// industry insights
Cosmetics & Beauty Logistics 101: How to find the best logistics for Cosmetics & Beauty products in Germany?
Published on: 22nd June 2020, 6 min read.
The consumption of Cosmetics and Beauty products in Germany, in the UK and Europe increasingly follows the trend of using natural and sustainable substances without chemical additives. Particularly fair trade Beauty products for the personal care of body and hair, and organic cosmetic products, such as vegan lipstick and other make-up items are highly demanded. In fact, according to a study, 57% of millennials inform themselves about substances used in self-care products; 46% said they prefer using organic Cosmetics (M. Hohmann, 2019).
Resulting from this, the organic Cosmetics industry showed a revenue growth of 9.4% in 2019 reaching the highest revenue growth in the past few years. The classical Cosmetics industry revealed negative revenue growth of -0.6% (Naturkosmetik Jahresreport 2019).
How do I master eCommerce, B2B and Retail logistics for my Cosmetics and Beauty products?
Beauty startups and merchants with innovative and sustainable products experience an expansion of interested and more knowledgeable customers. The strengths of these Cosmetics companies lie within customer-oriented product development and modern marketing.
However, there still is room for improvement in regards to eCommerce shop operations and the logistics processes involved with Cosmetics & Beauty products.
“Regarding the operational processes of distributing Cosmetics and Beauty products, there are several factors that need to be considered when it comes to logistics. This requires professional and experienced logistics providers, who are able to follow certain requirements. For example, many Cosmetics and Beauty products need to be air-conditioned sufficiently in order to maintain the appropriate texture of the products. Particularly natural serums and creams without preservatives should be treated like fresh goods. They should preferably be purchased if their use is foreseeable in the near future. Other products, such as perfume and nail polish, will last longer if stored under relatively cold and dark conditions.
Control and safety precautions are also an essential part of a qualified logistics provider’s field of activity. Consequently, strict internal quality control standards are important. The unpacking experience also plays a major role in the Cosmetics and Beauty industry. Logistics providers must ensure that customer expectations are met by implementing the companies’ requirements for the actual unpacking experience once the package arrives at its destination. Customers that are particularly interested in natural cosmetics correspondingly expect sustainable packaging. Should the Cosmetics trading merchant not take over the latter itself, this also falls within the logistics provider’s hands.”
Co-Founder at everstox
Beauty and Cosmetics companies place high and specific logistics demands on their order processing and order fulfillment inside the warehouse and towards the respective fulfillment provider. Fast delivery times are crucial. Often the sale of Cosmetics products is associated with free and fast return handling in case the 100% satisfaction guarantee is not fulfilled. Furthermore, strict consumer protection and hygiene standards, and product certification (such as IFS HPC, EFfCI GMP, or ISO22716) are also noticeable in the logistics process. In the case of special cosmetic products such as eye creams, face mists, or products with a high concentration of vitamin C, the cooling chain should be maintained during the packaging and transport process. This often makes it difficult for Cosmetics companies to find a qualified third-party logistics (3PL) provider and thus to scale their business activities within new distribution channels.
The three logistics challenges for
the Cosmetics & Beauty industry
01: The Cosmetics industry: fluctuating demand, competitive supply – how does logistics react?
The first challenge involves the fact that the Cosmetics and Beauty industry is very dynamic. New products with attractive marketing can replace established products within a few weeks. Resulting from this are difficulties for Cosmetics companies to control demand and supply and to react flexibly to market fluctuations. Cosmetics suppliers in the German and European market often cannot achieve this flexibility due to the traditional 3PL provider’s logistics offer for warehousing and fulfillment. For example, long-term contracts for contract logistics and complex IT integrations hinder merchants to react dynamically to market developments. Hence, with time- and cost-intensive logistics structures in place, Cosmetics companies cannot flexibly adjust the strategy of the existing logistics and distribution network.
