9 tips for doing business with European buyers of natural cosmetic ingredients

To export successfully, it is important for suppliers to understand their buyers’ wishes and needs. Buyers expect you to meet the minimum requirements and go beyond them. Use the following tips as a guide to do business with European buyers. Following these tips will increase your chances of becoming a successful exporter to Europe and help improve your relationship with your current buyers.

1. Understand the requirements that your (potential) buyer expects

To establish and maintain successful business relationships in the European cosmetics market, it is essential to have a thorough understanding of buyers’ expectations. In addition to compliance with legal requirements, European buyers of natural cosmetic ingredients look for quality, reliability and a good price. They need to understand whether your company can add value to their product portfolio, whether you can provide more value than a current supplier and whether buying from you would be a risk. 

Ask yourself, if you were in their shoes, would you buy from your company? Look for what is missing. Do you have all the expected technical documents? Do you have good traceability to the source of the raw material? Can you manage your supplies to ensure that you have reliable quantities available when your buyer needs them? All these points are covered in detail in the other market studies available on the CBI market information website for natural cosmetic ingredients.

2. Organise your technical documentation

A well-organised technical dossier helps you to stay in control of the large amount of test data and other paperwork that you will generate to have your product ready for the market. When meeting buyers, a technical dossier will allow you to have all the necessary information at hand. All technical information should preferably be in a digital format.

The ingredient dossier should contain data sheets and other technical documentation about effectiveness, traceability, corporate social responsibility, sustainability, production methods, claims, patents, health and safety. This information is essential for promoting your ingredients in Europe and complying with European buyer expectations. 

Make sure to provide a detailed description of your product (including product name, composition and origin) along with a clear overview of your supply chain. Also, outline the manufacturing process, from sourcing to final product. Include details on the extraction method used, the equipment employed and quality control measures implemented throughout the production process. Other supplementary technical information is also required, including:

• Certificates of conformity, as European buyers may want products to meet certain quality rules. These rules could be set by international groups like FAO or ISO, or they could be guidelines from a European trade organisation;
• Allergen declarations;
• Documentation of compliance, which certifies your business registration and confirms its validity;
• Relevant documentation on further certifications.

You do not have to share the whole dossier or its components with anyone outside the company. In some cases, it would be advisable to exchange confidentiality agreements when sharing commercially sensitive information. However, you will need to provide your buyers with at least the following:

• The latest versions of all your Technical Data Sheets (TDS);
• Safety Data Sheet (SDS), which is not a confidential document; and
• Certificate of Analysis (CoA).

Be prepared to invest time and resources into compiling the documentation required by European buyers. It is important that you keep your technical dossier organised, updated and readily adjustable. Doing this will allow you to respond quickly and effectively to requests from potential buyers.

3. Make sure you have a traceability system

In Europe, there is increasing demand for products made under environmentally and socially sustainable conditions. Large European companies have obligations under Corporate Sustainability Due Diligence (CSDD) to address actual and potential adverse impacts on the environment and human rights in their value chains, both within and beyond Europe. Accordingly, evidence of having transparent, traceable and sustainable practices in the supply chain is becoming more important.

Whether you work directly with producers or purchase natural ingredients through an intermediary, you must be able to provide European customers with detailed information about your supply chain. Consider implementing a robust traceability system. This will allow you to track and trace the origins and production journey of your products, providing buyers with reassurance about what they are purchasing.

Certification schemes have the advantage of building in traceability. However, certification may not be suitable for every supplier. If you do not want or need certification, you still need to demonstrate traceability in another way. There are many methods that you can utilise to implement a traceability system. To start with, you can use an analogue system. This will enable you to track products without identifiers, using non-digital systems and manual recording methods, such as printed labels, physical stamps or tags and spreadsheets. Then, you can implement digital systems that rely on electronic data capture and unique identifiers, such as QR codes or RFID/NFC chips. Companies are increasingly using digital systems due to their better efficiency, accuracy and access to real-time data.

