Near-shoring your supply chain with Modern Retail’s Melissa Daniels — plus Drunk Elephant’s sales slump and Touchland’s big acquisition

But the idea of near-shoring, or moving a supply chain closer to the brand’s home country, as well as multi-shoring, or diversifying your supply chain to additional regions, comes with many pros and cons. 

On today’s episode of the Glossy Beauty Podcast, host Lexy Lebsack is joined by Melissa Daniels, senior reporter at Glossy’s sister publication Modern Retail and co-host of the Modern Retail Podcast, to unpack the nuances in supply chain pivots today. 

“I’m hearing a lot of brands talk about this supply chain risk assessment that they’re trying to make now,” Daniels said. “Even if it’s not tariffs [prompting this], it might be something else: There was Covid that messed up supply chains, [and] certain weather events can have a huge impact on shipping and delivery, so if you are a company that has the resources to re-shore, you are looking into that much more seriously than you were a year ago.” 

The two hosts share their latest reporting, including insights from brands actively looking to move their supply chains to places like Mexico, foreign manufacturers looking for U.S.-based brands to work with and the companies connecting them. 

“If you’re insulated by having products in multiple places, that prevents that really scary situation where you have no inventory [because of an unexpected global event],” Daniels said. 

As previously reported by Glossy, many experts believe that “every purchase order is up for grabs” right now as brands rethink their suppliers. However, a future-proofed supply chain can take decades to build, so it’s important to think through changes. 

“This is such a relational business,” Daniels said. “Brands have a really close relationship with their suppliers and their manufacturers; they’ve worked together for a very long time, in some cases, and there’s trust there.” What’s more, there is a question over whether or not big supply chain shifts can be investigated fast enough, let alone implemented, to avoid tariffs this year. Ahead, Lebsack and Daniels discuss expected timelines, which can range from weeks to years, as well as the unexpected environmental and marketing benefits of near-shoring.

But first, Lebsack is joined by co-host Sara Spruch-Feiner to unpack this week’s industry news. 

This includes one of the biggest brand exits of the year: Announced Monday, consumer goods company Church & Dwight is set to acquire hand sanitizer company Touchland for $700 million in cash and stock, plus a potential 2025 earnout of over $100 million.

The team also dives into a new study out of the U.K. from watchdog group Advertising Standards Authority that found around a third of influencers fail to disclose their ties to brands. 

And finally, a look at Drunk Elephant’s sales tumble. Japanese beauty conglomerate Shiseido, which owns brands like Nars and Drunk Elephant, reported an 8.5% decline in sales on Monday. This is partially due to a 65% year-over-year drop in Drunk Elephant sales, the once golden child of the beauty industry. 

Excerpts from the conversation, below, have been lightly edited for clarity. 

On brands pivoting their supply chains

Daniels: “A lot of companies [I cover] have moved toward near-shoring or multi-shoring. One company I’ve talked to recently is Branch Furniture. They specialize in office furniture and their founder, Greg Hayes, told me that they were reading the tea leaves and working on moving out of China even 12-18 months ago. That’s also the case with SharkNinja, which does a lot of home appliances [and beauty devices]. Wayfair is another company in the furniture space that has done a really good job ensuring their suppliers are all over the place so they’re insulated from the effects of tariffs. But some are still in the process because this doesn’t happen overnight. The furniture company Havenly brands, which houses companies like Citizenry and Interior Define, has been trying to find new suppliers since Election Day. Their CEO, Lee Mayer, said the company has been able to diversify its sourcing for custom furniture brand Interior Define from about 80% in China to about 50% today. So that shows you that this really takes months.”

On the risks associated with multi-shoring 

Daniels: “[Consumer packaged goods like beauty and wellness] is a relational business. People forget that brands have a really close relationship with their suppliers and manufacturers. They’ve worked together for a very long time, in some cases, and there’s trust there. [Manufacturers] have scaled [these brands] and [brands] have invested in their manufacturers … That’s an interesting point about [both parties needing] connectors, because how do you just make that happen overnight? You can’t, right? You might almost need that trusted broker to come in and say, ‘Here’s what I think this person could do for you.’”