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Business / Companies

Amore sitting pretty in makeup market

By Wang Hongyi (China Daily) Updated: 2014-10-22 07:19

South Korean cosmetics group Amore Pacific aims to become Asia's top cosmetics producer with global sales reaching 70 billion yuan ($11.4 billion) by 2020.

As its largest market, China has become a key target for Amore Pacific to achieve its goal, with the nation forecast to contribute 28 percent of the company's global sales by 2020.

Amore Pacific announced on Tuesday the opening of a new center in Shanghai that combines the functions of research and development, manufacturing and logistics.

The center costs 750 million yuan, and has about 10 times the annual production capacity of its former factory in Shanghai. The center is also the largest R&D, production and logistics base for Amore Pacific outside South Korea.

"Amore Pacific has seen the huge potential of the Chinese market from very early days. The center will be a symbol for our group to accelerate the pace of China strategy. The strong production capacity, excellent R&D ability and efficient logistics system will help us produce more products suited to the Chinese market," said Suh Kyung-bae, president and chief executive officer of the company.

Amore Pacific first entered the Chinese market in the 1990s. The popularity of South Korean television series in China has helped South Korean cosmetics brands beat their global rivals in the country. For the past decade, Amore Pacific's average sales growth in China was 47 percent.

Last year, sales in China reached 2 billion yuan. In the first half of 2014, sales totaled 1.28 billion yuan, up 26.5 percent year-on-year.

"Based on individual brands' characteristics, Amore Pacific will continue to explore and expand the market with a multi-channel strategy," said Charles Kao, its general manager in China.

The company is also looking for opportunities to introduce new brands into the Chinese market.

According to the company, a logistics base in Qingdao, Shandong province, will start operations later this year, joining bases in Shanghai and Shenyang, capital of Liaoning province. Two more logistics bases in Beijing and Guangzhou will be built in 2015 and 2016.

"Smooth logistics and sales channels and (the expansion of) e-commerce channels will help us meet Chinese consumers' demands and achieve fast growth in China," said Kao.

Amore sitting pretty in makeup market

Amore sitting pretty in makeup market

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