DEEP DIVE: What happens in Product Development

[Intro] Hey, everyone. Welcome to Facially Conscious. I'm Trina Renea, a medically trained master esthetician here in Los Angeles, and I'm sitting with my rock star co-host, Dr. Vicki Rapaport, a board-certified dermatologist with practices in Beverly Hills and Culver City, Rebecca Gadberry, our resident skincare scientists and regulatory and marketing expert, and Julie Falls, our educated consumer who is here to represent you. 

We are here to help you navigate the sometimes confusing and competitive world of skincare. Our mission is to provide you with insider knowledge on everything from product ingredients to medical procedures, lasers, fillers, and ever-changing trends. With our expert interviews with chemists, doctors, laser reps, and estheticians, you'll be equipped to make informative decisions before investing in potentially expensive treatments. 

It's the Wild West out there, so let's make it easier for you, one episode at a time. Are you ready to discover the latest and greatest skin care secrets? Tune in and let us be your go-to girls for all things facially conscious. Let's dive in.

01:31 Rebecca Gadberry: Hello, everybody. This is Rebecca Gadberry, the resident cosmetic chemist, marketer, regulatory person and all the other things that we do behind the scenes in the industry. And I'm here with the marvelous Trina Renea, who is an, as they say, esthetician extraordinaire. I think that's what Julie calls you.

So Julie and Vicki are not with us right now because they're off doing their thing. 

02:00 Trina Renea: And we are going to deep dive into product development. 

02:02 Rebecca Gadberry: Yeah, something that is near and dear to both of our hearts. 

02:05 Trina Renea: Yes. 

02:07 Rebecca Gadberry: Because I know that you have your own line too. 

02:09 Trina Renea: Yes, and I think probably one third of America has their own line at this point. 

02:16 Rebecca Gadberry: It's that, what is it, the DIY trend right now? 

02:19 Trina Renea: It's so crazy. 

02:20 Rebecca Gadberry: Oh, I got to tell you, we're talking about product development. One of the things that is one of my pet peeves is when somebody says, “Oh, yes, I make my own product in my garage or in my kitchen.”

02:29 Trina Renea: Oh, my God, kill me. I hate— I can't with that. It's so dangerous. People, don't buy products that are made in anyone's house. It needs to be made in a proper lab. 

02:40 Rebecca Gadberry: Why not? 

02:41 Trina Renea: Because it's not going to be sanitary and it's not going to be safe and the things living inside of that jar are going to mess up your microbiome.

02:52 Rebecca Gadberry: Well, as we have been talking about over the last few months, yes.

02:57 Trina Renea: Yes. One thing I like to tell people about homemade things that people make and the stability of those in a really simplistic form, is let's say you take— and I probably got this from you, but let's say you're making a smoothie in a bottle. You're like, “I'm going to make this fruit and they're going to be antioxidants. I'm going to put them in this bottle and I'm going to put them on my face.” 

Well, how ripe was the banana? How not ripe was the apple? How do you know how long those are going to be stable for individually? So if you put a banana that's about to expire into something that has fruit that is not expiring and it's sitting in that jar, how long can it sit in that jar? Even if it's in the refrigerator before it's going to turn into a fungi and then…

03:48 Rebecca Gadberry: A host. A host for different microbes.

03:51 Trina Renea: Yes, and then you're putting that on your skin and it can wreak all kinds of havoc. You can have sensitivity, redness, irritation. It's just very, very risky to do and not recommended.

04:06 Rebecca Gadberry: To your point, a lot of these products that are made in the kitchen are “natural products.” So they're using fruits and vegetables that the person who's making it has on hand or they go to the store and they buy them. They're not using what we call chemically-standardized materials, which means that the chemicals that do the job on your skin are in the product or the source, the banana or the apple or the broccoli or whatever, from one batch to the next. 

Also, different types of fruits, such as a Granny Smith apple and a Martha Washington apple and a green apple all have different chemicals in them. They all do different things. And they will all vary depending upon when you pick them, what time of day you pick them, how you process them. 

04:57 Trina Renea: Well, most likely that ingredient is not going to go into your skin and do the benefits that it could do. It has to be treated in a lab and transferred into something that can carry the product into your skin and do the benefits it's supposed to do. There's a whole chemical process that happens in the lab to transfer those fruits into an ingredient that can actually go into the skin. 

05:23 Rebecca Gadberry: Right. 

05:24 Trina Renea: Just like I tell people, like, squalane comes from an olive tree. Extra virgin…

05:30 Rebecca Gadberry: The olive fruit. 

05:31 Trina Renea: Right, but it comes from the olive tree, from the olive fruit. 

05:34 Rebecca Gadberry: The fruit that grows on the tree. 

05:35 Trina Renea: Yes. 

05:36 Rebecca Gadberry: Okay. And the reason I'm differentiating is because if you try to get it out of the tree, you're not going to get it out of the tree. It has to be the fruit. 

