Cosmetic & Toiletry Wholesale

BARRIERS TO ENTRY
High barriers to entry mean that new companies struggle to enter an industry, while low barriers mean it is easy for new companies to enter an industry.

CAPITAL INTENSITY
Compares the amount of money spent on capital (plant, machinery and equipment) with that spent on labor.
IBISWorld uses the ratio of depreciation to wages as a proxy for capital intensity. High capital intensity is more than $0.333 of capital to $1 of labor; medium is $0.125 to $0.333 of capital to $1 of labor; low is less than $0.125 of capital for every $1 of labor.

CONSTANT PRICES
The dollar figures in the Key Statistics table, including forecasts, are adjusted for inflation using the current year (i.e. year published) as the base year. This removes the impact of changes in the purchasing power of the dollar, leaving only the "real" growth or decline in industry metrics. The inflation adjustments in IBISWorld’s reports are made using the US Bureau of Economic Analysis’ implicit GDP price deflator.

BIOLOGICS
Type of specialty drug made from living organisms.

DISINTERMEDIATION
The removal of intermediaries in a supply chain.

FEE-FOR-SERVICE (FFS)
A standard business model where services are unbundled and paid for separately.

GENERIC DRUG
Drug that is not protected by any patents, but can act as a substitute for the original brand-name product.

The success of the Drug, Cosmetic and Toiletry Wholesaling industry is driven by demand for its primary product segment, pharmaceuticals. The largest percentage of industry revenue is derived from the distribution of prescription and nonprescription drugs to a variety of retailers and healthcare providers. Over the five years to 2022, several major brand-name drugs have lost patent exclusivity which has created an opportunity for less expensive generic drugs on the market. Nonetheless, wholesalers have countered by adjusting their prices and supplies accordingly.
Consequently, industry revenue is expected to rise an annualized 2.5% to $1.2 trillion over the five years to 2022. Revenue during this period has been boosted by the COVID-19 (coronavirus) pandemic that started in late 2019. Revenue increased 4.0% and 4.7% in 2020 and 2021, respectively. In 2022 alone, industry revenue is expected to decrease 0.5%.