The Beauty Industry Struggles Despite Rapid Growth

The beauty sector is experiencing remarkable growth, outpacing the UK economy by four times, yet several notable brands have recently succumbed to financial difficulties. The unexpected closures of Malin + Goetz and Barry M, along with the administration of Beauty Bay, highlight a troubling contradiction within a supposedly booming market.

Millie Kendall, chief executive of the British Beauty Council, emphasised the resilience and diversity of the industry, noting that many businesses are women-owned small and medium-sized enterprises. This perspective contrasts sharply with the grim headlines that have emerged in 2026.

One of the core challenges driving these closures is the transformation of consumer behaviour due to the rise of e-commerce. Platforms such as Amazon and TikTok Shop have altered the competitive landscape, allowing smaller and emerging brands to effectively challenge established names. Industry insiders note an increase in challenger brands capturing market share from traditional players like Barry M and Malin + Goetz.

Mitchell Halliday, founder of the brand Made by Mitchell, successfully leveraged TikTok Shop shortly after its UK launch in 2021, achieving unprecedented sales. Halliday’s strategy involved conducting live product demonstrations, which resonated well with consumers, allowing for immediate purchases during these sessions.

Zara Saleem, co-founder of Delhicious, shared how her brand gained momentum by utilising TikTok Shop. Initially made in her kitchen, the brand saw significant growth after going viral on the platform. This success illustrates how TikTok’s straightforward purchasing process has contributed to rapid consumer conversion.

The term “halo effect” describes how products gain visibility online before becoming essential items for retail stockists. Delhicious exemplifies this phenomenon, having transitioned from a TikTok sensation to being featured in stores like Superdrug.

Industry analyst Alexis Amann warned that these recent closures signal a structural disruption in the beauty sector. Many businesses were unable to adapt swiftly to the changing customer journey, leading to their decline. E-commerce now accounts for 24 per cent of global beauty sales, with TikTok Shop emerging as a significant player in the UK market.

Companies that rely solely on web-based sales face existential challenges when competing with platforms that integrate discovery and transaction seamlessly. This struggle is illustrated by the decline of entities like Beauty Bay, which are not prepared for the speed of change.

In contrast, competitors such as LookFantastic proactively partnered with TikTok Shop in 2021, resulting in over 30 per cent sales growth last year. The beauty landscape continues to evolve rapidly, prompting significant players to adapt in order to remain competitive.