Supply chain management for beauty: How to think about challenges, solutions and setting up for success

Navigating supply chain management presents challenges for startups and growing businesses, but finding solutions is key to setting the stage for long-term success. To help founders think strategically about prospective hurdles, we spoke with Jyoti Sharma, Inventory Analyst – Beauty at Target. Below, Jyoti shares practical insights on how to approach common supply chain obstacles, from streamlining operations to anticipating inventory needs, offering actionable solutions that position companies for sustainable growth and efficiency. 

According to Jyoti, typical challenges that beauty startups face as they scale into mass retail include: 

• Inventory management: This can be difficult because it can be hard to determine what’s on the consumer’s mind. For instance, if an item or trend goes viral, it can increase consumer demand.  
• Production & transportation lead times: There can be extenuating circumstances that companies cannot predict, like the weather. If there is a weather incident that happens, it’s tough to know how that may impact transportation lead times of the product into stores.  
• Distribution: You want to make sure that you have a good handle on how you will store, transport and deliver products from your suppliers to the retailer. You will need to ensure that your goods are efficiently moved through the supply chain to meet demand. 
• Sourcing quality ingredients: It is important to keep in mind that you want to provide a level of safety for the consumer and ensure that you are putting the best possible ingredients into their hands.  
• Case pack requirements: This refers to the specific number of units of a product that must be packaged together in a single case or box for distribution and shipping to retailers or customers, ensuring consistency and efficiency in inventory handling. This is key when delivering to your retailer.  

Jyoti says the most important tip for small business owners is to establish transparent communication with their mass retail partner. With transparent communication, both the retailer and supplier can work with you, the founder, to achieve your goals and relay expectations. If you’re having a supply chain issue that will cause delays, be open with the retailer on the delay and when it can be resolved; most of the time, the retailer will be understanding and can work with you to waive compliance fees. If you’re doing marketing events or ads to push your products, be open with the retailer on your launch dates, so the retailer can be prepared for any increased demand. In short? Open communication is the best way to keep your business healthy, no matter what challenges or surprises might lie ahead.  

Another tip to ensuring a healthy business is to be proactive about forecasting trends and analyzing data. Case in point: For example, if you have a blue mascara, that item probably has more sales during Halloween since it can be used as part of a costume. If you have a perfume, you may find that product has more sales during Mother’s Day or Valentine’s Day. These are examples of cultural pegs or trends you can observe year over year, using data to build into an item’s forecasted sales.  

Some additional considerations founders should have as they expand into mass retail are:  

• Invest in technology: When it comes to technology, one thing to keep in mind is that retailers use technology such as EDI (Electronic Data Interchange) to transmit orders, so you want to make sure that you’re using technology that is compatible with their systems.  
• Strengthen supplier relations: If a product is going out of stock, you want to make sure that you have a reliable supplier that can fulfill any out-of-stock emergency in a timely manner.  
• Plan for contingencies: Ensure that you have some safety stock in place should you need it in case of an increase in demand. Most retailers want a certain percentage of fill rate to measure for the reliability of the brand. If you’re not able to guarantee a certain amount of stock, be open with the retailer about what the issue is, how fast the issue is being resolved, and when the estimated time of arrival of recovery will be.  

If you pay attention to investing in technology, strengthening supplier relationships and planning for contingencies, those together can form a major unlock as you scale your business into mass retail. Last, Jyoti shares the importance of having a deep understanding of your retail partner’s requirements (like packaging or product label requirements). Taking note of all these factors, such as proactive planning and communication, can help set up a strong foundation for success, and ensure that the goals you, your suppliers and retail partners established are all met. 

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