6 Min ReadBusiness 27 May 2020
It was blood, sweat, tears and plenty of “cheekiness," as she says, that propelled Dermalogica founder, Jane Wurwand, to create a multi-million dollar skincare business available in more than 100 countries around the world.
The brand, which is now something of a modern icon in the beauty industry, may have had humble beginnings, but it's emerged as a powerhouse player, having set the tone for a new type of product in a time when luxuriously positioned European skin care was king.
"There's clearly a population that can afford and wants these treatments, but no salons are providing it."
“My story really starts with being an immigrant," said Wurwand, who came to the US from South Africa in 1983 with her boyfriend Raymond Wurwand, who is now her husband and Dermalogica's co-founder.
Jane and Raymond at ribbon cutting ceremony
Always drawn to the salon industry, Wurwand describes it as a rich space for women looking to go into business for themselves.
An experienced United Kingdom-trained skin therapist new to the American “esthetician" industry, Wurwand soon discovered that skin and body therapy education was practically non-existent in the United States. Although her training had been rigorous and strategic, she noticed that U.S. students were entering the industry licensed yet under-trained. Whereas European students had three years of full time training, undergraduate education in the US consisted of only a few months without a proper mentoring program.
First Dermalogica Building
“My lightbulb moment was when I realized there is a lack of training in an industry that I know really well," says Wurwand, who became focused on finding a way to bring skin services to the masses by educating the skin therapists. “There's clearly a population that can afford and wants these treatments, but no salons are providing it."
In order to fill the white space she saw, she and Raymond, who was a sales representative for a Japanese skincare equipment company, rented a small one-room space in Marina del Rey, California. The space was chosen, according to Wurwand, because it was affordable and near her apartment.
To get the word out about her new education facility Wurwand contacted California's Board of Cosmetology and got a list of about 2,000 women who lived within a 50 mile radius. She sent each a post card introducing the class and had immediate interest from about 70 women.
“It took off very fast and we realized we had tapped into something no one else was paying attention to," she says. “People wanted to learn more, so I brought lecturers from Europe to teach subjects like lymphatic drainage, reflexology and aromatherapy."
Before long Wurwand's education facility, dubbed the International Dermal Institute, developed quite a reputation. Classes included everything from performing painless extractions and understanding galvanic currents to writing a business plan, developing a seamless booking system, and executing PR campaigns.
“We took aestheticians who were licensed with poor training and taught them how to be successful in a business," says Wurwand. “We wanted these women to learn a skill set that makes them marketable. You can have talent but without a business education, you have an expensive hobby."
“This is an industry that is an economic powerhouse for women and I wanted to have time to talk about that and use it as a blueprint. We tell women how we built the brand and how women can have a significant success, that's been my focus for last few years."
Before long, IDI became the largest advanced training program in the world," says Wurwand, adding that they now have 34 locations across the US, Canada, the UK, Ireland, Australia and Germany. In business for 33 years, IDI currently trains 100,000 skin therapists per year. “We trained the industry," she says.
Rewinding back to the the days when Wurwand was riding the wave of her education business, and another lightning bolt moment hit Wurwand. “I realized there was no American product," she says. “All skin care was French, Italian or German. I thought, we need to develop a product line and need to make it singularly different. Let's not follow the traditional European model."
With the desire to be as straightforward as possible and capture a modern, regional vibe, Wurwand and her husband joined their $14,000 of savings and launched the Dermalogica product line in 1986. Each of the 27 formulas in the range (there are now 96), was developed with a chemist.
“We owned every single formula," says Wurwand. “We didn't go the easy route and do private label. We didn't want to sell a product, we wanted to build a brand. We wanted it to have a West Coast American personality, and be something between a cosmetic and a pharmaceutical, which was unheard of at the time."
Unlike other products of the time, Dermalogica products were packaged in simple tubes and bottles (to keep them free from contamination), and Wurwand deliberately avoided jars and any iterations of pink and gold. She also paid close attention to the ingredients left out of the formulas; now commonplace product no-nos like mineral oil, lanolin, alcohol, artificial color and formaldehyde.
