While the Japanese company will celebrate next year the 90th anniversary of its foundation in Japan in 1930 and the 20th anniversary of its establishment in France, it has given itself the means to achieve its new ambitions with a sharp increase in its production capabilities in France and Europe.
J-Beauty revival
“Today our formulas are used by many very different brands all over the world, from Asia to Europe and including the two American continents,” states Kouji Okumura, the group’s chairman. “Our strength is really to be recognized as the R&D specialist for the manufacture of cosmetic formulas, and this for many years. We have the capacity to understand the needs of brands and propose them the formulas they were looking for.”
The company has taken full advantage of the recent revival of the J-Beauty (as made in Japan cosmetics are usually dubbed). "Japan is once again the main creativity hub in Asia," said Leïla Rochet Podvin, CEO and Founder of trend agency Cosmetics Inspiration & Creation.
Over the past five years, the group’s turnover has nearly doubled to reach USD 110 million in 2018 (from USD 63 million in 2014). Export sales, the main driver of the company’s growth, have increased by 44% over three years, especially towards China which accounts for 34% of the Nippon Shikizai’s turnover.
Huge investments
To meet this demand and maintain its leadership, Nippon Shikizai has accelerated its investments. Thus, more than USD 30 million were earmarked over the 2018/2020 period, mostly to increase the bulk production capacity in the Tsukuba factory, which had already benefited from significant investments between 2014 and 2017, with the construction of a new facility for the packaging of makeup products. It should be noted that this factory was approved by the U.S. authorities for the production of OTC products.
The group also recorded strong growth in Europe, where the it has been present in France since 2000, when it acquired Thépenier Pharma & Cosmetics. After an investment of EUR eight million over four years to modernize the production tool and standardize the production techniques dedicated to “pharma” and cosmetic products, the turnover of Thépenier Pharma & Cosmetics jumped from EUR 9 million in 2014 to EUR 20 million in 2018 and profitability was up to expectations.
An impressive growth followed in 2017 by the acquisition of a second French company with a staff of 35 employees, Orléans Cosmetics (now Nippon Shikizai France), specializing in the manufacture of make-up powders, hot-poured products and scented derivatives. A company in which the group, in line with its strategy, invested in 2018 and 2019 nearly one million euros, with the commissioning of new lines dedicated to compaction, the filling of loose powders, hot filling, not to mention the creation of a new cleaning room and new blenders. The aim: modernize the entire machine pool and quickly increase the production capacity by 30%!
Research & development
Beyond production capacity, R&D is at the heart of the investments made by Nippon Shikizai. Today, the group employs more than 60 researchers in cosmetic formulation and some 40 engineers dedicated to the design of manufacturing and filling lines and more generally to all industrial processes.
The group’s best known formula is the famous Warm Water Washable mascara, which is resistant to both tears and humidity but can be removed under warm water. Over the last ten years, more than six million units of this formula were produced each year serving the many Asian brands that adopted the solution. Introduced this year on the U.S. market, the formula is already a hit among American consumers.
To complete his makeup ranges, which still account for 85% of its sales, the group presented at the Cosmoprof show in Bologna a complete range of products designed to protect the skin against the harmful effects of the blue light generated by the screens (mobiles, computers) that have invaded our daily life.
The continuation of the group’s international development strategy should lead to new investments in the United States and Asia. “As you know, cosmetics are not just about trends, they are closely influenced by the cultures and traditions of each country and region. And we must absolutely take these facts into account for our effective and successful development,” concludes Kouji Okumura.
