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"It takes courage to say you are not making money in a specific area and to end it," said Pnina Rosenblum yesterday to TheMarker, speaking about her closing down her cosmetics business. Her eponymous firm will stop manufacturing and selling facial and makeup products, which she says account for about 30% of the company's revenues.

"It is hard to make money in cosmetics," Rosenblum said, explaining that the chains she sells in make enormous demands such as 40% discounts, large amounts of samples, gifts, providing sales people eight hours a day, promotional materials and more.

Rosenblum will be firing 90 workers: "Now I can make do with 10 employees instead of 100."

She said she is considering opening her own independent stores to sell her products, which also include toiletries such as shampoo, conditioner and body lotion as well as bedding and health foods.

The private company's annual revenues are NIS 25 million and it sells 2 million items a year, said Rosenblum.

A brand under fire

Cosmetics is a very tough business in Israel, with high costs. Huge international firms, such as Revlon, L'Oreal and Jade, have the lion's share of the Israeli market, along with a few Israeli firms such as Careline.

Rosenblum's announcment reflects the situation of the small manufacturers. She proudly battled the giants for years, but in the end had to surrender.

The question is how will her relatively new line of health food products do? Rosenblum's image is one of beauty, esthetics and chutzpah - and in the industry they are wondering what that has to do with health.