Beauty brands are helping consumers reprioritize their medicine cabinets. And to meet changing consumer needs during the coronavirus crisis, brands such as Venn Skincare and Hero Cosmetics have redefined forward thinking by calibrating existing lines — and even speeding up product development.
Venn Skincare, a line that blends the efficacy of science and nature, is prioritizing hand sanitizers and additional antibacterial products to address potential necessities and has increased order volumes for packaging and ingredient supplies, according to the brand. In addition, they’ve accelerated the development of new products so the company can secure packaging and ingredients in advance.
And Hero Cosmetics, a skin-care solution company, is championing the creation of contingency plans — not just for coronavirus, but for an uncertain future and other disruptions. Dwight Lee, Hero Cosmetics cofounder and chief operating officer, told WWD, “We have redundancies in place for situations like this. At the moment, we’re unaffected, but we’re stocking up on inventory as a precaution in order to buy time later if we need it.”
Lee explained that brands should have a thorough backup plan and consider worst-case scenarios that may appear in the future. “Next time, it may not be a virus. Natural disasters, worker strikes, even office fires are happening every day across the globe. It’s important to be prepared.” He added that the secret weapon — especially in times of crisis — is “strong relationships and good old-fashioned communication. Humans are ultimately at the core of this vast supply chain network. If you support them, they’ll support you.”
Here, Brian Oh, founder and chief executive officer of Venn Skincare, and Ju Rhyu, ceo and cofounder of Hero Cosmetics, talked to WWD about supply chain disruptions, strategic planning and sustainable solutions.
WWD: What business or product changes have been made to mitigate supply chain disruption?
Brian Oh: In anticipation of the pressure on the global supply chain only increasing in the next several months, we have increased our order volume for packaging and ingredient supplies from our Korean suppliers and accelerated the development of our new products to secure their packaging and ingredients in advance.
We tripled our PO for bottles and packaging of both our existing products and new products to launch later this year, since our suppliers couldn’t guarantee they would be able to meet our deadlines for future orders.
Ju Rhyu: We have started placing inventory orders early to ensure we are well stocked. We manufacture in South Korea and while our supply chain hasn’t been hit, we are keeping a close eye on developments and have stayed close with our manufacturer in case something does happen. That is why we decided to order early to ensure we have no inventory disruptions in case our manufacturer happens to be impacted.
WWD: What will your brand do differently to prepare for similar crises in the future?
B.O.: The coronavirus crisis shows how interconnected supplies and demands globally, with businesses and products relying not just regionally but now more globally, even for smaller companies. Also, it is a good example how a crisis situation in one part of the world (although now the crisis has become a global crisis) can significantly impact businesses and products in other parts of the world.
So, this was a good lesson for us to always monitor what is happening in the world, and not just focus on where we sell our products. We were very fortunate to have built strong relations with our current suppliers, and they were able to accommodate us on our supply needs. It would have been safer if we had prepared and planned sooner.
J.R.: We are a profitable company with healthy cash flow and we will continue to operate this way. It’s important to have a healthy balance sheet in case something happens so that you can be nimble and fund emergencies. In our case, placing an unanticipated early order is that “emergency” to ensure we are prepared to weather any supply chain disruptions and with strong business fundamentals we are able to weather this hiccup.
WWD: Are there any useful sustainable solutions that can be implemented on behalf of brands for supply chain transparency or streamlining?
B.O.: I think it comes down to suppliers and brands communicating constantly in terms of the supply needs, so that when something like this happens, suppliers can still set aside resources to meet the supply needs of their existing clients.
J.R.: There are a lot of software options out there that help with supply chain transparency and streamlining. We are evaluating a few but currently aren’t working with anyone at the moment — our supply chain is very tightly managed.
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