Lush decided to localize its production in Russia

Lush, a producer of personal hygiene products and cosmetics, decided to localize a production of goods for the domestic market in Russia. By that British cosmetics company hopes to reduce currency risks.

Lush decided to localize its production in Russia

Lush, a producer of personal hygiene products and cosmetics, decided to localize a production of goods for the domestic market in Russia. By that British cosmetics company hopes to reduce currency risks.

Today Lush produces in Russia only 10% of products for Russian market, while other 90% are imported from England. The current company’s objective is to increase the volume of production in Russia to 100%. As a result, Lush will be able to reduce a prime cost by 30% and to cut prices down.

Lush Russia, LLC is licensed by British Lush, according to the representative of the Russian company.

The revenue of Lush Russia in 2014 was 1,03 billion rubles that is less than in 2013, when the revenue reached 1,06 billion rubles. Lush Russia has a manufacture in Domodedovo, Moscow region, where it produces masks, but the most part of products is imported. Today the company chooses the site for the manufacture, where it plans to produce all range of products. Lush intends to start the production in 2016 with the invested amount of 100 million rubles. A low investment is due to handmade production of cosmetics.

The devaluation of the ruble has improved the image of Russia not only for manufacture localization, but also for exports. For example, in 2014 German household goods company BSH Hausgerate and Italian company Candy started exports to countries of European Community. Volkswagen Group and Nissan are now considering the possibility of exports of automobiles, produced in Russian factories. Lush Russia meanwhile plans to export its products, produced in Russia, only to Kazakhstan.