Toilet Preparation Manufacturing (NAICS 32562) — U.S. Industry Primer (rollup)

1. Overview

NAICS 32562 is the U.S. federal statistical label for what most people call the beauty and personal-care products industry — the factories that blend, compound, and package perfumes, makeup, skincare creams and lotions (including sunscreen), shampoos and other hair products, deodorants, shaving preparations, toothpaste, nail products, dental floss, denture preparations, nonmedicinal mouthwash, and premoistened towelettes.[1] (NAICS is the North American Industry Classification System, the government's standard code set for industries.)

This page is a rollup: NAICS 32562 is a five-digit "industry" tier that sits one level above the individual six-digit industries beneath it. It is a large, brand-driven, unusually recession-resilient corner of chemical manufacturing — cheap to make, with most of the value in brand, formulation, and marketing. For the full picture (economics, players, regulation, risks, how to invest), read the child primer for NAICS 325620; this page exists mainly to give the rollup's own ground-truth figures and hand you off.

2. What's inside — and why this level equals its one child

The five-digit industry NAICS 32562 contains exactly one six-digit child industry: 325620 — Toilet Preparation Manufacturing. Because there is only one child, the two codes describe the same set of factories and the same numbers. The five-digit tier here is a pure pass-through — a labeling layer in the taxonomy, not a broader grouping that pulls together several distinct businesses.

Practically, that means everything true of 325620 is true of 32562: the same scope (perfumes, cosmetics, skin and hair care, sunscreen, deodorant, shaving preparations, toothpaste, nail products, dental floss, denture preparations, nonmedicinal mouthwash, premoistened towelettes), the same exclusions (bar soap and detergents sit in NAICS 325611; drug-classified medicated products in NAICS 325412; retailing in NAICS 456120), and the same two-model structure — brand owners who market (and sometimes make) their own products, and contract manufacturers / CDMOs (contract development and manufacturing organizations) that make product to order for other people's brands.[1] Coty, for example, reported manufacturing approximately 81% of its fiscal-2025 products internally while obtaining approximately 19% from third parties.[2] For all of that detail, see the 325620 primer.

3. Size (this level's rollup figures)

Federal statistics for the domestic manufacturing base. Because 32562 has a single child, these are also 325620's figures.

Source note: these come from our ground-truth federal stats file for NAICS 32562. Employment estimates vary by source and methodology; County Business Patterns and BLS establishment surveys use different coverage and definitions. The industry's Herfindahl-Hirschman Index (HHI, a standard concentration score) is suppressed in the federal data, so we do not report it.[3]

Undercount caveat. The $36.5 billion is the domestic factory-gate value of what U.S. plants ship — not the retail market consumers experience, which is far larger. Estimates vary by source and methodology: Mordor Intelligence puts the total at roughly $130 billion for 2025[6], while Circana's measured retail data show $36.0 billion in prestige beauty and $72.7 billion in mass-market beauty for 2025.[7] The gap exists because retail figures include imported product, distributor margins, and retail markup, none of which show up in a domestic manufacturer's shipment value, while different sources use different category definitions and measurement approaches. Two structural undercounts also apply: (1) asset-light indie brands that outsource all production to contract manufacturers usually are not counted here as manufacturing establishments (they appear, if at all, under wholesale or company management), so the number of "beauty businesses" far exceeds 1,131 firms — the census counts factories, not brands; and (2) a large share of U.S. output comes from U.S. subsidiaries of foreign multinationals, so domestic firm counts understate how concentrated global brand ownership really is.

4. Investable universe (where value concentrates)

With a single child, there is nothing to allocate across children — all the investable value sits inside 325620. In short: a few U.S.-listed pure-plays (The Estée Lauder Companies, ticker EL; Coty, COTY; e.l.f. Beauty, ELF; Inter Parfums, IPAR; Oddity Tech, ODD; Olaplex, OLPX), a longer list of diversified consumer names with beauty segments (Kenvue, KVUE; Edgewell Personal Care, EPC; Church & Dwight, CHD; Procter & Gamble, PG; Colgate-Palmolive, CL), foreign majors via American Depositary Receipts (L'Oréal — with €11.7 billion in North America revenue in 2025[8] — Unilever, Shiseido, Beiersdorf, Kao), and a large private layer — Chanel, Puig, direct-sales firms, Revlon (which emerged from bankruptcy reorganization as a private company)[9], and the private-equity-owned contract-manufacturing "picks-and-shovels" tier (kdc/one, Voyant Beauty, Elevation Labs, Innovative Beauty Group).[10][11] Tickers, scale figures, and ownership detail live in the 325620 primer.

