China Beauty Trends: Criteria of A Good Factory
- Chaileedo Press
- Oct 3, 2022
- 7 min read
Win in efficacy, welcome the future. On September 22, The 5th CHAILEEDO Conference on China’s Cosmetic Trends hosted by CHAILEEDO was held in Hangzhou. At the conference, Zhu Hong, General Manager of CENKONG gave the keynote speech of "Criteria of A Good Factory".
Good morning, guests and friends!
The theme I am sharing today is "Criteria of A Good Factory". The word "efficacy" has been very popular in the past two years. Why? In fact, efficacy is not a new term. We have been pursuing it since the day we started making cosmetics. The popularity of this word is due to the promulgation of The Cosmetic Supervision and Administration Regulation (CSAR)(hereinafter referred to as new regulation). The promulgation of new regulation is a disruptive change and a system-wide upgrade for us in the cosmetics industry for more than 20 years. Because cosmetic brands used to cost nothing to talk about efficacy but now every efficacy has to cost money.
First, the impact of the new regulations on the brand
Just now I said the impact of the new regulations. What impact that new regulations on us? Briefly, under the new regulations, the filing time must be long. Because all the ingredients should do efficacy. Each conversion of a ingredients, the efficacy should do it again. So the product development cycle has become longer, the corresponding product development costs have also become longer.
In such a context, how to find a reliable factory, how to find a reliable partner, this is the following to talk to you.
Second, why do we need to find a reliable factory?
Under the new regulations, the link between factory and brand is getting closer and closer. In the past, when a product was launched, the brand would find a processing factory to make a product. It would take one and a half months if it was fast, or three months if it was slow. But now it is different. Now we two are bundled together to do the marketing. We are highly integrated with a mutual stake..
There are two aspects to a brand's growth. The first 50% is the ability to marketing and sales. Marketing and sales are completely different. The latter 50% is product development, research and development and supply chain capabilities. If you can’t do well in these four capabilities, a brand can not grow. In this way, even if you have good brand positioning or strong endorsement, the brand you want to create would not be successful. Positioning is only a foundation.
Third, abilities that a good factory needs
On this basis of how to find a reliable factory, we have our own 8 criteria.
1.Tax security. About the ability to comply, as a brand partner, the first anti-risk ability of cooperation factory should has is tax security. If a company earns 500 million but only pays 500,000 yuan in taxes, this partner will close down in minutes. Does the cooperation with this company take high risks? The answer is absolutely yes.
2.Environmental safety. Environmental protection should be complied. If the supervisors on environment came your factory for inspection and you close down, how to talk about long-termism.
3. Fire safety. Any fire can make you go up in smoke. Fire safety is that your fire facilities should be full and withstand the fire inspection. The emergency escape drills is also required. This is the most basic.
4.Production safety. Does your production meet the requirements of Chinese safety regulations? If supervisors from safety bureau find that your factory is not in line with related regulations, your factory will be closed down. How can you engage in production? Have you done EHS safety management system. If the management system to run in accordance with that, is there any dedicated staff to do this in your factory?
5.Employment. Have you bought social security for employees? If you have 500 employees, are you buying social security for these 500 employees? Or you only buy 100 of 500? This is employment safety.
6.Quality. The third party to factory inspection is often very serious about quality and safety. Some factories tested a lot, but many items in front are ignored. Quality safety is to run with what quality system, your quality system is reliable? Is not in accordance with the quality system in the implementation, or write a bunch of documents set aside in the cabinet to cope with the inspection.
7.Ability to innovate. We often say "black technology". we worship black technology when creating products. However, there is not too much black technology in producing cosmetics, black technology are grafted out of the black technology, to do a good job on the product. We now use more than 99% of the raw materials are normal raw materials, black technology raw materials are actually very little.
8. The ability to provide resources. The first is the hardware standard, the ability to provide resources including hardware capacity, plant, building. The second is the capital capacity, hardware standards above is the capital capacity, how much unused security liquidity on the account, this money is not moving, used to resist risk. The third is the ability to protect human resources. Under the new regulations, there are several personnel to do the regulations, a person absolutely not, a good factory at least three to five people to do the job.
