PARIS — Parfumerie Generale has closed up shop.

The niche beauty retailer, which opened to much fanfare in 2002, shuttered earlier this month. Its catalogue business has also folded and its corner in the Printemps department store here is set to close this week.

Victoire de Taillac, Parfumerie Generale’s cofounder with Ramdane Touhami and Mustapha Bouhayati, said private investors withdrew their backing when they became disappointed by the store’s sales.

“They thought it should work quickly or not at all,” she said. Taillac noted the store had suffered “six months of very bad business” and was facing increased competition on the niche front from retailers such as Sephora. She added that plans to open additional stores in Milan and Barcelona this year were nixed in mid-2003.

Industry experts were quick to point out that the closure of Parfumerie Generale is not indicative of a downturn in the niche beauty market here. Nancy Flavin, a Paris-based industry consultant, said, “Niche brands still have a lot of untapped potential in France.”

The location of Parfumerie Generale’s 1,000-square-foot store on the off-the-beaten-track Rue Robert Estienne was often cited as one of its drawbacks.

“The biggest mistake [was its location],” said Caroline Wachsmuth, creator of organic beauty brand Doux Me, also sold at the store. “To go there was like going on a mission unless you lived around the corner.”

While the specialty retailer was regularly featured in the French press, some brands noted that sales did not meet expectations.

“In my mind, the store was geared more toward promoting itself and not the brands it carried,” said one manufacturer. “Sales in a store that received that kind of publicity were not as good as they could have been.”

Wachsmuth noted, however, that her brand did very well at the store and it was a shame to see the end of the project.

“We’re so disappointed,” added Trae Bodge, cofounder and creative director of Three Custom Color Specialists, which was sold at the boutique. “We were so thrilled to be part of such an interesting concept and such a beautiful store.”

This story first appeared in the September 10, 2004 issue of WWD. Subscribe Today.

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— Brid Costello