. The North Asia region, dominated by China, accounts for a quarter of group sales, but persistently weak demand in the world’s second largest economy has curbed consumer spending, with sales in North Asia declining 6.5 percent in the period, worsening from a decline of 2.4 percent in the prior three months. [BoF]

🇨🇮 Abidjan Fashion Week debuts in Côte d’Ivoire’s commercial capital. The inaugural edition of the event took place from Oct. 10-13 in Abidjan. Founded and produced by Ivorian fashion designer Elie Kuame with financial support from the culture ministry, the showcase featured an opening night at Aby Concept store followed by around 30 runway shows of predominantly local designers and brands such as Kuame and La Maison Kanty’s as well as brands from the Republic of Congo, Ghana, Benin, Nigeria, Senegal and Cameroon. [Le Monde, Semafor]

🇦🇺 Conservation experts sound the alarm over Australian sandalwood. Used in luxury fragrances, sandalwood is a coveted ingredient for beauty companies, but Richard McLellan, a researcher at Charles Sturt University, worries the native Santalum spicatum tree population in Australia is overharvested and at risk of extinction. However, this claim is contested by the likes of local producer Dutjahn Sandalwood Oils, a 50 percent Aboriginal-owned business that sells the oil to companies such as Aesop and Givaudan, the multinational that supplies the Estée Lauder group, among others. [BoF]

🇨🇳 German beauty group Beiersdorf sees sales rise despite China slump. Nivea maker Beiersdorf reported a 6.5 percent rise in group sales for the first nine months of 2024 to €7.55 billion ($8.15 billion), helped by a rebound in North America and growth in its skincare segment. The company said it expected a strong fourth quarter, despite persisting challenges in the Chinese luxury market. Sales in luxury brand La Prairie dropped by 7.3 percent in organic terms in the first three quarters, driven by the continued weakness of the Greater China region. [BoF]

🇮🇳 Indian textile giant Siyaram’s invests $4.7 million in its Zecode brand. “We are targeting Gen-Z customers,” said Jayakar Shettigar, CEO of Zecode, and Gaurav Poddar, executive director of fabric manufacturer Siyaram’s in statement, adding that by the end of this fiscal year, the brand will use the 40 crore rupee injection to open 25 mono-brand stores around Karnataka state. The company also owns Siyaram’s Shirtings and Suitings, J. Hampstead, Oxemberg and apparel brands Mozzo, Inspiro, Tessio and Cadini. [Economic Times]

🇲🇽 Shein launches credit card with fintech Stori to aid Mexico expansion. The China-founded ultra-fast fashion giant is launching its first branded credit card worldwide to help it expand further in Latin America’s second-largest economy (where it is reportedly exploring building a factory) by making e-commerce more accessible to more Mexicans, many of whom lag in access to bank accounts and credit [Reuters]

🇮🇳 India’s Hindustan Unilever’s Q2 profit falls 4%, revenue rises 2%. The beauty, personal care and household goods major also known as HUL, whose portfolio includes brands like Lakmé, Glow & Lovely, Dove and Pond’s, recorded 2612 crore rupees ($310.5 million) in net profit and 15,319 crore rupees ($1.8 billion) in revenue from operations in the quarter ended Sep. 2024. [Economic Times]

🇦🇪 Elie Saab and Octa Properties to launch UAE branded residential project. The Lebanese couturier has partnered with the Dubai real estate developer to build 355 beachfront homes called La Mer by Elie Saab on Al Marjan Island in the United Arab Emirate of Ras Al Khaimah. The move follows Etoile by Elie Saab, the couturier’s Saudi Arabia-based branded residence project built with local property developer Dar Al Arkan. [Construction Week]

🇮🇳 India’s Zouk raises $10 million in round led by Aavishkaar Capital. The bag and luggage brand founded in 2016 by Pradeep Krishnakumar and Disha Singh has secured the funding in a Series B round led by the Mumbai-based venture capital firm with participation from existing investors Stellaris Venture Partners, Titan Capital and Winners Fund Sharrp Ventures among others. [Economic Times]

