• Drugstore products and cosmetics

    Fast-moving items common in the industry are best stored in live storage racking


Facts & Figures

Internationally, the cosmetics industry is dominated by large groups such as L'Oréal, Colgate-Palmolive, Henkel, Kimberly-Clark and Procter & Gamble. For example, the French group L'Oréal generated sales of around EUR 30 billion in 2019. France is the most important market for the cosmetics industry because of L'Oréal. In Germany, Hamburg-based Beiersdorf AG, a member of the Maxingvest Group, is the leading player. Nivea and L'Oréal are among the world's most valuable cosmetics and body care brands. The turnover of German cosmetics and toiletry manufacturers amounted to EUR 6.12 billion in 2018, according to an industry report published by Commerzbank. The industry employed 23,623 people in the same year.

Reasons for choosing where to buy cosmetic products

According to the German Cosmetics Association (VKE), the online sector now accounts for 14 to 15 percent of the market share in the beauty and cosmetics industry. High-priced cosmetics in particular are increasingly being purchased online. On behalf of VKE, the advertising agency Wavemaker determined the reasons for choosing where to buy beauty and cosmetic products. Accordingly, perfumeries score points with their sophisticated atmosphere and large selection. Drugstores are convincing when it comes to shopping for everyday needs, while online stores offer the option of convenient, flexible shopping. Products that have previously been tried out offline are usually also purchased there. Facial care and decorative cosmetics are often purchased in drugstores and fragrances in perfumeries. The reason for this is usually the possibility to test and browse products. Direct availability and the fact that shipping costs are not incurred also play a role. The shopping channel is usually changed if items are not available in sufficient quantities or in a limited variety, if the price is not competitive, if poor service is provided, or if deliveries reach the customer with a delay.

Drugstores have become a distribution channel

Experts in the beauty and cosmetics industry consider drugstores to be serious sales channels alongside influencers on YouTube or Instagram. According to a survey of industry experts by Statista in 2017, 38 percent of those taking part in the survey believed that the importance of drugstores as a sales channel for the German cosmetics industry was likely to increase over the next five years. 45 percent assumed that their relevance would remain the same and only 15 percent thought that drugstores would lose importance.

Online business and influencers

Large exclusive cosmetics brands often shy away from investing in online business. However, this channel in particular is extremely important for attracting young millenials. This is where drugstores and online retailers have a much easier time. One of the leading companies in this area is the drugstore chain dm. In Germany, dm has been the largest drugstore chain by sales since 2010. The company is increasingly winning over its customers through collaboration with influencers. One factor that contributes to company success is the cooperation with the well-known cosmetics and beauty influencer Bianca (Bibi) Heinicke. Her first own cosmetic product, Bilou bath foam, was sold exclusively at dm. Bibi's followers then stormed all dm stores and after a very short time the product was out of stock.


    • Men: Growing interest in cosmetics among men
    • E-commerce business on the increase: Online commerce is being driven by internet retailers such as Flakoni as well as drugstores.
    • Increasing demand for more expensive natural cosmetics and organic products
    • Specialty segments are gaining momentum: e.g. Korean cosmetics
    • Demographic change drives growth: The cosmetics and beauty industry are benefiting from the fact that society is steadily ageing. As a result, cosmetics and anti-ageing products are more in demand. However, awareness of one's own appearance and of health and body care is very strong across all generations. In Germany, many consumers spend more than 50 Euros per month on care and cosmetic products.
    • Continuous product innovation is crucial for growth: Risk of misjudging trends, shorter product life cycles with increasing innovation and monitoring costs.
    • Influencer marketing: Strong interest of young people in cosmetics and beauty products. As a result, influencer marketing on Youtube, Instagram, Facebook, Snapchat, etc. is very successful in reaching these age groups.
    • Growth in emerging markets: In the emerging markets, the demand for cleanliness, hygiene and cosmetics keeps growing.

Logistics requirements

Since the cosmetics and beauty industry often deals with fast-moving items, mostly carton or pallet live storage racking are used in the intralogistics of companies.

At dm, Germany's biggest-selling drugstore, a total of around 12,500 different items arriving at the logistics centre in Weilerswist near Cologne and the distribution centre in Waghäusl in Baden are collated for the various dm stores and distributed to all stores. The dm distribution centre at Weilerswist operates with BITO FLEX carton live storage racking with automated product in-feeding into the flow lanes to enable even faster order picking. At the same time, the enormous variety of goods is efficiently stored in as little space as possible, saving up to 30 percent of storage space. An integrated conveyor system moves bins with picked items to the pick stations. 36 racking aisles are serviced by fully automated stacker cranes that automatically feed the flow lanes and the pick stations. The system achieves significantly greater picking rates along with short order throughput times.

One of Germany's largest drugstore chains, Rossmann GmbH, uses a pallet live storage system combined with a shuttle-serviced compact pallet racking to integrate pallet picking and buffering in a single racking system. The pallets are picked in LIFO order (Last-In, First-Out) from ten-meter-deep lanes on the floor level of the pallet live storage racking. The two levels on top accommodate 176 pallet buffer lanes for pallets weighing between 80 to 1500 kg which are fed in and retrieved by five PROmotion shuttle vehicles. The great advantage of the system is both optimal space utilization and high pick rates.