05:44 Trina Renea: Yes. So it comes from the olive. So does extra virgin olive oil that you cook in the kitchen with. Two totally different things. Extra virgin olive oil in the kitchen that you're using to cook with doesn't penetrate the skin like squalane does. Comes from the same fruit or plant. What is that, olive?

06:01 Rebecca Gadberry: Fruit.

06:01 Trina Renea: A fruit?

06:02 Rebecca Gadberry: Yeah.

06:04 Trina Renea: But it's not going to penetrate. So if you’re like, “Oh, I have extra virgin olive oil in my kitchen. I can put that on my skin,” that is not going to work the same. Another way I try to explain it.

So it's super important that you use real chemists and real labs, and then they have to stabilize the ingredients and they have to make sure they're all working cohesively together.

06:25 Rebecca Gadberry: Coherently. 

06:26 Trina Renea: Coherently together. And then there's preservatives that have to maintain that product, and then it has to be tested in the bottle. Am I right? All these things. 

06:35 Rebecca Gadberry: Yeah. And another pet gripe of mine, “Oh, it's preservative-free.” How are you making sure that it's stable and will last without any bad things growing in it?

06:49 Trina Renea: Preservative-free is a terrible thing to be. That is not a good claim. 

06:53 Rebecca Gadberry: Good preservatives that are safe are the way to go, not preservative-free because, as we've also talked about at UCLA, and I know you took that class too, is you go to the grocery store, you buy fish and you buy meat, which has the collagen in it. The fish has your omegas that we like for the body, not good for rosacea skin but good for everybody else. 

07:20 Trina Renea: Don’t grind up your fish and put it on your face like a mask?

07:21 Rebecca Gadberry: Don’t do that. Plus, nobody will want to get near you. You may have a pink glow, though. But we also have our fruits and our vegetables. We have your milk products. So you go and you buy those and then you leave them out on your counter for a month, three months, six months, and you expect to be able to eat them. Everybody looks at me like, “No, of course you don't.” 

Well, what about these natural products that are preservative-free? They're the same type of products. They're taken from the same sources. So, yes, we need to preserve them. You can preserve them by putting them in the refrigerator. You can preserve them by using very safe preservatives that can be natural, like ____ [07:21] which comes from a plant that’s grown in New Zealand, one of the best natural preservatives I’ve ever used.

They can preserve by certain essential oils, but then you have to put up with the smell of the essential oils and the effects on your skin. 

They can also be preserved by what we call hurdle technology, which means that we create a formula that provides a hurdle to the bacteria breeding. So, it's still got bacteria in it, but we keep it at a very, very, very parts-per-billion rate so that it doesn't affect the product and it doesn't affect your skin.

So there's a variety of ways we could do that. The simple and naive way is to say it's preservative-free. It's a way to get bacteria in there that can blind you, that can cause staph infections. I really suggest you don't use preservative-free products, unless, of course— there is a bottle that I think comes out of Europe.

09:10 Trina Renea: I haven’t seen this. 

09:12 Rebecca Gadberry: That has a bladder in it. It's a rubber bladder that they fill the product in, and then it seals it off at the top. They put the bladder into a container so you can't see it's in a bladder, and they fill it in a microbe-free environment, a sanitized, ultra-sanitized environment so no microbes get into it. It's ultra-sanitary. 

But those are very rare. The container machine I don't think is even made anymore. These were popular in the ‘90s, but they've gone away predominantly. I don't know why because I love the idea. We could never afford the machine, though. It was like $70,000 or $80,000.

09:54 Trina Renea: This is probably why it went away because labs couldn't afford the machines.

09:56 Rebecca Gadberry: People couldn't afford it. 

09:59 Trina Renea: So let me ask you, if somebody wanted to start a product.

10:05 Rebecca Gadberry: Product line or…?

10:06 Trina Renea: Or a product line.

10:07 Rebecca Gadberry: Has an idea for a product.

10:08 Trina Renea: Has an idea. First of all, how do they find a lab? Second of all, how soon can they get it? We are currently in October, could they have it by Christmas to give to their family members?

10:22 Rebecca Gadberry: Well, there's a lot of people who think that they can.

10:25 Trina Renea: They can?

10:26 Rebecca Gadberry: I can't tell you how many people we get who call us and say, “Yes, it's July, I'd like to be on the market by September.” That is not going to happen and I'll explain the steps. You've already just talked about a couple of the steps. 

Once you get the formula right, and that can take several months or a year or longer, after you get all the ingredients in, you have to identify the ingredients. You have to identify the formula. Then once you've made the formula, you have to figure out if there's any problems with other ingredients. You put it in for stability at the same time that you, who came up with the idea, we call that the product developer, are testing the product to see if it meets your requirements. We put the product into stability in the laboratory and make sure that it's going to stay stable for the length of the life of the product.

