Compounding

When I first started making perfume, I realised fairly early on that you cannot run a compounding room on the turnover of one shop – simply because of the number of ingredients required. You are therefore more or less forced to sell your compounds outside to other finished goods manufacturers. Fortunately, almost without exception, none of the finished goods manufactures have perfume departments – it’s just too specialised – so they need to source the perfume concentrates from perfume manufacturers and then simply add the required amount to their base product.

For the perfumer, there is a fundamental decision about which market to aim for – you can aim at the cheap end and make fragrances for shower gels, soap, pot pourri etc., but then you have to buy the ingredients by the tonne in order to compete; or you can go for the fine fragrance market where the ingredients are much more expensive and minimum order quantities smaller. I went for fine fragrances and typically this means supplying fragrances to small perfumeries that have their own packaging and their own shops or websites. For me these have all ended up being European and have resulted in a turnover of raw materials that justifies a compounding side to the business.

A perfumer who owns his/her own company is becoming a rare animal these days. There have been so many takeovers that perfume manufacturers are becoming fewer and fewer. Those that remain are giants – IFF, Givaudan, Firmenich, Takasago, Quest and Symrise – and dominate the world market. In fact these “big six” are soon to become the “big five” as Symrise becomes the next victim of the hungry multinationals.

It’s remarkable in many ways that we have survived, but it just goes to show that there is a market out there even for small perfumeries. It is getting more difficult by the day of course – mainly with the mountains of paperwork and legislation I have to deal with, and I certainly wouldn’t want to start up now. Minimum order quantities increase in a seemingly unstoppable march and with raw materials that (in the main) deteriorate with age, you would need to start trading very quickly indeed.

I suppose our key advantage is the usual one that small companies have – service. Human beings answer the phone, you deal with same person over a period of time, someone actually listens to what you are saying, and we don’t insist on 6-figure orders from the start. The surprising part is that the giants survive! How can you be successful when you don’t do any of the above things? It’s a mystery.