4. Create a compelling sales pitch

Hopefully sooner rather than later you will be meeting buyers in person, over the phone or via email. European buyers receive many offers from prospective suppliers every day and generally do not like to be approached by mass mailing. They also carry out their own research to make sure they are getting the best value for their money. It is also possible that they are already buying your ingredient and are looking for new or back-up supply. Either way, you will need a compelling sales pitch to make an impression and improve your chances of success in this market.

When you contact potential buyers by email or have arranged a meeting with them, you should prepare your sales pitch based on who you are pitching to. Begin by researching your target buyers. Aim to understand their business operations, target market and pain points. Try to identify how your company and products can address their challenges and offer solutions. Also point out similarities between your businesses. Make sure to understand the role that the person you are targeting has within the company.

You must articulate a clear value proposition that highlights the unique benefits of your natural ingredients and how they can meet specific buyer needs. Focus on key selling points such as innovation in the ingredients’ properties and the value chain, high-quality ingredients, ethical ingredients, natural and/or organic ingredients, and unique or interesting origins. Highlight any certification schemes, quality management practices, traceability systems, sustainability initiatives or community engagement efforts that differentiate your product. These are all good examples of value propositions that could boost your sales prospects and add credibility.

When presenting the sales pitch, ensure you have a strong opening statement that captures the buyer’s attention. Use a relevant statistic, success story or industry trend to get their interest and encourage them to continue the conversation. A well-structured and confident sales pitch can make the difference between you doing business with a new buyer or not. Figure 1 describes the steps to give a good sales pitch. You can use it as a guide to prepare yourself.

Figure 1: Steps in delivering your personalised sales pitch to European buyers

Source: ProFound, adapted from SlideShare

Marketing stories are also gaining traction in this sector. European buyers are increasingly using these narratives to appeal to manufacturers and consumers. It is important to highlight your unique selling points (USPs) and value propositions not only in your sales pitch but also in your marketing materials, both on and offline.

Zuplex Botanicals is an example of a company that exports to Europe that successfully highlights its unique selling points (USPs) on its website and in its marketing materials. Zuplex is a South African manufacturer of proven active extracts. It is both a commercial and social enterprise, aiming to generate revenue and re-invest in social development. Zuplex complies with regulations under the Nagoya Protocol and signs Benefit and Material Sharing Agreements with both suppliers and customers. Zuplex has partnered with a women’s organisation in a rural village community. This organisation is the preferred supplier of raw materials to Zuplex and it also owns 32% of the processing company. In addition to its social component, Zuplex has set targets for reducing energy and water consumption, as well as waste. Zuplex cosmetic extracts are also COSMOS approved. Many companies in the cosmetics industry find this ethical and integral approach attractive. It is expected to become even more important in the future.

5. Prepare quotations based on actual costs

Before you approach potential buyers or start selling in the European market, you need to figure out your prices and pricing strategy. Having your pricing information ready when you are communicating with buyers will increase your credibility. Failing to do so might make you appear unprofessional and could lead to you under or over-pricing your natural ingredients. Under-pricing can result in financial losses, while over-pricing can hinder your export efforts as competitors can offer more attractive prices. Once all your efforts result in a conversation about prices, this is a great opportunity to seal the deal. So be prepared.

The right price is based on knowing the right costs

To set your prices correctly, it is important that you find out the actual production costs and define the desired profit margin of your product. Make sure to use up-to-date and accurate cost information. Key questions to answer when setting your prices include:

• What does it cost to source, process and deliver your goods to a certain point in the supply chain?
• What is the break-even point for your business? This is the minimum number of products you need to sell to at least cover your costs.
• What is the profit margin you want to achieve (so, how much above the break-even point)?

You may also need to get familiar with the different International Commercial Terms (Incoterms) for your products. These define the rights and obligations between buyer and seller and set out how costs and risks are allocated between the different parties to a transaction. Buyers often want to know the FOB (Free on Board) price for your goods, so include the cost of transportation to the ship in this price. You should also prepare quotes for other incoterms such as CIF (Cost, Insurance and Freight), and DDP (Delivered Duty Paid) is also recommended.