🇯🇴 Jordan’s leather and textile industry creates 1,500 new jobs. The sector that now employs more than 29,000 Jordanian workers saw the 4 percent year over year rise in jobs in the January to September 2024 period, according to Ihab Qadri, representative of the sector in the Jordan Chamber of Industry. [Fibre2Fashion]

🇮🇳 H&M India appoints Helena Kuylenstierna as director. The Swedish fast fashion giant veteran with 24 years at the firm was previously global managing director for childrenswear. H&M’s local unit, which operates 64 stores across 29 cities and partners with Myntra and Ajio online, is based in Bengaluru. [Economic Times]

🇮🇳 Indian menswear brand Rare Rabbit parent sees annual profit double. Parent company Bengaluru-based Radhamani Textiles, which also owns womenswear brand Rareism and Articale, reported net profit of 75 crore rupees ($8.9 million) during the year ended March 2024, up from 32 crore rupees the previous year. [Economic Times]

Adidas AG reached an out-of-court settlement with rapper Ye that concludes all claims connected to the sportswear maker’s decision to end their partnership two years ago.

“Both parties said we don’t need to fight anymore and withdrew all the claims,” chief executive officer Bjorn Gulden told journalists in a call. The agreement didn’t include any payments, he added.  “No one owes anybody anything anymore. So whatever was is history.”

The German company cut ties with the rapper and designer Ye, previously known as Kanye West, following a rash of offensive behaviour, including antisemitic comments. The Yeezy line accounted for about half of Adidas’s total profits before the split, according to analysts.

The sportswear company was stuck with some €1.2 billion ($1.3 billion) of unsold Yeezy shoes and merchandise after the end of the partnership, and has been gradually selling it down ever since. It expects to be done with the brand by the end of this year.

By Sonja Wind

Learn more:

Case Study | The Strategy That Brought Adidas Back From the Brink

Adidas has mounted one of the more remarkable turnarounds in recent memory after facing a crisis two years ago from the end of its Yeezy business. BoF spoke to chief executive Bjørn Gulden and other members of Adidas’ leadership to unpack how a series of bold decisions on products like its Samba sneaker, a move to refocus the brand on athletes and internal shifts brought Adidas back from the brink.

Crocs Inc.’s shares fell as much as 16 percent in US premarket trading after the seller of brightly coloured plastic clogs tempered growth expectations and warned of sales declines for its casual HeyDude brand.

Crocs’ sales growth in the third quarter, which includes the crucial back-to-school shopping period, remained flat. The company said it expects 2024 sales growth of 3 percent, the low end of its prior guidance of 3 percent to 5 percent. Dragging revenues was Crocs’ casual sneaker and loafer brand, HeyDude. The brand’s full year sales are expected to fall 14.5 percent compared to a year ago, lower than its previous guidance of down 8 percent to 10 percent.

“HeyDude’s recent performance and the current operating environment are signalling it will take longer than we had initially planned for the brand to turn a corner,” said chief executive officer Andrew Rees in a press release.

After a decade-long fallow period during the 2010s, Crocs regained relevance following a strategic move to target teens with endorsements from celebrities like Justin Bieber and Post Malone. Annual sales more than tripled over the last four years.

The shoemaker has run into trouble among schools across the US that are banning Crocs due to safety concerns and distractions. The company has said the school restrictions are “baffling.”

Crocs shares were up 47 percent for the year through Monday’s close, while the S&P 500 index has risen 22 percent.

By Julia Fanzeres

Learn more:

Crocs to Buy Footwear Brand Heydude for $2.5 Billion

Crocs Inc said on Thursday it would buy privately owned footwear label Heydude for $2.5 billion in a cash-and-stock deal, as the rubber clogs maker looks to take advantage of the pandemic-led surge in demand for casual shoes.

Over the past 15 or so years, Shopify Inc. has established itself as the go-to for mom-and-pop businesses looking to set up shop online. Now, in a dramatic shift, the Canadian company is targeting larger companies and, in doing so, looking to wrest e-commerce customers from Salesforce Inc.

