Third quarter statistics confirm what we suspected for some time now—the economy is up and growing again in the U.S. and probably around the world as well. According to the White House Council of Economic Advisors, gross domestic product expanded 3.5% in the third quarter. Of course, most of the gains can be traced back to government spending—especially in the automotive and housing markets. But even without the stimulus programs, real GDP would still be up a bit, according to observers. And, after two long years of declines, we’ll take it!
Need more evidence that things are picking up? How about the wheeling and dealing that’s taking place in the global household and personal products industry? First, Unilever acquired Sara Lee’s personal care brands. Now, Procter & Gamble may close the deal for Sara Lee’s household product unit. At the same time, P&G appears to be the frontrunner for the Coppertone sun care business, once Merck completes its acquisition of Schering-Plough.
Naysayers may insist that these moves would have taken place whether or not the economy was growing again, but the fact is, nobody was buying anybody when the recession was at its worst. You can bet more deals are on the way as multinationals take a closer look at their portfolios and entrepreneurs see opportunities that didn’t exist only a few months ago.
Of course, at the end of the day, the recovery hinges on topline growth. For the beauty industry, most gains can be traced to the all-important holiday selling season. After a couple of bruising years, industry observers are hoping fragrance sales will be flat this year. We think they can do a bit better than that because, after 20 months of keeping their spending in check, U.S. consumers are getting ready to spend again and that means heading out to the shopping malls in droves later this month. You can read more about the fine fragrance market on Happi.com. Also this month, we take a look at personal cleansers, which has proved to be a recession-proof sector, according to associate editor Melissa Meisel.
As always, we welcome your comments and suggestions.