Kylie’s Cosmetics Empire is Now Valued at $1.2 Billion but She’s in the Mood to Sell!

With Forbes labelling Kylie Jenner a billionaire when she’s only in her early 20s, and valuing her brand Kylie Cosmetics at just around $900 million, people are surprised that she may be considering selling it? But since June 2019, the rumor was that the youngest billionaire in the world was actually planning an exit from Kylie Cosmetics, a $900 million brand.

Though considered a rumour then, the fact that the story remained for over a month, now calls for a fact check-out. Apparently, Coty Inc., the global beauty brand was a potential buyer of Kylie Cosmetics, although the young entrepreneur may sell just 50% of her company.

High Valuation

According to credible sources, Coty bought 51% of Kylie’s brand for a whopping $600 million. So this places a huge $1.2 billion valuation on Jenner’s cosmetic company. Even if only half of it was being sold, Kylie still would retain control over the company, and will still get to pocket a considerable share of profits, now she only owns 49% of it. To be honest, it sounds like a plausible deal. And we must remember that momager Kris has always been very open to the idea of selling out, from the word go, and she must possibly consider this favourably.

Mom Kris keen to sell

However, there could be another angle on how to review this development. As is well known, the cosmetics outlet has always been at odds with terming Kylie a billionaire. As per their norms, her net worth is only $300 million, as her product sales have registered a sharp decline in 2019. According to their explanation, selling half of Kylie Cosmetics at the stated price would enable the young entrepreneur to pocket $300 million, that too after taxation. This could boost her net worth to $600 million, and retain 49% of a company valued at $1.2 billion. So, this cannot effectively make her a billionaire, a move that momager Kris Jenner fully supports. But all the same, experts claim that rapper Travis Scott’s partner remains a very wealthy young lady. While rather adamant on not buying the Forbes billionaire tag, experts say that even if she were to sell the entire company, she would not make it to the B-club.

Desperate to Sell?

As if that’s not enough, the outlet says that Kylie is desperate to sell because 2019 has not been good for business. Between January and May, the company recorded a 14% decrease in sales, and consumers over the social media voiced their complaints with negative reviews of some products. Additionally, the Kylie Cosmetics’ customer care service is inundated with multiple consumers complaining that the Department hardly ever resolves their issues. What do you do about a customer care department that does not bother to respond when you complain that items you ordered and paid for were never actually delivered?

According to a detailed customer analysis, it looks as though most people from the company’s target buyers have turned into only one-time buyers, stating that there was a steep decline in product quality. Around 60% of the customers, who bought products from Kylie Cosmetics between 2016 and 2019, only made a purchase once and never made repeat their buy. That is a substantial number over a three year period! While we can say that Kylie has done well for herself, these are just some challenges faced by entrepreneurs, and she will definitely bounce back.