Recently, you may have noticed a change in the aisles at your local Chemist Warehouse. The change may be particularly noticeable to you if you own or work at a hair salon.
The change I'm talking about is that an increasing number of professional hair and beauty brands, that were previously exclusive to salons, have been creeping onto the shelves at Chemist Warehouse.
For the general public, this may be a welcome convenience because it's a chance to access premium products previously only available to professionals.
For industry professionals though, it raises plenty of questions about the impact on brand reputation, the quality of and the future of salon-exclusive goods.
It's time to explore what the change means for the hair and beauty industry as a whole.
1. Increased Consumer Demand
Lately, social media has exploded with hair and beauty influencers recommending Olaplex, Fanola, Eleven Australia, L'Oreal Professional and Wahl.
As a result, customers have been requesting these professional brands from their favourite retailers. Chemist Warehouse has responded by offering an increasing number of brands that were previously only available from salons and doing so at competitive prices.
With influencers continuing to push professional brands, there is no sign of the demand slowing down anytime soon, especially with word spreading about the unbelievable results.
2. Brand Expansion & Market Penetration
Another reason professional brands are stocked at Chemist Warehouse is their desire for market penetration and expansion.
Professional brands have no doubt pounced on the opportunity to distribute their products through a big retail chain in an effort to reach a much wider audience. By doing this they also gain access to a market of customers who might not typically visit salons.
Chemist Warehouse also serves a role by providing flashy advertising to increase a brand's chance of becoming a household name, which is admittedly hard to resist.
3. Profit
Sometimes, the large orders placed by pharmacies like Chemist Warehouse are too good for brands to refuse.
These bulk purchases offer guaranteed revenue and an opportunity to move high volumes of products. While some professional brands indicated in the past that they would remain exclusive to salons, the appeal of sales can outweigh their original intentions.
4. Changing Perceptions of Exclusivity
Currently, professional brands are rethinking the exclusivity of salons and boutiques. They are adapting to consumer behaviours that favour convenience, affordability and one-stop shopping.
While there is no sign of salons being abandoned, more and more brands are seeing the value in reaching customers through retail stores.
The challenge for these brands will be staying in favour with the salons that no doubt played a major role in bringing attention to their products.
5. Parallel Imports
Parallel imports could be another reason Chemist Warehouse is able to stock professional brands.
Many manufacturers have arrangements allowing businesses to sell their products in a particular country. In contrast, parallel imports are when businesses sell products brought into a country without the specific permission of the manufacturer.
Even though parallel imports are legal, Australian brands can defend their trademark through “authorised stockist” applications and by requesting unwanted stockists be removed. It's an unfortunate grey area in the industry.
6. Missing Distributor Clauses
Another reason professional brands may be appearing at Chemist Warehouse is a missing distributor clause.
Some overseas distributors don’t have specific terms like minimum spend requirements in their contracts, which allows extra or outdated stock to accumulate. Instead of letting these products gather dust, distributors sell them to brand houses, who then send irresistible bulk offers to major retailers like Chemist Warehouse.
The Downsides of Chemists Stocking Professional Brands
While stocking professional brands in chemists has plenty of upsides, there are downsides for both consumers and industry professionals.
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Challenges for Salons
For salons, the practice undermines the exclusivity previously offered to clients. It's now possible for clients to bypass salons to buy exclusive products at a discount. This impacts the revenue of salons who rely on the sale of professional brands as part of their income stream. In addition, it weakens the relationship between professionals and their clients, who may now see these products as less premium.
As such, salon owners face a difficult choice of whether to continue to sell these brands at reduced margins (while increasing service fees to cover the difference), or change the brands they endorse and sell.
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Challenges for the Professional Brands
For brands, being widely available at chemists risks diluting their high-end image, potentially compromising their reputation for quality and expertise.
Additionally, chemists may lack the trained professionals needed to guide customers in selecting and using products correctly, which could lead to improper use and disappointing results.
What Are Your Thoughts?
Please let us know your thoughts about these recent changes in the comment section below.
Are you concerned that customers can access professional brands from common retailers?
