COHE (Coalition of Handcrafted Entrepreneurs) was formed to support small businesses in the soap and cosmetic industry. According to a recent industry survey, the Handcrafted Cosmetics Industry is comprised of at least 220,000 small batch producers in the United States. More than 95 percent of those businesses are woman-owned.

The vast majority of handcrafted, small batch products are sold at farmers markets, home parties, community fundraisers, and craft shows. By virtue of their size and manufacturing capabilities, batches tend to be of a size that can be manually handled (under 50 pounds, or roughly 200 bars of soap or 100 bottles of lotion). Many producers successfully market their products online as a means of staying in contact with an established customer base. A small percentage of producers sell their products in their own retail stores or wholesale to other retail venues.

Most ingredients used in the production of craft soap and cosmetics are “off-the-shelf” products that can be obtained at a local grocery store, such as olive oil, sugar, and beeswax. Small batch producers use these ingredients to create small yield, highly diversified product offerings.

Cosmetics, including handcrafted cosmetics and soaps, are regulated by the U.S. Food and Drug Administration (FDA) under the Federal Food, Drug and Cosmetics Act and the Fair Packaging and Labeling Act. Depending on the chemical makeup and the claims made surrounding a product, they may also be regulated by the FDA as “soap” or a “drug.” Other soaps containing certain specific characteristics are subject to Consumer Product Safety Commission jurisdiction but not regulated by the FDA.

FDA has had success in recent years employing their authorities under existing law to protect consumers from unsafe and/or mislabeled products.

Over the last several years, multiple legislative proposals have been introduced and discussed in Congress that would create new regulations on the cosmetics industry.

These proposals addressed issues such as new registration requirements for manufacturing facilities, products, and ingredients; the collection of fees; ingredient safety substantiation and review; reporting requirements related to adverse events; record retention requirements; and mandatory recall authority.

In addition to Congressional interest, in 2012 the FDA testified that it requested legislative authority from Congress to require cosmetics labelers to register their establishments, list their products with FDA, and pay an annual fee.

You can follow the latest legislative and regulatory developments on our NEWS page.

The craft cosmetics and soap industry supports legislative provisions that require identifying ingredients of concern and reporting adverse events, giving recall authority to the FDA, and the closing of existing labeling loopholes to ensure transparency for the consumer.

However, any new regulatory regime for the cosmetics industry should recognize the unique role and needs of the handcrafted industry. Specifically, it should include a “small producer rule” that provides exemptions to many of the additional fees and regulations contained in the proposed legislation.

The “small producer rule” exception concept has been employed in other regulatory jurisdictions to protect cottage industries similar to handcrafted cosmetics from certain provisions that make sense when applied to larger actors in the marketplace.