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Innovation and uncertainty are reshaping the personal care ingredients market, driven by pressures ranging from sustainability and natural ingredient demands to regulatory shifts and the opportunities presented by AI. Sunanda Desai, Vice President at Klein and Company, joins host Victoria Meyer to discuss the factors transforming the $30 billion personal care ingredients sector. They explore how consumer trends toward well-being and neurocosmetics are redefining product development, and examine the impacts of tightening tariffs, shifting regulations, and supply chain disruptions on industry strategies.
Victoria and Sunanda address how leading companies are using digitalization and AI to drive hyper-personalization and enhance ingredient efficacy assessments, even as market adoption remains uneven. From managing uncertainty with “no regret” moves to evaluating manufacturing footprints and potential M&A, this episode offers timely insights for leaders navigating a turbulent landscape. Sunanda also shares strategic advice for industry professionals and highlights opportunities for growth despite today’s volatile environment.
Learn more about these topics this week:
- Examining the personal care ingredients market and the key trends driving the $30B industry
- How top companies respond to market volatility, tariffs, and regulations with "no regret" strategic approaches to maintain agility.
- How AI technologies are revolutionizing ingredient assessment and product personalization in personal care.
- Opportunities in Disruption: Quick wins, cross-selling, and M&A possibilities as companies reformulate products and restructure supply chains (Maybe we don't want to mention M&A??)
- Sunanda Desai shares advice on seizing opportunities to pivot (roles and industries) and building a successful career in chemicals and personal care.
Killer Quote: "The most important piece of advice I would give is to recognize the opportunities as they come to you and as they're presented to you and have enough faith in yourself to take advantage of those opportunities...even if you feel like you don't know how to kind of execute against them." - Sunnie Desai
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Creators and Guests
What is The Chemical Show: Where Leaders Talk Business?
Looking to lead, grow, and stay ahead in the trillion-dollar global chemical industry? The Chemical Show - the #1 business podcast for the chemical industry - is your go-to resource for leadership insights, business strategies, and real-world lessons from the executives shaping the future of chemicals. Grow your knowledge, your network, and your impact.
Each week, you'll hear from executives from across the industry - from Fortune 50 to midsize to startups. You’ll hear how they're tacking today's challenges and opportunities, their origin story (what got them here!), how you can take and apply these lessons and insights to your own business and career.
We talk:
- Business Transformation
- Innovation
- Digitization of business
- Strategy
- Supply Chain
- and so much more
Founder and host Victoria King Meyer is an expert interviewer - who brings out the best in each guest. She gained her industry experience at leading companies, including Shell, LyondellBasell and Clariant. Today, she is a high-performance coach and advisor to business leaders in chemicals and energy, as well as the host of The Chemical Show podcast, and founder of The Chemical Summit.
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Websites:
https://www.thechemicalshow.com
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https://www.progressioglobal.com
Welcome to The Chemical Show, the
podcast where Chemical means business.
I'm your host, Victoria Meyer,
bringing you stories and insights
from leaders driving innovation and
growth across the chemical industry.
Each week we explore key trends,
real world challenges, and the
strategies that make an impact.
Let's get started.
Victoria: Welcome back to The Chemical
Show where Leaders Talk Business.
I am recording this episode in the
timeframe between InCosmetics and NYSCC
suppliers Day, and we are giving this
a personal care ingredients focus.
And because of that, I am speaking with
an expert in the market, so Sunanda,
Sunnie, Desai is the Vice President
at Kline and Company where she leads
the global chemicals and materials
practice and oversees the firm's
advisory service in the chemical sector.
So Sunnie is an expert in go to
market and growth strategies, and she
works extensively with clients across
personal and consumer care industries.
We're gonna have a great
conversation about what's happening.
The personal care ingredients market.
It says it gonna be a great tea into folks
going to Supplier's Day, and to folks
that aren't going to Supplier's day, but
are just interested in what's happening.
So Sunnie, welcome to the Chemical Show.
Sunanda Desai: Thank you
for having me, Victoria.
It's a pleasure to be here.
Victoria: I am so glad to have you here.
So let's just start
with your origin story.
I love to start every episode with this.
What's your origin story?
How did you get interested and engaged
in chemicals and specifically in
personal care and, consumer care?
Sunanda: so I've always,
enjoyed analytical, uh, topics
and, I come from a family.
