Indonesia’s beauty industry is thriving, fueled by a young, tech-savvy population and a growing demand for innovative, ethical products. This dynamic market presents immense opportunities for foreign businesses. From halal-certified products to hybrid beauty trends, the sector is rapidly evolving, catering to the unique needs of Indonesia’s culturally diverse consumers.
Also read: Major Industries in Indonesia (Based on Contribution to GDP)
Indonesia Beauty Industry Outlook
Indonesia’s beauty industry is a burgeoning sector with immense growth potential, driven by its young demographics, increasing urbanization, and rising disposable income. As of 2024, the Beauty & Personal Care (BPC) market in Indonesia is valued at USD 9.24 billion, with an expected annual growth rate of 4.60% (CAGR 2024-2029). The sector encompasses a variety of subcategories, including skincare, personal care, and makeup, with skincare leading the market at USD 2 billion and forecasted to grow at 9.4% CAGR through 2028.
Online sales are becoming increasingly significant, projected to contribute 45.4% of total revenue in 2024. However, offline retail remains critical, with brands like Sociolla successfully blending online and offline strategies to capture market share.
The demand for halal-certified and eco-friendly products is also on the rise, reflecting Indonesia’s predominantly Muslim population and growing eco-conscious consumer base. Trends like hybrid beauty (combining skincare with makeup benefits) and skinimalism (simplifying beauty routines) are reshaping consumer preferences, especially among Gen Z and millennials.
Also read: What Products Are Most in Demand in Indonesia?
Beauty Business Opportunities in Indonesia
The Indonesian beauty market offers diverse opportunities for businesses. Key drivers include:
Youthful and Tech-Savvy Demographics
Indonesia’s large Gen Z and millennial population is highly receptive to innovative beauty solutions, such as personalized skincare and digital-first experiences.
Demand for Local and Natural Ingredients
Consumers increasingly favor products with locally-sourced, natural, and organic ingredients, aligned with wellness and sustainability trends.
Growing Urbanization and Middle-Class Expansion
Urbanization exposes Indonesians to global beauty trends, spurring demand for premium and sophisticated products.
Suncare and Skincare Growth
With a 10.6% CAGR, the suncare category is a leading growth driver, fueled by heightened awareness of UV protection.
Emerging brands that cater to these trends, such as BASE and Diri Care, have shown remarkable success by leveraging local insights and offering personalized solutions.
Indonesia Beauty Business Regulations for Foreign investors
For foreign investors, navigating Indonesia’s regulatory landscape is essential. Key points include:
- Halal Certification: Products marketed in Indonesia must comply with halal certification requirements if they target the Muslim consumer base.
- Import and Distribution Licenses: Foreign companies must secure appropriate permits to import and distribute beauty products. Local partnerships can help streamline this process.
- Customs and Labeling Standards: Products must adhere to Indonesia’s strict labeling and packaging requirements, including ingredient lists and expiration dates.
- Company Registration: Establishing a local entity, such as a PT PMA (foreign-owned company), is often required to operate in Indonesia’s beauty industry.
Also read: Cosmetic Registration in Indonesia: Requirements and Process
Examples of Beauty Companies in Indonesia
Several players in Indonesia’s beauty market, including both local and global brands:
- Sociolla: Known for its omnichannel model, Sociolla combines online platforms with physical stores, making it a leader in both urban and rural markets.
- BASE: A local skincare brand focusing on natural, vegan, and cruelty-free products tailored to Indonesian consumers.
- Diri Care: A hybrid skincare brand offering prescription-grade products and offline treatments through clinics.
- International Brands: Global players like L’Oréal and Unilever maintain a significant presence, leveraging their extensive portfolios to meet diverse consumer needs.
Also read: Top 10 Cosmetic Brands in Indonesia: Beauty Industry Leader
How to Start a Beauty Company in Indonesia
To establish a beauty business in Indonesia, follow these steps:
Market Research and Entry Strategy
Perform in-depth analysis to identify consumer preferences, emerging market trends, and competitor strategies. Partnering with local distributors or launching an e-commerce platform can be an effective entry strategy.
Legal Compliance
Register your company as a PT PMA and ensure compliance with all import, halal certification, and labeling regulations.
Leverage Digital Platforms
Engage with consumers through social media, online marketplaces, and direct-to-consumer (D2C) strategies.
Focus on Localization
Adapt products to suit Indonesian skin types, climate, and cultural preferences. Emphasize the use of natural or halal-certified ingredients to resonate with local consumer expectations.
Invest in Offline Presence
Despite the growth of e-commerce, having a physical presence is essential for building trust and brand recognition.
Indonesia’s beauty industry is a dynamic and promising market for foreign businesses. With its growing middle class, youthful population, and demand for innovative, halal, and eco-friendly products, the country offers vast opportunities for investors. However, understanding and adhering to local regulations is critical for success.
By leveraging current market trends, investing in both online and offline channels, and prioritizing localization, foreign beauty businesses can establish a strong foothold in Indonesia’s rapidly expanding beauty market.
If you are considering starting a beauty business in Indonesia, there are a number of resources and support services available to help you get started.
InvestinAsia is among the companies that specialize in aiding you with Indonesia company registration. We boast a team of seasoned experts who can guide you throughout the process of:
- Foreign company / PMA registration in Indonesia
- Indonesia representative office registration
- PT PMDN Set Up
- Virtual office setup in Indonesia
- Business registration number in Indonesia
- Indonesian Business Licenses
- Indonesia Trademark Registration
If you are interested in starting a business in Indonesia, you can start by contacting us for FREE consultation.
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