Over the past five years, the beauty and personal care market has experienced unprecedented growth.
What was once an industry limited to physical stores and specialty cosmetics departments is now taking over e-commerce websites, subscription boxes, social platforms, and on-demand services. As a result of technology’s influence on the way we purchase goods and services, consumers are more knowledgeable and attracted to trying new products without ever touching, smelling, or sampling them in stores.
With skin care products leading the charge, online health and beauty product sales have already topped $4.3 billion/year. And this is just the beginning… Only 10% of all sales in the beauty category take place online, which means there is tremendous upside for additional growth in the coming years.
As with any success story, rapid growth in the beauty sector doesn’t come without its set of challenges:
1) Fixed costs: The cost of building, staffing, and managing a dedicated warehouse operation to handle product fulfillment can be staggering. Not to mention fulfillment takes away valuable resources from marketing and sales, efforts necessary get ahead of the competition in a booming market like beauty care e-commerce.
2) Pick, pack, & ship: From cosmetics to hair care, fragrances, and skin care, the complexity and variety of products make it challenging for retailers to package orders to send to consumers. Since the average order size exceeds 5 pieces, efficiency and accuracy often come at a high price.
3) Brand management: A beauty retailer’s brand is of paramount importance. Every detail—even down to the way the products are placed in a box—matters. Consumers are increasingly picky about branding and consistent imagery and consider these factors to be a significant part of their purchasing decision.
4) Returns: Increased sales of specialty products inevitably lead to increased returns. In addition to affecting a retailer’s bottom line, a significant inflow of products can bog-down operations leading to delayed outbound shipments.
For many online beauty and personal care retailers, it makes sense to partner with a fulfillment partner who has experience managing these challenges and rapidly scaling back-end logistics.
In fact, an expert fulfillment partner views the aforementioned challenges as opportunities to fuel even more growth.
With efficient processes in place, outsourced fulfillment partners…
- Turn fixed costs into variable costs that allow for flexibility across business cycles and seasonal peaks.
- Ensure 99% order accuracy with ≤3 day cross-country shipping so consumers receive the products they ordered, as quickly as possible.
- Train employees as brand ambassadors and suggest ways to improve the packaging design/process.
- Seamlessly handle returns, manage product quality, and restock products (if applicable) to ensure customer satisfaction. After all, an efficient return process ultimately encourages brand loyalty and repeat purchases.
At iD Commerce + Logistics, we understand the complexities of beauty and personal care fulfillment and have been working with beauty retailers for years to expand their operations.
To learn more about our experience and see if we might be a good fit, please visit www.idcomlog.com.
About iD Commerce + Logistics — iD is a third-party logistics (3PL) expert specializing in product fulfillment across multiple verticals including healthcare and beauty care, toys, subscription boxes, CPG, and more.