Personal Care Products Manufacturing Industry Profile

The US personal care products industry includes about 800 companies with combined annual revenue of $50 billion. Major companies include Estee Lauder, Johnson & Johnson, and Procter & Gamble. The industry is concentrated: the 50 largest firms account for about 70 percent of industry revenue.

This industry includes companies engaged primarily in preparing, blending, compounding, and packaging toilet preparations. Products include makeup, shampoo, and various creams and lotions.

COMPETITIVE LANDSCAPE

Demand is driven by population growth and consumer preferences. The profitability of individual companies depends on product innovation, effective sales and marketing, and efficient operations. Large companies have scale advantages in purchasing, manufacturing, distribution, and marketing. Small companies can compete effectively by offering specialized products. The industry is capital-intensive: average annual revenue per worker exceeds $800,000.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major products include cosmetics, hair products, and creams and lotions. Cosmetics (makeup and nail products) are 20 percent of global industry revenue; face care products about 18 percent; perfumes about 13 percent; and hair products, 9 percent. Other products include deodorant (8 percent); toothpaste and mouthwashes (8 percent); and soap and shaving preparations (5 percent).

Cosmetics, such as lipstick, follow current fashion trends and come in a wide variety of colors. Lipstick is made of dyes and pigments in a fragranced oil-wax base. Ingredients are melted separately, and then oils and solvents are ground together with desired color pigments. The manufacturing process includes three distinct steps: melting and mixing ...