Purity pays in beauty business

Purely preferred: People jump at products shown to be genuinely organic

ONEgroup may be a cosmetics manufacturer but its commitment to green business is more than skin deep.

The Brisbane company, which reports an annual turnover of about $12 million, manufactures more than 200 organic products, ranging from aftershave balm and baby bottom mist to bronzing dust and massage oil.

Seven years ago, the business was just a part-time hobby for its three directors. It has grown rapidly and now exports its green products to Japan, North America and the United Kingdom.

Director Alf Orpen says ONEgroup has focused on educating the public about the virtues of organic products while tapping into the desire for more ethical ways to consume.

“It was essential to educate people about organic products. People in the public do want a purer product, so when it’s authentic and you can show it’s authentic they will jump at it,” Orpen says.

“We’d take the message to public groups of 20, 30 or 100 people and it was word of mouth from there on out.”

A worldwide pick-up in the trade of organic products has also buoyed business, he says.

Globally, organic cosmetics are worth about $US7 billion ($7.64 billion) a year, research from the United States shows, with North America and Europe the two main sources  of growth.

The Australian organic market, which encompasses everything from wine and cheese to shirts and ties, is worth an estimated $600 million a year.

But it is the Japanese who consume the most organic products per person. The organic market there is now estimated at $US3.2 billion, up from $US1.5 billion in 1998.

Orpen says Japanese consumers want everything from organic hair conditioner to antioxidants, which makes Japan the ideal export destination. He says volumes into Japan have increased 5 per cent month-on-month since late last year. “We were able to keep that growth rate going for years here and hope to do the same over in Japan,” he says.

Still, the company faces challenges.

Orpen says many consumers are confused by the difference between products certified as organic and those that call themselves “natural” – not subject to the same rigorous requirements.

Last year the Department of Agriculture, Fisheries and Forestry imposed strict industry guidelines for the production, transport, preparation and labelling of products described as organic – including food, cosmetics and textiles.

The move came in response to the growing number of bogus organic claims on labels, and was partially funded through a $270,000 fine imposed on a Victorian egg producer convicted of passing off caged hen products as organic.

Even so, Orpen says the definition remains vague and many consumers are hoodwinked into buying products that are described as natural that are far from it.

“The thing with organic products is that a third party audits how the ingredients are grown and processed, so that a minimum 95 per cent must grown without any pesticides,” he says.

The company also has to absorb much higher input costs than regular cosmetic manufacturers.

“Our ingredients cost so much, for example, normal rose aroma to use in perfume costs around $100 a litre, but we buy pure rose oil for $7000 to $10,000 a litre,” Orpen says.

Research and development is another big cost. Orpen says on average it takes more than three years’ work before most products are launched, with the firm’s total research bill running into the hundreds of thousands of dollars.

“We ran into a lot of problems in R&D, he says. “We’d walk into the lab, see things explode and say, ‘Well that’s not going to work’.”

While it was an arduous process, the cosmetic maker discovered many old methods still have a place in the modern world. For example, it uses essential oils and herbs to preserve products, instead of synthetic chemicals.

Orpen says ONEgroup’s customers can be certain that the company cosmetics contain none of the harmful synthetic ingredients often found in off-the-shelf products.

But the irony, he says, is that the bigger the company gets the more it contributes to the environmental problem it set out to help solve.

In response, ONEgroup buys eco-friendly electricity and offsets its environmental footprint by planting trees and taking other initiatives.

“We had a paper blitz and we discovered just by moving printers away from people’s desk reduced paper consumption by 25 per cent – that’s a lot of paper, when three reams of paper equals a full tree,” Orpen says.

BRW

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