A guide to shipping cosmetics internationally from the Philippines

For a nation with the second highest beauty pageant crowns, it’s not surprising for the local cosmetics industry to get ahead of the game. So, how well are we doing? 

The beauty market in the Philippines, the skincare sector, in particular, was worth US$1.05 billion in 2021, figures by GlobalData indicate. Experts forecast a 7.8% compound annual growth rate (CAGR) over the next few years till 2026, recording US$1.5 billion in value.

This rise is attributed to key changes in consumer behavior. For one, the easing of pandemic-led restrictions has led to consumers heading out for work and social activities. That means there’s increased attention to wanting to look presentable. Two, the pandemic facilitated the switch to more natural and sustainable products, leading to many jumping on the clean beauty trend. Environmentally-friendly and easy to use are key characteristics of this, making multipurpose products more reliable and effective over multi-step skincare regimes. 

Why should Filipino cosmetics brands venture overseas?

The aforementioned consumer shifts are not limited to the Philippines – globally, rising awareness for grooming, hygiene and skin health is set to fuel the global demand for the makeup industry worldwide, according to Fortune Business Insights. Likewise, the adoption of sustainable alternatives will present itself as a key driver of this growth, a value that is expected to jump from US$287.94 billion in 2021 to US$415.29 billion in 2028. These make targeting the global cosmetics market a strategic move – the online space makes this more achievable than before.

Several Filipino beauty brands have already tapped into this lucrative trade, which has brought about incredible success. These include Beauche and Beautederm, which have joined notable names like Issy & Co and Colourette Cosmetics who have taken the world by storm. 

Now, it’s your turn to take your makeup store to the international stage. 

However, before any business begins to venture into a new market, it’s important for them to familiarize themselves with the market demographics, distribution methods, as well as international shipping rules and restrictions of the destination countries. 

Here’s our quick guide to shipping cosmetics internationally from the Philippines:

1. Conducting market research

As a business owner, you’d want to make sure you’re putting your money where it's worth. This means being convinced that a particular market has the potential to bring in greater revenue streams to your online makeup store. Doing ample research before considering shipping cosmetics overseas is, therefore, critical.

The key factors to take note of include:

• Market gap: Is there an unfulfilled need that your makeup products can address? This can be in terms of ingredient choice and price points. If yes, leverage your user selling points and target relevant consumers. If no, evaluate where you stand among competitors and map profit margins to determine success rates.

• Growth demand: Despite the high competition in a market, you can still benefit if there’s a steady growth in demand. Consumers prefer to have options to choose from, so leveraging that growth can bring in the success you need on a global scale.

• Market restrictions: Every country imposes restrictions on imports to protect the interests of their local suppliers. More often than not, these can be overcome, such as paying the right amount of taxes and duties as per customs requirements, preparing the shipping documentation for clearance, and applying for licenses where necessary. However, you’d need to look out for specific rules in place that may implicate the sale of your cosmetic products. These include the prohibition of products containing specific ingredients. For example, the United States (US) disallows the entry of cosmetics with bithionol as it may cause photo contact sensitization. 

• Tariff & duties waivers: If there are Free Trade Agreements (FTA) signed between the Philippines and the destination country, you can enjoy tariff reductions, which can make your exports cost-effective. On the other hand, high tariff and duty rates may implicate your finances – an evaluation of these is necessary to determine whether the market is worth venturing into.

2. Identifying distribution channels

When targeting a new market overseas, you’d want to understand the channels they use the most when shopping online. While your website can be expanded to accommodate customers in specific countries, such as having it localized to their language, you can also jump on shopping platforms to reach a wider audience. These include marketplaces such as Etsy, Lazada, Shopee and Amazon, or any specific one popular in the local market. If you’re targeting Malaysians, platforms like Lelong and GoShop, on top of globally renowned ones, will give you an edge. In Australia, Trade Me and Catch.com.au are popular alternatives.