The K-beauty boom has led to both COSMAX and Kolmar Korea, the two giants in the domestic cosmetics Original Design Manufacturer (ODM) industry, surpassing 2 trillion won in sales last year. As the influence of K-beauty grows in the global market, both corporations are competing by showcasing their respective strengths.
Last year, the export value of domestic cosmetics reached a record high of $10.2 billion (approximately 15 trillion won), with small and medium-sized enterprise exports accounting for $6.8 billion (approximately 10 trillion won). The production of cosmetics for indie beauty brands, which led the K-beauty boom, was handled by COSMAX and Kolmar Korea, resulting in improved performance.
According to the Financial Supervisory Service’s electronic disclosure system on the 25th, COSMAX's consolidated financial statement revenue last year reached 2.1661 trillion won, an increase of 21.9% compared to the previous year. During the same period, operating profit was 175.4 billion won, and net profit was 88.4 billion won, marking increases of 51.6% and 133.9%, respectively. The surpassing of 2 trillion won in revenue is a first since its founding.
Kolmar Korea's consolidated revenue last year was 2.4513 trillion won, reflecting a 13.7% increase from the previous year. This makes Kolmar Korea the second consecutive year with revenue surpassing 2 trillion won following 2.1557 trillion won in 2023. During the same period, operating profit was 198.3 billion won, and net profit was 133.4 billion won, up 45.7% and 430.6%, respectively. Kolmar Korea maintained its position in the 2 trillion won club for two consecutive years after 2.1556 trillion won in 2023.
As both companies surpassed 2 trillion won in revenue, the competition for the top spot is intense. Although Kolmar Korea has higher overall sales, COSMAX leads in the cosmetics sector alone. Kolmar Korea's cosmetics sector revenue was 1.1371 trillion won in 2023, accounting for 52.7% of the total. This is partly due to the substantial revenue from its subsidiary HK inno.N, which contributes 35.3%. Consequently, COSMAX emphasizes its status as the industry's first to achieve 2 trillion won in sales. Earlier, COSMAX highlighted its record as the 'first in the global cosmetics ODM industry' when it surpasses 1 trillion won in the first half of last year. Kolmar Korea also exceeded 1 trillion won in sales during the same period, but COSMAX claimed the industry's first title.
◇ COSMAX, the world's number one in cosmetics ODM vs Kolmar Korea with exceptional competitiveness in sun care
COSMAX is the world's number one cosmetics ODM corporation, with an annual production capacity (CAPA) exceeding approximately 1.77 billion units. This amount is equivalent to the number used by one in every four people worldwide.
COSMAX currently operates factories in South Korea, China, the United States, Indonesia, and Thailand. To secure 'super-gap technology,' it runs a cosmetics Research Institute (R&I) center staffed by about 1,000 researchers. In 2023, this center registered nearly 100 patents both domestically and internationally.
Kolmar Korea possesses unparalleled competitiveness in the sun care (UV blocking) sector. Sunscreen is not only a simple UV blocker but also an essential technology applied across basic and color cosmetics. With UV blocking features included in toners, lotions, and compacts, the competitiveness of ODM companies that have secured sun care technology is becoming more prominent.
Currently, Kolmar Korea holds over 70% of the domestic UV blocking product market share. With an aggressive technological investment of 5% of its annual revenue into research and development, it is evaluated as an ODM corporation leading the global market based on exceptional technology, similar to TSMC in the semiconductor industry. Within the industry, COSMAX is perceived as strong in color cosmetics, while Kolmar Korea excels in basic products.
Both corporations are collaborating with key beauty brands domestically and internationally. Notably, the backdrop for both companies achieving the milestone of 2 trillion won in sales includes South Korean small and medium-sized beauty brands. As the K-beauty boom continues in the global market, exports from small and medium-sized brands have increased, benefitting the ODM companies that produce these products.
Currently, COSMAX has about 3,300 client companies, of which over 1,500 are K-beauty brands. Additionally, 18 out of the top 20 global beauty corporations, including L'Oréal, Lancôme, and Yves Saint Laurent, are transacting with COSMAX. Kolmar Korea's client count increased from 2,509 in 2022 to 3,147 in 2023, reaching 3,776 last year. Popular clients of Kolmar Korea include Chosun Beauty, which sparked the 'K sunscreen syndrome' on Amazon, and Dalba, known for its high-function basic cosmetics.
◇ Trump administration's second term: anticipated benefits for COSMAX and Kolmar?… expectations for continued high growth
COSMAX and Kolmar Korea are determined to continue their growth driven by the K-beauty boom. They are devising strategies to attract not only the export volumes of their domestic clients but also the demand from overseas local clients. This also explains the expansion of overseas sales networks and local production facilities by both companies.
In particular, with the reality of high tariffs under the Trump administration materializing in the United States, which exports cosmetics second only to China, there is a possibility that COSMAX and Kolmar, who have production facilities in the U.S., may benefit. This is due to the difficulties faced by Chinese ODM companies in accessing the U.S. market.
COSMAX operates a factory in New Jersey, U.S., with an annual production capacity of 270 million units. Since the third quarter of last year, it has opened a new office in West Los Angeles to secure new clients. Kolmar Korea plans to start operations at its second factory in Pennsylvania by the first half of this year, focusing on the production of UV blocking products and basic cosmetics. Through this, it aims to increase its North American subsidiary's production from the current 180 million units to 300 million units.
The market generally expects the growth trend of both corporations to continue. Kwon Woo-jeong, a researcher at Kyobo Securities, noted that Kolmar Korea is likely to display a positive trend in diversifying its customer base through new brand contracts next year. Park Jong-dae, a researcher at MERITZ Securities, remarked that COSMAX, as the world's number one cosmetics ODM company, is expected to benefit the most from the global expansion of K-beauty, anticipating normalization effects from major regional subsidiaries in South Korea, China, the United States, and Southeast Asia.