You should be careful when comparing your offers with those of competitors. Remember that there are several factors that influence the price of a natural ingredient, which can vary significantly among suppliers. Do not fall into the trap of comparing apples with oranges. For example, you may want to consider:

• Whether the ingredients are unprocessed or processed;
• Whether the ingredients have been treated to get rid of insect pests and microbiological contamination or not;
• If the ingredients have been tested at an accredited laboratory and have certificates that show they meet specific quality specifications;
• Whether the ingredients are conventional or follow certain sustainability standards, like organic or fair trade;
• How much is being bought and how the ingredients are going to be delivered;
• The chosen payment terms and the relationship and trade history between buyer and seller; and
• The chosen currency and exchange rate movements.

Apart from some retail prices for individual cosmetic ingredients, very few examples of prices for individual cosmetic ingredients are published on the internet or in directories. If you find price information that relates to your price points, it can be a useful reference, but you should not rely on it as it is not absolute.

Creating a compelling quote

European buyers of natural ingredients for cosmetics typically ask potential suppliers for quotes before doing business. This is because the quotes contain information that will help them decide whether to do business with suppliers. The quotes you provide should be as short and concise as possible, and free of spelling and grammatical errors. The following information should be included in your quotes:

Product description

Provide basic information about the form, basic grade (conventional and/or organic), quality and certifications of your natural ingredient. You do not need to include a full product specification as this can be sent as an attachment.

Storage and shelf life

Indicate the typical shelf life of your ingredient when stored and handled correctly. Typical shelf life starts from the date of manufacture and is often based on industry experience.

Price and payment terms

Provide your quote in Euros (EUR) or US Dollars (USD), bearing in mind that European buyers often prefer the former. You must specify the Incoterms used along with the unit used (generally on a per kg or per tonne basis). This applies to both natural cosmetic ingredients in liquid form, such as essential oils, and in solid form, such as shea butter. Do not forget to outline the payment term. This serves as an indication but can be negotiated later.

Estimated delivery/lead time

Indicate the estimated delivery time from the developing country you are exporting from to the European buyer.

Capacity to export

Provide information on the quantities of natural ingredients you can supply and the time frame.

Packaging

Provide detailed information on the packaging type (for example, steel drum or kraft paper bag) and size (for example, 25 kg per batch) of your natural ingredient.

Quote expiry date

Set a quote expiry date to avoid or allow for potential price changes. This is not always necessary, and you can state that your price is not your final offer.

Table 2: Example of a quote in the natural cosmetic ingredients sector

Source: ProFound, 2024

6. Always send consistent quality samples to interested buyers

Samples are a key part of doing business in Europe. Often, European buyers will not continue discussions with you until they have received and tested the samples you send them. They need to make sure that the samples conform to the documentation you have provided previously.

If a buyer requests a sample from you, be sure to follow their instructions regarding product characteristics, type of sample (for example, organic/conventional or refined/unrefined), quantity, presentation, packaging, expected delivery time and expiration date. If your sample passes the quality control inspection and you are presented with an order, remember that you will be asked for a pre-shipment sample. If you receive another order, the sampling process will start over. Ensuring you have consistent quality (within the range of your specification) is critical. If your sample is rejected, be sure to request feedback so you can make the necessary improvements.

European buyers will use European laboratories to test the quality. As such, you may need to send samples to these laboratories. Make sure you specify the batch you are using and aim to minimise batch-to-batch variation as much as possible.

Note that shipping samples of hazardous materials can be complex and potentially costly due to the specific regulations and safety measures required for transportation. Essential oils are often classified as dangerous goods because of their flammable nature. As such, to ship samples of essential oils, you should select a carrier who is experienced in hazardous materials and can provide guidance.

7. Keep up with Europe’s general business culture

As a new supplier entering the European market, you should educate yourself on the local business culture. This will help you deal with potential buyers and make a good impression. Buyers will be observing you and your behaviour, which will ultimately result in an ongoing assessment of the risk of doing business with you. Documentation and established procedures are highly valued, particularly in Western European countries.

The business culture in the European cosmetic ingredients sector is similar to that of the chemical industry. Safety and efficacy are the main issues. You should familiarise yourself with the technical language of specifications, sector-specific terms and regulations that concern chemical substances and mixtures.