5. How the money works

Same as the child: this is a branded consumer-products business, not a commodity-chemicals one. Brand owners earn on a wide price-to-cost gap (prestige beauty routinely runs 70–80% gross margins because the formula is a small fraction of retail price) and on marketing intensity and product velocity (advertising often 15–25%+ of sales, with constant launches and social-media-driven trends; e.l.f. reported SG&A equal to 63% of sales in FY2026, illustrating how brand economics differ from factory economics).[12] Contract manufacturers run a more classic factory model — keep plants full, manage input and tariff costs (essential oils, alcohols, specialty chemicals, containers, and packaging), and earn a thinner margin on volume.[2] For licensed fragrance brands, royalties add another cost layer — Coty disclosed $853 million of future contractual royalty payments at June 2025.[2] The defining trait is unusually mild cyclicality: personal-care staples are near-necessities, and even discretionary makeup and fragrance hold up as affordable luxuries. See 325620 for the full treatment.

6. Demand drivers

Identical to the child industry: rising discretionary spending and premiumization (buyers trading up lift revenue faster than unit volumes — Circana reported U.S. prestige beauty retail sales grew 4% in 2025, while mass-market beauty grew 5%)[7]; demographics and "skinification" (aging population fuels anti-aging skincare, Gen Z fuels color cosmetics and fragrance, men's grooming is a growth pocket); social media, influencers, and direct-to-consumer (DTC) launches; a mid-2020s fragrance boom (prestige fragrance grew 5% and mass fragrance 15% in 2025)[7]; scalp care and treatment-oriented hair care as a growth pocket; and channel shifts across e-commerce, specialty beauty retail, and travel retail. Detail and citations are in the 325620 primer.

7. Regulation

Same regime as 325620. The central development is the Modernization of Cosmetics Regulation Act of 2022 (MoCRA) — the biggest expansion of U.S. Food and Drug Administration (FDA) authority over cosmetics since 1938, with core requirements enforced from July 1, 2024.[13] It requires facility registration, product-and-ingredient listing, Good Manufacturing Practices (GMP), safety substantiation, and adverse-event reporting, with a partial small-business exemption — the net effect favors scale.[14] Common misconceptions: FDA generally does not approve cosmetics or their ingredients before sale, other than regulated color additives; "cosmeceutical" is not a legally recognized category; and "organic" is not defined by FDA for cosmetics — USDA regulates organic agricultural ingredients under the National Organic Program.[15][16] Layered on top: FDA color-additive approval, federal labeling rules, California's Proposition 65, a wave of state-level ingredient bans, and the stricter EU regime for exporters. Full detail in the child primer.

8. Consolidation

The concentration picture is the rollup's own — and, with one child, also 325620's. The industry is fragmented at the bottom, concentrated at the top:[3]

(HHI is suppressed in the federal data, so it is not reported.)[3] Retailer power is material: in fiscal 2026, Target, Walmart, Amazon, and Sephora represented 18%, 13%, 11%, and 10% respectively of e.l.f.'s sales — retailers can reduce orders, destock, or change shelf space without a corresponding decline in end-consumer demand.[12] Consolidation is a constant: strategic buyers acquire fast-growing indie brands, private equity has targeted the contract-manufacturing layer for its brand-agnostic cash flows, and incumbents periodically review whether to shed beauty divisions. See 325620 for named deals.

9. Risks

The same risks that face 325620: tariffs and input costs (duties on imported ingredients, fragrance oils, and packaging rose sharply in 2025, pressuring margins — e.l.f., which sources and manufactures the majority of its products through third parties in China, attributed its FY2026 gross-margin decline primarily to tariffs)[12]; supply chain concentration (asset-light brands exchange plant capital for supplier concentration, lead-time, and capacity-allocation risk — dependence on specialized pumps, applicators, or single-source ingredients creates vulnerability); regulatory and litigation exposure (MoCRA compliance, talc/asbestos and PFAS "forever chemicals" scrutiny, product-liability suits); trend risk and brand fatigue (demand is fashion- and social-media-driven, and heavy marketing is needed just to hold share); channel and geographic concentration (dependence on a few big retailers and on China / travel-retail demand for prestige); substitution (private label, lower-priced "dupes," imported K-beauty, and salon products compete for share); and private-market cyclicality (funding and exit windows for the DTC/indie layer can freeze). Detail and citations are in the child primer.