We do something called PET, which is Preservative Effectiveness Testing to make sure that the preservatives are at the right level, not because we're concerned about the skin, but we're concerned about having enough of them in there to stop any growth in the product. 

You know, there's over 40 different types of bacteria, mold, virus, and fungus that grow in your bathroom. Where do we use these products? So we want to make sure that when you use the product, you're not going to introduce any foreign material that could harm you and make the product go bad. So we've got to make sure that the preservatives…

11:57 Trina Renea: Airtight bottles. 

11:58 Rebecca Gadberry: Airtight bottles, airless containers are really good. And I think we've talked in the past about what kind of containers have how long of a shelf life so we don't need to go into that here. 

12:10 Trina Renea: Yeah. Are preservatives longer lasting in those containers? Just curious. 

12:16 Rebecca Gadberry: Yeah, we don't need as much usually. And we can even do self-preserving or that hurdle technology that I was just talking about. 

So, how do you find a manufacturer? You get an idea. You're the product developer at that point. You probably are wearing the marketing hat as well. So how do you find a manufacturer for your product? Well, you can look online and you can Google or Bing or even go to one of the ChatGPT AIs and say, “I want to make this type of a product. I want to make a cleanser. I want to make a moisturizer. Where, what companies can manufacture that for me, or what companies can create the formula and manufacture that for me.”

You'll get a number of hits. And then it's just a matter of going through their websites, looking at any reviews that are online about them. 

You can also ask friends that might have done something like that in the industry, what they did. And then you need to contact the companies that you decide. You bring it down to like two or three and then you call them and you find out what are their requirements.

13:36 Trina Renea: I know this is a very, very broad question, but to make one product from scratch, to get it…

13:46 Rebecca Gadberry: You mean from idea to warehouse? 

13:47 Trina Renea: Yes. One product. From idea to warehouse. What is the range of money you're looking at? Just a broad…

13:57 Rebecca Gadberry: It depends on the product. It depends upon whether you're doing blue ocean innovation, which means that nobody has ever done it before. 

You know, the Dr. Thomas Hitchcock that we had on in the microbiome section, he has a very unique blue ocean concept. “Blue ocean” means that you're in an ocean all on your own.

14:19 Trina Renea: You've come up with some kind of concept that nobody else has.

14:23 Rebecca Gadberry: Nobody else has.

14:23 Trina Renea: Which is not the normal person. That's a unique person.

14:26 Rebecca Gadberry: Right. That's very unique. So blue ocean can take, depending upon how much research, anywhere from a year to five to ten years. It depends upon how technologically new and revolutionary it is.

I would not doubt that it took Dr. Hitchcock at least five years, if not longer, to come up with the concept for the product line that he produced.

Mostly, if you're doing something that's kind of not blue ocean, a new concept in a moisturizer, for instance, a new concept in a serum, those are going to be more expensive to create and produce. Then a cleanser or a toner, because there's not too much you can do that’s unique on a cleanser.

Now, there's some of these new products, cleansers that go on like a thick oil or almost like a petrolatum. You add water to them and they turn to a cream or a lotion and you rinse them off, they feel great when you take them off. That's based upon just one or two ingredients. Once the manufacturer understands how to do that, it takes maybe a month to develop a product like that.

On the other hand, let's say you have a serum and you want to have the serum do a skin brightening, total global anti-aging or age correction, working throughout the dermis, working in the epidermal-dermal junction that holds the epidermis and the dermis together, you want it to firm the skin, get rid of any gels, work around the eyes, everything all in one, that could take two or three years to develop. 

16:12 Trina Renea: Okay, but can I say that most chemists that are working on skincare products may have other ingredient lists or…

16:22 Rebecca Gadberry: You mean, like a library to choose from that’s already been done?

16:24 Trina Renea: Yeah, they've already kind of developed for other people or maybe they have— at least they know which ingredients go well together, almost like, what am I trying to say? Like a cake batter, like a cake mix. Like you have your mixes. What are those called?

16:40 Rebecca Gadberry: You have formulas. 

16:41 Trina Renea: Formulas. Thank you. They have all these formulas.

16:44 Rebecca Gadberry: If you're at home in the kitchen, they're called a recipe. 

16:45 Trina Renea: So if you're saying to a chemist, “I want it to be firming, brightening, all the antioxidants you can put in it,” this and that, in your head you're already going, “I know this, this, this.” You're going, “Oh, I can make something like this because I've done this a million times.” 

So maybe you would then suggest, I'm thinking, you would suggest, “Okay, let's put this kind of formula. I can get you those results. I will put something together for you.”

17:13 Rebecca Gadberry: “As long as you're open to what I have in inventory.” Let's say you're going to be small. You're going to order 1,000 units. Most manufacturers like mine, we have a minimum of 1,000 units. Some of them have minimums of 50,000 units. If you get an idea and you're going to be a small indie brand, you don't want the 50,000, you want the 1,000 units. 