A common theme across Europe is the emphasis on professionalism and formality when dealing and interacting with buyers. Behaving professionally is essential to creating and maintaining a positive and reliable business image in Europe. The professionalism you display in your meetings will determine buyers’ willingness to work with you.

Here are some key aspects to consider in order to project a professional image in your business relations:

• Professional appearance: Dress appropriately for business interaction, both online and in person. Present yourself in a way that aligns with the expectations of your industry and the cultural norms of your target market.
• Timeliness: Punctuality is essential in European business culture. You should respect the buyer’s time by arriving on time for meetings and communicating any unavoidable delays promptly. 
• Preparedness: Come prepared to your meetings with buyers. Research their business, needs and preferences beforehand. Gather relevant information such as product details, pricing and documentation. 
• Formal and clear communication: Communicate clearly and effectively. Maintain a polite and respectful tone and avoid using technical terms that may confuse the buyer unless you are using industry-specific terminology that you are both familiar with. Be responsive to inquiries and provide accurate and concise information. English is the most widely used language for business in the European cosmetics industry. Always use formal English when speaking and writing to European buyers. Do not use slang as this can make you appear unprofessional.
• Active listening: Practise active listening when engaging with buyers. Pay close attention to their needs, concerns and feedback. Ask clarifying questions and show genuine interest in their perspectives.
• Honesty: It is essential to be honest and transparent in your interactions with buyers. You should always have timely, transparent and honest communications. Provide accurate information about your products, pricing, delivery times and any limitations or risks involved. Avoid making exaggerated or false claims and take responsibility for any mistakes. Transparency builds trust, which is the most important aspect of successful and long-term business relationships.
• Follow up and follow through: Follow up on your promises promptly and keep your buyer informed of developments. Make it a priority to answer their requests in a timely way. This demonstrates your commitment to working together and reflects positively on your company.
• Fulfilling agreements: Fulfil the contractual agreements made with buyers, for example concerning quality, quantity and delivery. Do not overpromise and underdeliver. Always communicate any changes to your buyers quickly and clearly. You should also try to work constructively with buyers to find solutions to any unexpected problems.

Keep in mind that Europe is a diverse market with different business cultures. Practices may differ between individual European countries. For example, punctuality is taken very seriously in countries like the UK and Germany, while businesses in countries such as Italy and Spain may have a more relaxed approach. 

8. Attend trade fairs to meet buyers

Cosmetics are a personal business, and face-to-face interaction is highly appreciated. Exporters of natural ingredients who target the European cosmetics market should consider attending trade fairs as a strategic investment. Trade fairs offer a chance to display your natural ingredients and build relationships, gather market intelligence and stay ahead in a dynamic industry. Be aware of the competitive environment when deciding to either visit or exhibit at a trade fair. When you visit a trade fair, your primary contacts will be the exhibitors who may be your potential buyers. When you exhibit at a trade fair, you will meet both visitors and exhibitors. Make sure that you have offers ready tailored to every type of company.

Participating in trade fairs offers several advantages when targeting European buyers. They provide a unique platform for exporters to engage in direct, face-to-face conversations with potential European buyers. Personal interactions help establish trust and build strong business relationships. Immediate feedback from potential buyers provides valuable insights into product appeal and market readiness. Exporters can use this information to refine their offerings, ensuring they align with European market expectations.

Trade fairs not only host exhibitions but also networking events, seminars and workshops. These gatherings help connect exporters with industry experts, potential buyers and key decision-makers. They offer insights into market trends, regulations and consumer preferences in the European cosmetics sector. Trade fairs also provide a consolidated platform for exporters to conduct competitor analyses. Understanding the offerings of other suppliers of natural ingredients can help position products effectively and identify unique selling propositions that resonate with European buyers.