Shopify says it has lured hundreds of Salesforce clients, including big brands like Mattel Inc., Toys R Us and mattress seller Casper, and is encouraging other companies to “join the mass migration.” Shopify’s key selling point is lower prices for its suite of e-commerce services and it has been cheekily calling out Salesforce’s penchant for wining and dining potential clients.

“The reason most enterprise software is so expensive is because it takes so many steak dinners to put it in your hand,” Shopify chief operating officer Kaz Nejatian said in an interview.

Salesforce eagerly clapped back, saying its platform offers functions that Shopify doesn’t, including customer service, and can better handle traffic surges. “Anything’s cheaper if you narrow the use case to one thing and say, ‘Oh, we’re cheaper for this one thing,’” said Luke Ball, Salesforce’s senior vice president of product management. “We’re still the incumbent reigning champion in the space other companies are trying to break into.”

By targeting larger retailers, Shopify is hoping to turbocharge growth, which took a hit after the pandemic e-commerce boom fizzled. The company makes much of its money selling services to its customers and is betting that the order volume generated by bigger retailers like Mattel will help it grow more quickly than by relying on its existing base of mom-and-pops.

For years, Salesforce and Shopify peacefully co-existed. Better known for its customer management software, Salesforce entered e-commerce in 2016 with the $2.8 billion acquisition of Demandware. Now called “Commerce Cloud,” Salesforce says its clients include most top retailers, such as Saks Fifth Avenue. Customers also typically use other Salesforce products, meaning they can integrate the e-commerce tools with marketing and other functions, Ball said.

Salesforce also benefitted from a healthy pipeline of direct-to-consumer brands backed by venture capitalists concentrated around its San Francisco headquarters. The thought at the time was that the startups would quickly grow to the point where they needed Salesforce’s robust set of commerce and customer-relations software. Instead, many of them flopped, and a key new business pipeline dried up.

Today, the company’s commerce and marketing business is its slowest growing segment, and Shopify revenue eclipsed the business back in 2021. “They’re certainly a noticeable competitor in the space,” Ball said. “I think one would be head-in-the-sand to not see it.” Salesforce says it has been attracting Shopify customers, including Black Rifle Coffee Co., ReserveBar and Hasbro Inc.

Shopify built its business by making it easy for small businesses to quickly set up online stores. The Ottawa-based company constantly monitors industry trends and updates its software so online merchants can reach their customers on desktops, mobile devices and shopping apps without having to worry about the back-end technology. Shopify’s broad visibility into online transactions also helps sharpen its fraud detection tools.

Like Amazon, Shopify benefited from shoppers’ stampede online during the pandemic, but suffered once they returned to their regular shopping habits. The company also abandoned ambitions of building a logistics operation that would have helped it grow by selling more services to customers it already has. Without that, Shopify needs to find new clients.

In an effort to attract bigger customers, the company has been touting fees that it says are much cheaper than Salesforce’s. Scott Lux, executive vice president of global commerce and technology at clothier Esprit, says customers could save as much as 50 percemt over three years by switching. Shopify also has added new features that help it appeal to bigger customers, such as letting brands list as many products as they want and selling them on marketplaces and social media apps in addition to their own websites.

Mattel, which recently switched from Salesforce to Shopify, says its decision rested partly on the fact that fees are tied to traffic. While the toymaker experiences big spikes in demand for new products, such as collectible Hot Wheels, it doesn’t need that much capacity 24/7. Shopify’s flexible platform also lets Mattel customise pages for key products, including American Girl dolls, says Subramanian Kovilmadam, the company’s vice president of technology.

“Shopify has been extremely responsive to the complexities of Mattel’s needs,” he said. “By moving from a large, annual licensing fee model to a more flexible and transactional cost model, transitioning to Shopify has also resulted in cost savings for us.”

Salesforce’s Ball said the company is working on introducing more “pricing flexibility” for customers.

“Shopify has added enough capabilities over the last few years that have made it a viable option for even the biggest e-commerce merchants,” said Gil Luria, an analyst at D.A. Davidson & Co. who follows both companies. “At the same time, Salesforce is deemphasising its Marketing Cloud and focusing more on the Data Cloud, which leaves them vulnerable to losing e-commerce customers.”

