NEW YORK — Symrise has become the first fragrance supplier to sign up as sponsor of Mercedes-Benz Fashion Week here in early September.
By stepping into the middle of the Bryant Park fashion scene, Symrise will be ratcheting up a drive to raise its profile in the hyper-competitive world of global fragrance and flavor suppliers. The firm emerged last year in a new form following the acquisitions of two major suppliers — Haarmann & Reimer and Dragoco — which were combined and renamed Symrise early this year.
The companies were acquired by EQT Northern European Private Equity Funds with the objective of creating a dominant supplier that could one day be taken public. Tim Schaffner, president of the worldwide fragrance division of the reconstituted company, said in a recent interview that EQT’s goal is to engineer a public offering for Symrise within five to seven years.
Both Haarmann & Reimer and Dragoco are old German companies located near each other in Holzminden. With combined sales of $1.42 billion last year, Symrise claims to rank third in worldwide sales of fragrances and flavors combined, behind International Flavors & Fragrances and Givaudan. Dollar figures were converted from the euro at current exchange, as combined sales were 1.24 billion euros.
The overall president and chief executive officer is Horst Otto-Gerberding with Schaffner as president of the fragrance division. Reporting to him is Roger Schmid, who is president of the fine fragrance unit. In a statement, he said the reasoning behind the September sponsorship is to point out the connection between fashion and fragrance. “This is a perfect opportunity to marry the worlds and benefit creativity at the same time,” Schmid stated. Fashion week runs Sept. 12-19.
The North American fine fragrance division of Symrise is headed by Veronique Gabai. Of Symrise’s total business, 45 percent is generated by fragrance sales and, of that sum, 25 percent is fine fragrance.
Before the merger, Haarmann & Reimer ranked fifth in the industry and Dragoco ninth. In terms of total business, flavors and fragrances combined, 47 percent of sales were generated last year in Europe, Africa and the Middle East; 25 percent in North America; 21 percent in Asia Pacific, and 7 percent in Latin America.Most suppliers battle for supremacy in fragrances generally, both for the upscale department store market and for the household product category.
Symrise has decided to fine tune its ambition and narrowly train its sights on the personal care market, which encompasses not only fine fragrance but bath and body products, hair care, antiperspirant and deodorant and oral care, as well.
“We are the only company to come out and say, ‘We want to be number one in beauty care,’” said Schaffner. “We do not want to try to be everything to everybody.”
This focus is based on Symrise’s strengths, including leading positions in a number of categories that were ticked off by Schaffner. For instance, the company claims the number one spot as a producer of menthol, the flavoring for toothpaste. The firm also has top positions as a supplier for cosmetics and hair care ingredients.
Symrise executives have spent the last year knitting the two old companies into one as duplications and redundancies began to be eliminated. The plan was 95 percent complete by May, Schaffner said, and the company appears to be responding. He noted that Symrise’s fragrance sales are outpacing the industry’s average growth rate, which he expects to be 1.5 percent for the year. Symrise began with 6,000 employees between the two firms, and the goal is to reduce that number to 5,000 by the end of next year.
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