Um, my, both my parents, have education
in mathematics and the sciences.
I.
So, I have a little bit of a typ,
atypical, uh, background for the
chemicals and materials industry.
I actually started my career as a software
developer in Silicon Valley in California.
I have a math computer
science undergrad degree.
And, really enjoyed actually
the, the analytical aspect of, of
programming and software development.
And eventually I found
my way into consulting.
And, I really like the
energy of consulting.
The aspect of solving problems,
answering questions with a great degree
of intensity, uh, working in a team.
I, I really enjoy all of those.
Aspects of consulting and, I felt
a lot of passion for chemicals,
materials, and ingredients.
I think, this is an industry that
touches every aspect of our lives.
And, when the opportunity came to
work with client and company on two
favorite areas, essentially consulting
and the industry, I, I took it and,
um, as they say, the rest is history.
Victoria: Yeah.
Well, and, and I think that's really
cool 'cause we don't necessarily
have a lot of data scientists,
or at least, how about this?
We didn't used to have a lot of
data scientists in the industry,
and I know that's a growing field.
And I would not often think of people
going from Silicon Valley to, uh.
The chemical industry
even as a consultant.
So I think that's a great leap.
And really just kind of interesting
journey that you've taken.
Let's talk a little bit
about Kline and Company.
'Cause a lot of people may
not be familiar with them.
Sunanda: Absolutely.
Kline is a global, management, consulting,
advisory, market research firm.
We've been active in the specialty
chemicals, materials, and ingredient space
Victoria: I.
Sunanda: 65 years.
We have a global presence.
We're headquartered in New Jersey.
We have offices all over
in Europe and in Asia.
And, essentially from a personal
care and consumer perspective, we
cover the entire beauty value chain,
starting from the ingredients, the
raw materials, the ingredients, all
the way down to the brand owners,
the distribution, and the retailers.
The business covers the entire
personal care value chain.
Victoria: That's really cool.
I've been familiar with Kline for probably
about a decade, um, but I definitely
think of them, think of Kline as really,
especially chemicals, and really just
bringing a lot of data and insight to.
Markets and products that maybe are
sometimes difficult to understand.
Um, and I know I will say, I am just
going to tell you, I like when people
ask me for, you know, Hey, do you
know how to find this information?
I'm like, I don't, but you know,
let me send you over to somebody
at Kline because maybe they do.
Sunanda: We are very good at going
deep within the important aspects of
the personal care ingredient space,
Victoria: Yeah.
Love that.
Sunanda: and as well as the breadth.
Victoria: So with that, what are
you seeing in the market today?
What are the key trends that
are affecting personal care
ingredients in 2025 and beyond?
Sunanda: So, um, let me characterize
the personal care ingredients industry.
So this is about a $30
billion ingredients industry.
Okay?
So from the manufacturer's perspective,
and if you look at it, there's
the actives, specialty actives,
which are very much a concept cell.
You have more of the commoditized
ingredients, and then you have
the entire specialties, which are
Victoria: Hmm.
Sunanda: that are highly differentiated.
This is where client focus is.
Now, if we talk, think about the
trends that are affecting the market,
sustainability continues to be an
important trend in this space, and
Victoria: Yeah.
Sunanda: is essentially
natural ingredients.
You know, naturalness and natural
ingredients are still important, and I.
The interesting aspect of sustainability
though is the impact that sustainability
has on natural ingredients have
vary by ingredient category.
So in, for instance, surfactants,
emollient, actives that actually have
very good natural alternatives to offer
and where there is an opportunity to make
a claim or uh, or branded as a natural
product, definitely has much more of that.
Push from naturals or it has
that, uplift, but there's certain,
categories like preservatives or UV
ingredients where it's a little bit
Victoria: Hmm.
Sunanda: because there might not
be suitable natural alternatives
that perform at the same level
of efficacy that is needed.
Victoria: Yeah.
And so then the, um, the formulators,
the brands and the formulators are
making decisions based on that,
based on availability and efficacy.
Sunanda: They are, they
Victoria: Yeah.
Sunanda: Um, as you know that there have
been recent announcements, by certain
big brands such as L'Oreal have made
announcements that there's going to be a
significant portion of their ingredient.
Formulations are going to
have natural ingredients.
By 2030.
So there's definitely those types
of announcements and the brand
owner pushes that are basically
in pushing the industry, towards
more natural ingredients.