Salesforce will still appeal to big businesses with annual sales of $300 million or more since it has more sophisticated tools, including the ability to run tests and see which marketing campaigns perform best so they can be refined in real time, Lux said. Shopify is gaining traction with businesses that aren’t quite that large and want to save money, he said, adding that a lot of the Shopify savings come because the tools are simpler to use and don’t require as much technology support staff from the client.

“Shopify is just maniacally focused on commerce, which has helped them stand out with efficiency,” he said.

By Spencer Soper and Brody Ford

Adidas reported strong third-quarter growth across most regions in a sign a revival plan led by chief executive Bjørn Gulden is starting to work.

The German sportswear group said Tuesday that currency-neutral revenue grew by double digits in most places, except North America, where dwindling sales of Yeezy sneakers are still weighing on the region. Group operating profit also jumped to €598 million ($646 million), from €409 million in the same period last year.

Earlier this month, Adidas raised its annual profit target for the third time, amid surging demand for its retro kicks. The company said it now expects to generate operating profit of around €1.2 billion, up from the previous forecast of around €1 billion.

Shares of Adidas rose as much as nearly 3 percent in early trading. The stock had risen 16 percent so far this year through Monday’s close. Rivals Nike and Puma have both posted losses in contrast.

Gulden took over Adidas in January 2023, shortly after the company cancelled its partnership with Ye, following a string of anti-semitic comments by the rapper and designer. Gulden’s plan for Adidas is to reduce the company’s previous reliance on the Yeezy brand, while refocusing the design of new footwear and apparel and streamlining its operations and costs.

His early bet on boosting popular retro products like Samba and Gazelle shoes is paying off, with Adidas shares outperforming cross-town rival Puma. Adidas is currently scaling up volumes for its 70s-era running shoes SL 72. The goal is to close the gap to Nike, which remains the industry leader despite its struggles.

All regions, sales channels and product divisions are now growing, Gulden said in a statement. Even in North America, where sales fell percent, the region returned to positive growth when the Yeezy brand is excluded, he said.

Adidas is nearing the end of its Yeezy inventory, which contributed around €50 million in operating profit during the third quarter, the company has said previously. There will be no further profit contribution in the fourth quarter.

The current momentum is a sign that Adidas has more to offer than just its classic sneakers, according to analysts at Morgan Stanley led by Edouard Aubin. These strong top-line trends are likely to continue in the final quarter and next year, said RBC analysts led by Piral Dadhania.

Eyeing its next big seller, Adidas has said previously it’s preparing more launches in its lifestyle running shoes and its superstar brand.

By Sonja Wind

Learn more:

Case Study | The Strategy That Brought Adidas Back From the Brink

Adidas has mounted one of the more remarkable turnarounds in recent memory after facing a crisis two years ago from the end of its Yeezy business. BoF spoke to chief executive Bjørn Gulden and other members of Adidas’ leadership to unpack how a series of bold decisions on products like its Samba sneaker, a move to refocus the brand on athletes and internal shifts brought Adidas back from the brink.

Estée Lauder Companies’ succession strategy is shaping up.

According to a report in The Wall Street Journal, Stéphane de La Faverie has been selected as Estée Lauder Companies new chief executive officer. Estée Lauder Companies declined to comment on the report, though earlier on Monday, it confirmed that Jane Lauder, the company’s chief digital officer and another name thought to be in close contention for the top role, was set to step down by the end of 2024.

Rumours around succession have been swirling since 2022, when Estée Lauder’s stock price began a continued slide and analysts began to question Freda’s leadership de La Faverie and Jane Lauder quickly emerged as top contenders.

de La Faverie has been with Estée Lauder Companies for over 13 years, serving in various leadership roles, mostly recently as executive group president, a position he held for two years. Before joining the company in 2011, he served as a senior vice president at L’Oréal.

In partnership with [Jane] Lauder, de La Faverie has been leading the Estée Lauder’s “profit growth and recovery plan” since 2023, designed to reboot the company’s flagging performance, with a focus on rebuilding core brand equity and improving its performance in Asia, a stubborn drag on its results.