This is what I just said "8 safe", "8 safe" based on how a good factory to create a product with efficacy, to assist in the promotion of the brand.
Under the new regulations, the factory to help the brand product efficacy breakthrough, we have "6 selection", "3 fixed". How to make cosmetics effective in the efficacy of the product to produce better market results? We use the function of the precise crowd scene development strategy, that is, "6 selection":
1.Choose the channel. What is your selling channel? E-commerce, CS channels, or offline? Different channels are absolutely different, because different channels determine the product development standards are different.
2. Select the targeted audience. Your targeted audience is definitely not the same. For example, high school students, college students, or people who did not accept high education. All of them are young people, they have different needs for the product.
3. Find the efficacy. On the basis of these two, you can choose what kind of efficacy to what group in what channel.
4. Choose the packaging. Packaging is humane. You should not think about what your products should fill in big bottles or small bottles. You should consider what packaging to what scene, what kind of people.
5. Selection of ingredients. On top of the previous four bases is the selection of ingredients.
6. Choice of endorsement. You have to prove that what you say and do is real, and at the same time is the least amount of money to ensure that this money spent can get the endorsement. Endorsement can decide what the brand can say, not what can be nonsense, but what to say in the case of not being fined.
Today I here also hope that the brand owners and builders can get some inspiration. When your existing factories and cooperation factories can not meet the brand upgrade or can not meet the needs of the future development of the brand, welcome you to visit CENKON.
Q&A: How can brands avoid the homogenization of the same OEMs?
Zhu Hong: In fact, the problem of OEM homogenization is quite easy to solve. The above I talked about “6 selections” has provided answers. Because the positioning of different brands must be different. When the positioning is not the same, the selected channels must be different. You will definitely have a different group in different channels, and do not do the same group.
At the beginning of a brand, in fact, we cut into the market is small. Do not compare to those big brands, including international brands, in fact, they have no relationship with you. You first let yourself live in a market segment, your group is yours. You should consider what strategy you will choose and what thoughts you apply.
Many people wonder how L'Oreal do marketing. In fact, you do not need to learn marketing from them first, there is no such volume when we do brand actually do not need to think so big, and do not care too much about themselves. Please remember, your purpose now is to survive first, walk through 0 to 1, walk through 1 to 10, walk through 10 to 100, at least walk through 1 to 10 later, before talking about how to do.
There is no homogeneity. It is just saying that you are in different channels, different products, different people, how you serve people, so that he can pay for the first time to buy, the second can pay to buy. How much proportion that people who buy the first and second time. This is what I just said, the brand's service capacity, but also the factory's service capacity. This service capacity is very difficult to do, is the ability to allocate human resources.
If this service capacity can not meet and can not convince people to pay to buy, even this differentiation is not done what to talk about homogenization, so in fact there is not much homogenization.
Q&A: What is the difference between efficacy cosmetics and cosmeceuticals?
Zhu Hong: The difference is very simple, efficacy cosmetics are cosmetics, not drugs. The starting point of a drug is very different from that of a cosmetic. The starting point of a drug is to use it under the guidance of a doctor, and the goal of using it is to achieve results. In the pursuit of effectiveness, patients will tolerate side effects. It is the doctor who is responsible for solving the side effects so that the patient can achieve the maximum effect of the treatment. For example, you have to choose whether you want to cure the cancer to save your life or lose your eye. If you can live by curing cancer at the cost of possible blindness, which one you choose, not a good choice, right?
Cosmetics must be on the basis of safety before talking about the effect. If a cosmetics can not pass the efficacy test, can not pass all the efficacy evaluation of the risk test, it can not be launched. Cosmetics have risks. So in the new regulations to start at the same time, cosmetic adverse reactions to the monitoring system to start again on October 1. It is to monitor the side effects of cosmetics.
In addition, cosmeceuticals is a foreign word. Chinese cosmetics do not have this word, which is a pseudo-concept. (The moderator added that "cosmeceutical" is an illegal claim under the existing regulations)
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