Neary Khmer Assocation is aiming for a nationwide presence by reinvesting the profits from sales of its beauty products
Cambodia’s beauty industry is increasingly influenced by international trends, making it difficult for small Cambodian companies to gain shelf space in a retail sector dominated by Thai, French and American products.
Despite limited consumer spending power, the Kingdom’s consumers generally purchase expensive, imported beauty products and consider domestic variants second-tier, according to the founder of one such company.
Ing Sovanly, the director of the Neary Khmer Association (NKA), which manufactures a dozen types of shampoo and an assortment of other
products, is hoping a marketing message based on more beauty for the buck can help the company break through.
“Rather than focusing on expensive foreign trends, I’d like Cambodians to focus on healthy, cost-effective beauty products,” she said.
Like many in the domestic beauty industry, Ing Sovanly learned to manufacture cosmetic products while abroad, developing an interest in the subject while completing a master’s degree in agriculture in Thailand.
Upon returning to Cambodia, she noticed that women tended to use beauty products with little understanding of the health benefits and implications and decided to launch a range focused on health as well as beauty. “I thought about quality first, and knew the profits would come once the users began seeing benefits.”
Ing Sovanly said the secret ingredient was the “effective microorganisms” concept, which combines beneficial microorganisms to create a whole greater than the sum of its parts.
Even as Ing Sovanly attempts to overcome a preference for all things foreign, she recognises that it’s impossible to get too far away from overseas influences. When she launched NKA in 2000, her first products were mostly labelled in the Thai-language. The approach worked initially, but a rash of anti-Thai sentiment in 2003 drove NKA into bankruptcy.
“It cost me five years and $100,000,” Ing Sovanly said.
Switching to Khmer and English labelling and marketing proved more palatable to domestic consumers and returned the company to the black.
The company also relies on some imported ingredients, with around 15 percent of materials brought in from Thailand. “I’d like to make everything domestically,” she said. “This year I will cut my imports to just 5 percent.”
The firm has taken a distinctive approach to marketing its shampoos, which retail for between $3 and $5. Rather than traditional advertising, the company relies on word of mouth, training students to market and sell the products. The company has completed 103 training courses, churning out around 13,000 students. “Our former students have been instrumental in increasing our sales,” she said.
The business was launched with 20 employees in 2000 but has since grown by one-third. Ing Sovanly plans to expand the company from its current location in Choam Chao district.
“I will open two branches this year, one in Siem Reap and one in Kampong Cham province, and next year I will continue to open branches in all 24 Cambodian provinces,” she said.
She said she hoped to grow using capital generated by the business.
It currently earns between $13,000 and $15,000 a month in sales, but she refused to discuss profit margins.
She said she was optimistic about the future. “Cambodians are using more beauty products every day,” she said. “Demand is just going to increase. Cambodians should be able to purchase locally produced beauty products, and producers have a responsibility to create healthy, inexpensive products to make their customers look and feel their best.”