One would have to go back to Cleopatra days to find a beauty distributor that started before Peel’s. Without consulting a history book, I think if they hung around another 4 years, they would have celebrated their 100th anniversary.
Peel’s joins the chorus of other family-owned distributors that have decided enough is enough. In this instance, Peel’s claimed that the estate taxes going up after the first of the year was the culprit: The family could not justify paying 55% estate taxes and handing off the business to their kids to pay the taxes.
I’m not going to expel on the whole notion of estate taxes but it is worthy to understand that is the reason for the sale. Both Essie and OPI sold this year along with Aerial and Schoneman, perhaps their reasons were the same.
L’Oreal picked up Peel’s and it’s now #1 L’Oreal doing battle with #2 Sally Beauty Holdings for the business. Boutique distributors and brands will continue to be around until they too get to a size that makes it worthwhile for an acquisition.
While the Peel’s family is staying on, their culture will change. We have seen the transformation in virtually every instance.
My question is “Is this the end of legacy independent businesses?” Sure there are still thousands of such businesses around but the likes of public companies such as P&G, Unilever, L’Oreal and Henkel make it very difficult to be independent. After all, these are legacy businesses that will be around a very long time.
What’s ironic is at this very moment powerhouse L’Oreal, a $26 Billion company, is fighting for it’s life. That’s right. Nestle owns 30% of the company and wants the rest. Can you imagine? But it could be a tasty acquisition: Buy a bottle of Biolage and get a Nestle Crunch bar free (King Size please).
One thing for certain with the stock market heading higher is that acquisitions in 2011 will intensify. There isn’t much left in the pro beauty business field to pluck (we aren’t selling) so the likes of ULTA become attractive.
While I never had any dealings with the Peel’s family, they will be missed. It’s sort of the end of a bygone era with a whole new era being ushered in. I got my FLIP camera, Facebook-Twitter-YouTube infantry, and other new media resources for this era. Steve Jobs has made the life of people simpler and with the introduction of his new iPad2 in 2011, we are going to see things we have never dreamed about.
New era, new media, new iStuff, new year. Hey, it’s still fun to be independent, damn the estate taxes.