Some of the most prominent trade fairs for cosmetic ingredients and finished products include:

• In-Cosmetics Global (Paris, France), which is the leading global event for personal care ingredients, bringing together suppliers, manufacturers, formulators and other beauty professionals to showcase innovative ingredients, formulations and technologies;
• SCS Formulate (Coventry, United Kingdom), which focuses on the formulation of personal care and cosmetic products, offering a comprehensive look at raw materials, ingredients and cutting-edge science;
• Cosmetics Business (Munich, Germany), which brings together suppliers involved in the cosmetics industry, providing an overview of the latest trends and developments in ingredients, manufacturing and packaging;
• Sana (Bologna, Italy), which is an exhibition of organic and natural cosmetics, highlighting eco-friendly, sustainable beauty products and wellness solutions;
• Vivaness (Nuremberg, Germany), which is the leading trade fair for natural and organic cosmetics and personal care;
• Beauty International (Dusseldorf, Germany), which focuses on products and services in the segments of cosmetics, nails, feet, wellness and spa;
• Cosmoprof Worldwide (Bologna, Italy), which covers all sectors of the beauty industry, including perfumery and cosmetics, natural health, packaging, machinery and raw materials; and,
• Fraganze (Florence, Italy), which is dedicated to perfumery, showcasing the latest trends and innovations in fragrances.

9. Participate in export promotion programmes offered by governmental and non-governmental organisations

The European market is strictly regulated and highly competitive. Joining an export promotion programme or working with industry groups that facilitate trade with European buyers can help increase your chances of success in the European market. These programmes and groups offer support, coaching, trade fair participation, matchmaking and market insights tailored to specific European industries, including the cosmetics industry. They often employ industry experts to advise exporters on how to meet the market requirements and buyers’ expectations.

By participating in these programmes, suppliers from emerging market economies can receive guidance on regulatory compliance and learn about relevant industry trends. They also get the chance to network and connect with potential European buyers.

Figure 2: Business-support organisations in Europe offering trade promotion programmes

Source: Various, 2024

Numerous export agencies provide specialised knowledge and support to exporters seeking entry into new markets. Some of the most important agencies include:

• CBI: The Centre for the Promotion of Imports from developing countries (CBI) is a government-funded organisation that supports entrepreneurs from developing countries in becoming successful exporters to the European market. CBI offers an extensive range of services, including export coaching programmes, training, distance learning and guidance, company visits, market information and multiple trade fairs. CBI focuses on sustainability and niche products. It works with senior sector experts who work closely with the exporters during the export coaching programme. CBI also works with Business Support Organisations (BSOs) that help exporters develop their export businesses. CBI is active in specific so-called CBI countries across Asia, East Africa, the Middle East and North Africa, West Africa and the Sahel.
• SIPPO: The Swiss Import Promotion Programme (SIPPO) provides support to selected Business Support Organisations (BSOs), helping exporters increase their exports to new markets. BSO employees receive expert training and coaching in their home countries, which they then use to help exporters. It is important to check whether the BSO in your country is being supported by SIPPO. Note that SIPPO has offices in Albania, Bosnia and Herzegovina, Colombia, Indonesia, Morocco, North Macedonia, Peru, Serbia, South Africa, Tunisia and Vietnam.
• IPD: The Import Promotion Desk (IPD) connects exporters from selected developing countries with European, particularly German, importers through a platform. The IPD also prepares market reports that help exporters in entering the European market.
• COLEAD: The Committee Linking Entrepreneurship-Agriculture-Development (COLEAD) is a Belgian-based organisation that offers tailored support, training programmes and market access, primarily to West African companies. COLEAD supports the transition to more ‘sustainable agri-food systems’ by facilitating and promoting good practices aligned with agroecological systems tailored to local contexts.
• ITC: The International Trade Centre (ITC) is a United Nations developmental agency that promotes sustainable trade. Their programmes and activities are aimed at exporters. ITC offers export management, supply chain management, quality management, packaging, and marketing and branding programmes. ITC has publications and a SME Trade Academy which offers online courses (some cost-free). If you want to become a successful exporter of natural food additives, courses like ‘Export Sales and Negotiation’ and ‘Helping SME’s Generate Export Business’ may be useful for you. 
• ICC: The International Chamber of Commerce promotes cross-border trade and investments, while offering various tools and services to SMEs, such as the SME360X online platform.

ProFound – Advisers in Development and Fair Venture Consulting carried out this study on behalf of CBI.

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