Cosmetics ODM Market Size, Share, Growth, and Industry Analysis, By Type (All process ODM, and Half process ODM), By Application (Skincare, Makeup, Haircare, and Others), and Regional Forecast to 2032

Updated On: 04 November 2024

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COSMETICS ODM MARKET OVERVIEW

The Global Cosmetics ODM Market size was USD 7.55 Bn in 2019 and is projected to touch USD 17.15 Bn by 2032, exhibiting a CAGR of 8.74 % during the forecast period. 

The Cosmetics ODM Market has seen considerable growth owing to the rising demand for personalized beauty products and a rise in popularity of outsourced manufacturing processes within the cosmetics sector. With these services, brands can focus on marketing and brand building as they outsource design, development, and production of cosmetics products to specialized manufacturers.

One of the determinants of the rising rates in Cosmetics ODM Market is the increasing desire of consumers for new and tailored beauty products. Consequently, brands are seeking ODM suppliers for unique formulations, package designs, and product lines that meet specific target market requirements as they respond to changes in consumer tastes characterized by more personalized skin care, makeup and hair care products.

And lately, the growing need for pure, organic and sustainable beauty things has made ODM producers adopt green implementations and compositions. Such happens due to rise in buyers’ choice for vegan, organic and ecologically friendly goods thus pushing the market to develop at an accelerated pace.

GLOBAL CRISES IMPACTING COSMETICS ODM MARKET - COVID-19 IMPACT

"Refrigerated Transport Industry Had a Positive Effect Due to increase in demand for customized and private-label beauty products"

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 the market’s growth and demand returning to pre-pandemic levels.

Due to the shift in consumer behaviour towards online shopping, the COVID-19 pandemic had a positive effect on the Cosmetics ODM Market. As a result of this, the demand for private label and customized beauty products increased. The focus on skin care and wellness also led to an increase in demand for innovative formulations among cosmetic manufacturers right during this pandemic. This was further strengthened by the growth of e-commerce and direct-to-consumer brands that created new opportunities for ODM providers thereby expanding their market.

LATEST TREND

"Shift towards sustainable and clean beauty products to Drive Market Growth"

One of the biggest changes seen in ODM cosmetic industry has been an increased emphasis on sustainable and clean beauty products due to growing consumer preference for such goods as liquors or mandarin fruits with less harmful chemicals. Therefore, these manufacturers devote their time into including ingredients that are natural, using packages that can be recycled in addition to reducing pollution caused by how they make their products. Clean beauty which emphasizes safety, transparency and sustainability is becoming an important focus area for both brands and manufacturers alike thus making it a crucial trend in innovation within this sector.

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COSMETICS ODM MARKET SEGMENTATION

BY TYPE

Based on Type, the global market can be categorized into All process ODM, and Half process ODM

• All process ODM : The whole product development cycle from beginning till end is controlled by the manufacturer in ODM model as per all processes. This involves everything from formulation, packaging, testing and even regulatory compliance thus letting brands concentrate on marketing as well as sales. In simple terms, companies looking to quickly launch their products without an investment of time into research or production can benefit from this option made available for them.

• Half process ODM : Through half-process ODM, organizations can team up with producers during selected stages of product development like formulation and designing the package. The ODM takes care of producing or doing part of the development while brands can give their own ideas or raw materials. It gives more flexibility and control for brands regarding the product than an all-process model.

BY APPLICATION

Based on application, the global market can be categorized into Skincare, Makeup, Haircare, and Others

• Skincare : Cosmetics ODM companies build a spectrum of items within the skincare division varying from moisturizers, cleansers to serums that lay emphasis on innovation in ingredients as well as formulations. They target the rising demand for organic, anti-aging and dermatologically tested products for skin care. This segment is witnessing rapid growth since customers are now giving more priority to self-care and maintaining healthy skins.

• Makeup : Regarding the cosmetics sector, ODMs are involved in producing such items as foundations, lipsticks and cohesive eyeshadows usually with tailored formulations and tint variations. Furthermore, they also help businesses to keep up with prevailing beauty trends like long-wear, non-animal tested products, hence responsible beauty practice. Most importantly however, this market is driven by a rising need for more individualized and sustainable cosmetics.

• Haircare : In the haircare segment, there are ODMs for cosmetics that are engaged in the development of shampoos, conditioners and styling products with special emphasis on formulations for different types of hair and hair-related issues. The market is majorly driven by consumer preferences towards better hair health which includes products devoid of any harmful chemicals as well as natural ingredients. More so, there is an expansion in hair care due to such trends as sulphate-less products and those that cater to the scalp.

MARKET DYNAMICS

Market dynamics include driving and restraining factors, opportunities and challenges stating the market conditions.

DRIVING FACTORS

"Rising Demand for Customization to Boost the Market"

The demand for beauty products that are specifically made to cater for individual clients has caused a growth in the Cosmetics ODM Market. ODMs collaborate with brands to design skin care, make-up and hair care products that suit different skin types, tones and personal requirements. This has resulted into innovation and product distinction which are contributing to increased sales.

"Growing Interest in Sustainable and Clean Beauty to Expand the Market"

In a market where consumers are more concerned about sustainability than ever before, quite a few of them prefer using eco-friendly and clean beauty products. This has forced brands in the cosmetics industry towards focusing on sustainability. In developing their formulations, cosmetics ODMs have focused on natural, organic and cruelty-free ingredients as well as packing made from recyclable materials. The Cosmetics ODM Market growth is mainly driven by this evolution towards clean beauty practices.

