Brazil is the fourth largest consumer cosmetics market in the world, behind only the United States, China and Japan. The growth of this market has attracted thousands of cosmetics manufacturers, who do not always meet the increasingly demanding and avid demand of the national consumer – or race for competition. Thus, outsourcing is often a practical and available resource, not only for start-ups but also for large companies.

Whether to gain efficiency or increase productivity, the contracts of provision of services collaborate for competitive capacity, privilege technical enhancement and technology exchange, and are essential for the formation of local, regional, national and global production networks, considering that the world production structure is increasingly interconnected.

Research conducted by the National Confederation of Industry (CNI) revealed that in 2016, faced with the economic crisis and loss of competitiveness, the reduction of production costs gained importance – and this is the first point to be considered by companies when they decide to  outsource. Secondly according to the survey, is the time gain, signaled by 85.9% of the industry in general. Then, the increase in quality of the service was considered as an important result for 83.4% of the manufacturing industry, to which belongs the cosmetic industry (82.7%).

“Today it is possible to outsource everything, because this market has been evolving more and more. Natura usually outsources only execution, “says Angela Pinhati, Natura’s industrial director.

The Brazilian cosmetic industry has in the outsourcing a great ally and, although facing difficulties, this is a prosperous market. So it has attracted in recent years some international producers, looking for a slice of this cake. In the wake of this new perspective come new technologies, processes, good products and impecable professionalism.

Fiabila2

Fiabila Production

The production of enamel offered in Brazil, for example, almost all is local. Some of the major players have their own production facilities, others turns mainly on outsourced manufacFiabila, turers. “The current manufacturing conditions of these products, from a qualitative and regulatory point of view, do not meet the requirements we are accustomed to in Europe and the United States, for example,” says Alexandre Miasnik, General Director of a French company for 40 years in the market, producer of nail polish and nail care products that is settling in Brazil, and whose facilities occupy more than 7500 m2.

“We are constantly developing innovative products and creating new colors and effects and ready to execute the processes of color mixing and potting with 2 fully automated lines that will grow to at least 7 lines,” he says. In the coming weeks, Brazilian Fialiba will be manufacturing thixotropic bases locally, using extremely modern techniques, following the model used in France and the USA. “This allows us to offer the market the service and flexibility resulting from a local presence, with the same products, in the quality level with which it is produced in France

The main manufacturers that operate in Brazil are: Age do Brasil; Colepe; Fareva; Lange Cosmetics; Lipson and Universal Chemistry.

Age of Brazil will inaugurate its third plant until May. With it the company’s production capacity, will be expanded to 10 million pieces per month. “Our goal is to double that volume in a year,” says Guilherme Jacob, director president of the company, which produces cosmetics, toiletries, makeup and perfumery for national and international brands. “We have certifications of a global standard in quality and social and environmental respect, in addition to great flexibility in production, logistics, fiscal and foreign trade,” she points out.
She says that 100% of the company’s products are developed by its customers and specifies its services: production engineering, input procurement, manufacturing steps and quality control, which strictly follow the current legislation and the requirements demanded by customers.

Nobile
Nobile´s  Lipsticks

Nobile Cosmetics develops, manufactures and packs Makeup, Perfumes, Personal Care Products and Cosmetics. It has manufacturing capacity of up to 4,000,000 varied items per month. “We have the factory and the customers the marketing”, says Amauri Albiero, company´s trade manager.

Faber-Castell has production sites in Germany and Brazil and exports to more than 13 countries. The company provides outsourcing services to the largest global and national companies meeting the demands for makeup lines eyes, lips, face and nail treatment. It develops a modular system of formulations, packages and accessories, with customization according to the demand of the brands of its clients and for different types of applications. Its portfolio includes technologies for slim and jumbo wooden pencils, mascara for eyelashes, liquids, chubbys, retractable pencils and sharpeners. “The challenge is to keep up with new technologies and trends with the agility demanded by a rising market, even in times of economic crisis,” says Ivonne Ascher, Brazil and Latam sales director.

“It is very common for companies to use outsourced services for what does not make up their core activities,” explains Angela Pinhati of Natura. “In production, we usually use external partners when they have more expertise than Natura in a particular manufacturing technology or when there is a lack of internal productive capacity in the company and there is no enabled time for training.”

In recent years, Natura invested in Cajamar (SP) and the soap factory in Pará, which made it possible to internalize many items that were previously outsourced. “Currently, we have a low volume of outsourced production, usually items with low demand,” says Pinhati, noting that Natura’s choice of an outsourced company undergoes a rigorous process of auditing legal aspects, work safety, environment, Quality and planning.

Advantages and Difficulties of the Outsourcing

 

“It depends a lot on the moment, says Pinhati. “As possible advantages there is the possibility of accelerating a launch, when the third one already has the technology “installed”, and, in other cases, more competitive costs. The main difficulty is to ensure the speed to meet the sales variations, ” she evaluates.

The CNI research report points out that for 67.6% of the industry, legal security / possible labor liabilities is the greatest difficulty faced by those who contract outsourced services. In the manufacturing industry, this percentage reaches 60.9% in the Cleaning and Perfumery sector. In turn, the use of new production or management technologies was considered as an important result for 71% of the  industry in general that uses outsourcing services. The main reason for outsourcing is cost reduction: 88.9% of companies say they contract outsourced services to this end.

“In Europe and in a growing number of countries and regions, regulation is becoming extremely strict. Even in Brazil, Anvisa is now establishing a model largely inspired by what we have in the EU. Even so, consumer expectations in terms of innovation, performance and creativity are very high, “says Alexandre Miasnik of Fiabila. “The challenge today is to meet this demand by respecting applicable rules and keeping prices affordable. This is what Fiabila is committed to doing. ”

According to Ivonne Ascher of Faber-Castell, the advantages of outsourcing are evident in the distribution of tasks. The R & D department is at the forefront of developing formulas and products, and the industry supports new technologies for manufacturing and supplying products in the full-service system. “This leaves our customers free to focus on their marketing and marketing strategy,” says the director of sales.