Victoria: Yeah.
What other trends are you seeing?
Sunanda: From a consumer
perspective, there's definitely
a trend towards wellbeing.
And so what that means from a, a beauty
perspective is neuro cosmetics are
actually of interest and neuro cosmetics
actually are topical cosmetics, right?
So they're topical, products that are
applied to the skin, but they interact
with the nervous system of the skin to
essentially produce a desired effect.
It could be enhanced mood,
it could be relaxation.
And there's different ingredients that
are formulated with these products to
give that there could be neuropeptides,
there could be cannabinoids, there could
be different ingredients that confer this
particular effect to a neuro uh, cosmetic.
Victoria: Is this a generational thing?
I, 'cause I gotta be honest,
I'm a little freaked out by
some of this, um, personally.
But is it, is it, do you see
this trend cutting across.
Demographics or is it localized or is it
just still starting and therefore will
become widespread um, in a few years?
Sunanda: I mean, if you think
about aroma therapy, right?
Like there
Victoria: Hmm.
Sunanda: this, this aspect of using.
Essential oils or, or other
aspects to kind of enhance your
surroundings, enhance your mood,
and, you know, support relaxation.
So it is essentially, there has
been that movement for a while now.
Victoria: Yeah.
Sunanda: we're seeing is essentially
using more neuro cosmetics to
kind of produce that, from a
skin, from a topical perspective.
. Victoria: So, who's
regulating these products?
So when I think about these actives,
and having neurological effects,
what agencies or how do, are they
getting regulated differently
than other personal care products?
Do they, or is it all part
of the same ecosystem?
Sunanda: Well, all the products have
to meet the requirements that are
mandated for any personal care product
to go out into the market, you know?
So,
my understanding is it's not that they're
not that I, that they're not being FDA
regulated or I do not know if the FDA is
Victoria: Hmm.
Sunanda: of these.
, But they have to meet the basic
requirements to be able to be
marketed as a personal care product.
Victoria: Got it.
Makes sense.
One of the things we were talking about
earlier is the role of digitization in ai.
And that's certainly
a trend that, is here.
And when we think about cutting
across the industry, how do you
see, personal care companies and
personal care ingredient manufacturers
harnessing, uh, digitization and ai.
Sunanda: So digitalization and
AI is, is an important trend.
To, to keep track of and definitely,
there's various ways in which
AI is actually being used.
Now.
The most, maybe the aspect of
it that's been most known to
more people is personalization.
So the use of AI driven tools to
essentially, um, hyper-personalized
offerings based on certain
skin types or, hair types.
So that's actually the, the consumer
end where you're actually targeting
Victoria: Yeah.
Sunanda: to certain consumers.
other uses are more behind the scenes
supporting ingredient, say ingredient
assessments to essentially really
quickly assess ingredients for efficacy.
and there's also essentially
optimizing formulations.
Now, while all of these have been, you
know, raised and discussed in the press as
Victoria: Yeah.
Sunanda: you know, ai, uh, uses,
this point, it is unclear how
much of this is being, you know,
actually implemented within, the
companies that we're looking at.
But there are several high profile
announcements on partnerships in
the public domain between beauty
brands and, you know, AI suppliers.
So we have to see how much of
this really is, being used.
Victoria: So one of the things I've,
I've, I've observed when I've talked
to leaders across the industries.
Number one, everybody's grappling with.
How do they really utilize and execute AI
and bring it into their systems, right?
So people are, experimenting and I
think that would align with perhaps what
you're saying is people are experimenting
and yet the biggest companies are
embracing and experimenting even more So.
I was at an event recently and
somebody from Exxon, for instance, was.
Talking about the AI and
digitization that they're using
in their manufacturing sites.
You know, flying drones to get
temperature readings and doing other
stuff and things that companies
maybe can't necessarily dream about.
I know you've talked about the,
the L'Oreal example, and I've
seen similar things from L'Oreal
and Unilever's and others, as it
relates to the consumer brands.
And part of it is we need these, um, the
bigger companies to, to lead the way and
do some of this testing and figure out.
How it's all gonna work so that
it becomes more widespread in
adoption across the industry.
Sunanda: Absolutely Victoria,
and that's what it is.
Market leaders will always
embrace new technology
Victoria: Yeah,
Sunanda: and try to see
where it can take them,
Victoria: yeah,
Sunanda: the rest of the market
and the rest of the players
in the space follow suit.