17:36 Trina Renea: Because you also have to sit on those until they sell.

17:39 Rebecca Gadberry: Until they sell, which is your marketing aspect.

17:42 Trina Renea: Right. So how much would that cost for one product?

17:46 Rebecca Gadberry: Okay, are we talking about length of time to develop and budget or…?

17:51 Trina Renea: Length of time, just to get my product from my brain, I want a serum like this, to you giving it to me in the box. And for the price that that's going to cost me average, whether I'm creating— I'm not the blue one you were talking about. Just a little different. Just like a serum or a moisturizer. Like a basic. 

18:14 Rebecca Gadberry: Okay, so let's take you through some steps. 

18:15 Trina Renea: Okay. 

18:17 Rebecca Gadberry: So you get an idea. You're going to have to communicate that idea to your formulators, to what we're called the bench chemists, to the chemists, the cosmetic chemists who know the chemistry behind how to put all the ingredients together so that you get effectiveness, what we call efficacy, so that you get stability, so that you get a preserved or safe product. So you're going to go to somebody who knows what they're doing, preferably somebody with a degree or with a long amount of experience that specializes in the type of product that you want. 

I'm a skincare chemist. I don't know from Adam about makeup or hair care. I know skincare. I know skincare like the back of my hand, which I know pretty well because I look at them.

[coughing] 

[background conversation] 

20:01 Rebecca Gadberry: So, when you first get the idea, you're going to need to communicate your idea in some very detailed ways to the chemist who will be producing the formula for you. That means you need to identify or define the product traits, and we do that in something called a product profile. That's what most of us call it. 

On there, you're going to talk about the purpose of the product, the form, like whether you want it to be a lotion or an oil or a serum or whatever. The appearance that you want it to take. Do you want it to be blue? Do you want it to be the natural color? Any fragrance? What kind of fragrances that you're open to. Natural, synthetic. I want it fragrance free. What the benefits are, what's the client going to see when they use the product. The directions for the product. 

Sometimes people say, “Oh, I don't need to put the directions down.” Well, when you're talking about an alpha-hydroxy acid or you're talking about a slugging cream or something like that, yeah, the directions are very important, so we like to have those.

21:04 Trina Renea: Is it mandatory to put directions? Like if it was just a cleanser and you didn't want to have directions, do what you have to? 

21:11 Rebecca Gadberry: I believe it is mandatory. Any claims you want to make for the product. And remember, when you make a claim for a product, you have to be able to prove that claim. That's called claim substantiation. Just the claim substantiation can add several months to the development process, by the way, depending upon what type of claims you're going to be making. Does it brighten the skin? Does it firm the jaw line? That's going to take longer to prove than “Does it clean your face?”

OTC or cosmetic. OTC means over-the-counter and it describes a drug you can buy without a prescription. Is it a sunscreen? Is it an acne…

21:52 Trina Renea: Is a sunscreen OTC? 

21:53 Rebecca Gadberry: Yes, it is. It's a drug. It's not a cosmetic. So when you find your manufacturer, you have to find somebody that can manufacture over-the-counter drugs. Completely different government agency or regulatory. 

22:05 Trina Renea: So if you're looking to develop an acne product or something that has salicylic acid, glycolic acid, is that OTC as well? 

22:16 Rebecca Gadberry: Glycolic is not. Salicylic acid at 2% or higher is. 

22:21 Trina Renea: So you want to know that before, when you're looking for chemists, to ask the lab, “Are you an OTC lab?” If you're planning on creating like a sunscreen or something. 

22:28 Rebecca Gadberry: Actually, the lab is different than the manufacturer. Now, you can have the lab, which has the chemist in it that develop the product. They may be on the same premises and at the same company as the manufacturer, like they are with our company. But there are also labs that work independently and then either refer you to manufacturers or you take it to the manufacturer you've already selected.

22:53 Trina Renea: And can you explain the difference between the lab and the manufacturer? What is a manufacturer's job? 

22:58 Rebecca Gadberry: I will get there. We're doing this off the cuff, everybody. Normally, we have the questions written down. 

23:07 Trina Renea: Am I jumping ahead. 

23:09 Rebecca Gadberry: We’ll get there. And at home, you may be saying, “Well, what does the manufacturer do?” We'll talk about that, okay?

23:13 Trina Renea: Okay.

23:14 Rebecca Gadberry: But upfront, you have to decide whether you're going to be doing a drug product, which has different regulations and is much more expensive to do and does not allow you to really bring forward your cosmetic claims, which are anything other than it protects from the sun or it helps to clear up acne. Anything else is a cosmetic claim. Those have to kind of go on the backburner.