Learn more:

A To-Do List for Estée Lauder’s Next CEO

Whoever steps into Fabrizio Freda’s Italian loafers in June 2025 has a big job on their hands, as the American beauty conglomerate battles softened demand internationally and on its home turf. Kickstarting meaningful growth will mean a fresh China strategy, channel and category overhauls, and generating some much needed buzz.

Less than two years into the role, The RealReal chief executive John Koryl has exited the company and will no longer serve on its board, the resale platform announced Monday morning.

In his place, the company has appointed president and chief operating officer Rati Sahi Levesque, who will assume the position effective immediately. Levesque helped found the company in 2011 and was its first employee. In her tenure, she has held leadership roles across the organisation, from sales and merchandising to marketing.

Under Levesque and former chief financial officer Robert Julian — the duo served as interim co-CEOs after founder Julie Wainwright resigned in 2022 — The RealReal set out on a path to profitability that included drastic changes to its commission structure that favour high-value items like jewellery and Hermès handbags.

In early 2023, the company brought in Neiman Marcus alum Koryl to seal the deal on narrowing losses. Koryl continued to iterate on the commission structure and helped revamp customer service offerings. In the fourth quarter of 2023, the company finally accomplished EBITDA (earnings before interest, tax, depreciation and amortisation) profitability, the first time since its IPO in 2019.

In fiscal 2024, The RealReal expects to post adjusted EBITDA of between $4.5 million to $7.5 million, it said as part of its CEO  announcement Monday. That’s compared to an adjusted EBITDA loss of $55 million in 2023 and loss of $112 million in 2022.

But as The RealReal reduced losses, its topline shrank. Last year, it posted $1.7 billion in gross merchandise value, reflecting a 5 percent drop from the year prior. This year, it’s expecting annual GMV of about $1.8 billion.

“Rati and the leadership team have the full confidence of the board and are well-positioned to drive the business forward,” Karen Katz, chairperson of the board, said in a statement. “We wish John well as he begins his next chapter and takes time to focus on his family.”

Learn more:

Wall Street Loves The RealReal’s New Direction. Users Have Mixed Feelings

The fashion resale company finally became profitable last year, but it was at the cost of losing consignors who complain that reselling is no longer as lucrative as it once was on the platform.

Many international fashion and beauty brands are hedging their bets on China, where a faltering luxury market has an economic slowdown.

But those warning signs haven’t deterred niche British fragrance brand Perfumer H. In early 2025, it will open a four-story, 4,000-square-foot store in Shanghai’s fashionable French Concession, near stores like streetwear maker Supreme. In addition to the sales floor, the store will also include a film screening area, a candle refilling station, a tea room and space for an artist in residence.

Despite not yet having a physical presence in China, Harris said the brand has reason to believe its new shop will resonate in the market. Perfumer H’s scents, such as Ink (with notes of vetiver and black pepper), Rainwood (which smells like juniper) and Moss (with notes of grapefruit and patchouli), all $190, are already popular with Chinese customers making purchases overseas.

“I don’t fear anything, really,” said co-founder and perfumer Lyn Harris. “I can feel people [in China] want the product, and we offer something special and unique.”

China may be the world’s second-biggest beauty market (after the US), but lately, it’s been posing headaches for international beauty brands. In the post-pandemic era, local brands often come out on top over global names, and China is seeing a slower economy recovery, compounded by government crackdowns on excessive wealth and softer consumer spending. Muted demand caused LVMH-owned retailer Sephora to cut 10 percent of staff in August, while overexposure in the market has dragged down earnings for conglomerates like Estée Lauder Companies and Shiseido.

The Chinese fragrance market is still a nascent one, with customers more comfortable shopping for skincare and cosmetics. According to market insights firm Digital Luxury Group, Chinese consumers are still in the early development stage with fragrance, and just beginning to build habits around consumption and usage — which could mean they’re more malleable, and that behaviour and uptake could still evolve.

