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COSMETICS OEM AND ODM MARKET REPORT OVERVIEW
The global cosmetics OEM and ODM market size was USD 26790 million in 2020 and the market is projected to touch USD 52198 million by 2032 at a CAGR of 5.6% during the forecast period.
Cosmetics OEM (Original Equipment Manufacturer) and ODM (Original Design Manufacturer) are two distinct business models within the cosmetics industry. In the OEM model, a company manufactures products based on the specifications provided by another brand, allowing the brand to sell the products under its own name. This approach is advantageous for brands that want to focus on marketing and brand identity without investing heavily in production facilities. The OEM manufacturer is responsible for formulating, producing, and packaging the cosmetic products according to the client's requirements.
On the other hand, ODM involves the development of cosmetic products by a manufacturer who already has predefined formulas and designs. The brand purchasing the ODM services can choose from the manufacturer's existing catalog of formulations and packaging options, often allowing for some degree of customization to align with their branding. ODM is beneficial for brands that seek cost-effective and time-efficient solutions, as they can access ready-made products with minimal involvement in the product development process. Both OEM and ODM play crucial roles in the cosmetics industry, offering flexibility and scalability to brands with varying needs and resources.
COVID-19 Impact: Market Growth Boosted by Pandemic due to Increased Digitization
The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to market’s growth and demand returning to pre-pandemic levels.
ODM manufacturers also faced challenges as the pandemic disrupted the supply chain and manufacturing processes. However, ODMs with diversified and flexible production capabilities were better positioned to weather the storm. The decline in consumer spending on non-essential items during economic uncertainties impacted the overall demand for cosmetic products, affecting both OEMs and ODMs.
Furthermore, the increased focus on hygiene and safety during the pandemic led to changes in product formulations, packaging, and marketing strategies for cosmetics. Both OEMs and ODMs had to adapt to these changes to meet the evolving needs of the market. Digitalization became crucial for communication and collaboration between brands and manufacturers, facilitating remote product development and coordination. The global cosmetics OEM and ODM market growth is anticipated to boost following the pandemic.
LATEST TRENDS
"Sustainability and Clean Beauty to Drive Market Growth"
The cosmetics industry, including OEM and ODM services, has been increasingly focused on sustainability. There's a growing demand for clean, eco-friendly formulations, and manufacturers are incorporating sustainable practices in their production processes and packaging. This trend is likely to continue with an emphasis on reducing environmental impact.
The use of technology, such as artificial intelligence and data analytics, in product development, supply chain management, and customer engagement has been gaining momentum. Companies in the OEM and ODM space are likely to invest in digital solutions to enhance efficiency, collaboration, and innovation. Consumers are showing a preference for personalized cosmetic products. OEM and ODM manufacturers may explore technologies that allow for greater customization, such as tailored formulations based on individual skin types or preferences.
COSMETICS OEM AND ODM MARKET SEGMENTATION
By Type
Based on type the global market can be categorized into OEM and ODM.
OEM: OEM, or Original Equipment Manufacturer, is a business model where a company produces goods or components that are used in another company's final product. In the context of cosmetics, an OEM manufacturer would produce cosmetic products based on the specifications provided by a brand or company. The OEM manufacturer is responsible for the formulation, production, and packaging of the products, and the brand selling these products typically markets them under its own name. OEM arrangements allow brands to focus on marketing and branding without the need for extensive in-house manufacturing facilities.
ODM: ODM, or Original Design Manufacturer, is a business model where a company designs and manufactures products based on its own designs and specifications, which can then be sold under another brand's name. In the cosmetics industry, an ODM manufacturer typically has predefined formulations and designs that can be customized to some extent to align with a client's branding. ODM services are beneficial for brands that want ready-made products without heavy involvement in the product development process. ODM manufacturers are responsible for the entire product development cycle, from formulation to packaging, offering a turnkey solution for brands looking to launch cosmetic products quickly and efficiently.
By Application
Based on application the global market can be categorized into Skincare, Makeup, Haircare, and Others.
Skincare: Skincare refers to the practices and products used to maintain and enhance the health and appearance of the skin. This includes cleansing, moisturizing, sun protection, and targeted treatments to address specific skin concerns. Skincare products can include cleansers, toners, serums, moisturizers, masks, and more. The goal of skincare is to promote skin health, address issues such as aging or acne, and maintain a radiant complexion.
Makeup: Makeup involves the application of cosmetic products to enhance or alter one's appearance. It includes products like foundation, concealer, eyeshadow, lipstick, and mascara. Makeup is used for various purposes, including highlighting features, concealing imperfections, and expressing individual style. It is often applied to the face but can also be used on other parts of the body. Makeup trends can vary widely and are influenced by fashion, culture, and personal preferences.
Haircare: Haircare involves practices and products aimed at maintaining the health and aesthetics of the hair. This includes washing, conditioning, styling, and treating the hair to address specific concerns such as damage or dandruff. Haircare products encompass shampoos, conditioners, hair masks, styling gels, and hair oils. The goal of haircare is to keep the hair clean, nourished, and styled according to individual preferences, considering factors like hair type, texture, and desired look.