I do not like OTC cosmetics. To me, I'd rather have the OTC, the drug be separate from the rest of the cosmetic product, so I can make claims for that. Or it's simply a cosmetic and it doesn't have any regulated drugs in it, like sunscreens or salicylic acid or any of that.

Then you want your ingredients story. Now, your formulator can help you develop the ingredients story from the ingredients that they have on hand. 

24:10 Trina Renea: What do you mean by story? 

24:12 Rebecca Gadberry: What we tell the story about the ingredient. 

24:15 Trina Renea: You mean in your marketing? 

24:16 Rebecca Gadberry: In your marketing. Exactly. So what do you say about retinaldehyde, for instance? Right. What do you say about retinaldehyde?

24:25 Trina Renea: Me? 

24:26 Rebecca Gadberry: Yeah. 

24:27 Trina Renea: I don't say anything about a retinaldehyde. 

24:29 Rebecca Gadberry: Because you don't use it. 

24:30 Trina Renea: Right. 

24:31 Rebecca Gadberry: Okay. So what is an ingredient that you use that you tell the story about? 

24:36 Trina Renea: Antioxidants. 

24:38 Rebecca Gadberry: Okay. And what do you say? 

24:40 Trina Renea: I say that they help to protect your skin from sun and pollution and help the cascade of the free radical damage that occurs when that happens, which rapidly ages your skin. They're kind of like your little warrior that sits on the surface of your skin and protects your skin from aging rapidly, basically, and it's a must have. That’s what I say.

24:40 Rebecca Gadberry: So as a cosmetic chemist, and that's great. As a cosmetic chemist, I hear, okay, the antioxidants, there have to be more than one. We have to make sure they're stable for the life of the product, and antioxidants usually aren't. So that's a challenge to the formulator. 

Because she's making claims, okay, protects from this and this and inhibits this in the inflammation cascade, we have to give her data that show that the ingredients that we've chosen actually do what she's talking about. 

So that's four things that I as a cosmetic chemist have to give you as the product developer and marketer to help you tell people about the product.

25:44 Trina Renea: Tell the story.

25:44 Rebecca Gadberry: Right. 

25:46 Trina Renea: Do you come up with that story before you actually decide on the ingredients of the product?

25:51 Rebecca Gadberry: Sometimes we do. For instance, I had a client years ago, like around 2015. This was a doctor who worked in Russia. He was very familiar with stem cells and stem cell proteins called defensins. Defensins helped to stimulate stem cells in the skin, a certain type. 

He brought me on board to figure out how to formulate the products with these defensins in the product. Turned out to be a multi-award winning line. One of my pride and joy is in my life as a product developer or as a formulator. But I had to figure out how the rest of the ingredients that we were using would support the role of the defensins and not get in the way, but actually take off or act as a synergy with the defensins.

26:48 Trina Renea: How long did that take? 

26:50 Rebecca Gadberry: That took about six to eight months. So, in that case, he came to me and said, “I want to use this ingredient.” That's his primary ingredient story that all of his products are built around. So ingredient story, yes. Have the product or identify any ingredients that you're in love with. 

Now that the internet is so popular, I've had people come to me and give me a list of ingredients that they found on the Internet that they want in their products. And I have to say to them as their chemist, “These are not compatible,” or, “If you want to order that, that is a 50-kilo order and you only need half a kilo. So what do we do with the rest of it?” Because I'm not going to buy it because my profit goes out the door. 

And any good manufacturer will not buy something like that unless you have enough units that you're ordering that'll use up all that ingredient. Otherwise, it sits there and can go bad. 

27:50 Trina Renea: So can a person come to you and say, “I want these three ingredients, and I want you to make it silky and feel good on the skin…”

27:58 Rebecca Gadberry: Absolutely. 

27:59 Trina Renea: And then you can tell them what those three ingredient stories are?

28:02 Rebecca Gadberry: Yes.

28:03 Trina Renea: So that they can then create their story? Can it go that way as well? 

28:06 Rebecca Gadberry: Absolutely. That's exactly how we go. A lot of times, we'll go from the benefit and not from the ingredient. “I want a product that firms the jaw line.” 

“Okay. I know of three peptides that'll do that. We happen to have two of them in stock. Would you like to know more about them?”

“Yes, I would,” and then we’d go from there. “The third one that I don't have in stock, you’ll have to purchase, but it may have better performance. So, is it worth it to you…”

28:34 Trina Renea: And then you have to test it together with these.

28:34 Rebecca Gadberry: We have to test it, make sure they all work. So, let me go on with this. You want to look at competitive products. Okay, go ahead.

28:43 Trina Renea: Talking about competitive products, that was my next question, is what if I have something that I love and I want it to be just like that?

28:55 Rebecca Gadberry: Okay. So let's talk about competitive products, which is next on the list. If you want it to be just like that, we're going to have to have an analysis of it. That costs money that you may not have in your hip pocket. So think about that. 

