Premium Beauty News - Sozio has made many announcements since the beginning of the year.
Frédéric Braud - Our recent purchases are perfectly in line with our growth strategy, both in terms of geography and market segments. The fact that we purchased Alpine Aromatics in 2011, and then Elias Fragrance in 2015 helped us settle in the USA. In France, after purchasing Sentaromatique in 2012, we were able to really establish ourselves in Grasse and better adapt to the craze for natural and organic perfumes. Also, we purchased two other companies based in Grasse, APF Arômes et Parfums in 2013, and then Fragworld in 2016, which contributed to our growth in Fine Fragrances and strengthened our presence in Asia and the Middle East, where these companies were very well-established.
Likewise, we purchased Phoenix Fragrances Ltd. last March, so we now boast a solid base and a production centre in the UK, a very specific perfume market. The company achieves 85% of its turnover on the British market, on the cosmetics and home care segments, where we are very present. Besides, 40% of their perfumes are natural. There is a real strategic complementarity and multiple synergies.
As for Scentessence, a Brittany-based company specialized in natural perfumes for detergents in France, this purchase further strengthened our presence on these markets.
Premium Beauty News - Botanicals by Sozio helped you diversify your ingredient offering, did it not?
Frédéric Braud - We launched this division both as part of our strategy to diversify our product offering and because we wanted to meet new market trends.
Over the past 15 years, at least, we have significantly strengthened our presence on the natural perfume segment. Today, natural products account for 30% of our sales in France. We were gradually led to source raw materials with much rigour in terms of traceability and ethics. Our customers benefit from this know-how.
Many of our customers used to purchase raw materials from traders with few guarantees as regards sourcing. With Botanicals by Sozio, they take advantage of our own supplier chains and, consequently, of both our fair farmer compensation policy and all the traceability guarantees we implemented. Today, all this is essential, given the strong transparency and ethics expectations.
Premium Beauty News - Is that also a way to revive your history?
Frédéric Braud - Sozio is a centuries-old company founded in 1758 in Grasse. It was a pioneer in French perfumery, so our launching the Botanicals by Sozio division is also a return to our origins: perfume essences and absolutes.
But our history is also that of a company with a family spirit and a long-term perspective. We are craftsmen specialized in perfumes. Our customers get the tailor-made approach and flexibility medium-sized companies can offer.
Premium Beauty News - You are doing pretty well after a tough year 2020, are you not?
Frédéric Braud - Indeed, we have not really suffered from the consequences of the Covid-19 pandemic. In 2020, our turnover rose by 9%, and we increased our sales by 23% in the first quarter 2021, on a like-for-like basis. Our subsidiary in the USA is doing very well. It is very well-established on markets that remained drivers despite the pandemic (industrial detergents and home fragrances). Also, we have achieved significant growths in Asia for several months. Of course, recovery remains fragile in Europe, but we have received many projects for launches scheduled next September and October, so we are optimistic for the second part of the year. The situation is trickier in the Middle East, but it remains a key region for the global perfume market. We will have a stand at BeautyWorld Middle East, next October in Dubai, and at in-Cosmetics Global in Barcelona.
We achieved a 50-million-euro turnover in 2020, and with our various purchases, our sales should reach 62 to 65 million euros in 2021. We make 40% of our turnover in the Europe-Middle-East-Africa region, 40% in the Americas, and 20% in Asia.
Premium Beauty News - How do you think the market will evolve?
Frédéric Braud - Natural perfumes are a growth driver: there is a real craze for these products. Plus, perfumers’ palettes were considerably broadened, thanks to natural isolates, which provided alternatives to essential oils.
However, naturalness is far from being the only market challenge. Clean Beauty and Clean Perfumery are two other major trends that drive the market growth. Our strategy consists in being as close as possible to these new expectations.
Last year, we created our own clean fragrance label based on strict specifications: we removed all molecules suspected of being harmful for human health and the environment. These perfumes are intended for detergents, personal care and cosmetics. They are not 100% natural perfumes: they do contain synthetic materials, but these were chosen because they do not have a negative impact.
For our clean range and natural perfumes, we chose a comprehensive transparency policy: we shared all our formulas with our customers, without mentioning the doses, in order to meet brands’ complex requirements… The demand for transparency cannot but be taken into account, although perfumes cannot be patented – which explains why manufacturing secrets need to be preserved.
Last April, we launched a new tool to calculate the biodegradability of perfumes. Based on the profile of raw materials, we can now calculate a score for each perfume. We have already used this tool within the company to create biodegradable perfumes, and we are now making it available to our customers.
Again, to meet this demand, we are going to broaden our Botanicals by Sozio offering and strengthen our supply chain controls with specific contracts with farmers and purchases, or by creating local distillation units, in particular in Indonesia and Madagascar. In addition, we will develop an increasing number of raw materials derived from natural isolates by fermenting or fragmenting essential oils.
We are also working on specific innovations: highly-perfumed gels (for air fresheners or wax melters…), a COSMOS-certified natural micro-encapsulation for cosmetics… All this should help us attract new customers!
