Why Third-Party Manufacturing is the Future of Personal Care in India

The Indian personal care and cosmetics market is witnessing exponential growth, driven by a rising middle class, increasing awareness of self-care, and global beauty trends.

According to Statista, the Indian beauty and personal care market is projected to reach USD 30 billion by 2027, with skincare and haircare leading the surge.

But behind the success of many beauty brands is a powerful yet often underappreciated force: third-party manufacturing (also known as contract manufacturing or private labeling).

In this blog, we’ll explore why third-party manufacturing is shaping the future of India’s personal care industry, its advantages, challenges, and how brands can leverage it to scale quickly and sustainably.

What is Third-Party Manufacturing in Cosmetics?

Third-party manufacturing refers to outsourcing product formulation and production to specialized manufacturers. Instead of setting up expensive factories, brands partner with certified manufacturers who produce products under the brand’s name.

This model is especially popular in personal care, skincare, haircare, and cosmetics because it reduces costs, ensures quality, and speeds up market entry.

You can then customize:

• Product formulations (natural, herbal, or active-based)

• Packaging design and branding

• Labeling and regulatory compliance

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This allows startups and growing businesses to focus on marketing, distribution, and brand building while the manufacturer handles the technical side.

Why India is Embracing Third-Party Manufacturing?

India has quickly become one of the most sought-after destinations for private label and contract manufacturing in cosmetics. Here’s why:

1. Rich Tradition of Ayurveda & Herbal Beauty: Consumers are actively seeking Ayurvedic cosmetics, herbal skincare, and natural ingredients. India, being home to Ayurveda, has a competitive edge in supplying these formulations.

2. Cost-Effective Production: Compared to Europe or the U.S., setting up cosmetics in India is more affordable due to lower labor and infrastructure costs while maintaining global quality standards.

3. Booming Domestic Demand: The Indian beauty market is projected to grow at a CAGR of 5.6% from 2023–2028 (IMARC Group, 2023). Products like herbal soaps, serums, and hair care oils are especially in demand.

4. Export Opportunities: India is a major exporter of natural and herbal cosmetics to countries in the Middle East, Africa, and Europe. According to the India Brand Equity Foundation (IBEF), cosmetics exports have seen a consistent rise, particularly in herbal-based products.

5. Ease of Customization: Manufacturers allow brands to tailor products to specific niches—whether it’s acne-care skincare, sulfate-free shampoos, or anti-aging serums.

Benefits of Choosing Private Label Manufacturing

For startups and emerging brands, private labeling offers clear advantages:

• Low Investment Risk – No need to build factories or R&D labs. Manufacturers with in-house R&D labs bring scientific expertise in natural botanicals (aloe vera, neem, turmeric) as well as trending actives like niacinamide, hyaluronic acid, and salicylic acid.

• Faster Time to Market – Products can be launched in 3–6 months instead of years.

• Professional Expertise – Manufacturers bring in years of knowledge in formulation, testing, and compliance.

• Wide Product Range – From soaps and body washes to serums, sunscreens, and lip care, you can create a full product portfolio.

• Scalability – Start small with small-batch manufacturing and scale as demand grows.

How to Choose the Right Third-Party Manufacturer in India

When selecting a manufacturing partner, ensure they:

• Hold ISO 9001:2015 and FDA certifications.

• Offer custom formulation and R&D capabilities.

• Provide transparent pricing and small-batch flexibility.

• Have track record of serving 100+ clients across skincare, haircare, and body care.

• Align with values like sustainability, innovation, and quality assurance.

Success Through Third-Party Manufacturing

A rising D2C skincare brand in India launched with just three SKUs in 2020 through a third-party manufacturer. Today, they have over 40+ products, retail partnerships, and exports to 5 countries. Their growth was possible because they focused on branding, while manufacturing was handled by experts. (Business Standard, 2023)

Ready to start your journey to building a super successful brand?

At Ketaki Industries, we’ve proudly partnered with 100+ brands since 2012, helping them turn ideas into high-quality personal care products. With our in-house R&D, ISO 9001:2015 certification, FDA approval, and semi-automated production lines, we deliver products that embody purity, affordability, innovation, and sustainability.

If you’re ready to launch or scale your personal care brand, third-party manufacturing may just be your most strategic business move.

Frequently Asked Questions (FAQs)

1. What does Ketaki Industries manufacture?

Ketaki Industries specializes in third-party manufacturing of cosmetics including soaps, skincare, haircare, body care, sun care, and lip care products. We combine traditional Ayurvedic wisdom with modern cosmetic actives to deliver innovative and high-quality personal care products.

2. Do you provide private label and contract manufacturing services?

Yes. We offer private label, contract manufacturing, and third-party manufacturing services for cosmetic and personal care brands in India and globally. Whether you are a startup beauty brand or an established FMCG company, we can customize formulations, packaging, and branding as per your requirements.

3. Are your cosmetic products FDA and ISO certified?

Yes. Our facility is ISO 9001:2015 certified and FDA-approved. All our products follow strict quality control standards to ensure safety, purity, and effectiveness.

4. Can you develop custom cosmetic formulations for brands?

Absolutely! Our in-house R&D lab and cosmetic technologists can create custom skincare, haircare, and personal care formulations—ranging from natural herbal blends to trending chemical actives like Niacinamide, Hyaluronic Acid, and Salicylic Acid.

5. What are the minimum order quantities (MOQ) for third-party cosmetic manufacturing?

Our MOQ depends on the product category. For soaps and personal care products, we offer flexible batch sizes starting from small-scale production (ideal for startups) to large-scale manufacturing (for established brands).

6. Can international brands collaborate with Ketaki Industries?

Yes. We cater to domestic and international cosmetic brands. Our manufacturing standards meet global quality certifications, making our products suitable for export markets.

7. Do you provide marketing and branding support?

While we specialize in manufacturing and formulation development, we also guide clients on market trends, product positioning, and packaging to ensure their products stand out in a competitive market.