We can, because we use, we call them benchmarks. We will take a product that you love and we will ask you what you love about it, what would you change if you could. That way, we have a little bit more to go on and we don’t have to hit it exactly. Because, most of the time, there is something that you would like to change. “I'd like to have a different fragrance. I'd like to have color. I'd like to put in some other performance ingredients.”

And, by the way, an ingredient that does the work in the product is not called an active ingredient. That is a drug claim. Active ingredients are in these over-the-counter drugs I was talking about. They're performance ingredients, functional ingredients, or action ingredients. Those are marketing claims for the cosmetic ingredients that are doing the job. 

If we have other ingredients like surfactants that cleanse and emulsifiers that hold oil and water together, or preservatives that make sure that the life of the product will be safe for you to use, those are called vehicle ingredients. They create the vehicle or the car that drive the performance ingredients into the skin and onto the skin. 

30:24 Trina Renea: I wanted to tell you one thing about you said if somebody wants to come up with a formula, you send it out for analysis. 

30:31 Rebecca Gadberry: Uh-hmm, or you could do it in-house, but it costs money.

30:33 Trina Renea: I used to use these two creams from two different companies and I'd mix them together and people would always say, “I love that, the smell of this.” I was like, “Well, you'll never be able to get it because it comes from two different products.” And I don't sell one of them. I just use it in the back bar. 

So when I was making candles, when I started making candles, I asked them, “Can I get this smell into a candle scent?”

30:57 Rebecca Gadberry: Oh, I remember that. Yeah. 

30:58 Trina Renea: Yeah, and they said, “Send me four ounces of each of the cream,” and they will send it for analysis. 

So I just mixed the four ounces of each of the cream together. I did two ounces and two ounces to make four. I mixed it together myself and I sent it off to the lab, and they created a candle scent for me. 

31:16 Rebecca Gadberry: Yeah, I remember. It was beautiful, too. 

31:18 Trina Renea: It's so great that you can do that. So you can do the same thing with products, basically. 

31:22 Rebecca Gadberry: You can do the same thing with products. And a good chemist will look at an ingredient list and say, “Oh, this would get us more of what we're looking for here. This gives us something that we don't want.” So we might edit the ingredients, too. 

Plus, a good chemist will know, ballpark what percentages we're looking at with each ingredient as opposed to what you as the product developer would know. That's one of the things that we teach at UCLA, by the way, is how to look at an ingredient list and ballpark the percentages on the ingredients. 

31:57 Trina Renea: Right. Really quick, we have about 10 more minutes before we have to end this, and I don't know how we can do that, but I'm going to let you do all the talking at this point. But at some point, you have to get to the cost of a product for me. 

32:11 Rebecca Gadberry: I'm going to end with the cost of the product, because there's a lot that goes into the cost. 

32:15 Trina Renea: Yeah, but maybe we could give a range. 

32:18 Rebecca Gadberry: Yeah. So the next thing that you need to identify in your product profile is the price, the total cost to you. That includes all of your fixed as well as your non-fixed costs, what your wholesale price is going to be and what your retail price is going to be. That will determine your profit.

The geographic market, if you're going to be selling in the United States, we have different regulatory requirements than Canada, Mexico, Europe, Brazil, Russia, India, and Asia. So we have to know right up front where you're going to be selling your product. 

33:00 Trina Renea: Can you be international? 

33:01 Rebecca Gadberry: You can, but it's going to take a lot more finessing of the regulatory issues. When I say regulatory, I mean the regulations that the countries— with us, it's the FDA and the Federal Trade Commission. With other countries or geographic areas, it could be a completely different title of an agency. But they issue the regulations or the requirements that we have to meet in order to produce this product. I'm going to talk about legal in a couple of minutes. 

And then any special requirements that you have. Let's say it's going in a very unique container. And that goes to the packaging characteristics. We like it if you can identify the container prior to coming to us. Then we can produce a product that meets the requirements of that container. 

Let's say you're putting it into a clear plastic container or a clear bottle. We're going to have to do some things with stability ingredients to make sure that it doesn't fade or change color or change fragrance or lose any water while it's sitting on the shelf. 

We want to know what kind of material it is because the materials of the container can react with the product inside of it. So we need to know what kind of material it is. 

We need to know how it's going to be dispensed. Is it going to be in a pump? Is it going to be in an airless? Is it going to be in a squeeze bottle? If it's in a squeeze bottle, if it's a really resistant plastic that you can't squeeze, we're not going to put a product in it that is high viscosity or very thick that you can't get out of the container. We're not going to put in a product that is very thick in a pump bottle either.

The last thing that you need to know about is how available is that container. I was just talking to you about some containers that we have that are going to take nine months to get in, which is not uncommon anymore with the way that the logistics or supply chain has changed since COVID. A lot of these things are taking a lot longer. Are you prepared to wait for nine months for a container to come in from Korea or Africa or Italy? And is it worth it to you or do you want to do something else? 

