By Stan Katz (rev 09/16)
Entering the Cosmetic Business is possible if you understand how it works and you establish clear goals.
The Cosmetic Business is divided up into several general areas:
- Color Cosmetics or Make up
- Treatment or Skin Care
- Fragrance
- Health and Beauty Aids, or HBA ,a broad area that includes everything from shampoo to foot products.
These products can be produced for you by companies that specialize in one or several of these areas. If you want a line of products with your label on the package you have two potential directions: Private Label and Contract Filler.
Private Label and Contract Filler
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If your quantities are really small, you might even want to consider making your own blends and filling your own bottles. See Qosmedix for carton quantities of components ready for immediate delivery or McKernan.com for larger but limited quantities. It all depends on what quantity of each product you want and how "custom" the products need to be. Generally, if the quantity is small and you are willing to accept the product types and packaging that already exists - your choice would be a Private Label house. The Private Label company maintains a ready supply of components and finished goods. By using different variations and combinations, and applying your custom labeling or decoration, you can usually find a satisfactory "custom" look.
Once your quantity requirements get larger (several thousand per item) a Contract Filler might be a better choice. You become responsible for providing the packaging components, labels, etc., and the Filler makes the formula and fills your components. What you get is a truly custom product from formula to packaging, but a lot more depends on you.
In both cases, selling products under your name makes you legally responsible for the product in all areas including labeling (regulated by the FDA) and product claims. And the FDA has determined that your claims include not only what you say on the label but what you say in any brochures or other advertising material. You will also be the first one contacted if a consumer experiences any adverse reactions to your product. This means you should educate yourself about such things as stability, shelf life, and Product Liability Insurance.
There are many resources available to you, some of them free. Check out Industry Resources and Trade Associations. ICMAD (Independent Cosmetic Manufacturers and Distributors) is the appropriate trade association for companies entering the industry. ICMAD can provide general guidance on regulations and government support and even has a Group Products Liability Policy for members.
For a great article on STARTING UP read this article from Beauty Packaging Magazine ( a great resource!) and learn from people who have already done it, as they share their secrets at BeautyPackaging.com.
For some Reality Check Tips from a marketing pro, Karen young try: YGroup.com
Private Label: Getting finished products made with your label in small quantities
Ideal for: Beauty Salons, Boutiques and Single Stores.
Quantities: a few pieces up to several hundred of each product.
What you need: almost nothing but money and an idea of the types of products you want.
Advantages: gets you into the business fast without large startup or inventory cosmetics-beauty
Disadvantages: you are limited to the shades, products, and packaging carried by the supplier.
Suggested vendors and their specialty:
What else you will need: Product Liability Insurance
- Frenkel: Insurance- Cosmetic Company Specialists
- IBA: Trade Association- Learn all about the industry
Contract Filling: Getting products made with your label in larger quantities.
Ideal for: Chain Stores and Companies that want to develop a single product or a single line of products for wide distribution.
Quantities: usually 5000 pieces with the exception of shaded items which are usually 2000 pieces per shade.
What you need: packaging, artwork, displays and possibly consultants in marketing and product design.
Advantages: Custom made products from the ground up, and lower per piece cost.
Disadvantages: requires a large investment and support staff.
Suggested vendors and their specialty:
What else you will need: Product Liability Insurance, component suppliers, label suppliers, warehouse and shipping, etc.
Alternative suggestions: If you don't have expertise in the Cosmetic Industry consider using consultants. Some can act as your marketing and product development staff. Some specialize in technical, formulation and regulatory issues. Some, called Full Service Development Companies can put together an entire line of products using their knowledge and experience, and will arrange for everything from formulation development to the final package. We recommend Carl Geffken Associates, Regulatory (FDA) Compliance.
Special note on Fragrances: To produce a custom fragrance in small quantities is a difficult task. You must first work with one of the essential oil houses who will blend the ingredients according to your guidelines. Then you must locate a filler who will do the rest of the steps necessary to bring the essential oils into a finished product like a perfume, cologne, etc.
Accessories & Displays: Accessories such as brushes, applicators, etc. as well as counter displays, tester displays, can be bought in both small and large quantities. We recommend Brushes By Karen.
In any case, if you would want to sell using your own brand (either via Private Label or via Contract Manufacturing), your logo is important to convey your style and become unique. You can check cosmetic packaging designers who can do it for you, or you can try a do-it-yourself approach with an online logo maker like Logojoy.
