Small is big in the world of cosmetics--just ask Toronto entrepreneur, Hana Zalzal.
When Zalzal told friends and colleagues that she wanted to quit her day job and start her own line of cosmetics, they told her she was crazy. But Zalzal stayed true to her passion for creativity, and 8 years later, she is basking in the success of her multimillion dollar company, CARGO Cosmetics Cor. Her products are sold in five countries and are used by numerous celebrities, including Heather Locklear, Sheryl Crow, and Sharon Stone.
But what is most extraordinary about Zalzal's story is where it begins. Her transition from work designing cables and the structures that house them to a life of glamour and rubbing shoulders with celebrities sounds like the stuff of fairytales. But it has been a career change that Zalzal has managed with considerable aplomb.
The self-made entrepreneur insists that she had an interest in both the creative and the scientific throughout childhood, but it was her interest in construction and building design that persuaded her to study civil engineering at the University of Toronto. That interest, however, turned out to be short-lived. After graduating in 1988, Zalzal took up a position at the telephone company Bell Canada doing work that she says was routine and "not at all interesting." "There were certain ways of doing things, and the work wasn't at all creative, innovative, or challenging," she explains, "It was handbook-style engineering."
After only 2 years, she returned to university, earning an MBA from York in 1992 when she went back to Bell as a marketer. The next stop on Zalzal's career path was as a financial analyst at the brewing company, Molson. Although she found the marketing side of business more interesting than the engineering side, she also discovered that she didn't like to be just one of the minions in a large company. "It didn't suit my personality very well," she says.
During her time at Molson, Zalzal began to set her mind toward making a complete break and forming her own company. "I was always interested in cosmetics. I enjoyed purchasing them, and I liked the art of applying them," Zalzal explains. The inspiration for her company came from reading fashion magazines. She realised that although young women wore different fashions than their mothers, they were still purchasing the same cosmetics brands and colours that their mothers and grandmothers used. What she observed in the marketplace was "a need for cosmetics to be brought up-to-date in terms of packaging and image, and also in terms of the offering to the consumer." Zalzal also recognised a growing trend towards boutique brands and "felt there was room for more" in Canada. So while working a 4-day-week as a financial analyst for Molson, she used her spare time--and the den of her home--to develop the concept for her cosmetics business.
The going wasn't always smooth in the beginning, says Zalzal. At first, many people couldn't accept that her talents extended beyond civil engineering. She explains, "I got a lot of people saying, 'What do you know about cosmetics?'. That was a comment that came up over and over again." But it wasn't friends or colleagues who were her harshest critics. Competitors in the industry were obviously hoping that Zalzal would fail--and telling her so. 'Why would anyone put something on their face that was called CARGO?' was, she says, just one of the many disapproving comments she received from industry insiders. One individual even went as far as saying to her that if she ever got an order from a big department store they would "eat their shirt." "I never took them up on that!" she laughs.
When asked how she coped with the negativity, Zalzal replied unequivocally, "I am the kind of person that the more you tell me I can't do something, the more I want to do it." As far as she was concerned, she wasn't happy with her career, "so there was nowhere to go but up." She also adds that the engineering degree prepared her well for these experiences because it was "the most gruelling and challenging 4 years" of her life. "It left me with a sense of confidence that if I could do that, then I could do anything I put my mind to."
In 1994, she approached the department store Eaton's because at the time, unlike rivals The Bay and Holt Renfrew, it didn't carry a boutique cosmetics brand. Her timing couldn't have been better, she admits, as the company was in the process of revamping its image. She arranged to meet the general manager, armed with little more than a business plan, samples of packaging and colours, and a brand name. Zalzal had enlisted the help of the artist who applied her wedding makeup to put together the sample colours and work with some labs to perfect the texture and the look of the products. The preparation paid off. "[Eaton's] were quite excited about the stylish packaging and all of that. They took a chance on us, basically."
Eaton's distribution gamble was Zalzal's breakthrough. The natural shades housed in "techno-urban" metal tins and named after exotic locales quickly gained a strong following, first among professional makeup artists and then among consumers. CARGO was doing "phenomenally well"--that is, until the 130-year-old Canadian retail icon met its unexpected demise in 1998. "The risk factor that nobody anticipated was what if your major customer applies for bankruptcy protection. Who would have thought that of Eaton's?" says Zalzal.
By now, though, she had the United States in her sights. Surprisingly, the formidable challenge of distinguishing the young cosmetics company from other big-name cosmetic brands in a huge market never posed a problem. Sephora, a chain of European supermarkets that sells cosmetics, fragrances, and skin care products had begun its U.S. expansion and signed a distribution deal with the small Toronto-based company. "It was a perfect fit," recalls Zalzal. CARGO continues to do exceedingly well through Sephora to this day, thanks to "the might of the consumer" who, she reasons, "wanted something small and different"--an alternative to the offerings of the larger companies.
CARGO has doubled its sales each year since 1995. Word-of-mouth promotions by Hollywood makeup artists have provided a convenient avenue for marketing, and today, professional makeup artists on runways, film sets, prime-time television, and photo shoots around the world use CARGO products. And, of course, it's great advertising if Hollywood stars choose to wear CARGO products at their wedding--when Jennifer Aniston, wearing the CARGO lipstick Plume, said "I do" to Brad Pitt, sales of the colour went through the roof. But the real coup in terms of CARGO's exposure to consumers in the United States, says Zalzal, was when Friends celebrity Courtney Cox Arquette agreed to design a lip colour. Other stars and established make-up artists were quick to follow Cox's lead, so Zalzal established the Celebrity Charity Collection. A portion of each purchase from the collection goes to her favourite charity, the Children's Miracle Network, an international nonprofit organization dedicated to raising funds for 170 children's hospitals throughout North America.
While a strong desire to live by her own set of rules was the driving force behind Zalzal's venture, being your own boss comes with its own set of headaches. "It's always with you. ? There's no maternity leave, there are no weekends, and there are no nights," she says.
But Zalzal is not making plans for early retirement. Now that her company has reached some of the many goals she set for it 8 years ago, her next challenge, she says, is managing controlled growth. "We are keeping it very much a niche brand and avoiding over-distribution," she says. CARGO is on the verge of expanding into Europe and Asia and is always in the process of developing new products. Staying innovative, she says, will be the key to the company's long-term sustainability. Nonetheless, says Zalzal, "the hard part is done."
Taking a moment to reflect on her career, Zalzal says she can't think of anything she would do differently. Every aspect of her background, including her engineering experiences, taught her something and helped her get exactly where she wants to be. Science, she emphasizes, is the great stepping stone to any career and should never be underestimated. "Even though I am not applying engineering principles to cosmetics, I am applying the analytical thinking I learned to business situations all of the time."
Above all, the flexibility afforded by her new career is a main source of her happiness. "I work 24 hours a day because my brain doesn't shut off when I sleep, but I have the flexibility of spending time with my [three] children and being where I need to be, when I need to be there." She's grateful for her new lifestyle and hopes that this is reflected in the way she runs CARGO. "I think I have created a company that respects that people have personal lives."