So you need to find an R&D team, a research and development team. These are your chemists that can support your timeline, the type of products and any other requirements that have good development costs that won’t bleed you try. 

We charge about $1,500 to $4,500 depending upon the formula, the type of product it is, and how much work we have to do. Some companies will charge you $20,000, $25,000, $50,000.

36:09 Trina Renea: To do what?

36:11 Rebecca Gadberry: To develop the product. And at that point, you don’t even own the product yet. You're just paying us to develop it. You don't have the rights to the formula yet. That's an extra fee. Okay?

So what's the experience of the team, the team education? What kind of lab equipment do they have? Can they— and this is a huge one. Can they transfer? Once you approve the formula, can they do what's called tech transfer to the manufacturer? Now that's either on-premises where they are, or from their group to an outside manufacturer. Can they write up a formula and identify all the source materials or all the materials and where they come from in a way that is explanatory to the manufacturer. That’s called tech transfer. 

I can't tell you how many times things have fallen apart between where the R&D, the chemist, give the formula to the manufacturer because the manufacturer doesn't understand what the formulators did or the formulators didn't communicate it properly.

37:22 Trina Renea: And so the manufacturer is the one who actually physically makes the products from the chemist. 

37:25 Rebecca Gadberry: That’s correct. Hence the term manufacturer. 

37:28 Trina Renea: Got it. 

37:30 Rebecca Gadberry: Okay. So what are their formulation policies? Who owns the formula? And do they have enough of the ingredients that you're interested in in stock, in their own inventory or how much are you going to have to buy?

So let's talk about the manufacturer. What the manufacturer does is they make the product. They do something called compounding it. Imagine a great big kettle on your stove and you've got a recipe. You're going to take that recipe, you're going to measure everything out, put it into the kettle on the stove. You're going to heat it up, mix it up, and let it brew for a while or cook. Then you're going to take it out and you're going to fill it into bowls. That's basically what a manufacturer does.

But we call them compounding tanks. We have rotating devices that mix them up. We have homogenizers that blend them, just like you do when you blend a smoothie. We will do that to certain formulas. 

Do they have the filling equipment? Do they have the ability to put your products into a box and seal it? Do they have the ability to ship the product to you? Are they going to hold your stock in their manufacturing facility, or do you have to find an outside warehouse to put your inventory? 

All of these things have to be decided upon upfront. Otherwise, you're going to get into trouble. 

So, there's a lot of ingredients now that are being discontinued or the manufacturer is increasing the amount so much that a small indie company can't afford them any longer. So what is the manufacturer’s policy that when you have trouble with an ingredient, if it's discontinued or out of reach, who pays for reformulation? And do they even tell you that they're reformulating? Because, you have a year to change the ingredient list on the container. Do they tell you at the end of the year or do they tell you at the beginning? So what kind of runs do you have to do, etc.? 

You also want to know the manufacturer certifications. Are they organic certified? We're going to be talking with Gay Timmons about— well, I think we talked to Gay about that.

39:49 Trina Renea: We have two minutes.

39:53 Rebecca Gadberry: Okay. So we've already talked to her about that, and there are different requirements. Do they have the licenses that are needed? Do they have FDA complaints against them or warning letters? What are their cleanliness standards? And can you do an audit or have a third party come in and do an audit? 

And very important, what about product liability insurance? If something goes wrong, do they have the insurance to pay the person that it's gone wrong for? 

40:23 Trina Renea: And the manufacturer holds that insurance?

40:27 Rebecca Gadberry: The brand can put what's called a rider on their insurance policy, which means that you take out extra insurance in your name as well. It has to have insurance. 

You need to find an attorney so that the attorney handles contracts. Do not go to a manufacturer without a contract, because if things don't work out, you could be left with a $20,000 bill and no product to show for it. 

All of this needs to be done. So, now, we're going to talk about how much. Let me go to that. I have my budget right here. 

So you've got basically $1,500 and up for product development for the chemist. Formula ownership can be $5,000 or higher. Logo and package design, anywhere from $1,000 or your son-in-law does it for you that's free or just dinners, or $5,000 to $25,000 in a custom packaging. $5,000 per size of the container. So if you are in a 1-ounce and a 4-ounce and an 8-ounce, that's $5,000 minimum each. 

Outside testing can run you $1,250 to $50,000. That can be claims substantiation. That could be dermatologist testing. Your legal can be a $5,000 retainer or $450 to $750 an hour. Your marketing should be 10% to 30% of your budget. That includes your collateral materials, like brochures, your PR, your social media, your advertising events, and then your cost of doing business, your sales, for meetings and entertainment, anything you're doing on the internet.

