The new "Regulations on Supervision and Administration of Cosmetics" (hereinafter referred to as "Regulations") will be implemented on January 1, 2021, and the beauty industry is facing new changes.
At the 2020 Huali Beauty Summit Forum held on December 20, a number of industry experts said that the "Regulations" advocates innovation and simplification of processes, which will bring breakthroughs for domestic cosmetics.
This year, more than 30 beauty-related companies have hit IPOs. According to data from the Prospective Industry Research Institute, by 2022, the market size of China's beauty industry will reach 500 billion yuan. If you add personal care categories, the market size will reach trillions.
Under the new regulatory requirements, how can the beauty industry seize opportunities and respond to challenges?
Pan Qiusheng, Chairman and CEO of Shanghai Jahwa, said that with the continuous growth of China's GDP, the role of the beauty industry in driving consumption will continue to grow, but China's local beauty industry still faces the problem of low penetration.
"Today, the penetration rate of China's overall beauty industry is far lower than that of the entire global market, especially in some countries such as Europe, America, Japan and South Korea. China's daily cosmetics industry must continue to innovate to promote the development of the industry." Pan Qiusheng said.
China is the world's second largest cosmetics market, with 5398 cosmetics companies, which is more than the sum of all cosmetics companies in the world except China, but it also presents a problem of large but not strong.
Jiang Ligang, Chief R&D Officer of Proya R&D and Innovation Center, believes that the "Regulations" encourage industry innovation, solve the problem of new raw materials that the industry has been complaining about for a long time, and face up to cosmetics' efficacy recognition and management issues; introduce the concept of registrant and recorder, and clarify the operating subject Quality and safety responsibility, implement the process management of production and operation to ensure product safety; follow the principle of risk management, classified management, and efficient supervision; increase the punishment for illegal acts, and avoid bad money expelling good money.
"Regulations have the same requirements for domestic and foreign companies. This is a fair game rule that the domestic cosmetics industry hopes to see." Jiang Ligang said.
The "Regulations" mentioned that "the state encourages and supports the development of cosmetic research and innovation." Jiang Ligang believes that this will encourage and support enterprises to use modern science and technology, combine my country's traditional advantageous projects and abundant plant resources with Chinese characteristics, to research and develop new raw materials and cosmetics, and to find breakthroughs for domestic cosmetics.
Zhang Wanping, executive dean of the School of International Cosmetics, Shanghai University of Applied Sciences, believes that the future development direction of beauty products is nationalization, and the nationalization of cosmetic raw materials is also an inevitable development trend in the future. For the cosmetics industry, in the process of realizing nationalization, we need to realize technological innovation from three aspects: raw materials, formulations, and evaluation.
"In the field of cosmetic raw materials, natural extraction and biological fermentation are hot words in the industry, but under the constraints of the new regulations, natural extraction and biological fermentation have problems of unclear structure, unclear ingredients, and unclear effective concentration. We can’t deny the application and value of natural raw materials in cosmetics, but how to break through the concept and achieve efficacy is something that the entire industry needs to do in the process of nationalization.” Zhang Wanping said.
In addition, the "Regulations" strengthened the specification of cosmetics advertised functions and requirements for verification. Jiang Ligang believes that, affected by the new regulations, cosmetics companies will also be more cautious in promoting functions. In the future, the formulation of cosmetics will focus on efficacy as never before. Product development costs and time costs will increase. Therefore, the number of new cosmetics output will decrease and the speed will slow down. But he believes that domestic cosmetics are relatively less restricted by regulations and will accelerate their rise.
The “Regulations” also require that when the product name involves raw materials, the label should be explained in accordance with the regulations. Jiang Ligang believes that this will affect some products with brand names or suspected raw materials. Many domestic brands contain "ginseng bird's nest" in their names due to the inherent herbal concept in China. Such brands will need to add explanations on the product labels in the future.
According to the technical guidelines for cosmetic safety assessment, disclosure of data by raw material suppliers will be a requirement of future national regulations. "In the future, relatively large raw material companies that can obtain a complete set of data can be more competitive in the market. After the implementation of the new regulations, it will give greater impetus to the leading raw material manufacturers." Jiang Ligang said.
Mao Jianwen, BASF's global vice president, also believes that the promulgation of the "Regulations" will have a positive impact on the entire industry and promote the launch of new materials.
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