Cosmetic Change in California

The gradual decline in the market for cosmetics and toiletries on the West Coast got the blame for the recent closure of Henkel Corp.’s specialty chemicals plant in Hawthorne.

The population boom that helped fuel the dramatic growth of the personal-care market in the 1960s and 1970s has tapered off, Henkel pointed out in announcing the June 30 closure, which is displacing about 50 employees.

And the advancing age of the Baby Boom generation is also believed to be a factor. “I’m a manufacturing man, not a salesman, but I’ve heard our marketing people say it’s the demographics of the situation” that led to the closure, said Ray Jones, Henkel’s vice president for manufacturing.

But Henkel’s most pointed reason for leaving Hawthorne is that, in the last two or three years, the company’s primary customers have been moving their own manufacturing plants back East, Jones said.

Redding, Calif.-based Jhirmack Enterprises Inc., for example, will complete its move to Apex, N.C., this month, and Los Angeles-based Vidal Sassoon Inc. announced in June that it will be shifting some operations from Chatsworth to plants in Pennsylvania and North Carolina.

“The East Coast has always been a center for cosmetics,” Jones said in an interview from Henkel’s Minneapolis base. “That’s where (the industry) started, and it’s where 99% of the major cosmetics and toiletry firms are headquartered.”

Henkel, a wholly owned subsidiary of the West German firm Henkel KGAA, will concentrate production in two plants--in Charlotte, N.C., and Hoboken, N.J. Like the Hawthorne plant, they manufacture products used in shampoos, skin lotions and liquid soaps, Jones said.

The Hawthorne plant also supplied specialty chemicals to the domestic oil and gas industry, which has been undergoing its own severe slump. The “weak marketing situation” there was also a reason for the closure, Henkel said.