So you asked me how much does it cost? How much do you have? We're not just talking about producing a product that you can give to your friends at Christmas. We're talking about a product that you're going to sell. How are you going to get it out there? 

You know, we've done our job as cosmetic chemists, the manufacturer does their job. Now, it's up to you as a marketer to go out and market it so that you can buy more product and help the people you want to help. 

You also have to put your fixed costs in, your packaging, shipping and fulfillment, your product and fill, your commissions, your bonuses, your overhead, your compensation, the insurance, all of that. 

So if you want, “I just want to get a product to market,” count on at least $5,000. “I want to get a product to market and I want to make it highly successful,” between $100,000 and $200,000 per product. That's what I usually tell people. 

Things that can make your budget go crazy is scope creep. You give us that product profile. Three months later, “Well, I'd also like to have this in it, or I'd like it to do a little different.” That, we're going back to the drawing board. 

The number of units that you purchase. 

43:27 Trina Renea: What’s that called? Scope creep?

43:29 Rebecca Gadberry: Scope creep. You're going, we have the scope of the project, and now we're creeping past the scope. “What are the requirements?” “Oh, I want more.” 

So I had one client a few weeks ago say, “Well, I decided I didn't want silicones in the product.” We did a product with 19% silicones. It made a huge difference. So were we going to go back and reformulate? Turns out that for the price and going back, she was happy with the silicones.

So, the more extravagant the project, the more consultants you bring in.

Not being ready for your Gates, like having copy ready for your lawyer to review for claims. 

And you go crazy with the marketing. So what budget should you allocate per product? Well, you have to consider the category of product. If it's a cleanser, it's going to be a lower allocation than a serum, which is your hero product. It's your super seller. So you're going to be putting more money towards that. 

The ingredients, how many unique ingredients do you want? The claims that you make. How many claims do you want and how much does it cost to substantiate?

44:32 Trina Renea: And this is every single product, meaning if you're doing a product line, it's five products, then you do this five times. 

44:41 Rebecca Gadberry: Right. However, if you've got five products and it's a line, and you're going to market it as a line, go back to that $100,000 to $150,000. Okay. 

Your packaging in your timeline can also impact your budget. “I want it in three months.” There's no way you're going to get a stable product in three months that the manufacturer will stand behind, by the way, because we don't have enough time to test it. 

And remember, on your timeline, it's finding the R&D people, doing the product profile. That'll take you a few weeks, most likely. And then you find your R&D people, getting them to work on it. 

After you pay your fee, that's when you go in line to have the work done. Depending upon how busy that R&D team is, you may wait two weeks, you may wait three months. You don't know.

And then, but I really want that R&D team, so you wait. So you're in a queue there. Then they go to the bench and they start putting the formula together. They get it right off the bat, you're probably looking about six to eight more weeks if they get it off the bat. If they don't, it could be six months to a year, depending upon how close they are. 

So all of this comes into play. Products don't appear on the shelf. And when you look at a product on the shelf, you are looking at a product that was brought to you by at least four different groups of people. It just did not appear in that container. 

So, the last thing you have to ask yourself is, “Can I make a profit? Can I replace my inventory and make a profit?” Do not plan on making a profit for at least two years.

46:28 Trina Renea: Okay. Wow! There's another way for those of you who don't want to do all that in the beginning. 

46:36 Rebecca Gadberry: What's the other way? 

46:38 Trina Renea: Private label. 

46:39 Rebecca Gadberry: Oh, yeah. You mean where you buy a pre-filled, pre-packaged product?

46:43 Trina Renea: Which is what I feel like a lot of people out there.

46:47 Rebecca Gadberry: Yeah. Well, we have a division that does that too. As a matter of fact, we're one of the largest in the industry. But people can come to us. They have a proven product. They have insurance for the product. They have the story, the ingredients story. You can name it whatever you want, put your label on it. We will be happy to do that for you and go and sell. 

And after you've tested your product and you like it, if you want to come back and say, “Well, I'd like it to do this or this,” or have other ingredients, we can work from that base and make it unique to you. 

47:21 Trina Renea: And how much does it cost to do from the base to unique for you? 

47:24 Rebecca Gadberry: It depends on what it is. It's about $1,500. And I don't remember what the minimum is. 

47:30 Trina Renea: Okay. Well, that's good to know. 

We have another episode we have to record right now, so we have to say our goodbyes.

47:40 Rebecca Gadberry: Goodbye, everybody. 

47:40 Trina Renea: I hope that was informative. And if you have questions, you can totally email us and we will get you some more information of what you need.

47:50 Rebecca Gadberry: Well, it could go into the Substack information. 

47:53 Trina Renea: Yep. We can give it to you. This will all be in Substack, but you can send us an email if you have more questions.

Please don't go into your kitchen and make your own product, unless it's a candle. 

48:06 Rebecca Gadberry: Bye, everybody. 

48:07 Trina Renea: Bye. 

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