Natural Fragrance Ingredients Market Analysis
The natural fragrance ingredients market is set to witness a spend growth of more than USD 1 billion with spend momentum to accelerate at a CAGR of over 6% between 2019-2024. The cosmetics industry accounts being one of the largest end-users in the natural fragrance ingredients market. Factors such improvement in the purchasing power and consumer's affinity towards using luxury items are driving investments in the cosmetics industry which is favoring the demand for a range of natural fragrance ingredients. However, the gradual proliferation of synthetic or artificial fragrance ingredients are exerting a moderately negative impact on the demand growth in this market through the forecast period.
Top Spending Regions in the Natural Fragrance Ingredients Market
An exponentially increasing demand for organic and natural fragrance ingredients from the cosmetics and perfume industries is driving spend growth in the natural fragrance ingredients market across the key geographies.
Europe
The perfume industry in this region is accounting for a significant portion in the spend share as it is known to extensively leverage organic and natural fragrances that are customized to suit the tastes of both the gender. Suppliers from the perfume industry are advertising their brand through perfume blogs and social media platforms which will further favor the procurement in the natural fragrance ingredients market.
North America
The market in North America is experiencing a high rate of adoption of fine fragrances and signature fragrances as end-consumers are open to experiment with natural aromas. Therefore, global cosmetics and personal care product manufacturers are focusing on product innovations in these markets. Moreover, they are collaborating closely with natural fragrance ingredient manufacturers to design and develop these products.
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What are the Key Price Trends in this Market?
- Despite an increase in the supply following the penetration of low Chinese and Indian suppliers in the western market, forecasts of increase in the prices of raw materials such as lavender and chamomile will increase the OPEX of natural fragrance ingredients suppliers.
- Attempts to make a mark in niche markets and offer unique products are driving suppliers to increase their investments in their R&D activities. This is increasing their OPEX and will have a subsequent impact on the purchase price of this product.
- Suppliers' need to store raw materials due to their perceived unavailability and seasonality in demand for products such as lavender and chamomile will increase their inventory and warehousing cost during the forecast period
Download the free sample of this report to know what the key natural fragrance ingredients procurement best practices that you must adopt to address price dynamism in this market.
Insights Offered in this Natural Fragrance Ingredients Market Report
- Global and regional spend potential for the natural fragrance ingredients market for the period of 2019-2024
- Supplier relationship management practices in the natural fragrance ingredients market
- Supplier margins and selection criteria in the natural fragrance ingredients market
- Top natural fragrance ingredients suppliers and their cost structures
- Top natural fragrance ingredients suppliers in the US and their cost structures
- Natural fragrance ingredients market spend analysis in the US
- Natural fragrance ingredients price trends, and forecasts
- Cost drivers influencing the natural fragrance ingredients prices
Insights into Natural Fragrance Ingredients Supply Market
- The supply market influence is high in APAC. This is because countries such as India and China are the largest producers of natural fragrance ingredients that are produced from flowers and herbs such as rose, chamomile, jasmine, lavender, moonflower, and rosemary. Hence, key natural fragrance ingredient suppliers from North America and Europe are planning to start their production bases in China and India due to the ease in availability of low-cost feedstock in these countries.
- The profit margins of suppliers based in Europe and the Americas are expected to reduce during the forecast period by 3%-5% owing to the increase in penetration of low-cost natural fragrance ingredients that are imported from the APAC region, especially from countries such as China and India. The increase in the cost of raw materials such as lavender and chamomile is also estimated to reduce the profitability of these suppliers.
- Buyers are advised to partner with natural fragrance ingredients suppliers who implement bottleneck management strategies such as engaging with multiple secondary vendors of lavender and chamomile, apart from a primary vendor. This gives them supply assurance of raw materials even during peak demand.
Insights into Some of the Leading Natural Fragrance Ingredients Suppliers
The supply market dynamics hint at a substantial hike in suppliers' OPEX which will drive buyer's procurement spend. Keeping such dynamics in mind, strategic selection of suppliers and maintaining an effective supplier relationship management are observed to facilitate buyers with optimized procurement expenditure and better category management in the natural fragrance ingredients market. This natural fragrance ingredients market procurement intelligence report has enlisted the top suppliers and their cost structures, SLA terms, best selection criteria, and negotiation strategies for the top natural fragrance ingredients suppliers. The top natural fragrance ingredients suppliers highlighted in this report include:
- Givaudan SA
- Firmenich SA
- Symrise AG
- International Flavors & Fragrances Inc.
- Takasago International Corp.
- Sensient Technologies Corp.
Criteria to select suppliers in this dynamic natural fragrance ingredients market is subject to change based on the day-to-day market outlook. Get a free demo of our procurement platform to gain immediate access into real-time insights to the changing suppliers selection criteria.
