Have you ever stopped to consider the ins and outs of manufacturing and what determines a final production cost? You’ve probably heard of all the major steps that lead up to a final product – research and development, formulation, testing, scheduling for production, organizing components, and finally production and filling. But most people don’t understand the major influential factors that determine the final unit cost in manufacturing. Manufacturing is rarely broken down and simplified so we are often left to our own assumptions when trying to understand how it all works.
It all starts with quality. What are we working with? Are we working with very costly ingredients that make up a costly end product? Or are we working with less expensive ingredients? Take an example specific to the skincare and personal care industry. If we are manufacturing a conventional moisturizer that utilizes clean and standard ingredients, that would fall into the low to mid-tier cost category. Now take that formula and replace the ingredients in it with all-natural or all USDA Organic ingredients. The cost and quality of the product overall have now gone up significantly. The natural or organic version is higher in quality than the conventional moisturizer and thus more expensive to manufacture.
But it isn’t always the case that higher cost means higher quality. This is often true, but not always. Say for example we are creating a facial oil blend. We can blend oils that are commonly found in nature such as sweet almond oil, lavender oil, and rosemary oil or we can blend oils that are more costly to source due to high demand and short supply such as cannabis sativa seed oil and jasmine oil. The two oil blends are not different in quality, its just that one uses essential oils that are more easily sourced and therefore, less costly, while the other uses oils that are harder to source and therefore more costly.
Whether you are looking for high quality rare ingredients or commonly found ingredients, at the end of the day, the overall cost of your product boils down to the make-up of that product.
Components – What are we packing it in?
Components – What are we packing it in? Is it a standard material like a plastic jar bottle or tube? Or is it a more elevated component with more costly material? The packaging says a lot about your beauty brand and product. It tells the story about who you are as a brand and about the product it holds. You want the packaging to be relevant to your target audience and you want it to represent your product well. In addition, you want to be sure that the material of your components is compatible with the materials in your product. They need to sit well together on a shelf. Glass and plastic are your basic options that will keep the cost down. But when you start looking for more customized shapes, colors, frosting, special molding, or specific materials, that’s when the cost will go up.
IN-HOUSE, EZ-RUN & SAMPLES SHOPS TERMS AND CONDITIONS AGREEMENT
By placing this order with Spa de Soleil, Inc. (“Developer”), you (“Client”) agree to the following terms and conditions of sale. Please review carefully and confirm your agreement with your signature below.
This agreement constitutes the entire understanding between Client and Developer with respect to the subject matter and supersedes all prior agreements between the parties and any representations or promises made by third parties, whether oral or written. This agreement may be amended or modified only by an instrument in writing, signed by an authorized representative of both parties.
For questions regarding your order or for any notices to be sent pursuant to this Agreement, email Developer at info@spadesoleil.com.