“It's standard now, but in 1985 when we were developing products it was unheard of because there was no mandatory ingredient list," says Wurwand. “A French competitor said 'why do you talk about what's not in? No one cares.' We said 'We will make them care.' We thought this is the future. It's a much fresher approach that's focused on new aestheticians coming into the industry, training them and supplying them with product."
In order to get the word out about her new brand, Wurwand took to the trade show circuit, demonstrating products at the end of booth she shared with Raymond's device company. “We were very cheeky, we said there is a $1,500 opening order, that they had to take whole line, and a free education comes with it," says Wurwand. “We needed $15,000 to do full product run so we were hoping to open 10 accounts. We opened 10 accounts in first 3 hours."
Dermalogica did $1 million in its first year on the market and $10 million in its third year. “The whole thing was seeded with education," says Wurwand. “We never paid for print ads in the US. We created our following by building a foundation based in education." And like her scrappy start, Wurwand says she personally promoted her line in order to get it featured in publications.
“No one told me you can't just walk into Vogue and ask to see the beauty editor, so I did," she says. “I took my bag of goodies and showed anyone who would listen and we built this groundswell understanding of people who knew what we were. We were thumbing our nose at the European brands and being deliberately productive."
Dermalogica is currently sold in over 100 countries, and is comprised of both consumer and professional products for skin therapists. The brand is sold in locations where there is a licensed skin care professional who can give insight on addressing skin problems such as hyperpigmentation, acne, aging, and sensitive skin.
The Next Step
After generating wholesale revenues over $240 million in 2014, Dermalogica was clearly a top player in the skin care industry. In 2015, a majority share was acquired by Unilever, strategically chosen by the Wurwands due to its commitment to causes they believed in.
“We didn't want to go public, but we decided it was time for an acquisition. We didn't need outside funding, we didn't need a partner. We only wanted to sell to someone we admire and respect and hope they support our legacy. We settled on Unilever because the CEO, Paul Polman, is a visionary and his commitment to sustainability and to empower 5 million women spoke to our hearts. We felt our legacy would be best served and protected with them."
"This is an industry that is an economic powerhouse for women and I wanted to have time to talk about that and use it as a blueprint."
These days, Wurwand is busy with a new project, which not surprisingly is rooted in education and supporting women.
Wurwand, who was appointed a White House Ambassador for Global Entrepreneurship in June, launched the FITE (Financial Independence Through Entrepreneurship) initiative in 2011. The organization, which worked alongside KIVA, has helped more than 75,000 women across 68 countries on the path to entrepreneurship by providing business loans.
“It was branding in a box, so they wouldn't just be a skilled technician, but so they can make their own businesses and become entrepreneurs," she says.
She has taken her FITE initiative into its next phase with the introduction of the FITE Entrepreneur Accelerator, described as a "new model of online, purpose-driven education that fills critical business skills gaps to help small, entrepreneurial businesses grow to scale." The first phase will, not surprisingly, be focused on the salon industry; but the overall goal is "to serve as a blueprint that other sectors can adopt to help truly accelerate entrepreneurship and financial dignity."
“I'd like to think ultimately my legacy will be about great skin care around the world, but the bigger legacy will be many, many women entrepreneurs being successful," says Wurwand. "We are in desperate need of job creation on this planet, and women entrepreneurs are the game changer."
In early next year the brand will introduce content classes, mentoring opportunities and and additional resources for women participants. Wurwand's goal, same as the early days of her business, is to give women the tools to become self-employed.
"You need really practical solutions of how to promote your business," she says. “We are giving them simple smart steps that explain what you need to do to be solvent. We are talking about the nuts and bolts, and telling them 'this is how you do it."
“When someone compliments your product it's like someone praising your children."
CEW Achiever Awards - Cocktails - 2014 by Patricia Willis Photography
“I'm a great believer in purpose-driven vocational education," says Wurwand. “It gave me my start."
This article was originally published December 18, 2016.
