The flagship brand of Japanese company POLA Orbis Holdings has plans to double the number of physical retail touchpoints by 2027. POLA had 23 stores in SEA at the end of 2024.
This comes on the heels of its stumbling performance in China in 2024.
According to the firm’s FY2024 report, POLA’s net sales fell by 5.8% to JPY92.8bn (USD626.5m).
“Overseas, overall sales declined due to the significant impact of deteriorating business conditions in mainland China,” said Yoshikazu Yokote, representative director and president of POLA Orbis Holdings.
He added that the firm does not expect to see much improvement over this financial year.
“The current economic environment and cosmetics consumption trends are weak, and we expect a flat to low growth in 2025.”
On the other hand, the company recognises significant opportunities in SEA and believes it could become its growth driver for the future.
“Meanwhile, in ASEAN, personal consumption remains strong due to rising incomes amid continued economic growth. The cosmetics market is expected to continue to grow in the high single digits in the future, and we have positioned ASEAN as our focus market… In ASEAN, where market growth is expected, we intend to expand customer contact points and make the region a growth driver for the overseas business,” said Yokote.
The firm expects the region to be a key market moving forward and delivery high-single-digit growth for FY2025.
Rebuilding in China
Overall, the firm expects POLA overseas sales to decline by approximately 7% to 8% over the year, mainly because of China.
“As for the Chinese business, we expect the impact of business conditions to continue and need to speedily liquidate unprofitable stores, thus we are forecasting a decline in revenue in 2025,” said Yokote.
In 2024, the company had shuttered a number of stores in China and started a new initiative of opening new stores in more high-end areas, which it plans to continue in 2025.
The company describes this new store concept as “community-type stores” which it hopes will attract China’s wealthier set of consumers.
The aim is to foster community development and the establish of strong relationships with its consumers.
“Instead of opening stores in conventional malls in commercial areas in urban centers, we will open salon-type stores in residential areas of affluent neighborhoods to build a community with the surrounding target group and promote the provision of experiences ranging from beauty services such as aesthetic treatment and counseling to workshops on a variety of themes,” said Yokote.
He emphasised the importance of the Chinese market for the brand moving forward.
“China is the world’s largest market for skin care products, and is undoubtedly a promising market for our group, whose strength lies in skin care products.”
