Why cosmetic projects fail: The structural causes, and how to avoid them
Why cosmetic projects fail: The structural causes, and how to avoid them
12 min read
CEO & Founder at Labtree GmbH
When cosmetic projects fail, it is rarely due to individual mistakes. It is due to structural patterns: development without a real basis, late samples, sequential processes, a lack of development depth, and gaps between development and production.
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The topic is short and compact
Cosmetics projects fail predominantly due to structural patterns, not isolated mistakes.
A real formulation basis at the start eliminates open-ended development.
Early physical models prevent critical decisions from being made based on concepts alone.
"Failure" in cosmetics development is rarely a clear end. More common are these forms:
Postponed Launch: The date is pushed back by months, often with knock-on effects for commercial planning
Reduced Scope: Ten planned products become five because others could not be developed in time
Stop and Restart: The project is canceled and set up anew with a different partner
Launch without Substance: The product reaches the market but does not meet performance or stability expectations
Due to the variety of definitions, public figures vary widely. In practice, it is common that at least every second cosmetic project is affected by one of these forms, often without this being communicated publicly.
Failure in reality: what it means
"Failure" in cosmetics development is rarely a clear end. More common are these forms:
Postponed Launch: The date is pushed back by months, often with knock-on effects for commercial planning
Reduced Scope: Ten planned products become five because others could not be developed in time
Stop and Restart: The project is canceled and set up anew with a different partner
Launch without Substance: The product reaches the market but does not meet performance or stability expectations
Due to the variety of definitions, public figures vary widely. In practice, it is common that at least every second cosmetic project is affected by one of these forms, often without this being communicated publicly.
Cause 1: Open-ended development, without a real formulation basis
The most common structural weak point is the start. When a cosmetics project begins with an abstract concept, "a rich day cream with anti-aging effects", without reference to realistically implementable formulations, development in the first few weeks is a pure search.
This produces two problems:
The requirements are specified multiple times because it is unclear what is feasible
Active ingredient concepts are chosen without stability, performance, and skin compatibility being known
The answer is structural: a clear starting point. At Labtree, more than 1,000 of our own formulations serve as a basis. Brands see early on which product base fits and which adjustments are realistic. This means development does not begin with uncertainty, but with a tangible product base.
Cause 2: Late physical patterns, decisions based on concepts instead of reality
If the first physical samples are not available until weeks or months after the start of the project, many decisions are made in the meantime on the basis of concept papers. As soon as the samples arrive, issues that were considered resolved often have to be reopened: texture does not fit, application feels different than expected, performance does not meet anticipation.
The result: sampling loops that were not factored into the calculation.
The structural answer is speed in sampling. Standard samples of pre-qualified formulations are shipped from the sample warehouse at Labtree within 24 hours; shipping is free of charge for customers. This shifts decisions from the concept phase to the reality phase.
Cause 3: Sequential processes, packaging, approval, and production one after the other
In classic OEM structures, the process runs sequentially: first formulation, then packaging, then registration, then production. This order seems logical, but creates bottlenecks at each transition:
Packaging is selected after the formulation is finalized; incompatibilities become visible late
Safety assessment starts when the formulation and packaging are set; anomalies force adjustments
Producibility is checked at the end; if something is not producible, the formulation is adjusted again
Each of these points is potentially project-threatening if discovered late.
The structural answer is early parallel consideration. Packaging, design, regulatory requirements and producibility are considered early in parallel with formulation development, instead of being addressed only after final formulation approval. The final regulatory approval and start of production still take place after the formulation is completed, but the preparatory steps are then already far advanced. Thus, the logic shifts from a relay race to an orchestrated parallel process.
Cause 4: Partner's lack of in-house development depth
If the development partner only selects formulations instead of developing and testing them themselves, critical adjustment steps remain outside of their control. This becomes visible when:
Formulation adjustments take a long time because they have to be passed on to external laboratories
Stability problems are only detected late because test batches are not possible in-house
Production requirements do not flow into development early on because the parties involved are organizationally separated
The structural answer is having one's own development expertise. At Labtree, we have our own laboratory and our own development expertise. Formulations are not just selected, but specifically developed, tested, and adjusted. In addition, smaller test batches can be produced in-house in order to validate products early under real conditions and transfer them safely into production.
