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The human hair industry has grown rapidly in recent years, fuelled by the increasing demand for hair extensions and wigs. This industry is worth billions of dollars and is expected to grow in the coming years. From synthetic to natural hair, the human hair industry offers various options to meet customers' diverse needs.
What is the Market Size of the Hair Industry?
The global hair extensions market reached US$ 7.5 billion in 2021 and is predicted to expand at a substantial increase of 5.3% between 2022 and 2028. The global hair extensions market is expected to see an increase in the market demand for hair extensions as a result of the increase in the use of chemicals in food products and the usage of low-cost and discount shampoos that have high levels of phosphate and sulfate, which causes hair thinning and hair fall.
Why is the Hair Industry Growing?
Here are some major drivers of the growth in the hair industry are as follows:
- The rising popularity of hair extensions: Many people use hair extensions to add length, volume, and thickness to their natural hair. Hair extensions can be made from synthetic or natural hair, which is more expensive but offers a more realistic and natural look.
- Increasing acceptance of wigs as a fashion accessory: Another factor contributing to the growth of the human hair industry is that wigs are no longer just worn by people with hair loss but are also being used by fashion-conscious individuals who want to change their look without having to cut or colour their natural hair. Wigs made from natural hair are in high demand because they offer a more realistic look and are more comfortable.
- Increasing interest in hair care products: The human hair industry is driven by the demand for hair extensions and wigs and the changing interest in hair care products. Many people will spend money on high-quality shampoos, conditioners, and styling products to maintain healthy and beautiful hair. This has led to the emergence of many new hair care brands and the expansion of existing ones.
- Rise in social media and beauty influencers: With the emergence of new trends, people are frequently inspired to try new hairstyles or hair colors and mimic their favorite influencers. The market is expected to see a rising demand for using hair extensions as a medium to enhance one's appearance. The widespread use of hair extensions within the entertainment and fashion industries is expected to create significant profits for the global marketplace for hair extensions.
Impact of Growing Hair Industry
The growth of the human hair industry has also created job opportunities for many people. From hair collectors to manufacturers, distributors, and retailers, the industry employs thousands of people worldwide. This has a positive impact on local economies and helps to reduce poverty in some regions.
However, there are also concerns about the ethical and environmental implications of the human hair industry. The demand for human hair has led to the exploitation of poor communities in countries like India, China, and Cambodia, where hair is collected from temples, salons, and individuals. There are also concerns about the environmental impact of the chemicals used to process human hair and the waste generated by the industry.
Which country buys the most Hair Products?
North America is one of the prominent hair care consumers, holding around 25% of the global market share for hair care products. This is due to the latest developments in the hair care segment, such as shampoos, conditioners, colorants, relaxants, perms, sprays, etc. Hair extension products are being utilized globally, especially for females.
They have been gaining popularity in recent years as more people seek to boost their hair volume by using hair extension products. African-born consumers across the US and Europe possess curly and kinky hair and typically can afford hair products that cost more than native African consumers.
How profitable is the Hair Industry?
The hair industry encompasses many products and services, including hair care products, hair styling tools, hair extensions, wigs, and hairdressing services. As such, the profitability of the hair industry varies depending on the specific sector and the business size.
As per the RationalStat market research report, the hair industry in the US generated over US$ 50 billion in revenue in 2022, with an annual growth rate of 3.5% over the past five years. This suggests that hairdressing services can be a profitable industry for those skilled in this area and able to build a loyal clientele.
What are the Challenges of the Global Hair Industry?
The global hair industry faces several challenges that affect its operations and profitability. Some of the major challenges include:
- Supply Chain Disruptions: The hair industry relies heavily on international supply chains for raw materials, processing, and distribution. Disruptions to these supply chains, such as trade restrictions, natural disasters, and global pandemics, can affect the availability and pricing of hair products.
- Counterfeit Products: The hair industry has a high rate of counterfeit products, which can harm the reputation of legitimate brands and pose health risks to consumers.
- Sustainability: The hair industry has a significant environmental impact due to its use of chemicals, packaging materials, and energy. The industry faces increasing pressure to adopt sustainable practices and reduce its carbon footprint.
- Labor Issues: The hair industry relies heavily on labor-intensive processes such as harvesting, sorting, and processing. Labor exploitation, poor working conditions, and low wages are common issues in some regions where hair is sourced.
The human hair industry is growing rapidly and offers a variety of products and services to meet the diverse needs of customers. While the industry provides job opportunities and economic benefits, it is important to address the ethical and environmental concerns associated with it. Consumers should also be aware of the source and quality of the human hair products they use and support companies that promote ethical and sustainable practices.
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Co-founder and Director at RationalStat
Divyanshu is an experienced market research consultant. He helps growth-driven organizations and entrepreneurs understand market entry prospects, industry assessment, and grow their revenue strategically.