Private Brands vs. Name Brands: The Truth About Beauty Products

::Article excerpts from SpaTrade: Bright Ideas for Today’s Spa Professional::

Money and the protection of your hard-won customer loyalty are two of the greatest benefits of selling private-brand products. Most private-brand custom manufacturers offer many extremely attractive gross profit margins on their products. Simply put, you keep a lot more money per sale than when retailing items where the markup is a mere 100% or less. Sure some will throw in shipping charges for larger orders and possibly even a discount or free product now and then. But when you compare this to the steady thick margins available in private-brand selections the logic is clear.

Competition in the spa, salon, and beauty products industry is at an all-time high. Day spa signs are sprouting up around us like spring grasses, grocery stores and gift shops have their own little “spa aromatherapy” departments, and .com companies have the huge beauty and wellness market firmly in their sights. It’s becoming increasingly difficult for even large retailers to retain their share of the beauty products market when so many means of access to these goods is now available to their customers. Customer have beauty.com, eve.com, and the now famous Bliss catalog at their disposal and these companies make it very, very easy for your customers to browse and buy at home or work. If you haven’t awakened to this business challenge yet it won’t be far off.

Even more disturbing is a growing trend for suppliers of spa and salon products to begin offering their goods directly to the consumer—your customer. The reason for playing both sides of the fence is simple: it’s far more economical for producers to sell directly to the public than through expensive distributors who must deal with lists of low-volume, slow-paying, support demanding small business owners. That’s you and me folks. Once we have worked to establish a product line in the consumer market it is very tempting to bypass us and sell through e-tailers and home websites. Business is about making money and in a changing world companies must respond decisively and correctly in order to survive.

This is precisely where selling your own brand makes especially good sense. As far as the consumer is concerned the only place to get your brand is from you, whether it be at the retail counter, by mail order, or through your own online store.

So are private-brand, custom products right for your business? Only you can answer this question accurately. But if retail profits, customer protection, and building some real brand-equity into your company investment have any meaning for you, there are fewer options available that can help you better than this can.

The Importance of Cosmetic Stability Testing

There are many “mom and pop” cosmetic companies out there that are making great, unique products in their kitchens. Unfortunately, these products are not always properly tested, and some are even unsafe to use.

The purpose of stability testing cosmetic products is to ensure that a new or modified product meets the intended physical, chemical and microbiological quality standards as well as functionality and aesthetics when stored under appropriate conditions.

A good cosmetic manufacturer or development laboratory will always perform the necessary testing on the products that they create and produce.

In general, stability tests can be conducted in real time or under accelerated conditions and should address the stability of a product under appropriate conditions of storage, transport and use.

Physical/Chemical Stability Tests

These describe approaches to predicting how well cosmetics will resist common stresses such as temperature extremes and light. Typically, manufacturers determine whether to perform such specialized testing based on the vulnerabilities of the particular cosmetic product and its anticipated shipping, storage display and use conditions.

Common testing procedures include temperature variation, freeze/thaw cycles and UV light application. For all of these tests, the lab will monitor the color, odor / fragrance, viscosity and pH value to ensure no changes take place.

Microbiological Stability Tests

Microbial contaminants usually come from two different origins: during production and filling, and during the use of the cosmetic by the consumer. From the moment the cosmetic unit is opened by the consumer, a permanent microbial contamination of the cosmetic is introduced caused by contact with the consumers’ hands and body.

Microbial preservation of cosmetics is important to ensure the microbial safety of cosmetics for the consumer, maintain the quality of the product, and confirm hygienic and high-quality handling. Although only a small number of cases of microbial infections of the consumer have been reported, microbial contamination of cosmetic products may spoil them or seriously reduce the intended quality.

Therefore, it is necessary to carry out routine microbiological analysis of each batch of the finished product coming on the market.

Packaging Stability Tests

Packaging can directly affect finished product stability because of interactions which can occur between the product, the package, and the external environment. For example, product constituents may be absorbed into the container or may chemically react with the container. In addition, the container may not fully protect the product from the adverse effects of atmospheric oxygen and/or water vapor, or volatile product constituents (e.g. fragrances) may evaporate through the container.

The Bottom Line

If you are developing a product line, you want to ensure the safety of the product for your consumer and should therefore choose a cosmetic development laboratory that has strict guidelines for the testing of your products.

Starting a Cosmetics Line

Have you ever dreamed of being the next Estee Lauder? Don’t know where to start?

Some people choose to formulate their own products in their kitchen, but most of us aren’t chemists, and it’s a little bit more involved than just whipping something together that is going to sell. The best route is to hire a custom formulator to develop your products for you. Even some of the top product companies hire a private label cosmetics manufacturer to make their cosmetics line, perfumes and beauty products.

Once you have an idea of the type of products you want to make, the cosmetics formulator will do everything from replicating products that are already on the market to creating something that is completely unique for your line. They will also perform all of the necessary testing in order to ensure that your products are free of contaminants and that they will maintain a stable shelf life.

Most custom cosmetics manufacturers have an upfront fee for development in order to make sure you are going to be a serious client. Some will even credit a percentage of your development fee towards your first order. Make sure you are honest with the company you choose about your budget. Not everyone has the resources to start their own cosmetics line. Manufacturing your products can cost anywhere from thousands to tens of thousands of dollars and up, depending on the ingredients and the manufacturer’s minimum order. It’s best to choose a manufacturer with a low minimum order, especially if it is your first time taking this journey.

The manufacturer you choose will most likely have an Account Director who will be your main point of contact. Be sure to ask them lots of questions about fees and opening orders, as well as their capabilities if your company grows. Any reputable manufacturer will allow potential clients to visit their facilities. Make sure you take advantage of this. Unfortunately, there are manufacturers out there who are not what they seem, and you definitely want to protect yourself.

After your products are developed and you approve your samples, you will need to choose packaging. Your Account Director should have some referrals to give you. Some manufacturers offer turnkey services, so you would not have to worry about sourcing your own packaging.

Testing will be completed on the samples you approve, and all that’s left to do is place your order! Turnaround times differ from company to company, so be sure to let your Account Director know what your scheduled launch date is.

What happens once all of this is done is up to you. Market your products correctly, and you could be the next big thing!

Welcome!

Welcome to the new blog for B&R Products, Inc. We are your #1 source for cosmetics development and manufacturing. We will be posting periodically about topics that are related to the industry, including industry news, innovative ingredients, and the business side of developing a custom product line. You can learn more about B&R Products at www.brpro.com. Come back often to see what's going on, and don't forget to subscribe. We look forward to sharing with you!