Before Manna Kadar’s beauty business became a multi-brand portfolio, retail buyers were being greeted at Island Tan, passing tanning beds before getting to the 100-square-foot showroom of Manna Kadar Cosmetics.
“That was the first office. The bathroom was over there and here’s the hallway and there’s spray tan machines,” Kadar said, looking at a picture of the company’s very first office—within a Laguna Niguel tanning salon she used to operate.
“There came a point where you couldn’t take me seriously—or, I couldn’t take myself seriously presenting that. So we had to grow up, but it was a good thing to do to push me to that next level.”
Kadar’s now in a dedicated Irvine Spectrum office building overseeing a business in roughly 6,000 stores and comprised of two cosmetics lines—one prestige and one for the masses—as well as Manna Kadar Bath & Body, Haute Dog, Mason Man Skincare, and Beauty & the Bump.
The overall business closed out the 12 months through June 30 with $6.5 million in sales. That’s up 41% from 2017, making the company No. 30 on this year’s list of the fastest-growing small private companies in Orange County—those with revenue of $10 million or less (see list, page 50).
The revenue spike came from the expansion into men’s, pets, maternity and bath offerings—all of which came at a dizzying rate in the past year.
What’s more, it doesn’t reflect recent deals with retailers Urban Outfitters, Bed, Bath & Beyond or Ulta, which are expected to significantly boost sales moving forward.
The growth of the company, which has about 10 employees at headquarters, will likely mean buying its own building in Costa Mesa next year, she said.
Keeping Customers
Kadar is part of the U.S.’s prestige beauty industry, which had sales of $18.8 billion last year, up 6% from a year earlier, according to researcher NPD Group. Within that segment of beauty, makeup accounted for $8.1 billion of those 2018 sales, up about 1% from the year prior.
Each move by the Irvine business has been calculated. The executive’s prestige cosmetics brand came first before she created the more affordable line called Goddess. Bath and body was a natural next step.
“Usually, our customers buy one of the cosmetics lines and then they continue on to buy the bath and body, the men’s, the pet,” Kadar said.
“So rather than having more quantity of customers, we’re doing more volume within the breadth of the business because every new customer you’re trying to get is much more challenging than working with your existing customers to try and gain more business from them. So we’ve sold more lines to each customer versus opening a new door, opening a new door, opening a new door.”
Companies that can are now testing and expanding into retail. Laguna Beach jewelry brand Gorjana is one example after launching first with a wholesale business. Then there are larger, venture-backed digital businesses such as eyewear maker Warby Parker and mattress brand Casper Sleep Inc. also making a go at retail.
Kadar isn’t sold on company-owned brick-and-mortar with no plans in the immediate future to begin dabbling in pop-up stores or something more permanent. Her decision’s culled from an interesting set of experiences that got her and her business to where they’re at now.
Teenage Entrepreneur
Kadar, at 16, bought a free-standing cosmetics store at the Brea Mall.
The timing was right in 1996 to get into retail. There was plenty of disposable income to go around. She funneled her profit into a second outpost at MainPlace Mall in Santa Ana, followed by Mission Viejo, two stores in San Diego and then a final expansion into the Fashion Show Mall in Las Vegas.
She did all this as she attended the University of Southern California full time.
“When you’re young, you’re just so motivated and so hungry,” she recalled of the time. “You’re seeing success. That’s great. So you want more and more of that, and that’s what drove me to do all of this.”
Things changed after 9/11 and the recession that hit around the same time. There were fewer people in malls and Kadar—not surprisingly— was burned out. Armed with her finance degree, she went into corporate banking for the next four years, but she couldn’t stay away from entrepreneurship. She got into the tanning business while still a banker, opening up Island Tan in Laguna Niguel. The economy was different this time around, in 2008, with the financial crisis and subprime mortgage meltdown in full effect.
She diversified the salon’s revenue stream by adding eyelash extension services, apparel and accessories to the mix, and also took over an abandoned tanning salon business in Fullerton.
Cosmetics were the one thing she didn’t have in her portfolio, so she jumped into that business and hasn’t looked back.
No Limits
What’s next for Kadar and company is carefully managing growth so as not to put too much stress on the existing organization. As for how large Manna Kadar could be, the CEO sees plenty of opportunity: “The sky’s the limit. It can grow as much as the infrastructure can support. You’ve seen some amazing stories in beauty where one year they’re this and then next year they’re that.
“I don’t want to take on any equity partners. I still want it to be privately owned so it will be what we can manage internally. We can be $20, $30, $100, $200, $500 million. It’s definitely feasible.”
