Cosmetics guru close to becoming S. Korea`s richest man

The chief of AmorePacific, South Korea`s largest cosmetics maker, has closely caught up with the chairman of Samsung Group, the country`s richest tycoon, in terms of stock assets, due to brisk sale of the company`s cosmetics products amid the high popularity of Korean pop culture and beauty style.

AmorePacific operating profits increased 58 percent during the first three months of this year from the same period in 2014, quadrupling the stock assets of its chairman Suh Kyung-bae. If the trend continues, the value of Suh`s stocks will soon exceed that of Lee Kun-hee, chairman of Samsung Group.

It is not just AmorePacific that is faring well. South Korea`s entire cosmetics industry is reviving. LG Household & Health Care, the parent company of LG Group, was once dwarfed by larger affiliates such as LG Electronics and LG Chem but is now the conglomerate`s cash cow. Original development manufacturers such as Kolmar Korea and Cosmax are also seeing their stocks prices soaring.

Cosmetics products, in which South Korea long suffered from trade deficits, have now become the country`s major exports with overseas shipments increasing by 34 percent annually over the last five years. It is projected that cosmetics will be the country`s second export item dominating overseas markets after electronics goods.

South Korean cosmetics makers owe much of their revival to the growth of the Chinese market. However, opportunities come only to the prepared ones. Unlike dominant global cosmetics giants such as Chanel and Lancôme, the South Korean makers focused on basic makeup products, incessantly rolling out new products such as BB cream and cushion compacts. Now, global makers are imitating South Korean cosmetics products. The U.S. daily Wall Street Journal reported on May 6 that South Korea had emerged as a leader of innovation in the cosmetics industry due to its development speed and creativity.

The revival of the cosmetics industry shows that there eternal sunset or booming industry. Fashion was also once a sunset industry in South Korea. However, E-Land, which has focused on China since the 1990s, is now treated as a luxury brand in the country. The case of Ikea, which created a boom in South Korea`s saturated furniture market, indicates that creation and innovation are not far away. A slightly different idea and change could create new demands. No one knows when the South Korean cosmetics boom will end. The makers should prepare for the future when they are faring well.

ysshin@donga.com