Harris is resolute that there’s plenty of opportunity. She and co-founder Christophe Michel are hoping that a combination of innovative products and experiential elements to the store will increase their chances of success. Their bet is also on the wider power of brick and mortar, as the company plans to have 10 points of sale in China by 2028.

“We offer something really special and unique … we’re giving an experience,” said Harris.

Experience and Emotion

There’s precedent for Perfumer H’s confidence. Gen-Z and Millennial shoppers are not only voracious consumers of fragrance, but prioritise spending on experiences. Many consumer brands have seen success adding lifestyle or experiential elements to their retail outposts — think Ralph Lauren’s “Ralph’s” cafés, or Glossier’s purpose-designed selfie areas.

Penetration of fragrance in the Chinese market is lower than categories such as skincare and cosmetics, due to cultural preferences that favour smelling clean rather than perfumed, but the market is showing early rumblings of growth. Per local press, the local luxury department store chain SKP opened a new outpost in the Chinese city of Wuhan in July that featured 40 fragrance brands, while conglomerates like L’Oréal and Estée Lauder Companies have tapped homegrown indie labels like To Summer and Melt Season for investment.

Perfumer H’s China effort is being launched in partnership with a local distributor, who will also assist with local press, marketing and communications, which should relieve staffing pressure on the company and reduce the likelihood of it getting lost in translation. Much of the flagship space will be dedicated to Shanghai-based artisans, like a ceramist selling hand-crafted objets or a bakery offering preserves and oils.

Still, it’s a premium brand: in addition to its core range of perfumes, Perfumer H also offers refillable candles and fine fragrances in hand-blown glass bottles, which sell for over $700. Harris is a seasoned perfumer who previously created scents for niche brands like Vyrao and Cire Trudon (Perfumer H is her sophomore brand; she previously launched the premium line Miller Harris in 2000 and exited in 2013).

Harris believes her pedigree, on top of the brand’s unique assortment including candles, teas and incense, will help win over local consumers. “They like my style of perfumery,” Harris said — especially her emphasis on quality.

Channel Mixing

China is just one part of Perfumer H’s global ambitions. By early 2025, the brand will launch in top Australian beauty retailer Mecca, unveil a new store in Tokyo, and open another under franchise in Seoul.

Currently, the label operates three stores in London, including a new Mayfair flagship, and it has a presence in multi-brand retailers like Arts + Science and Tomorrowland in Japan, Sans in South Africa, as well as its own stores in Hong Kong, Macau and Taipei through a mixture of wholesale and franchising,

While many niche perfume brands prefer to lean on solely on wholesale to grow their customer base, Harris and Michel opened dedicated stores as soon as possible because “it builds up your community instantly,” said Harris.

The brand is backed by Fable Investments, the venture firm spun out of Brazilian conglomerate Natura by former Aesop executives. (The firm took a stake in 2022, and increased it in May 2023.)

Harris is well aware that the Chinese customers, like their international contemporaries, are looking for value. Where do fragrances with hand-blown glass bottles that cost as much as a mid-range smartphone fit into that?

“They’re not just going to buy for the sake of it anymore,” said Harris. “And that’s great. That’s the customer we want.”

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Consumers and celebrities around the world covet it for its warm, earthy and musky scent, but Australian sandalwood’s popularity has come at more than just a hefty cost to the wallet, with some scientists warning the species is at risk of extinction in the wild.

“Australian sandalwood’s downfall is that it’s one of the most fragrant species of sandalwood in the world,” said Richard McLellan, an adjunct research fellow at Charles Sturt University.

“A lot of people know sandalwood very well but very few people know it’s declining in the wild and it’s been over-harvested for decades.”

McLellan has spent the past six years researching wild Australian sandalwood — Santalum spicatum — which is harvested in Western Australia for oil that is used in luxury perfumes, incense, cosmetics and other consumer products.

Dutjahn Sandalwood Oils is a 50 percent Aboriginal-owned business that sells sandalwood oil to companies such as Aesop and Givaudan — a multinational that supplies the Estée Lauder group, among others.

Its chief executive, Guy Vincent, said the business sourced Santalum spicatum from a combination of plantations, the WA government-owned Forest Products Commission and native title lands managed by traditional owners.

