Feminine Care Products Case Study

industry:

FEMININE CARE PRODUCTS

target market:

EUROPE

revenue:

HIGH 7-FIGURE USD

key metrics:

IN SAVINGS
Leveraged through our relationship-building prowess.
$20K/YEAR
LEAD TIME
Via logistics improvements in the supply chain.
32% REDUCTION
CUSTOMER COMPLAINTS
Using Kanary QC methods to elevate initial unboxing.
70% DECREASE

The Challenge:

The client is in the feminine care industry. They aimed to launch white labeled products that are medically compliant.

  1. Find a supplier that can produce medical-grade silicone products: The client needs to find manufacturers capable of producing feminine care products using medical-grade materials. The European markets require strict compliance certificates to meet health and safety regulations and so the manufacturers would also have to have necessary certifications (Biocompatibility Certificate, FDA certificate, GMPC certificate, ROHS reports, EU Declaration of Conformity ). The client was at a loss on how to navigate the complex regulatory processes with the manufacturers and European regulators.
  2. Better Pricing: (product cost, quantity discount). When the client initially launched their brand in the European market, the pricing wasn’t optimal. They needed help negotiating with the supplier for better pricing.
  3. Customer complaints After the main product launch, the client reported customer complaints about product scent. This was concerning because it had the potential to destroy the brand reputation online.
  4. Improve Lead Times to free up cash flow: Long production lead times tied up a significant amount of capital for several weeks to months, and forced the client to make larger purchases in order to keep up with fast-growing demand for their products.
  5. Develop New Products: (For upselling, increase Average Order Value [AOV]). The client wanted to expand into new products; however, due to the need of his products to be medical grade, thorough research is needed for each additional product launch.

Each of these problems requires strategic planning, resources, and expertise to navigate effectively. Overcoming these challenges is crucial for the client to ensure product safety, regulatory compliance, and scaling more profitably, thereby securing a sustainable position in the competitive market.

our solutions:

The key in helping this client achieve their goals is to find medically compliant manufacturers that offer favorable pricing and can be quick with lead times.  

  1. Find medically compliant silicone manufacturers: The number of certifications needed for the European market made this one of our most extensive due diligence processes. Our team talked to over 40 medical and silicone producers. The vast majority of manufacturers had some certificates (e.g., FDA, GMPC), which makes them compliant with the US market but not the European market. After going through an exhaustive search of suppliers, we were able to identify one supplier that had nearly all the necessary certificates; their biocompatibility certificate was out of date and we were able to convince them to renew it (at their own expense) on our client’s behalf.
  2. Renegotiated pricing after product launch: As the client began scaling their business and ordering at higher volumes, our team focused on strengthening our relationship with the manufacturer by initiating several in-person meetings and maintaining weekly calls. This allowed us to have more face to face dialog about pricing and gauge how flexible they could be.
  3. Troubleshoot customer complaints. The client received several complaints about product scent from customers. To address this, we kept track of the timing of the complaints and visited the supplier and the client’s shipping agent to identify the cause. We performed extensive testing and ruled out improper production as the cause of the issue. We noticed that the complaints were more likely to occur as the client was running out of inventory. From this, we were able to figure out that the scent issue came from the humidity created inside the packaging when the inventory had been sitting at the warehouse for an extended period of time.To fix this problem, we had the manufacturer add humidity and scent packs inside the packaging.
  4. Changed packaging to improve lead times: From visiting the supplier, we learned that the production bottleneck is in the packaging (which is produced by a separate packaging supplier to keep the cost low). The packaging was designed to mirror others in the industry and had to be produced in a semi-automated process where a person had to manually fold and create each package. To address this bottleneck, we placed advanced orders with the packaging supplier to give them ample time to put together all packaging. Importantly, we negotiated terms such that payments were not due until all packaging productions were complete (normal terms are 30/70 rather than 0/100).  
  5. Worked with new factories to develop new products: The main product that the client was selling was a silicone product. The client wanted to expand into electronic devices, cleaning agents, and apparel-related products. To produce in these categories, we conducted new rounds of due diligence and successfully identified quality suppliers in each of these new product categories.

The Outcome:

Here are the outcomes after taking the specified actions:

  1. Found a quality supplier to produce medical-grade silicone products: We found a supplier for our client that has all necessary licenses and certificates by the time of production (Biocompatibility Certificate, FDA certificate, GMPC certificate, ROHS reports, EU Declaration of Conformity).  Furthermore, we negotiated with the supplier to add our client’s brand to their FDA registration ($9,500 borne by the factory). This not only adds legitimacy to the client’s brand, but also allows the client to explicitly advertise themselves as “FDA compliant.”
  2. 35% savings on product cost over time: From the frequent meetings and relationship building, we successfully reduced our client's cost per unit by 35%, leading to savings of over $200,000 annually.
  3. Reduced customer complaints by 70%: After instructing the manufacturer to add humidity and odor control packs inside the packaging, our client saw a 70% reduction in customer complaints.
  4. Reduced lead time by 32% for core product: After placing advanced orders with the packaging supplier, overall lead times were reduced by 32%, resulting in freed up cash flow and allowing the client to order products in smaller batches, while still maintaining a competitive price.
  5. Launched 6 new products for upsells: We successfully launched 6 new ancillary products, amounting to additional revenue of 27%.  

Overall, we helped the client find a quality supplier, reduce their cost (by ~35%), and reduce lead time.