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"How did you ever get into a business like that?" people ask me. They're confounded to hear that my product is industrial baler wire—a very unfeminine pursuit, especially in 1975 when I founded my company in the midst of a machismo man's world. It's a long story, but I'll try to shorten it.
I'd never been interested to enter the "man's" world of business, but when I discovered a lucrative opportunity to become my own boss, I couldn't pass it up—even if it involved a non-glamorous product. I'd been fired from my previous job working to become a ladies' clothing buyer and was told at my dismissal, "You just aren't management or corporate material." My primary goal then was to find a career in which nobody had the power to fire me and that provided a comfortable living for my two little girls and myself.
Over the years, I've learned quite a few tough lessons about how to successfully run a business. Below are five essential elements to keep in mind, as well as my story on how I learned them.
Find A Need And Fill It
I gradually became successful at selling various products, which unfortunately weren't profitable enough to get me off the ground, so I asked people what they needed that they couldn't seem to get. One man said, "Honey, I need baler wire. Even the farmers can't get it." I saw happy dollar signs as he talked on and dedicated myself to figuring out the baler wire industry.
I'd never been interested to enter the "man's" world of business, but when I discovered a lucrative opportunity to become my own boss, I couldn't pass it up.
Now forty-five years later, I'm proud to be the founder of Vulcan Wire, Inc., an industrial baler wire company with $10 million of annual sales.
Have Working Capital And Credit
There were many pitfalls along the way to my eventual success. My daughters and I were subsisting from my unemployment checks, erratic alimony and child-support payments, and food stamps. I had no money stashed up to start up a business.
I paid for the first wire with a check for which I had no funds, an illegal act, but I thought it wouldn't matter as long as I made a deposit to cover the deficit before the bank received the check. My expectation was that I'd receive payment immediately upon delivery, for which I used a rented truck.
Little did I know that this Fortune 500 company's modus operandi was to pay all bills thirty or more days after receipts. My customer initially refused to pay on the spot. I told him I would consequently have to return the wire, so he reluctantly decided to call corporate headquarters for this unusual request.
My stomach was in knots the whole time he was gone, because he said it was iffy that corporate would come through. Fifty minutes later, however, he emerged with a check in hand, resentful of the time away from his busy schedule. Stressed, he told me to never again expect another C.O.D. and that any future sale must be on credit. Luckily, I made it to the bank with a few minutes to spare.
Know Your Product Thoroughly
I received a disheartening phone call shortly thereafter: my wire was breaking. This horrible news fueled the fire of my fears. Would I have to reimburse my customer? Would my vendor refuse to reimburse me?
My customer told me to come over and take samples of his good wire to see if I might duplicate it. I did that and educated myself on the necessary qualities.
My primary goal then was to find a career in which nobody had the power to fire me and that provided a comfortable living for my two little girls and myself.
Voila! I found another wire supplier that had the right specifications. By then, I was savvy enough to act as though they would naturally give me thirty-day terms. They did!
More good news: My customer merely threw away all the bad wire I'd sold him, and the new wire worked perfectly; he then gave me leads and a good endorsement. I rapidly gained more wire customers.
Anticipate The Dangers Of Exponential Growth
I had made a depressing discovery. My working capital was inadequate. After I purchased the wire, I had to wait ten to thirty days for a fabricator to get it reconfigured, which became a looming problem. It meant that to maintain a good credit standing, I had to pay for the wire ten to thirty days before my customers paid me.
I was successful on paper but was incredibly cash deprived. In other words, my exponentially growing business was about to implode due to too many sales. Eventually, my increasing sales grew at a slower rate, solving my cash flow problem.
Delegate From The Bottom Up
I learned how to delegate and eventually delegated myself out of the top jobs of CEO, President, CFO, and Vice President of Finance. Now, at seventy-eight years old, I've sold all but a third of Vulcan's stock and am semi-retired with my only job currently serving as Vice President of Stock and Consultant.
In the interim, I survived many obstacles and learned many other lessons, but hopefully these five will get you started and help prevent some of you from having the same struggles that I did. And in the end, I figured it all out, just like you will.