Shifting Market Demands Adaptability

Q: What is IM Natural doing to accomplish its expectations for 11 percent growth in the cosmetics industry by 2019?

A: The company is changing its internal structures so it can procure the necessary merchandise to supply national demand. Competition is also growing daily, so we update all our resources constantly because the Mexican cosmetics market can be unpredictable. Although trends may vary on a daily, weekly and monthly basis, in general when the economy contracts it is reflected in lower demand but sometimes the market does the contrary and our main customers place bigger purchasing orders than usual. We must be wary of transnational companies noticing this bipolarity. L’Oréal, for example, whose products are meant for a wealthy, highincome market, may notice that our products, destined for the middle and lower-income segments, have higher demand strength in terms of volume and bulk, so it turns its focus to our market. Those companies retain their prestigious and high-end market while also producing products to compete with midlevel companies

. Q: What is your focus in terms of internal corporate changes?

A: The goal of these corporate changes is to enhance efficiencies in product delivery, quality, replenishing delivery reach and general operational effectiveness. This internal reengineering entails a commercial re-engineering.

IM Natural is a traditional company known for its mamey seed oil mascara. However, we sell a great variety of eye mascaras made of different ingredients, which provide different benefits and different presentations. We also have a wide range of face creams and lotions that will be affected by the re-engineering of our operations. We are changing the image of our face creams, creating new creams and formulating new lotions. IM Natural is known for using a variety of natural ingredients like chamomile, snail slime, argan and marrow in its cosmetics. This company was the first to use mamey seed oil, which enhances eyelash growth, and traditionally employs national ingredients. It is important for some of our customers that animal ingredients are not used in our products while other countries require that our mascaras contain no parabens. One of our policies is not to test any of our products on animals.

Q: What are your distribution channels?

A: We have two levels of self-service partners in Mexico: regional, such as Casa Ley in Sinaloa and Operadora Futurama in Chihuahua, and national, such as Walmart, Chedraui, Soriana, H-E-B, Farmacias Guadalajara and Farmacias Benavides. We started in naturist retailers and the market pulled us toward new distribution channels. IM Natural then started exporting, assembling for foreign companies, licensing its products and finally developing private labels for national companies such as ISSSTE-marts, Farmacias Benavides and Almacenes García.

Q: How would you describe IM Natural’s success in entering foreign markets?

A: We have had mixed results. IM Natural exports its products and also negotiates licensing representations and manufactures for foreign companies. The company has entered new foreign markets thanks to our distributors and the support of ProMéxico. We have exported our products to Europe and South America and recently we started selling our products in the US, performing especially well in states with a high concentration of Latinos, such as California, Texas and Illinois. IM Natural is negotiating with new distributors such as Walmart, CVS and Walgreen’s to enter other markets but these processes are lengthy.

The company has faced various levels of market openness in countries that recognize COFEPRIS. For example, we have already entered Colombia. Argentina is more difficult but easier than Chile, while Brazil is virtually impossible. In other markets such as Peru and Ecuador, IM Natural is deciding whether to export or produce for local companies. The company has received sanitary registrations in Bolivia to produce mascara. IM Natural produces for a Mexican-owned company in Australia and we are about to grow its cosmetics line with new creams and facial products.