PROGRAMME: MASTER OF BUSINESS ADMINISTRATION MODULE: MANAGERIAL ECONOMICS QUESTION ONE [55] Read the article below and a
Posted: Wed May 04, 2022 7:38 am
PROGRAMME: MASTER OF BUSINESS ADMINISTRATION MODULE: MANAGERIAL
ECONOMICS QUESTION ONE [55] Read the article below and answer the
questions that follow: South Africa Cosmetics Industry Report 2021:
Digitalisation, Wellness, Personalisation and Sustainability
Gaining Prominence ResearchAndMarkets.com The Cosmetics Industry in
South Africa: Consumer spending patterns are reflecting the
economic downturn caused by the impact of the pandemic, with
spending focused on essential items. The lockdown has had a
significant effect on the industry as frequent handwashing and use
of hand sanitisers has resulted in increased use of hand creams and
lotions to moisturise the skin. Numerous cosmetics companies have
started manufacturing hand sanitisers. Retailers reported increased
sales of haircare products when salons were closed, while sales of
nail polish and shaving products also grew. Trends: Consumer
concerns about sustainability and the use of harmful ingredients
has led to a growing market for cosmetics formulated with natural
ingredients. The number of cosmetics start-ups has increased, often
as a result of black consumer complaints about the lack of products
for their skin and hair requirements, leading to the development of
new brands. Men are becoming more fashion-conscious, and male-
focused grooming products and beauty parlours are increasing.
Online sales of products, including cosmetics, have grown
significantly since the start of the lockdown. Global Trends:
Digitalisation, wellness, personalisation and sustainability are
some of the important beauty and grooming trends, largely
popularised by independent beauty brands and followed by
established companies. These trends have also resulted in mergers
and acquisitions as major companies wanted to benefit from the
success of independent brands. Throughout the lockdowns people have
generally stuck to their normal skin care routine, but sales of
make-up have declined due to fewer trips outside the home, and the
wearing of masks. Source:
https://www.businesswire.com/news/home/ ... /en/South-
Africa-Cosmetics-Industry-Report-2021-Digitalisation-Wellness-
Personalisation-and-Sustainability-Gaining-Prominence---
ResearchAndMarkets.com 1.1 In light of the given article, use
demand and supply analysis to explain the impact of the lockdown on
the cosmetic industry in South Africa. (12) 1.2 Justify the
increase in mergers and acquisitions in the cosmetic industry. (13)
1.3 Substantiate the type of market structure best suited to the
cosmetic industry in South Africa. (15) 1.4 Cosmetic products are
generally considered to be relatively price elastic. Justify the
extent with which you agree with this statement and recommend a
pricing policy that can be used for such products. (15
managerial economics
ECONOMICS QUESTION ONE [55] Read the article below and answer the
questions that follow: South Africa Cosmetics Industry Report 2021:
Digitalisation, Wellness, Personalisation and Sustainability
Gaining Prominence ResearchAndMarkets.com The Cosmetics Industry in
South Africa: Consumer spending patterns are reflecting the
economic downturn caused by the impact of the pandemic, with
spending focused on essential items. The lockdown has had a
significant effect on the industry as frequent handwashing and use
of hand sanitisers has resulted in increased use of hand creams and
lotions to moisturise the skin. Numerous cosmetics companies have
started manufacturing hand sanitisers. Retailers reported increased
sales of haircare products when salons were closed, while sales of
nail polish and shaving products also grew. Trends: Consumer
concerns about sustainability and the use of harmful ingredients
has led to a growing market for cosmetics formulated with natural
ingredients. The number of cosmetics start-ups has increased, often
as a result of black consumer complaints about the lack of products
for their skin and hair requirements, leading to the development of
new brands. Men are becoming more fashion-conscious, and male-
focused grooming products and beauty parlours are increasing.
Online sales of products, including cosmetics, have grown
significantly since the start of the lockdown. Global Trends:
Digitalisation, wellness, personalisation and sustainability are
some of the important beauty and grooming trends, largely
popularised by independent beauty brands and followed by
established companies. These trends have also resulted in mergers
and acquisitions as major companies wanted to benefit from the
success of independent brands. Throughout the lockdowns people have
generally stuck to their normal skin care routine, but sales of
make-up have declined due to fewer trips outside the home, and the
wearing of masks. Source:
https://www.businesswire.com/news/home/ ... /en/South-
Africa-Cosmetics-Industry-Report-2021-Digitalisation-Wellness-
Personalisation-and-Sustainability-Gaining-Prominence---
ResearchAndMarkets.com 1.1 In light of the given article, use
demand and supply analysis to explain the impact of the lockdown on
the cosmetic industry in South Africa. (12) 1.2 Justify the
increase in mergers and acquisitions in the cosmetic industry. (13)
1.3 Substantiate the type of market structure best suited to the
cosmetic industry in South Africa. (15) 1.4 Cosmetic products are
generally considered to be relatively price elastic. Justify the
extent with which you agree with this statement and recommend a
pricing policy that can be used for such products. (15
managerial economics