In-depth sources: The legal basis for all cosmetic products marketed in the EU is the EU Cosmetics Regulation (EC) No. 1223/2009. In Germany, the health assessment of ingredients is the responsibility of the Federal Institute for Risk Assessment (BfR). Industry information and market data are published by the German Cosmetic, Toiletry, Perfumery and Detergent Association (IKW).
Cause 5: Late production transition, the final step fails due to breakage
The most dangerous moment in a cosmetics project is often the transition from development to production. If producibility is only checked at the end, late adjustments are very costly:
A formulation, which is stable in the laboratory, can show problems under production conditions
Packaging that works on a small scale can cause complications in the filling system
Scale-up effects on active ingredient stability or texture are not visible in small batches
The structural answer: producibility must be considered early in development. In practice, this means that scaling questions are answered during prototyping, not just in the production step.
A practical example: A cosmetics brand successfully validated a product in the PoC and was about to scale up for dm. Because the formulation, packaging, documentation, and producibility were already thought of early on, the scaling did not have to be set up from scratch, and the transition ran in a coordinated manner.
Related articles: Avoid launch delays · Avoid overengineering · Manufacturer change too late
The five causes can be recognized by concrete signals that are visible early in the project:
Briefing phase takes longer than two weeks without reference to a real basis → Risk: Development into the open
First physical samples are announced for week 6 or later → Risk: Late sampling
Packaging selection is not parallel in the process → Risk: Sequential handovers
Adjustments to formulations are handled via external service providers → Risk: Lack of development depth
Production capability is not part of the prototyping phase → Risk: Late production transition
Anyone who checks these signals early can take structural countermeasures before the project tips into one of the failure modes.
The structural causes of failure can be addressed along a phase model:
Conceptualization: Instead of an open-ended search, inquiries are matched with suitable products and formulation bases. Answer to Cause 1.
sampling: Standard samples within 24 hours, free shipping. Answer to Cause 2.
Individualization: Targeted adaptation instead of new development, with own laboratory and development expertise. Answer to Cause 4.
Prototyping: Product and packaging in parallel, design and approval integrated. Answer to Cause 3.
Production: Transition coordinated, production capability already considered in the previous phases. Answer to Cause 5.
The process is no guarantee. However, it structurally reduces the probability of typical failure patterns.
Some risks remain independent of the process:
Market developments: A product may be technically finished, but lose its commercial justification due to market changes
Regulatory changes: New requirements during development can force adjustments
Strategic pivots on the brand side: If requirements change fundamentally, a reset is part of reality
The realistic goal is therefore not "zero failure", but to use tectonic levers and thereby reduce the risk to what lies outside of the process.
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FAQ
Does Labtree have its own laboratory?
Yes. Labtree has its own development expertise, including a laboratory. This means that formulations can not only be selected, but specifically developed, tested, and adjusted. Additionally, smaller test batches can be produced in-house in order to validate products early on in real conditions and safely transfer them to production.
What percentage of cosmetics projects reach their planned launch date?
Reliable public figures vary because "failure" is defined differently. In practice, it is common for at least every second project to experience some form of delay, scope reduction, or stoppage. The exact number depends heavily on the maturity level of the development partner.
What is the most important lever to avoid failure?
A clear starting point with a realistically implementable formulation basis. Almost everything else follows from this: faster sampling, targeted customization, parallel implementation. Without this anchor, the process remains partly a pure search.
What role do digital tools play in avoiding failure?
Digital tools support transparency, documentation, and coordination in the development process and are a valuable component of a clean setup. However, the underlying development logic and the sequence of process steps—formulation basis at the start, early samples, packaging and approval considered in parallel early on, production feasibility tested early—remain the central factor in structurally reducing the five typical causes of failure.
How early can you tell that a project might fail?
Often in the first four to six weeks. If the briefing phase takes a long time without any reference to a real basis, if initial samples are announced for week 6 or later, or if packaging selection and approval are scheduled sequentially instead of in parallel, the risk is structurally increased.
What distinguishes a development partner with their own laboratory from a mere intermediary?
A partner with their own laboratory can develop, adapt, and validate formulations in test batches without external handovers. This significantly shortens adaptation and validation cycles and increases reliability during the transition to production.
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