Riding a global K-beauty boom, the top four domestic cosmetics ODM (original design manufacturer) companies—Kolmar Korea, COSMAX, Cosmecca Korea, and C&C International—posted more than 6 trillion won in combined sales last year. As their main clients, K-beauty companies, delivered solid sales at home and abroad, overall product orders flowing to ODM firms also increased. To respond to growing order volumes, the companies are securing additional production capacity (CAPA) across Korea and overseas while strengthening research and development.
According to the Financial Supervisory Service's Data Analysis, Retrieval and Transfer System (DART) on the 24th, Kolmar Korea, COSMAX, Cosmecca Korea, and C&C International recorded a combined 6.0503 trillion won in sales last year. That was up 11.5% from a year earlier and marked the first time the four companies' annual sales total surpassed 6 trillion won. Their combined operating profit rose 18% to 541.1 billion won.
Kolmar Korea posted sales of 2.7224 trillion won and operating profit of 239.6 billion won last year. Sales rose 11% and operating profit 23.6% from a year earlier. Expanded overseas export volumes by indie-brand clients and strong results for suncare products propelled growth.
COSMAX recorded sales of 2.3988 trillion won and operating profit of 195.8 billion won last year. Sales increased 10.7% and operating profit 11.6% from a year earlier. Demand rose for basic skincare products such as gel masks, creams, and suncare items, and hair and body products also posted solid sales.
Cosmecca Korea reported sales of 640.6 billion won and operating profit of 83.4 billion won, up 22.2% and 38.1%, respectively, from a year earlier. Growth in North America and cost-structure improvements from production efficiencies drove the results.
C&C International posted sales of 288.5 billion won and operating profit of 22.3 billion won last year. Sales rose 2% from a year earlier, while operating profit fell 22.9%. Buoyed by an expansion of new products and new formulations and an increase in overseas orders, the company set a record high for annual sales.
Domestic ODM companies are moving to expand production capacity and research and development to match the growing workload. Kolmar Korea plans to shut its existing plant in Beijing and expand its Sejong plant in Korea into a large-scale automated smart factory. It will consolidate production in China at its Wuxi plant and significantly increase domestic capacity to handle global orders.
COSMAX recently signed a stock purchase agreement (SPA) to acquire 51% equity in the Italian cosmetics ODM company "Keminova," securing its first production base in Europe. Keminova has multiple clients among Italy's derma and skincare brands and pharmaceutical companies. COSMAX plans to propose innovative formulations and technologies to these clients to generate new sales.
In addition, starting in 2024, COSMAX is investing 130 billion won to build a Smart Factory in Shanghai, China, and research facilities to establish a super-gap R&I capability. When the Shanghai smart factory is completed in the second half of this year, COSMAX's China CAPA is expected to increase from the current 1.49 billion units to 1.6 billion.
Cosmecca Korea added annual CAPA of 66 million units by starting operations at its new Cheongju plant in May last year. Of its 15 production lines, four were allocated as dedicated hydrogel mask lines to proactively respond to demand for mask packs that are popular overseas.
C&C International is investing 79 billion won to build a new plant in Cheongju. The facility is being constructed at more than six times the combined size of C&C International's existing domestic plants in Hwaseong and Yongin, and after completion in September next year, annual production capacity will expand by 1 billion units to 1.45 billion.
A beauty industry official said, "Domestic ODM firms are evolving beyond simple manufacturing partners into total-solution companies that handle brand planning, product development, and global regulatory approvals," adding, "If a brand wants to enter the market quickly, it has no choice but to rely on top ODMs with technology and production capacity."