10. How to invest and outlook

Because NAICS 32562 is identical to its single child, there is no separate "rollup" allocation decision — investing in this industry is investing in 325620. Public routes: the pure-plays (EL, COTY, ELF, IPAR, ODD, OLPX), diversified consumer names with beauty segments (KVUE, EPC, CHD, PG, CL), and foreign majors via ADRs; there is no large dedicated U.S.-listed beauty ETF, so most exposure is built through individual names or broad consumer-staples/discretionary funds, and this remains a stock-pickers' sector. Private routes: contract manufacturers/CDMOs, indie-brand roll-ups, and early-stage DTC startups — the essential diligence question is which profit pool is actually being purchased: brand equity and customer acquisition; licensed intellectual property; formulation and regulatory capability; or physical filling capacity. The base case is a steady, low-single-digit-growth domestic market with premiumization lifting value ahead of volume, punctuated by aggressive M&A — cheap-to-make product and durable demand on one side, relentless competition, trend risk, and a heavier regulatory and tariff burden on the other. For the complete analysis, read the NAICS 325620 primer.

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Sources

1. U.S. Census Bureau / NAICS Association. NAICS 325620 — Toilet Preparation Manufacturing (2022 definition and scope). 2022. https://www.naics.com/naics-code-description/?code=325620
2. Coty Inc. Fiscal 2025 Form 10-K (net revenue $5.89B; 81% internal manufacturing; principal inputs; royalty commitments $853M). 2025. https://www.sec.gov/Archives/edgar/data/1024305/000102430525000030/coty-20250630.htm
3. U.S. Census Bureau. 2022 Economic Census — Concentration by Largest Firms, NAICS 325620 (value of shipments, firm count, CR4/CR8/CR20/CR50; HHI suppressed). 2022. https://www.census.gov/programs-surveys/economic-census.html
4. U.S. Census Bureau. County Business Patterns 2023 — NAICS 325620 (establishments, employment, annual and first-quarter payroll). 2023. https://www.census.gov/programs-surveys/cbp.html
5. U.S. Bureau of Labor Statistics. CES Benchmark Article, Table 1 — NAICS 325620 employment (58,200 jobs, March 2023). 2023. https://www.bls.gov/ces/publications/benchmark/cesbmart23-tables.htm
6. Mordor Intelligence. United States Beauty and Personal Care Products Market ($130.25B in 2025). 2025. https://www.mordorintelligence.com/industry-reports/united-states-beauty-and-personal-care-products-market
7. Circana. U.S. Prestige and Mass Beauty Retail Deliver a Positive Performance in 2025 (prestige $36.0B +4%; mass $72.7B +5%; fragrance growth). 2025. https://www.circana.com/post/us-prestige-and-mass-beauty-retail-deliver-a-positive-performance-in-2025-circana-reports
8. L'Oréal. 2025 Annual Results (global sales €44.05B; North America €11.72B). 2025. https://www.loreal-finance.com/eng/press-release/2025-annual-results
9. Revlon, Inc. Announcement of emergence from Chapter 11 reorganization (now private). 2023. https://www.sec.gov/Archives/edgar/data/887921/000114036123016005/brhc10050829_ex99-2.htm
10. Capstone Partners / BeautyMatter / DC Advisory. Private equity opportunity in beauty contract manufacturing; kdc/one (KKR), Elevation Labs (Knox Lane), Innovative Beauty Group (Fremman). 2024–2025. https://beautymatter.com/articles/private-equity-opportunity-beauty-contract-manufacturing-development
11. Voyant Beauty. About Voyant Beauty (U.S. contract manufacturing network). 2025. https://www.voyantbeauty.com/about-voyant-beauty/
12. e.l.f. Beauty, Inc. Fiscal 2026 Form 10-K (70.7% gross margin; SG&A 63% of sales; tariff impact; customer concentration). 2026. https://www.sec.gov/Archives/edgar/data/1600033/000160003326000020/elf-20260331.htm
13. U.S. Food and Drug Administration. Modernization of Cosmetics Regulation Act of 2022 (MoCRA). 2024. https://www.fda.gov/cosmetics/cosmetics-laws-regulations/modernization-cosmetics-regulation-act-2022-mocra
14. Wiley LLP. Cosmetic Facilities Must Comply With FDA's New Registration Requirements by July 1 (small-business exemption). 2024. https://www.wiley.law/alert-Times-Up-Cosmetic-Facilities-Must-Comply-With-FDAs-New-Registration-Requirements-by-July-1
15. U.S. Food and Drug Administration. Cosmetics Safety Q&A — Personal Care Products (product classification, OTC drug status). 2024. https://www.fda.gov/cosmetics/resources-consumers-cosmetics/cosmetics-safety-qa-personal-care-products
16. U.S. Department of Agriculture, Agricultural Marketing Service. Cosmetics, Body Care, and Personal Care Products — Organic certification requirements. 2024. https://www.ams.usda.gov/grades-standards/cosmetics-body-care-and-personal-care-products