1941: Cosmetic Industry

Sales of cosmetics reached an unprecedentedly high figure during 1941 amounting, in preliminary estimates, to some $517,500,000 at retail. For the first time in over a decade it was a sellers' market and, in common with most other industries, the chief problems of the year were those concerned with supplies of raw materials. As the year ended with this country engaged in total war, it was obvious that the supply problem was only beginning and that products and packages would have to be stripped to their essentials in harmony with a wartime economy and the necessities of an all-out war effort.

On Oct. 1 a new 10 per cent tax on cosmetics sold at retail went into effect and the manufacturer's excise tax on cosmetics was terminated. The tax on the sale to the consumer has as yet had no apparent deterrent effect on such sales, but it has made this industry a fairly important producer of revenue. The former tax on the manufacturer probably amounted to an average of about 3 per cent on his selling cost to the dealer and meant very little in terms of revenue. The shift in the tax brought some agitation for lower prices but in the face of rising labor and material costs and the fact that in a great many cases it was difficult to get anything at any price, the whole trend at the year's end was towards higher and not lower prices.

This industry used to draw its raw materials from many of the far corners of the world. At one time this was part of the glamorous appeal of its products but with a world at war it becomes a problem calling for unending research, resourcefulness and ingenuity. Most of the natural aromatic materials are not grown in this hemisphere and many of the synthetic aromatic materials are dependent upon natural materials for their starting point. Others, which are wholly chemical are dependent upon chemicals which are unavailable for anything but the manufacture of war essentials. Practically all chemicals, oils, fats, waxes, colors, metals and minerals are in short supply and rising in price.

When it comes to packaging materials, metals are almost non-existent, paper and plastics scarce, and glass, while plentiful so far, faces a shortage of shipping space, for the needs of war have first call upon all types of transportation as well as upon labor and materials.