MAC GETS IN GEAR ON GLOBAL SCALE

Byline: Sharon Edelson

NEW YORK--MAC, the hot Canadian cosmetics company that continues to lead a revolution in the color market, is expanding--although cautiously--to meet what it calls the "pent-up demand" for its products here and abroad.
The company plans to open a 3,000-square-foot store at 113 Spring St. in SoHo in February or March. The store, between Greene and Mercer Streets, will be MAC's second freestanding unit in Manhattan.
Frank Toskan, creative director of MAC, said the new unit will do $3 million to $5 million in the first year. MAC is also sold at Henri Bendel and Saks Fifth Avenue here. "We're doing double that at Bendel's," Toskan said.
MAC began as a professional line for makeup artists and became the prominent example of companies that in the last two years have been on the cutting edge of the color cosmetics market. It has built a cult following, but after selectively expanding its department and specialty store distribution, it is now gaining a wider audience, as interest in lines inspired by makeup artists continues to rise.
MAC's volume for 1994 was $58.6 million ($78 million Canadian) and is expected to be $112.7 million ($150 million Canadian) in 1995, according to a company spokeswoman.
Toskan said it had become apparent that MAC needed another location in New York. There are often lines on weekends at the company's Christopher Street store in the West Village here, and the MAC cosmetics counter at Bendel's can sometimes seem like a subway at rush hour.
"Those businesses are quite saturated," Toskan said, referring to Saks and Bendel's.
MAC, which operates 18 freestanding units in the U.S., is currently negotiating a lease for a company-owned store in Boston, Toskan said. He is also developing MAC's business abroad with the help of EstAe Lauder Cos., which signed an overseas distribution deal with the company in December 1994.
The first move for MAC with Lauder will come in Asia. Next month, MAC will open a counter at Seibu department store in Hong Kong.
Toskan said MAC will open a second store in London at 28 Fouberts Pl. next year, and the firm will look for sites for freestanding units in other European sites.
"We're actively looking with MAC for sites in Paris and Milan," said William Lauder, president of Origins Natural Resources and the Lauder executive responsible for MAC. "We're also searching for the right way to make an entry into Germany as well as the right retail distribution for Japan.
"Our arrangement with MAC is that we're responsible for all their operations outside of North America," Lauder said. "They control the creative process and the store design process. We're involved in some of the logistics."
He noted that Lauder Family Partners LP bought a 51 percent interest in Make-Up Art Cosmetics Ltd., the Canadian entity, but "both Frank Angelo [vice president of marketing] and Frank Toskan continue to control and manage the company and run it according to their discretion.
"I think their business in the U.S. is extremely successful so far and they have an enormous opportunity to continue to expand it," Lauder added. "But it should be done in the MAC way. Both MAC and potential retail partners have to have patience."

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