ipc 2015. fernando ferrer mba multinational partnerships 03 16 2015

The Business Ingredient .

Fernando Ferrer, MBA

Interna6onal Society for Phytocosme6c Science

Interna6onal Phytocosme6c Congress Bogota, Colombia. March 16th, 2015

®

© Mul6na6onal Partnerships LLC 2

Privileged and Co

nfide

n6al

The global market is there and growing

The global beauty market grew by an impressive 4.5% to US$ 300 bn (£192bn, €228.6bn) in 2012

The global demand for personal care packaging was valued at US$ 19.3 bn in 2012; will reach US$ 25.8 bn by 2019*. In terms of

volume, the demand was 130 bn units in 2012

The global flavors and fragrances (F&F) market totaled ~ US$ 28.0 bn in sales by 2013.

Expected to grow US$ 35.0 bn by 2018**

Source: The Future Laboratory, 2013, Transparency Markets Research 2013. HIS Chemical 2014

* CAGR of 4.3%, 2013 to 2019 / ** CAGR 5 – 6% 2014 – 2018


Privileged and Co

nfide

n6al

Truly Natural Products

•  Products formulated with a high propor6on of synthe6c ingredients dominate the global natural personal care market, accoun6ng for nearly 75% of the total market share in 2014; however, truly natural posi6oning is gaining importance with consumers, manufacturers, and retailers.

•  The natural personal care market grew by 10.6 % globally to reach US$ 29.5 billion at the manufacturers' level in 2013, and will reach US$46 billion in 2018.

Source: Kline & Company, Jan 2015 and Dec 2013


Privileged and Co

nfide

n6al

Organic personal care products market

Global organic personal care products market was valued at US$ 8.36 bn in 2013,

will account for US$ 15.7 bn in 2020*

Source: Transparency Market Research, Jan 2015.

* CAGR of 9.3% from 2014 to 2020


Privileged and Co

nfide

n6al

Organic personal care products

•  Are manufactured from natural plant ingredients extracted under eco-‐friendly condi7ons.

•  Products include –  body care, facial and sun care, condi6oners, shampoos, hair dye, mouthwashes, toothpastes, mascaras, lips6cks, founda6ons, feminine hygiene products and deodorants, among others.

•  These products do not contain synthe6c chemicals such as parabens, phthalates, petrochemical and aluminum salts.

Source: Transparency Market Research, March 2015

HOW ARE WE GOING TO GET THERE?

USA, Europe, Asia, La6n America, Middle East and Africa are the markets


Privileged and Co

nfide

n6al

Define your Goals

Short

Medium

Long


Privileged and Co

nfide

n6al


Privileged and Co

nfide

n6al

The Journey


Privileged and Co

nfide

n6al

① Intellectual Property (IP) o  TRIPS Agreements: Trade-‐Related Aspects of Intellectual Property Rights o  To protect ideas in a global market place o  A broad collec6on of rights rela6ng to human inven6veness and crea6vity

•  Patent –  A governmental grant of a property right to the inventor of a product or process. –  u6lity, novelty, nonobviousness –  Inventor or successors a minimum of 20 years from the filing date of the applica6on

•  Trademark –  Any word, symbol, design or device used to iden6fy a product or service –  Valid for at least 7 years with indefinite renewals

•  Copyright –  Literary and ar6s6c work –  Author's life + 50 years or 70 years (EU)


Privileged and Co

nfide

n6al

Discuss the project with IP experts

The IP Dilemma Publish

or Patent

Publish and

Patent


Privileged and Co

nfide

n6al

Build a brand

Interna6onal

Domes6c


Privileged and Co

nfide

n6al

safety

efficacy

manufacturing quality

cost-‐effec6veness

②  Integrate the cri6cal regulatory and consumer demands


Privileged and Co

nfide

n6al

③  Access to the market

•  Share the enterprise with other commercial capabili6es. –  Add Marke6ng to your R&D Team to discuss the 4Ps mix: Product, Price, Promo6on and Place (Distribu6on)

–  Add Sales to the R&D team to know about the required creden6als to become an approved vendor: reliability, poruolio, origin

•  Expor6ng to the main markets: e.g. follow the Registra6on, Evalua6on, Authoriza6on and Restric6on of Chemicals (REACH) in EU, and the Voluntary Cosme6c Registra6on Program (VCRP) in the USA.

e.g. see FDA: Informa6on for Cosme6cs Importers, updated on 11/19/2014


Privileged and Co

nfide

n6al

④  Comply with interna6onal standards

•  Social and environmental responsibility; GRI Management systems on social responsibility, ISO 26000, SA 8000, adhere to SEDEX Global; UTZ, Global G.A.P. and Fair trade standards

•  Biological Diversity, Conven6on on Biological Diversity, Nagoya Protocol.

•  FDA does not define or regulate terms such as “organic” and “natural.” However, the U.S. Department of Agriculture (USDA) does regulate the use of the term “organic” when used in terms of agricultural ingredient marke6ng.

Source: FDA, Conven6on on Biological Diversity (cbd.int)


Privileged and Co

nfide

n6al

⑤  Establish the supply chain •  Secure diverse and long-‐term reliable sources of the raw materials

•  Follow interna6onal quality standards and traceability – Well documented product from the source to the package

– Cer6fica6ons, MSDS, complete analy6cal methods for compound and impuri6es (IP !)

– Validated manufacturing processes (IP !), cGMP


Privileged and Co

nfide

n6al

⑥  Expand the offer •  Give regulatory and technical assistance – Analy6cal methodology transfer –  Formula6on (IP !) –  Stability data – Dossier

•  Reformula6on using natural products is a trend •  Consider opportuni6es to partner with other products and suppliers to expand the poruolio

•  Discuss other applica6on areas for the ingredients (IP !)


Privileged and Co

nfide

n6al

⑦  Meet the buyer

•  Understand and match the service level for each customer •  Add value. Compe6ng in price and quality is not enough •  The price and all costs including innova6on and high

standards should leave sufficient gross margin to cover overheads and leave a reasonable profit

•  Purchasing and distribu6on agreements are key; the manufacturer is the more interested party in the promo6on of the ingredient, the final product, and brands

•  Func6on, product features and claims are key successful factors


Privileged and Co

nfide

n6al

⑧ Talk the talk ... walk the walk

•  The customer expects punctual communica6on without any delay in a regular, proac6ve, honest, clear / open fashion, in their local language or in very good English

•  Build and maintain a rela6onship of trust with all the stakeholders.

•  Demonstrate cultural awareness.


Privileged and Co

nfide

n6al

“By three methods we may learn wisdom:

First, by reflec8on, which is noblest; second, by imita8on, which is easiest; and third by experience, which is the bi<erest.”

-‐ Confucius

Kong Qiu; Lu,China 551 -‐ 479 BC


Privileged and Co

nfide

n6al

Be brave, purse your dreams There is a growing global market for both, truly natural and organic ingredients and formulas, and for the beau6ful La6n American biodiversity

The development work must go nonstop from the basic research and the laboratory bench to the hands of the consumer

There are no boundaries for those who have a vision and determina6on to carry on any enterprise. But in this interconnected and changing environment we need to partner with those who complement our capabili6es and fully share our ethics and interests.

Thank you

Phone + 1 908 326 6417 -‐ [email protected]

®

Mul6na6onal Partnerships® is a Registered Trade Mark of Mul6na6onal Partnerships LLC

ipc 2015. fernando ferrer mba multinational partnerships 03 16 2015

Small Business & Entrepreneurship