Korean Cosmetics Manufacturing Industry - The Foundation of K-Beauty Rests on World-Class Production
Updated: Jun 26
The Korean cosmetics OEM/ODM industry is led by the top three companies: Cosmax, Korea Kolmar, and Cosmecca Korea. There are about 300 companies operating in this industry, including Ingredion Lab, CNF, and Cosvision. Despite the downturn in the cosmetics market due to the impact of COVID-19, the Korean cosmetics OEM/ODM market has shown steady growth. In 2021, it experienced a sales growth of around 5.7% compared to the previous year, with Cosmax recording a 15.1% increase at 1.5915 trillion won and Korea Kolmar a 20.0% increase at 1.5863 trillion won.
Established in 1992, Cosmax supplies over 90% of its total sales in the form of ODM. It supplies cosmetics to approximately 600 brands worldwide, including L'Oréal Group, Mary Kay, and Johnson & Johnson. Cosmax's flagship products are gel-type eyeliners and cushion foundations. The gel-type eyeliner, as a single item, produced over 40 million units, with more than 30 million units exported overseas, making it a global hit product. This product was sold as Maybelline, a low-cost brand under L'Oréal, and became a major hit after its launch. As a result, Cosmax received the "Innovation Excellence Award" from L'Oréal in 2010.
Korea Kolmar is the first ODM company in the Korean cosmetics industry. After its establishment, it expanded its business areas to pharmaceuticals and health functional foods and positioned itself as a comprehensive beauty and healthcare company. Korea Kolmar has solidified its position in the industry with its convergent technological capabilities that go beyond cosmetics, pharmaceuticals, and health functional foods. By combining cosmetics and pharmaceutical technologies, Korea Kolmar has enhanced the usability and efficacy of its products. It currently holds 50% of the ODM products in the Korean sun care market. To strengthen its convergent technological capabilities, Korea Kolmar consolidated its 11 research institutes, previously separated by business areas, into one, establishing the first cosmetics technology convergence R&D center in Korea. Based on this technological prowess, Korea Kolmar produces products not only for major Korean cosmetics companies such as ATOMY, Carver Korea, and LG Household & Healthcare but also for global giants like L'Oréal, Estée Lauder, P&G, and Mary Kay.
Cosmecca Korea is a mid-sized company that ranks third in the Korean cosmetics OEM/ODM market. It has developed and operates its own OGM (Original Global Manufacturing) system, which includes reviewing distribution structures and legal regulations on a country-by-country basis to establish sales strategies. The Ministry of SMEs and Startups selected four companies, including Cosmecca Korea, as K-Smart Lighthouse Factories benchmarked after the World Economic Forum's Global Lighthouse Factory. Cosmecca Korea operates a smart factory by establishing digital production information and real-time monitoring systems, and it has set a goal to achieve real-time automatic control in relevant areas.
In addition to these companies, various others such as CNF, HNG, and Seoul Cosmetics are actively engaged in the Korean cosmetics OEM/ODM business. CNF is an OEM/ODM company specializing in cosmetics research, development, and manufacturing. Established in 1995, it holds the top position in the sheet mask production field in Korea. Having already established itself as a leader in the sheet mask market, CNF established a hair and body research center to expand its business areas and currently produces hair, body, and skincare products.
HNG is a specialized company that carries out contract manufacturing and research and development for cosmetics, health functional foods, and other products in Korea and overseas. It particularly specializes in cosmetics manufacturing and serves as an OEM/ODM manufacturer for famous beauty brand companies in Korea and abroad. The HNG Research Institute, in collaboration with Korea Kolmar's research institute, develops various products ranging from basic cosmetics to high-efficacy functional cosmetics.
Seoul Cosmetics, established in 1982, provides high-quality products that satisfy customer needs based on years of accumulated research and development technology know-how. It has a production and quality management system recognized in the global market through various certifications. Seoul Cosmetics has exclusive contracts with partner companies in China, Taiwan, Hong Kong, the Philippines, the United States, and exports OEM/ODM and in-house brand products to more than 40 companies in 21 countries.
In this way, Korea is filled with OEM/ODM companies that possess world-class cosmetics production technology and capabilities. Although Korea may not have the world's largest market size, it can be considered the world's top production base when examined by product category. While semiconductors, automobiles, shipbuilding, and the gaming industry are well-known, Korean OEM/ODM cosmetics manufacturing companies can also be regarded as world-class in terms of price competitiveness and product quality. It might be worth considering doing business with these Korean OEM/ODM cosmetics manufacturing companies.