The cosmetics industry is big business, and brands that can quickly and reliably deliver in-demand products to their customers are the most profitable. In just Q3 of 2022, the luxury beauty market had $6 billion in sales, and the industry is continuing to grow rapidly despite general market turbulence. High-end beauty products such as makeup and luxury skincare goods are seeing a surge in popularity.

Cosmetics are also gaining ground in online marketplaces. Brands that offer virtual consultations and virtual try-on tools get more engagement from online shoppers, and they can include direct-to-consumer e-commerce sales as an additional revenue stream. Partnering with 3PLs, or third-party logistics providers, streamlines the process and allows many small and large organizations to sell more efficiently.

In the future, the cosmetics market is expected to see:

Continued growth and demand for luxury cosmetics
Inventory management
Growing use of 3PL services to manage supply chains, warehousing, and distribution (e-commerce fulfillment services)
Demand for luxurious experiences during both the sales process and fulfillment

Cosmetic Market Segments

The global cosmetics industry is expected to end 2023 valued at $313.22 billion, with an anticipated valuation of $417.24 billion in 2030. Cosmetics encompasses a wide range of different products and consumer interests, including luxury goods and prescription-level cosmetics. There are three major markets within the cosmetics industry: makeup, skincare, and haircare.

Makeup

Makeup is the third biggest category within the cosmetics market, following haircare and skincare. While the makeup market saw a decline during the pandemic, it is seeing a return to anticipated demand.

Skincare

Luxury skincare is a growing market that encompasses cleansing agents, moisturizers, sunscreen, and other products. For example, 80% of U.S. consumers surveyed in 2018 spent more than $100 per month on skincare products and services. Consumers around the world are learning more about skincare from social media and other channels, which is encouraging them to seek out new brands that meet their preferences regarding effects, ingredients, and more nuanced results.

Haircare

Hair color, luxury conditioners, and salon-level styling products are quickly becoming strong niches within the haircare market. This market is the second biggest segment of cosmetics, and it’s seeing a lot of growth by marketing to all genders.

Other areas within the cosmetics market include oral care, hygiene, and fragrances.

Overview of Global and Regional Regulations for the Cosmetics Industry

Cosmetics brands are quickly globalizing. This means manufacturers need to comply with regulations from global, national, and regional bodies regarding allowed ingredients and processes. Private-label providers, niche retailers, and companies that bottle products for D2C sales also need to comply with these regulations, as they detail labeling requirements, sales restrictions, and product categorization.

Consumer safety is top of mind for both regulatory bodies and consumers themselves as they navigate a global market of goods that extends far wider than the items on drugstore shelves. Brands now need to provide detailed information (including ingredients, instructions, and warnings), guarantee proper conditions throughout the supply chain, and provide proof of compliance. Some of the key areas of regulation include:

Ingredients
Proper categorization
Pre-market requirements
Advertisement regulations and marketing restrictions
Restrictions on animal testing
Required elements of labeling

What to Look for in a Cosmetics 3PL

Cosmetics third-party logistics providers can assist brands as they strive to reach new consumers, fulfill demand, and comply with an increasingly complex web of regulatory concerns. As you look for a 3PL that aligns with your business goals, search for a fulfillment center that offers these benefits:

Quick and transparent shipment of goods to consumers and retailers
Easy inventory management through near-real-time insights and online tools
Branding customizations, including labeling, packaging, and unboxing experiences
Integration with major marketplace platforms so you can sell across every channel you operate on

Choose Daily 3PL for Cosmetics Order Fulfillment and Supply Chain Management

Daily 3PL is a third-party logistics services provider that offers warehouse and inventory management, shipping services, e-commerce fulfillment services, data and analytics, and other capabilities for cosmetics brands. Reach out to us today to learn more about our comprehensive 3PL solutions.