# Brief History of COSMECCA Korea
"COSMECCA Korea Co. Ltd. 코스메카 코리아 (website)" is the 3rd largest cosmetics manufacturer in Korea.
The company was founded by current chairman & CEO Cho Im-Rae in 1999. He was born in 1953, studied Chemical Engineering at Sung Kyun Kwan University, and started his career at a leading Korean cosmetics company Peeres as a skin care researcher (The company Peeres later became Skinfood). He was the first research director of Kolmar Korea in 1992 and moved to Taewoong Cosmetics as a manufacturing director in 1993.
Taewoong Cosmetics faced a possibility of bankruptcy as many other companies struggled during the Asian financial crisis. Cho Im-rae could find another job with his quite impressive experience at cosmetics manufacturing but he could not move as he ran a big team at the Taewoong Cosmetics' factory and they all could lose their jobs if he moved. Finally he decided to buy out Taewoong Cosmetics and changed its name to COSMECCA in 1999.
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# Research-Oriented Business Strategy
During Cho Im-Rae's time at many other cosmetics companies, he has realized that cosmetics business is all about research and development.
"Cosmetics can look good with fabulous design, can sell well with massive marketing efforts, or it can be very cheap on price-wise. However, customers will loo away from all the products that actually do not work well. Our mission is to create the best quality products and it could be done with huge investment in research & development. This R&D First philosophy is now our culture."
With this philosophy Cosmecca has put their best efforts and resources on R&D to develop new innovative products. They succeeded developing BB creams that have 3 different function (UV protection + wrinkle improvement + Brightening) for the first time in the world in 2002 as well - Brands like SKIN79 and Hanskin, known for the best BB cream brands for a time, used to launch many different BB creams like Hanskin Super Light Touch BB Cream or Skin79 Green BB Cream through Cosmecca.
Cosmecca Korea R&D Team (Source: Cosmecca Korea Website)
The efforts on research & development has helped improve manufacturing system as well.
They adopted Toyota's famous manufacturing process 'Just-In-Time' for their cosmetics manufacturing process and reduced its conveyor belt from 12 meters to 3 meters so that they can improve manufacturing efficiency.
This helped improve its productivity over 400% and helped them manage product defects easier and faster.
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# Consistent Growth in Difficult Condition & Situation
As a later mover, Cosmecca prepared for a quantum jump through IPO and it seemed plausible that they would go public soon in early 2010's.
However, in 2013, a big fire broke out at its one of Cosmecca's main manufacturing facilities Eumseong Factory and it caused a lower valuation on Cosmecca.
Also in 2015, Cosmecca's China factory got a factory relocation order from Chinese government, which also caused its efforts for IPO defeated.
Among these unfavorable circumstances, Cosmecca retained its core reputation on cosmetics manufacturing ability and finally became a listed company on KOSDAQ in 2016.
They also recorded continuous sales growth every year and now they are the top 3 cosmetics manufacturer in Korea following Cosmax and Kolmar Korea.
IPO on Kosdaq in 2016 (Source: MK News)
Cosmecca also recently bought a 34.71% stake in a New Jersey based skin care manufacturer Englewood Lab for $53.7 million (article: Cosmecca Korea buys majority stake in Englewood Lab). Englewood Lab worked with over 80 western brands such as Elizabeth Arden, L'Oreal, Clinique, Benefit Cosmetics, Kiehls, Laura Mercier, et cetera. This partnership can help Cosmecca to work closely with US cosmetics brands for sure.
*FYI, former CEO of Englewood Lab David C. Chung will more focus on his own brand line Farmacy after he sold his shares on Englewood Lab.
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# Research, Manufacturing facilities, & FDA warning
As they claim they are focusing on research and innovation, Cosmecca runs 2 research & development teams (skin care lab & makeup lab). Not like Kolmar and Cosmax, currently Cosmecca focuses on cosmetics only.
Cosmecca's manufacturing capability is 100 million per year and 32% of their staffs are in manufacturing. As mentioned above, they have their own innovative manufacturing practice called CPS (Cosmecca Production System) with various technologies to maximize productivity with less defects.
The manufacturing facilities feature proper certificates as well: ISO 9001 (Quality management system), ISO 14001 (Environmental management systems), ISO 22716 (GMP, Good manufacturing practice for cosmetics), OHSAS18001 (British standard health and safety management system), et cetera.
Cosmecca manufacturing facilities (Source: Cosmecca Korea webstie)
However, in February 2018, Cosmecca received an warning letter from FDA as they violate FDA good manufacturing practice (GMP). FDA inspected Cosmecca's facility and found that Cosmecca released over-the-counter(OTC) drug products without data to support their conformance to specifications. This means Cosmecca did not feature proper data for its OTC drug products (mostly sunscreen functional products). There are other reasons but mostly they are about them not having proper data for products they claim with function.
This actually happened to Kolmar Korea as well, actually many of Korean cosmetics manufacturers violate US GMP rules as there are not that much clear information for Korean manufacturers how they should prepare for US GMP requirements. I am quite sure it was not an intentional violation, but still, a violation is a violation.
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# Products manufactured by Cosmecca Korea
Like Kolmar and Cosmax, Cosmecca also produces products for many different brands. I have searched 283 products of 43 different brands below, hopefully it can help you understand what products they make and how good they are through your previous experience with specific products.
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Cosmecca Korea is now such a big corporation now: total sales in 2017 was bout US$162 million. With its acquisition of Englewood Lab, it could possibly exceed US$250 million this year.However, still they are no.3 after Kolmar Korea and Cosmax. With this circumstance, CEO Cho Im-Rae is still very positive and confident.
"It is true that there are already those leading companies. However, Cosmecca's direction is somehow different from them. It is not always how big you are and how long you have run your business to become a leading company. Cosmecca will focus on our own direction and will become the leading OGM (Original Global Management) company both in Korea and global market."