I interviewed Tricia Heidemann who discussed Greening our Supply Chains in the HABA/Beauty Arena.
Tricia, could you first provide a brief of yourself?
Sure. My background is in supply chain management with an emphasis on greening the beauty supply chain. My background started in pharmaceuticals. I was buying raw materials and components for aesthetic dermatology and pharmaceutical company. And what that transitioned into was going into replenishment of global distribution platforms for skincare for an Australian skincare company while I was based in the US. That meant a lot of making sure that not only the raw materials that were being sourced from the biodynamic for the ingredients but also the actual components and everything got rolled into making sure that the whole globe was able to be supplied with the brand's product for their specific launches.
Once I transitioned out of that, I went into the strategic sourcing category from the supply chain standpoint for Henkel with Sexy Hair Concepts and that meant managing the contract manufacturers as well as the vendors that provided the componentry and secondary packaging for the brand. And making sure that not only were we getting the best pricing, but we were also optimizing the smartest supply chain from inception to launch each year for the brands that we were launching.
I also have a background in manufacturing and distribution with the lowest carbon footprint. And a lot of people say that. And typically what that means is just being about to capture additional cost-savings and increased margins for the clients. There are so many different ways to do this, and a lot of it starts from that product development standpoint with cost savings as well as getting those increased margins by not only sourcing the best raw materials but also looking at the different standpoints from where the manufacturer is and the actual distribution and freights and also using contract manufacturers that utilize the renewable energies.
We work with a company called BAM Superior Solutions, and they do amazing these for the contract manufacturers, because they have huge electrical bills, energy bills based on manufacturing of these products for us. So what they do is they go in and put solar panels on, battery backups, so we never have to worry about, "Oh, we're not able to produce your product. You're going to miss your launch because we don't have the ability to turn on all of the machines." And that's a huge, huge resource and part of greening the supply chain that we use.
My business partner, Karen Reznik, started out in the entertainment industry, and she was drawn into beauty to lead product launches and manage project managers. And her specialty is in the actual project management and product development for our high-profile projects. So these are well-known, established brands that people go into the Sephoras and Ultas and grab that product off of the shelf and have been using it for years. And she's been a part of that. So that's what started Athena Beauty Group was just our passion.My background was supply chain management and Karen, with the ability to do the product development in the forefront of that and combining together has just been so much fun.
What does greening the supply chain mean to you?
Greening the supply chain can mean so many different things. But for us, it's making sure that we're able to get our clients that lower margin so that they can use that extra working capital for the things that they want to, such as social media campaigns and marketing. When we do our market analysis, it's all about how the brand is going to be perceived and [inaudible 00:04:43] and that's where we suggest the product type and size and packaging based on the current market conditions and the trends.
So when you go to actually green that supply chain for that specific brand, it's looking at everything from the very beginning. So again, it's the contract manufacturer. How are they utilizing their resources? Are they using renewable energy, such as the battery backup and the solar panels? Are they using the secondary packaging, or do we need to source a secondary packaging vendor that we have selected that uses the FSD certified and the soy-based inks? And that is a huge part of not only being able to market for their brand but also cutting back on their costs, because that's definitely where the globe is going when it comes to products that are sitting in the HABA aisles. They want to see the leaping bunny certified. They want to see the FSC,all of these eco certs, things like that. It's a huge part of what markets the beauty brands that we work with, the prestige and also the masstige. Everyone is definitely paying attention to that.
So I think that the best way to say green your supply chain, make sure that you have a team that is looking at your overall carbon footprint, so everything from the beginning, which is the product development. And using and creating formulas or reformulating so that you actually have a formula that isn't ingredients from that no-no list — the parabens, the sulfates, the phthalates, things like that. And also sourcing raw materials that aren't on that no-no list and that are certified as fairtrade or ecocert or organic. That's huge. That's not something that is going to go away.
How can this be done effectively in the HABA beauty arena?
That's a really good question. There is so many different things that you can do. I briefly touched on them. But I think that the most important one is when you are in that beginning stage — in the product development and/or reformulation — you want to make sure that your product is efficacious but it still is something that people can pick it up and look at the ingredient list and say, "Okay. Yes, this is a clean formula. I know that I can put this on." Especially for women, they want to know that they're not putting anything in their skin that will affect, later on in life, if they decide to have a child. There is nothing in the ingredient list that will potentially cause cancer or endocrine disruptors or tumors or things that the campaign for Safe Cosmetics Act points out.And that's a great resource, and people use it now. There are apps that people scan and it connects right to those. And it can say, based on a color gradient scale, this is a really great formula. It has in the green area where it's not going to be something that could potentially be harmful to you all the way up to the red saying this is why this could potentially be harmful. And then the consumer can make that educated choice. But it's all about the education.
The health and beauty aisle is something that originally when it started out, just more in the natural, crunchy, granola-y, now it's become the trendy more of the norm expectations, especially when it comes to the buyers. I used to be in my background. So I can relate very well to what they're looking for. And now it's just based on what that consumer knows that they should not have in that ingredient list and educating yourself based on it.
Where have you seen success in implementing changes?
We've seen a lot of success with implementing these changes just purely based on what the buyers are asking of us. Obviously when you have people going out and going in to buy their beauty, skincare products, hair-care, nail, color cosmetics, they already know what they want. They've already done the research on many different sites. They're very educated. The consumer is so educated now. So when they're going into Sephora, for example, they know what they are looking for. And the buyers have to react to that. So they notice the uptick in the more natural category, which is why the indie category is becoming so huge. We're based in Los Angeles, California, and there is such a demand for indie beauty brands. I could go on and on about it. But the bottom line is that ticks the buyers to know that they need to change what it is that they're looking for for the brands that they're forecasting to come in for their marketing plan.
So the success in greening the supply chain is very transparent. When you look at all of the new brands, look at 2016 and go into these retail channels and look at what they're launching for 2017. There is such a huge demand for the more natural category that doesn't have those no-no lists in the ingredient lists, but also is very focused on efficacy. And you can absolutely have both now.
About Tricia Heidemann
Co-Founder/ Supply Chain Management