Procter & Gamble Acquires Cover Girl Cosmetics
Acquisition of Noxell Brands expands Global Cosmetics Business, but presents major challenge to long-standing Manufacturing Process
Procter & Gamble's acquisition of Noxell Corporation's mass-market cosmetics brands represented a major expansion of its global cosmetics business. Not only was it intended to add to the bottom line, but entry into the US mass-market cosmetics business represented a major challenge to P&G's manufacturing process with its first entry into 'less-than-case' ordering and distribution.
DRO joined P&G in this journey near the beginning. We provided the first plant project manager with a 'P&G pedigree' after the acquisition. Charged with 'Procter-izing' Noxell processes, our project manager began a journey of listening and learning that would lead to a 'best of both worlds' future state.
Noxell had been planning a major expansion of its lipstick manufacturing business prior to the announcement of the acquisition by P&G. Upon looking into Noxell's processes for manufacturing, P&G quickly reacted by placing an experienced project manager in the plant at Hunt Valley, MD.
For the role, P&G tapped DRO for one of our most experienced project managers. Given the challenge to convert Noxell from its traditional 'small-batch' manufacturing processes to the current state-of-the-art processes called 'continuous-batch,' our project manager first set out to understand the reasons for Noxell's processes, including strengths and weaknesses.
Our project manager often said, "I learned more about cosmetics manufacturing than I ever expected." We learned that the nature of the ingredients, mostly organic substances that change with the seasons and geographic location of the originating product, implores frequent formula adjustments and to-frequent loss of batches due to off-shade test results.
We learned some great lessons from this work, not the least of which was the criticality of listening to the people who are passionate about their product, especially making a quality product.
The first new construction project after the acquisition combined a state-of-the-art 'A-frame' picking system with P&G's wildly successful RTCIS case-management system, thereby optimizing distribution for the 'less-than-case' world of cosmetics.
While the 'continuous manufacturing' vision did not work out, for a variety of reasons, solving the objective of optimizing manufacturing, warehousing, and distribution of a highly complex product mix did lead to breakthrough packing and just-in-time distribution technologies.
Working with experienced Noxell engineers, P&G engineers, and world-class material handling engineers from the likes of St. Onge Company, DRO played a key role in the transition of two legendary branding and manufacturing companies into the new P&G+Noxell venture.
We like to think that the visionary contributions we made in both the lipstick manufacturing and the cosmetics distribution processes helped make our customer the world leader it is in the cosmetics business, US and worldwide.
Product Mix Complexity
We heard it said that the acquisition of Noxell's brands doubled the number of SKU's in P&G's manufacturing systems.
About the same time, P&G ventured into SAP's MRP technology - not a minute too soon.