Beauty, The New Basics
Rona Berg, Anja Kroencke, Deborah Jaffe

Excerpt :

What does it actually cost to make the beauty stuff ? Well, in most cases, not much. the actual cost of average cosmetic products is about 10 percent of what you pay at retail whether you are shopping Saks or Say-on Drugs. Some ingredients do const more than others which is another reason to learn how to read a label. so that you can gauge the value.

Let’s say your favorite up-market skin cream costs $30 in a department store. Subtract $15. But hiw much of that goes into making the lotion or cream ? Around $3 . Gross profir for the company $12. But the bucks dont stop there. Though the beauty industry has high gloss margins, their net margins are not so high. Out of the profit, the company substract substantial costs for - you guessed it - advertising and marketing.

What about a amass market product at a drugstore level ? Basically the same equation applies. If a product costs $10 the drugstore pays the manufacturer about $5.50. The cost of product however including packaging, container and contents will rarely exceed $1.25

Tags anja kroencke, beauty, beauty industry, curly, fashion, hair style, hairstyle, hairstyling, net margins, rona berg, skin cream