Back to Basics: ERP Software for Cosmetics and Personal Care Industry

Everyone in the world wants to look presentable now and hence, cosmetics have become an integral part of everyday life. Cosmetic products are essential to people as they can enhance the individual’s overall appearance and thereby achieve a positive impact on personality. This growth in consciousness around beauty is one of the major driving forces for the growth of the global cosmetic industry.

Concerns regarding body and well-being are rising due to busy schedules, changing routines, eating habits, and fluctuations in the sleep cycle. Beauty products can help people appear more attractive and healthier. As a result, the world has recently seen a sharp rise in the number of men using grooming products along with women, the cosmetic industry’s age-old customers.

In addition to men using cosmetics, the use of herbal and organic products has also emerged as the latest trend in the industry. Also, consumers have started to prefer products that are handy and easy to use while traveling or attending social meetings. Therefore, innovative strategies such as new products, attractive packaging, and natural ingredients are being used increasingly by manufacturers.

Despite all the growth that the industry has seen, cosmetics and personal care manufacturers still have to deal with a lot of challenges. The threat of ever-increasing competition is omnipresent along with the constant demand for quality products. The speed of innovation, product traceability, Omni-channel supply chain management, and dealing with a wide range of products & packaging are also major challenges for cosmetics manufacturers.

ERP – Beautifying business for the business of beauty…

ERP or “Enterprise Resource Planning” is a software solution that helps businesses automate operations, optimize business processes and streamline supply chains. The unique features of ERP software can help cosmetic companies remain competitive by getting rid of paper-based manual processes, boosting productivity, and implementing current good manufacturing practices (cGMP) in their business.

With modules such as inventory management, warehouse management, formulation management, supply chain management, customer relationship management, workforce management, e-commerce integration, and financial management, ERP presents all business functions on a unified dashboard. What’s fascinating here is, that businesses can have additional features embedded into it, according to their requirements.

Manufacturing multiple products using distinct processes calls for accurate production planning and precise scheduling. A cosmetic ERP software can help manufacturers get the best out of their men, machines, and materials. ERP also acts as a central database to enhance data accuracy and consistency, thereby facilitating informed decision-making and cost savings.

The need for ERP in cosmetics manufacturing

The cosmetics industry has a complex production process and complexity breeds confusion. A confusion, that gets stronger by the use of confusion-evoking methods like manual or spreadsheets. Therefore, to clear this confusion and streamline plus standardize business processes manufacturers should implement an ERP for cosmetics.

What are the Advantages of ERP For Cosmetics Manufacturing?

A few of the many advantages of implementing an ERP for the cosmetics and personal care industry are listed below:

• Faster Innovation – Along with rising demand for herbal and organic products, customers are also asking for products that are safe for the environment. ERP supports this constant need for innovation by letting manufacturers perform product development with their R&D capabilities. With dynamic automated calculation abilities, manufacturers get the horsepower to perform what-if analysis to achieve the desired physical properties as well as cost targets. A single click transfers for approvals, if needed, the formula derived is made available in production, ultimately reducing the time to market. Also, these Formulae for new products can be recorded, stored, tested, compared, and scaled within the ERP software.

• Organized Inventory Management – To manufacture products for skin, hair, hygiene, fragrance, and more, cosmetic production companies need to keep a diversified inventory. The safekeeping of specific chemicals and perishable products needs to be done carefully. ERP helps segregate and group inventory based on their properties, composition, nature, etc. It enables managing them to the palette, bin lot, and item level, enhancing their tracking. Moreover, it offers 360-degree visibility into inventory movements and inventory levels, based upon various inventory characteristics, including a simultaneous view of weight/volume, and quantity in various units of measure. Creation, costing, and selling of kits (two or more products bundled together in the offer price) are also facilitated by ERP.

• Omni-Channel Supply Chain Management – With customers now expecting to browse and buy across a variety of channels, the supply chain must reach beyond the retail store to a customer’s home and dedicated pick-up points. ERP makes the execution of omnichannel supply chains easy by managing all different channels in one place. It centralizes and streamlines the flow of data and offers real-time updates on the availability of products. Due to its automated synchronization, ERP eliminates the possibility of inconsistent/lost data.

• Quality Management – Products that perform their intended function and don’t damage the appearance of a person in any way are the bare minimum quality requirements for cosmetic products. ERP helps manufacturers go above and beyond the basic requirements and helps in establishing strict quality checks at every step of the production process. ERP also supports stability testing to ensure the products’ safety of use in the long run. With chemicals being used in the factory, ERP also helps companies issue SOPs for workforce safety and COA for customers.

• Support for Multiple Packaging Options – Cosmetic products need to be made available in various different packaging depending on their utility. Cosmetic manufacturing ERP software solves this predicament by supporting multiple packaging options. ERP makes the production process formula-centric and thus allows associating a single formula with different packaging of different quantities. Also, it separates formula costs from packaging BOMs, so as to help manufacturers calculate processing and packaging costs separately. ERP can also containerize a group of products in order to simplify the process.

• End-to-End Traceability – With products having a direct impact on the consumer’s life, factory audits are necessary. In case of any discrepancy, manufacturers should be able to trace every ingredient of that particular production cycle right down to its source. ERP facilitates end-to-end traceability with the help of barcodes and RFIDs for each and every batch. And if in case, the products are shipped and a recall needs to be initiated, ERP helps in tracking and tracing the problematic lot and saves manufacturers the trouble of calling back the entire production output.

Based on the above-mentioned advantages, manufacturers stand to gain tremendously by implementing ERP for the cosmetic industry. Their issues regarding innovation, inventory, supply chain, quality, and traceability can be solved with streamlined processes and improved visibility.