What you're mentioning right
now is an example of that.
Victoria: yeah.
So, you know, we're sitting here
in 2025 in a period of a lot of.
Turmoil, let's call it turmoil, right?
So tariffs, regulations, you know, we've
got the new administration in the us
but let's not forget, we actually have
new governments and new governmental
leaders across the world, right?
But certainly if we, we focus in on
what's going on from reciprocal tariffs
to non tariffs, to pauses to others,
there's just a ton of uncertainty and,
you know, maybe a bit of an uproar.
It seems, at least, at the biggest
level, how is this affecting the
companies that you work with?
Sunanda: So that's a very good question.
There, there is a significant degree of
uncertainty in the market, as you say,
and the most important thing for personal
care companies to think about is how
to manage in the face of uncertainty.
There is definitely various
strategies that can be undertaken.
But there is an aspect of agility and
making those quick decisions based on
, the situations in the market and what
are the no regret moves that can be made.
This is an important way of thinking.
From a personal care, um, for a
personal care in industry leader.
If we were to talk a bit more concretely
about specifics, really that what that
would entail is when the tariff situation
started, you know, there was a lot of
concern in terms of the impact, right?
Increased costs,
Victoria: Yeah.
Sunanda: costs, increased
prices, all of that.
So from the perspective of now,
we we're seeing some discussions
where there might be some
reprieve, but it's still uncertain.
So what does this mean for
personal care ingredient suppliers?
Well, it's still the time to be thinking
more strategically about what are those
no regret moves that you can make today.
That will still put you in a good position
regardless of what the outcome is.
And some of those could be
thinking about the supplier base.
Is this a good time to
diversify that supplier base?
Is this a good time to invest in
some of those relationships with
contract manufacturers so that you
can or enhance those relationships
so that there is an opportunity?
To manufacture formulations
Victoria: Hmm.
Sunanda: where those tariff, uh, tariff
considerations might not be so harsh.
it's also a time to think about should
any ingredient or, or should any,
formulations be visited, revisited, um,
to, maybe consider ingredients that might
be negatively impacted by any future.
Um, or even current tariff restrictions.
And as you know, Victoria, the
devil is always in the details.
I mean, if you really were to
look closely at what's in the
annex, um, there are exemptions.
And then there are not.
So really kind of understanding, you
know, are my ingredients falling within
that exemption list are or are they not?
So kind of starting from that
point is also very important.
Victoria: Yeah, I think those are great.
And, and, and the no regret moves.
I like the way you frame that.
I was speaking with the, um, a leader
recently and, you know, everybody's
always like, well, how's business?
Is business soft?
Is it busy?
Or whatever?
But this person was
like, they are so busy.
And part of it is, they're doing
a lot of projects with their,
business partners, their
customers, et cetera.
And I think a lot of this is
around reformulations innovations,
thinking about these things that
you've talked about, supply chain,
what products you're bringing in,
and how you can be more effective.
So I think that's, you know,
it's definitely good news.
I think we're always a little
bit worried, and I know that, you
know, market softness is a concern.
The cost of doing business and
the cost of raw ingredients and
the effects that has is a concern.
But I think, getting busy.
On these no regret moves is really smart.
Sunanda: You're absolutely
right, Victoria.
In light of the current situation, it is
also important to think about are there
quick wins that can be taken advantage of?
Are there, opportunities to cross sell?
Are there inorganic opportunities
that can be, you know, considered
in light of these changes?
So, um, definitely that's another point to
keep in mind, to enhance one's position.
Victoria: Is this a busy time for Kline?
Do you see a lot of.
Clients coming to you with big questions,
and if so, what, what are they?
What are the questions that your
clients are asking you today?
Sunanda: Yes, it is a busy
time for us and, certainly
our clients are coming to us.
One of the things they're coming to
us is exactly that, what are the,
are the quick wins in the market
that we can take advantage of?
Are there, um, inorganic plays that we can
Victoria: Yeah.
Sunanda: You know, are there
opportunities for ingredients that
might not have been so, , considered a
few years ago that now become relevant
in light of,, more considerations
on price, price versus performance?
Victoria: Yeah,
Sunanda: there's, there's,
we're getting questions of that
Victoria: that's interesting.
I, those three, those are
all really interesting.
