Polishes in Serbia

2020 IMPACT

Slowed growth as consumers reduce purchases of non-essential items in 2020

Polishes as a whole as well as all the individual categories recorded slowed retail value growth in 2020 as sales were impacted by consumers’ focus on home care products with perceived hygiene benefits during the health threat due to COVID-19. Also, these products are not perceived as essential items and consumers were quick to cut back on their purchases in 2020 due to the economic impact of the pandemic.

Distribution shift, with growth of discounters and e-commerce

Traditional grocery retailers lost further value share in the distribution of polishes during 2020 due to the poor availability of such products in this channel. Meanwhile, discounters recorded share growth due to the general modernisation trend that has been shaping Serbia’s retailing landscape, the expansion of outlet numbers, as well as their favourable pricing.

SC Johnson & Son leads but faces growing competition

SC Johnson & Son remained the leader in polishes in value terms in 2020, although it saw another year of slight decline in its value share due to growing competition in the market. Seventh-ranked Lomax Co continued to perform well, recording the highest growth in value sales in polishes in 2020.

RECOVERY AND OPPORTUNITIES

Without retailer investment, private label is set to remain insignificant

Polishes can be considered to still be a relatively underdeveloped category in Serbia, hence the negligible share of private label in 2020. Retailers are simply not willing to invest in such an insignificant category, and instead focus on larger, more profitable categories, particularly those involving products which are widely perceived as necessities.

Retail modernisation and e-commerce to continue influencing sales of polishes

Retail modernisation is set to continue influencing sales of polishes in Serbia throughout the forecast period, with an anticipated continued decline in the share of traditional grocery retailers, and growth of modern channels, including discounters. E-commerce will continue to grow as consumers are increasingly confident and used to purchasing online, particularly during COVID-19 when e-commerce allowed them to avoid retailing outlets and thereby reduce the risk of catching the virus.

New product development expected as economy stabilises

Producers present in polishes remained fairly inactive when it came to new product launches at the end of the review period. In 2019, they were happy with the growth of the category and focused on the improvement of marketing and distribution, whilst in 2020, manufacturers were not very active in terms of new product launches due to COVID-19.