Cosmetics OEM Industry - 2023

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Report Overview - Cosmetics OEM Industry

Salient Features

• Thailand is the leading original equipment manufacturer (OEM) for cosmetic brands in the ASEAN region. It is considered a base for the production of cosmetics, offering OEM services to both local and international brands.
• Product differentiation is low due to the extensive availability of low-cost offerings from cosmetics OEMs.
• The Thai government's legalization of hemp in Thailand has greatly benefited the country's OEM companies.
• The COVID-19 pandemic has led to a drop in cosmetics production due to declining overseas demand. However, the domestic demand for cosmetics has been on an upward trend.
• Small and medium-sized enterprises (SMEs) make up the largest portion of the Thai cosmetics OEM industry. These SMEs primarily provide services to small cosmetics brands.

Value Chain/Business Model

• The industry is broadly segmented into companies providing OEM/ODM (original design manufacturer) services and those manufacturing their own brands while also offering OEM/ODM services.
• Thai OEMs not only provide OEM services but also offer original design manufacturing (ODM) services. Among the different segments, skincare and makeup are the most penetrated segments in terms of OEM/ODM services.

Other Points

• OEMs gain credibility as the Thai FDA strengthens the rules for manufacturing cosmetics. 

 Cosmetics OEM Industry Value Chain

Report Index

Industry Overview

• Thailand; Leading OEM for Cosmetic Brands in the ASEAN Region
• Thai OEMs Provide ODM Services; Skincare and Makeup Being the Most Penetrated Segment
• Product Differentiation Low Due to Extensive, Low-Cost Offerings from Cosmetics OEMs
• Legalisation of Hemp by the Thai Government Act Beneficial for OEM Companies in Thailand
• OEMs to Gain Credibility as FDA Strengthens Regulation of Manufacturing Practices

Market Trends

• Drop in Cosmetics Production Driven by Reduced Overseas Demand; Domestic Cosmetic Demand on an Uptrend

Competitive Trends

• SMEs Make Up the Largest Portion of the Thai OEM Industry with Companies Increasingly Providing Services to Small Cosmetic Brands
• S&J International Enterprise; Listed OEM Company Manufacturing High-Quality Cosmetic and Personal Care Products 
• Milott Laboratories: OEM Manufacturer Serving Almost 100 Plus Thai Clients
• Neocosmed: OEM Manufacturer of Five Main Categories of Products Including Skincare and Personal Care