RESTRAINING FACTOR

"Stringent regulatory requirements and compliance standards to Potentially Impede Market Growth"

In various areas, there are strict rules and compliance standards about Cosmetics ODM Market, which is a major obstacle in that business. The ODMs who produce things that go to many places find it difficult navigating through such restrictions because it is too complex, and expensive. Consequently, the manufacturing costs may rise or take longer time before hitting the trade centres. Also, keeping abreast of changing regulations remains a major problem to these companies.

OPPORTUNITY

"Growing demand for personalized & bespoke beauty products to create Opportunity for the product in the market"

The need for more personalized and customized beauty products presents an opportunity in the cosmetic ODM market. This trend can be tapped into by ODMs through offering customizable options as well as developing innovative products because consumers are increasingly looking for tailor-made solutions that can only be satisfied by unique formulations. In this way, ODMs can position themselves differently from their competitors hence appealing to a wider number of clients who want specialized goods.

CHALLENGE

"Intense competition and rapid pace of innovation Could Be a Potential Challenge for Consumers"

One of the key hurdles faced by the Cosmetics ODM Market is fierce competition and fast-paced innovation within the sector. ODMs must keep coming up with new formulations and be in tune with the changes in consumer preferences to remain relevant in this market. Therefore, there is a lot spent on R&D plus flexibility needed during production which ultimately forces ODMs to provide state-of-the-art products without delay but at reasonable prices.

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COSMETICS ODM MARKET REGIONAL INSIGHTS

• NORTH AMERICA

North America maintains a stronghold on the United States Cosmetics ODM Market because of its well-established beauty and personal care industry and high consumer spending on premium innovative products. The region’s robust regulatory environment enhances the quality of products, and this promotes confidence amongst consumers. Moreover, North America’s trend-setting market spurs the need for new and varied cosmetic formulations thus providing major opportunities for innovation and expansion to ODMs.

• EUROPE

The Cosmetics ODM Market Share is driven by Europe, which boasts of a long-standing tradition in the manufacture of stylish and expensive makeups. With these attributes, premium along with creative goods find considerable demand. Stringent regulations on product safety and effectiveness in this area enhance client’s trustworthiness. On the aspect of sustainability and use of natural ingredients, European beauty brands lead in this arena; thus, creating chances for ODMs who specialize in such products as their core competency. Furthermore, European Multi-Country allows ODMs to develop numerous lines suited for diverse tastes as well as fashions within its individual countries.

• ASIA

The Cosmetics ODM Market Share is dominated by Asia, due to its large manufacturing base and cost-effective production capabilities. South Korea, China and Japan are major hubs for cosmetic innovation and mass production, with a wide range of products at competitive prices. Furthermore, there is high demand for diversity and premium beauty products in the region driven by the increasing middle class and rising disposable income. Moreover, Asia’s influence on global beauty trends like K-beauty or J-beauty enhances its position in the ODM market.

KEY INDUSTRY PLAYERS

"Key Industry Players Shaping the Market through constant innovation and product development"

The growth of the Cosmetics ODM Market is being driven by key players in the industry through strategic partnerships, innovation, and strong R&D investments. Major ODMs use modern technologies and trends to develop unique formulations and packaging methods that meet changing customer demands. They can offer comprehensive services ranging from product design to production enabling brands to introduce new products promptly in response to market needs. Furthermore, through collaborations with established cosmetic companies and extension into developing countries, ODMs can seize larger market shares while at the same time boosting total market development.

LIST OF TOP COSMETICS ODM COMPANIES       "  "

• Intercos (Italy)
• Ya Pure Cosmetics (China)
• Cosmo Beauty (China)
• Toyo Beauty (Japan)
• Nihon Kolmar (Japan)
• Kolmar Korea (South Korea)
• COSMECCA (South Korea)
• Ancorotti Cosmetics (Italy)
• Cosmax (South Korea)
• Life-Beauty Cosmetics (China)
• Ridgepole Biological Technology (China)
• Homar (China)
• Francia Cosmetics (Brazil)

KEY INDUSTRY DEVELOPMENTS

February 2024: One industrial development in the Cosmetics ODM Marketplace is announced by L'Oréal. Using augmented reality (AR) and micro-printing technology, they introduced Brow Magic, a small handheld electronic device that can be used for precise application of eyebrow makeup. It scans the user’s face to create an individualized brow shape using AR and applies it within seconds on to the brows. This invention illustrates how deeply mingled technology has become in the beauty sector as it provides consumers with home-grown products for personalization in their choice of makeups.

REPORT COVERAG

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 Cosmetics ODM Market is poised for a continued boom pushed by increasing health recognition, the growing popularity of plant-based diets, and innovation in product services. Despite challenges, which include confined uncooked fabric availability and better costs, the demand for gluten-unfastened and nutrient-dense alternatives supports marketplace expansion. Key industry players are advancing via technological upgrades and strategic marketplace growth, enhancing the supply and attraction of Cosmetics ODM. As customer choices shift towards healthier and numerous meal options, the Cosmetics ODM Market is expected to thrive, with persistent innovation and a broader reputation fueling its destiny prospects.