Cosmetics Contract Manufacturing Market in FY2018 Grew by 12.1% from Preceding Fiscal Year to Attain 325,000 Million Yen
Market Expands as Newcomers across Industries Increased and Outsourcing Driven by the Trend of Splitting Production and Sales (at Cosmetic Manufacturers)
Yano Research Institute (the President, Takashi Mizukoshi) has conducted a survey on cosmetics contract manufacturing market in Japan, and has found out the current market conditions, the trend by market players, and the future outlook.
In FY2018, the market size of the cosmetics contract manufacturing in Japan grew by 12.1% from the preceding fiscal year to attain 325,000 million yen. Since the revision of Pharmaceutical Affairs Law in 2005 which deregulated the market entry, the production outsourcing to the contract manufacturers by the cosmetic brands and the newcomers across industries is expanding.
Moreover, as the inbound demand that scaled down for a while is making an upward turn, and as the outbound demand (local demand at the destination of export) keeps on expanding, the increased production of Japanese cosmetics continues and the cosmetics contract manufacturing market shows steady growth.
The Market Show Stable Growth as Tariff Reduction Proved Effective, despite the Decrease in Chinese Inbound Tourists Caused by China’s New E-Commerce Law
Under the China’s new e-commerce law enforced in January 2019, the Chinese “social buyers” (individuals doing business through online channels) are obligated to register officially in order to obtain a business license. There is a growing concern that this may decrease the number of Chinese inbound tourists who purchase the cosmetic products as the agents.
On the other hand, the export of Japanese cosmetics (outbound) is increasing, driven by the drastic tariff reduction on the household products in July 2018, which included the cosmetic products such as skincare products and hair styling products.
In the cosmetics market in Japan, the production hike is continuing due to the rise in the domestic consumption (domestic needs) and the overseas’ demand for Japanese cosmetics. With increasing number of contracted manufacturing (outsourcing) by cosmetics brands and newcomers across the industry, the cosmetic contract manufacturing market in FY2019 is estimated to grow by 8.0% from the previous fiscal year to attain 351,100 million yen.
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