Personal Care Contract Manufacturing Market Size, Share & Trends Analysis Report By Service (Manufacturing, Custom Formulation and Packaging) By Region, And Segment Forecasts, 2023 - 2030

Report Overview

The global personal care contract manufacturing market size was estimated at USD 19,861.7 million in 2022 and is anticipated to grow at a compounded annual growth rate (CAGR) of 8.1% from 2023 to 2030. The shifting focus of significant companies producing personal care products from in-house production to R&D and other promotional activities is projected to boost the contract manufacturing of these products. The personal care industry witnessed a significant decline in the first two quarters of 2020 due to the COVID-19 pandemic. Factors such as reduced discretionary spending, rising unemployment rates, lockdown restrictions, and altered consumer behavior have reduced the consumption of personal care products. However, easy accessibility of e-commerce platforms, swift vaccination drives, fiscal stimulus packages, and improving consumer demand are expected to drive industry growth.

It is worth mentioning that the U.S. was one of the worst-hit countries due to COVID-19, with personal care players switching to manufacturing hand sanitizers to meet demand. The personal care industry which saw a decline in 2020 is expected to see a rise on account of vaccine rollouts, ease of restrictions, increasing consumer spending, and fostering partnerships among key players for innovative products.

The rising awareness about the side effects resulting from the use of skincare, hair care, and cosmetic products made of chemical components has impacted the rise in demand for organic products in personal care, thereby increasing the growth of the PCCM market of these products.

The increase in the millennial trend and its impact on their followers to buy the products advertised by the millennials has impacted the growth of personal care contract manufacturing. Furthermore, the increase in social media beauty specialist retailers and e-commerce websites has provided huge opportunities for the sales of personal care products.

Contract manufacturing is a highly competitive, difficult, and low-margin business, which needs to be actively managed. The presence of a vast number of contract manufacturers, striving over low-profit margin to offer the formulators a favorable deal, has steered the business into a very narrow pass for being profitable. High investment costs, coupled with low margins, also tune up the risk factor in the business, making it a big restraint for industry growth.

Service Insights

The manufacturing service segment led the industry growth and accounted for 87.4% of global revenue share in 2022, owing to the increasing demand for the products in developed as well as developing nations. The major brands, including P&G and Unilever, are outsourcing their mass-manufactured products and are focusing on the production of innovative products, which is expected to aid the production of these products through contractors.

The skincare segment in manufacturing service is expected to grow at a CAGR of 8.9% during the forecast period. Rising demand for skincare products, particularly from the millennials to delay the signs of aging is expected to propel the demand. In addition, increasing R&D expenditure on producing specialty formulations involving organic ingredients is expected to propel the global personal care contract manufacturing market growth.

Rising demand for organic and natural personal care products is expected to compel the formulators for R&D and custom formulation of products. This, in turn, is likely to have a positive impact on the industry during the forecast period. The companies are rigorously trying to innovate new products owing to the changing tastes & preferences of the consumers, thereby investing majorly in research & development and custom formulation.

The rising demand for flexible and innovative packaging in the personal care industry is expected to have a positive impact on the market. The packaging of personal care products adds aesthetic value to the product, which is one of the primary reasons for the purchasing decision of the consumers. Moreover, the companies are investing in innovative packaging, which is expected to propel the growth of the personal care contract manufacturing market.

Regional Insights

Asia Pacific led the market and accounted for 37.4% of the global revenue share in 2022. The personal care industry in the Asia Pacific is driven by the heightened demand for products such as deodorants and shaving creams among the younger population in emerging markets, including India and China, which is expected to have a major impact on industry growth.

The European PCCM market is expected to grow at a CAGR of 7.0% during the forecast period. Growing demand for personal care products, particularly in Germany, Italy, France, Spain, and the UK due to consumer inclination towards grooming to inculcate positive self-esteem is expected to drive demand.

Advanced technological capabilities and supporting infrastructure have promoted highly sophisticated manufacturing of critical products on a large scale with high accuracy. The demand for custom formulations is also high in North America, pertaining to the presence of R&D hubs of key personal care industry players in the region, and appealing advanced technological centers established by contract manufacturers for providing a one-stop solution to formulators.

Population growth, urbanization, and industrial growth in the Middle East are expected to play an important role in augmenting the personal care industry. Governments in these regions have framed supportive policies to augment the industrial output of personal care sectors. As a result, personal care manufacturers could collaborate with the manufacturing facilities in the Middle East for contract manufacturing and tap new industries during the forecasted period.

Key Companies & Market Share Insights

The companies in the personal care contract manufacturing market are highly competitive and compete on the basis of prices and regional expansion. The companies provide high-performance products with customized solutions in terms of services.

The players give a competitive edge to their competitors based on various factors like product prices, product performance, product formulation, raw materials used for the product manufacturing, packaging, reputation, and availability. The companies employ various strategies to stay on top of the market such as new product launches, R&D investments, distribution network expansion, and mergers & acquisitions. Some prominent players in the global personal care contract manufacturing market include:

• Cosmetic Group USA
• McBride
• Knowlton Development Corporation
• HCT Group
• KIK custom products
• PakLab
• Fareva
• Albea
• SeaCliff Beauty Packaging &Laboratories
• WWP Beauty

Personal Care Contract Manufacturing Market Report Scope

Global Personal Care Contract Manufacturing Market Report Segmentation

This report forecasts revenue growth at global, regional & country levels and provides an analysis on the industry trends in each of the sub-segments from 2018 to 2030. For the purpose of this study, Grand View Research has segmented the personal care contract manufacturer market on the basis of service, and region:

• Service Outlook (Revenue, USD Million; 2018 - 2030)

  • Manufacturing

    • Skin Care

    • Hair Care

    • Make up & Color Cosmetics

    • Fragrances & Deodorants

    • Others

  • Custom Formulation

    • Skin Care

    • Hair Care

    • Make up & Color Cosmetics

    • Fragrances & Deodorants

    • Others

  • Packaging

    • Skin Care

    • Hair Care

    • Make up & Color Cosmetics

    • Fragrances & Deodorants

    • Others

• Regional Outlook (Revenue, USD Million; 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • Germany

    • France

    • Italy

    • Spain

    • UK

  • Asia Pacific

    • China

    • India

    • Japan

    • South Korea

    • Australia

  • Central & South America

    • Argentina

    • Brazil

  • Middle East & Africa

    • Saudi Arabia

    • UAE