It is equally important for eCommerce companies and retailers to have data transparency to optimally plan product sales. Data transparency specifically implies the insight into – and the due diligence – of historical inventory and order data management – what does this have to do with logistics? Simply put: seasonal, cyclical, and trending demand patterns can be forecasted based on inventory turnover in the respective warehouse and the number of fulfillment orders placed. This makes it possible to better monitor the purchasing behavior of customers. It also makes it possible to plan inventory more optimally by forecasting demand. As a result, supply bottlenecks can be avoided and quick delivery to the customer is ensured.
A permanent assurance of stock levels, supply chains, and the possibility of quick re-ordering in case of unexpected demand spikes from customers, is very important. Consequently, this must also be included in the question of “How do I master eCommerce and retail logistics for my Cosmetics and Beauty products?”.
02: Search for qualified Cosmetics warehousing logistics
The second challenge entails the right warehousing logistics and storage of cosmetic products. Particularly in the case of cooled products, the correct temperature is essential; either ambient (15-20°) or refrigerated (1-4°).
Furthermore, logistics requirements during the packaging process and packaging materials for products, such as IFS HPC certified personal care products, must be taken into consideration. It could happen that cosmetic companies lose the hard-won validity of a certificate due to incorrect storage or use of non-qualified packaging materials – for example during an inspection by the TN Cert Auditor (TÜV Nord Certification). This would not only endanger the company’s existence but could also be avoided in advance by finding a qualified 3PL logistics partner for Cosmetics and Beauty products.
03: The right shipment for Cosmetics & Beauty products
The third challenge comprises the high customer demands for short delivery times of consumer goods sold online. In Germany, the UK, or other European markets there is an increasing expectation for online purchases to be delivered with the Amazon status-quo of same-day and next-day delivery. This holds equally true for Beauty products and Cosmetics. Many online shoppers expect delivery within 24 hours without a major additional charge. In addition, customers attach great importance to “green” transport and delivery of the parcel. The emphasis here is on the emission-friendly transport of the goods. After all, 3PL providers cannot avoid long transport routes – especially if the parcel shipment from the warehouse to the customer has to cover a distance of more than 500 kilometres. The only way to overcome this obstacle is through flexible warehousing logistics – that is – by including strategic warehouse locations in the Cosmetics retailer’s distribution network. This leads to drastically shortened last-mile delivery and thus reduced Carbon dioxide (CO2) emissions during transportation.
Furthermore, customers of natural Cosmetics products are paying more attention to the actual package delivery during the unpacking experience. Regarding the unpacking experience, customers focus increasingly on the quality and sustainability of cardboard boxes, insulation material, and marketing flyers. These already give the first indication of the product inside.
Conclusion: Cosmetics & Beauty logistics 101.
everstox connects merchants with qualified logistics providers, in order to facilitate the search process for finding the best logistics for Beauty products and Cosmetics. The optimal logistics requires providers with strong references in the Beauty and Cosmetics area. A qualified logistics provider should be flexible, able to meet fast delivery times and act in accordance with the hygiene requirements of the Cosmetics industry.
Particularly regarding reliable API integration, the technology used is of high importance in the operative logistics processes. Due to strict hygiene regulations, there is a high need for tracking and visibility.
Furthermore, inventory planning plays an important role in the future demand for cosmetic products coming from the respective distribution channel. Forecasting tools and simplified inventory management should be part of daily planning and operational processes.
In order to master all these obstacles involved with logistics operations, together with qualified third-party logistics providers and the state-of-the-art cloud technology from everstox, merchants are enabled to operate with cost-efficient warehousing and fulfillment.
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About the Authors
everstox is a technology and Logistics-as-a-Service (LaaS) platform enabling scalable and data-driven fulfilment for eCommerce, B2B and Retail businesses through a European network of independent logistics providers.
We enable transparent, efficient and ecological logistics solutions by forming Europe’s first tech-driven network of trusted warehousing & fulfilment partners.
Further information about everstox can be found under: www.everstox.com.