Especially this piece about:
There may be formulations and
products today that make sense.
That didn't make sense two or
three years ago because the
circumstances are different.
So I think it's, it's always a
good reminder to, revisit your
pipeline 'cause what you thought
was dead maybe is not dead.
It maybe alive and awake again today.
Um, you know, the other piece you
talked about, there's inorganic growth.
Do you see, a lot of interest
in m and a activity right now.
I mean, it's, again, it's it, you know,
these periods of uncertainty, it's hard.
But do you think that's
gonna be happening?
You know, if you were reading the
Tea Leaves of the World, should
we be expecting some moves?
Sunanda: Certainly I do think
there is opportunity for
inorganic, plays in the market.
Um, I was at InCosmetics, a few weeks
ago, I guess a month ago at this point.
Victoria: Yeah.
Sunanda: and it's a very vibrant,
it was a very vibrant show.
And a lot of players in this space.
So I can absolutely see that there is,
I just think there is a lot of, there's
a lot of players in the industry and I
think that there is an opportunity for
more consolidation in this industry.
But this is my point of view.
Victoria: We've talked about, uh,
maybe some of the, the quick wins
and the no regret moves, but what
are the strategies that companies can
and should be employing, um, to be
successful here in 2025 and beyond?
Sunanda: Um, so that, that's,
that's a big question.
My points were about kind of,
um, essentially about taking
advantage of the quick wins
about reconsidering formulations.
Bigger picture.
bigger picture thinking is about
really reconsidering whether the
manufacturing footprint needs to be
changed in light of the way the, the,
Victoria: The way the world is going.
Yeah, yeah.
Yeah.
I think that's interesting.
I think people are
grappling with this, right?
Where, what the right
investment profile is, what the
manufacturing footprint should be.
I can't decide if we are shifting
to a time of more regionalization.
Certainly regionalization
of supply chain seem likely
regionalization of manufacturing.
I don't know.
Right?
Because it's a big investment
to make, to move, right?
To move plants and assets
or to rebuild them.
Is expensive and depending on a company's
appetite, depending on frankly whether
they're public or private, right?
Because privately held companies maybe
have, they have different time horizons
and different judgment calls about
whether they can make those investments.
Whereas despite our best interest
in, uh, in every public company,
executive's interest in telling
their story and helping their
investors understand investors.
Still by and large want quick returns.
And so navigating to that is tricky.
Sunanda: It absolutely is tricky
and there were, there was a lot of
discussion about look reconsidering
manufacturing in the light of covid.
But
Victoria: Yeah.
Sunanda: Covid was, over, I mean,
none of those changes did happen.
So whether this is going to
be the motivating factor is,
is, um, is yet to be seen, but
Victoria: Yeah.
Sunanda: at least reconsidering
the supply chain and, and, uh,
assessing the manufacturing footprint.
Would be
Victoria: Yeah.
Makes sense.
Makes sense.
Alright, so Sunnie, let's
talk about leadership.
And I love to ask this question
to people 'cause I love the
responses that we get in.
So do listeners.
In fact, I hear, um, from
folks is this is one of their
favorite segments of the show.
So when you think about your
career, and how you've achieved
what you have, what advice would
you give to a young professional
recently entering the industry about
navigating her career in leadership?
Sunanda: the most important piece
of advice I would give is to.
Recognize the opportunities as they come
to you and as they're presented to you,
and have enough faith in yourself to take
advantage of those opportunities to, to
take them head on, even if you feel like
you don't know how to kind of execute
against them, and I believe that's what
I have done in the course of my career.
So I started, as I said,
my career in, in software.
And then, I was able to make the
move to an industry that I love
being in and love working in.
And, I was able to achieve that because
I did try my best, try my best to be able
to take advantage of those opportunities
as they were presented to me.
Victoria: Yeah,
Sunanda: is the, the, the advice
that I would give to a, to a
young professional starting
Victoria: I love that.
And I mean, it's a bit of the say
yes even when it's really scary.
Sunanda: Yes.
Victoria: Yeah.
Awesome.
Well, Sunnie, thank you for taking
time to speak with me and to The
Chemical Show audience today.
It's been really great to have you here.
Sunanda: Thank you for
having me, Victoria.
Victoria: And thank Absolutely, and
thank you everyone for listening.
Keep listening, keep following,
keep sharing, and we will
talk with you again soon.