DRIVING FACTORS
"Time-to-Market to Boost the Market"
Outsourcing manufacturing to OEMs allows brands to bring products to market more quickly. OEMs are equipped to handle the entire production process, from formulation to packaging, reducing time-to-market for new products. ODM services are known for their speed in product development. Brands can choose from existing formulations, reducing the time and effort required for custom product creation. While OEM manufacturing may involve customization, it is often more flexible in terms of accommodating specific brand requirements. Brands can have more control over the product specifications and branding.
"Global Market Expansion to Expand the Market"
Both models enable brands to expand their presence in global markets without the need for significant investments in manufacturing infrastructure. Manufacturers may have the capacity to produce products that comply with different regional regulations and cater to diverse consumer preferences. Advances in technology, such as automation and digitalization, contribute to improved manufacturing processes and communication between brands and manufacturers. This facilitates faster and more efficient collaboration in product development.
RESTRAINING FACTOR
"Limited Control over Formulations and Processes to Potentially Impede Market Growth"
Brands outsourcing to OEM manufacturers may have limited control over the formulation of the products. The OEM handles the production process, and brands might have less influence on ingredient choices and formulation adjustments. ODM services, while offering customization to some extent, may not provide full control over the formulation process. Brands have to work within the framework of existing formulations provided by the ODM manufacturer.
COSMETICS OEM AND ODM MARKET REGIONAL INSIGHTS
"Asia Pacific Region Dominating the Market due to Manufacturing Capabilities "
The market is primarily segmented into Europe, Latin America, Asia Pacific, North America, and Middle East & Africa.
Asia Pacific has emerged as the most dominant region in the global cosmetics OEM and ODM market share due to several factors. The region with its vast manufacturing capabilities, has been a go-to destination for OEM services. They are known for its innovation in skincare and beauty products, attracting many brands seeking ODM services for cutting-edge formulations and designs.
KEY INDUSTRY PLAYERS
"Key Industry Players Shaping the Market through Innovation and Market Expansion"
The cosmetics OEM and ODM market is significantly influenced by key industry players that play a pivotal role in driving market dynamics and shaping consumer preferences. These key players possess extensive retail networks and online platforms, providing consumers with easy access to a wide variety of wardrobe options. Their strong global presence and brand recognition have contributed to increased consumer trust and loyalty, driving product adoption. Moreover, these industry giants continually invest in research and development, introducing innovative designs, materials, and smart features in cloth wardrobes, catering to evolving consumer needs and preferences. The collective efforts of these major players significantly impact the competitive landscape and future trajectory of the market.
List of Market Players Profiled
- COSMAX [South Korea]
- Intercos [Italy]
- Kolmar Korea [[South Korea]
- Nihon Kolmar [Japan]
- Cosmo Beauty [South Korea]
INDUSTRIAL DEVELOPMENT
October 2023: Estée Lauder Companies, Inc. took significant strives ahead in the alkaline water ionizer market. They recently developed La Mer Crème de la Mer Moisturizing Cream. La Mer Crème de la Mer Moisturizing Cream is a luxurious and iconic skincare product known for its deeply hydrating and rejuvenating properties. Created by aerospace physicist Dr. Max Huber, the cream is part of the La Mer brand, which is renowned for its premium skincare offerings.
REPORT COVERAGE
The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.
The research report delves into market segmentation, utilizing both qualitative and quantitative research methods to provide a thorough analysis. It also evaluates the impact of financial and strategic perspectives on the market. Furthermore, the report presents national and regional assessments, considering the dominant forces of supply and demand that influence market growth. The competitive landscape is meticulously detailed, including market shares of significant competitors. The report incorporates novel research methodologies and player strategies tailored for the anticipated timeframe. Overall, it offers valuable and comprehensive insights into the market dynamics in a formal and easily understandable manner.
REPORT COVERAGE | DETAILS |
---|---|
Market Size Value In |
US$ 26790 Million in 2020 |
Market Size Value By |
US$ 52198 Million by 2032 |
Growth Rate |
CAGR of 5.6% from 2020 to 2032 |
Forecast Period |
2024-2032 |
Base Year |
2023 |
Historical Data Available |
Yes |
Regional Scope |
Global |
Segments Covered | |
By Type
|
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By Application
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Frequently Asked Questions
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What value is the cosmetics OEM and ODM market expected to touch by 2032?
The global cosmetics OEM and ODM market is expected to reach USD 52198 million by 2032.
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What CAGR is the cosmetics OEM and ODM market expected to exhibit by 2032?
The cosmetics OEM and ODM market is expected to exhibit a CAGR of 5.6% by 2032.
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Which are the driving factors of the cosmetics OEM and ODM market?
Time-to-Market and Global Market Expansion are some of the driving factors of the market.
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What are the key cosmetics OEM and ODM market segments?
The key market segmentation that you should be aware of, which include, based on type the cosmetics OEM and ODM market is OEM and ODM. Based on application the cosmetics OEM and ODM market is classified as Skincare, Makeup, Haircare, and Others.