The OEM quotation process is where most private label projects are quietly won or lost. Two quotes that look identical on the unit price can differ by 40 percent once freight, tooling, testing and payment terms are added, and the difference is usually visible only when the line items are itemised. A quotation that arrives as a single number is a number, not an offer.
1. The lines a quote should break out
Formula or base cost per kilogram, fill cost per unit, packaging per unit, assembly and labour, tooling or mould fee, testing and certification, sampling, artwork and plate costs, and freight. Then the commercial terms: MOQ, lead time, payment schedule, Incoterm, and validity period. A supplier that provides all of these in one page is a supplier that has quoted before.
2. The lines buyers forget
Testing, artwork plates, and the cost of a second production run. Stability and microbial testing can add a meaningful amount per SKU and are often excluded because they are not a production cost. Artwork and printing plates are one-off charges that appear at the first order and surprise at the invoice. A second run at half the first volume costs more per unit, and the quote should say so upfront.
3. Incoterms and the landed cost
EXW, FOB, CIF and DDP produce very different landed costs from the same unit price, and a comparison has to normalise to one term. FOB is the most common for a first order because it makes the freight visible; DDP is convenient and hides the freight inside the price, which is useful only when the buyer cannot arrange transport. Add duty and the destination VAT to get the true landed cost.
4. Payment terms and the risk price
A 30 percent deposit with 70 percent before shipment is standard for a first order; a sight letter of credit costs the supplier money and appears in the unit price. A buyer asking for 60-day terms is asking the supplier to finance the order, and the quote will reflect it. Compare terms before comparing prices, or the comparison is meaningless.
5. MOQ and the tiered price
Most fillers price in tiers: a first tier at the minimum order, a second at three times that, a third at ten times. The difference between tiers is often 20 to 30 percent, which is why a brand planning a full year should quote the annual volume rather than the launch volume. A single-tier quote with no volume break is usually a sign that the supplier has not costed the changeover.
6. Validity and the raw material clause
A cosmetic quote is exposed to raw material price movement, so most are valid for 30 days. A quote with no validity date is either careless or a placeholder. Ask how the supplier handles a raw material increase mid-order, and get the answer in writing before the deposit.
7. Commercial profile
Standard quotation turnaround, three to five working days for a stock format; a custom formula adds a week. See the production range and the sampling guide for the step before the quote.
