- Cosmetic OEM Lab
I want to know the tips to choose skincare manufacturer!
What kind of skincare manufacturer is there?
I want to know what kind of costs we need to think about before we choose skincare manufacturer!
In today’s beauty-conscious society, skincare has become an essential part of our daily routine. As consumers, we strive to achieve healthy and radiant skin, and the products we use play a crucial role in this pursuit. However, with the vast array of skincare manufacturers flooding the market, choosing the right one can be a daunting task. The quality, safety, and effectiveness of skincare products largely depend on the manufacturer behind them.
In this article, I will explain two types of skincare manufacturers, some advantages of each manufacturer, and will give some ideas about the cost of making your own skincare products.
If you are trying to find skincare manufacturers, you need to remember that there are several types, and this is not only in Japan but also in other countries as well: Fabless manufacturers and manufacturers that have their own factories. It is quite important to understand the differences between them so that you can choose what’s best for you.
The first one is called “fabless manufacturer”. It is a company that does not own its own manufacturing facilities. Some of them are active as planning companies, while others own cosmetic manufacturing and sales license. Basically, they have a large number of partner manufacturers, and they make requests on a project-by-project basis.
Probably, we don’t really hear the word “fabless manufacturer” but it is said that the recovery from the pandemic is expected to continue this year with strong demand from fabless companies.
This is a cosmetics OEM company with its own factory. The scale of annual sales can be in the billions to tens of billions. Some companies have their own brands, while others do not.
Probably, it is safe to say that all of the large cosmetic companies have their own factory.
Let me share some advantages for each manufacturer and some possible disadvantages so that you can choose which one you should go for.
There are several advantages in fabless manufacturing and let me share some of them.
However, since usually, fabless manufacturers work with tons of factories, there are so many possibilities, and they can suggest the best factory depending on the customer’s needs.
Some disadvantage of fabless manufacturers is that they outsource their productions to factories which means they add their profit margins to the prices they are given by those factories, which means it can be a little higher.
Maufacturer that have their own factory
Here are some advantages of a manufacturer that has their own factory.
The disadvantage that can come up with is that they tend to have high minimum orders.
Most of them can handle from 3,000pcs~ or even more, so if you are looking for a large quantity at an affordable price they can be good but if your priority is low quantity, they are not might be it.
In this section, since now we know what kind of manufacturer options we have, so let’s focus on the cost more. Understanding the cost makes you well-prepared before you actually contact the manufacturers.
Bulk is about the content of the products. This price is vary depending on the ingredients, formulation, ratio, etc. The same moisturizing serum can be expensive if it contains very expensive ingredients, or it can be inexpensive if it is a basic formula. Products with a high percentage of water, such as lotion, tend to be relatively inexpensive. Also, this price can be different depending on the quantity as well.
If you are on a tight budget or want to keep costs as low as possible, you can use an existing bulk from an OEM manufacturer and change only the container (package). Since the formulation had been determined already, it is quick and easy to start as well.
On the contrary, if you try to create your 100% original formulation, try to use only the ingredients you want to use or try to use materials that are not registered as cosmetic ingredients yet, etc cost more than usual.
You can create your original formulation by using some of your preferred ingredients, but combining the manufacturer’s formulation idea can keep your cost down compared to 100% original formulation.
Cosmetics containers are one of the most important elements to convey the product concept and message. It also accounts for a large portion of the price of a cosmetic product, so it is important to consider it carefully.
The materials used can be broadly divided into plastic and glass.
If you want to keep your fee down, using a plastic container is a better idea.
Plastic is comparatively inexpensive and has characteristics that make it easy to color and process. If standard bottles are used, costs can be considerably reduced.
Besides printing directly on the bottle, you can create your original container by using shrink film or labeling. Recently, high-end plastic containers that look like glass have also been introduced.
Glass has an appealing weight and texture when held in the hand. It is often used for perfumes that contain a lot of alcohol or corrosive ingredients, or when you want to prevent deterioration caused by air or light.
Recently, there has been an increasing movement to review glass containers from the perspective of sustainability.
Another aspect you need to think about is “cap”. The price varies depending on the cap that is attached to the container. For example, there are screw caps that can be opened by twisting and turning, one-touch caps that can be easily opened and closed with one hand, pumps used for shampoo and mist, and so on.
The simpler the structure, the lower the price; the more parts, such as a pump, that are required to be assembled, the higher the price tends to be.
The container fee can be expensive if you are trying to:
Besides these, you also need to think about the labeling fee if you don’t prefer to do the printing, and also the outer box, and the cosmetic box fee as well.
This is the price you need to think about if it’s your first time ordering. These costs are in addition to the manufacturing of the contents of the cosmetics. It is not required for repeat production.
Lastly, let me share some of the licenses that skinacre manufacturers have in Japan. Licensing of cosmetics-related businesses is a quite complicated topic because of the number of existing licenses. Sometimes a company has to have several licenses to operate in the cosmetics business.
This is a prefectural governor’s permit required for the production of cosmetics. This license allows for packaging, labeling, etc. However, this cosmetics manufacturing license alone is not enough to ship and sell cosmetics on the market.
There are two categories of cosmetics manufacturing licenses: the “general category,” which allows for all cosmetics manufacturing processes, and the “packaging category, etc.,” which only allows for packaging, labeling, and storage.
Cosmetics manufacturing and sales license is granted by the prefectural governor and is required to ship cosmetics under your own brand. However, this license does not allow for packaging and labeling.
If you are considering the entire process from manufacturing to sales, you need to outsource to a manufacturer that has both a cosmetics manufacturing license and a cosmetics manufacturing and sales license.
In Japan, when you go to a store to get cosmetics, you see not only cosmetics, but also products called “yakuyou(薬用）”, “iyaku-bugaihin（医薬部外品）”, and it is called “quasi-drug”. Quasi-drugs are products that fall in between cosmetics and pharmaceuticals.
Quasi-drugs are products with formulations that are recognized and licensed by the Ministry of Health, Labour, and Welfare in Japan. In a simple definition, they are products that are not as “strong” as drugs (pharmaceuticals) but their efficacy is recognized by authorizing constitutions.
There is a specific license that the manufacturer needs to have to create them and it’s called
“Quasi-drug manufacturing and sales license” and in order to produce a quasi-drug, the manufacturer must have this.
In this article, I introduced two types of skincare manufacturers and each advantage: fabless manufacturers and manufacturers that have their own factory, and I think it’s important to decide your priority and decide which manufacturer you go to because every manufacturer has their own strength. Also, important to remember that each manufacturer has different licenses so what you can create can be different.
If you are creating your own brand for the first time or considering a private label, skin care is a great product to start with, however, keep in mind that the above information does not apply only to skincare but also to other types of products such as hair care, body care, etc.
I hope this information was helpful to all of you!
For further information, please contact us.