“From our perspective, the species is not threatened, it’s thriving especially on native title land where there are traditional owners managing their land,” he said.

He said regeneration of the species on native title lands was “monitored and validated scientifically”.

“Here we have this spicatum that is valued greatly by international fragrance houses and managed sustainably by Aboriginal people and gives opportunities for Aboriginal people.

“There needs to be a broader view of the sustainability in this context.”

In WA, the primary commercial harvest operator is the Forest Products Commission, which manages the harvest of up to 2,500 tonnes of wild Australian sandalwood each year.

Australian sandalwood is also harvested in plantations but the warnings from conservationists are focused on trees found in the wild and long-standing concerns that there is insufficient natural regeneration of the species.

Historically, Santalum spicatum grew across most of southern Western Australia and into South Australia. It was listed as a threatened species decades ago in South Australia but has no such protections in WA, where wild populations have largely retreated to the semi-arid parts of the state.

McLellan is hoping that could soon change with the federal threatened species scientific committee (TSSC) considering whether to list Australian sandalwood for protection under national environmental laws.

“My research shows it is a keystone species for native fauna and yet we pull it out of the ground to make perfume with no thought to its ecological value in the landscape,” he said.

The committee is due to deliver its recommendation to the environment minister, Tanya Plibersek, on 30 October, one of almost 50 expected recommendations – including on the conservation status of the maugean skate.

Three years ago, the International Union for Conservation of Nature (IUCN) listed wild Australian sandalwood as vulnerable on its international red list of threatened species after scientific advice identified “unsustainable, legal wild harvest” as a major threat to its survival.

Prof Kingsley Dixon, a botanical specialist at Curtin University, said across its range, “we are seeing the species reduced in both abundance and vigour and vanished in many areas where it was once common”.

“The evidence is we have less sandalwood in the wild than probably ever in its evolutionary history,” he said.

The WA department of biodiversity, conservation and attractions manages wild sandalwood by imposing limits on how much can be harvested each financial year. The department is due to set new annual harvest limits in 2027.

A spokesperson said that review process would “respond to any decision by the commonwealth should sandalwood be listed as a threatened species”.

“As acknowledged in Western Australia’s sandalwood biodiversity management program, there is concern that a lack of natural regeneration in some areas in the wild is threatening long-term stability of populations,” they said.

“Therefore, re-seeding and regeneration programs are important for sandalwood conservation. WA’s sandalwood management program seeks to conserve, maintain or re-establish self-sustaining sandalwood ecosystems in the state.”

Peter Robertson, an environmental consultant and convener of the “Save our Sandalwood” network, said that — in addition to over-exploitation — climate change and grazing by feral animals were major threats.

“It’s in a dire state,” he said.

“We think that the minister must accept that advice and ensure that Santalum spicatum is listed as a threatened species.”

By Lisa Cox

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The wheels of change continue to turn at Estée Lauder Companies.

Jane Lauder — the granddaughter of Estée Lauder, the company’s founder — will step down from her role as chief digital officer and executive vice president of enterprise marketing at the end of this year, the company confirmed to The Business of Beauty on Monday.

The company is undergoing a raft of executive changes as it shores up its succession strategy. Chief financial officer Tracey T. Travis will step down on November 1, while chief executive officer Fabrizio Freda is set to retire next June. A successor to Freda has yet to be named.

Lauder has occupied her dual role since 2020, and was named as a co-leader of the company’s profit recovery plan in July alongside executive group president Stéphane de la Faverie. She previously worked as a global brand president at various ELC brands, including the skincare lines Clinique and Origins. She will retain her board seat, though her departure will mean the Lauder family no longer hold any roles in the company’s quotidian operations.

Investors have been calling for a shake-up in the company’s leadership since 2022. The aftermath of the pandemic laid bare how reliant the company had been on the Chinese market and department stores, and its slow recovery, downward revisions to its outlook and tepid sales growth have seen its stock price slide by around 80 percent since the end of 2022.

The company will report quarterly earnings on Thursday.

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