300 K-Beauty Brand Creators and 500 Export-Oriented Small Business Teams to Be Identified

Announcement of Measures to Enhance and Expand K-Beauty Export Performance

The "Measures to Enhance and Expand K-Beauty Export Performance" have been established to further solidify K-Beauty's global standing.

On the 27th, the Ministry of SMEs and Startups and the Ministry of Health and Welfare announced the "Measures to Enhance and Expand K-Beauty Export Performance" at the National Policy Coordination Meeting chaired by Prime Minister Kim Minseok.

Isun Bae, Global Growth Policy Officer at the Ministry of SMEs and Startups, is giving a preliminary briefing on "Enhancing and Expanding K-Beauty Export Performance" at the Sejong Government Complex on the 26th. Ministry of SMEs and Startups

Cosmetics, symbolized by K-Beauty, have ranked first among SME export items from 2023 through the first half of this year. K-Beauty has also achieved strong global results, ranking third in export destinations and first in market share for imported cosmetics in the United States. These achievements are attributed to active innovation through specialization in planning, production, and distribution, world-class manufacturing capabilities, and robust overseas marketing combined with the Korean Wave.

However, recent global protectionism, non-tariff export regulations, and the pursuit of competitors are threatening the sustainability of K-Beauty, prompting the introduction of these new measures. First, 300 young beauty brand creators will be identified, and 500 strong small business teams will be selected to foster powerful export companies through collaboration and convergence between creators and startups. Export support programs for SMEs, such as export vouchers to prepare for overseas marketing and export consortiums that allow direct promotion to overseas consumers and buyers, will also be intensively linked and supported.

To further expand K-Beauty’s presence overseas, new markets will be developed based on the relatively low-barrier online market, and support for connecting online and offline market entry will be expanded, enabling products that prove their marketability online to enter offline channels. To help K-Beauty products that have proven their marketability online expand their markets and customer base, an "Offline First Export One-Click Package" will be introduced, supporting the transition of popular online products into offline export items.

K-Beauty will also focus on global market expansion through K-Culture convergence marketing, utilizing K-content such as K-Pop and dramas, which are highly popular overseas. Marketing programs will be planned in conjunction with popular K-trends abroad, and K-Beauty promotions will be strengthened by linking with K-content during key local events and national holidays.

A K-Beauty cluster will be developed as a regional export hub, and a pilot project supporting exhibitions and experiences centered on products from beauty startups will be launched next year. In addition, glocal business districts will be fostered by combining various K-Beauty spaces and content with the involvement of commercial planners and local governments, leading to exports. New initiatives will also be launched to help beauty sector small businesses, such as those producing perfumes and air fresheners, which have been slow to expand into export markets, commercialize their products for export.

An advanced AI collaboration program will also be introduced for products in beauty and healthcare. The goal is to upgrade products and secure new sales channels by combining innovative AI technology from startups, in line with global trends that emphasize value and differentiation. After identifying promising beauty products for export market expansion, collaborations with AI startups will be carried out. Next year, about five pilot projects will be supported, with plans to expand further. The ongoing K-Beauty Fund (worth 40 billion KRW) will be intensively invested starting next year, and efforts will be focused on investment roadshows, expanding K-Beauty loans and guarantees, and smart manufacturing in the beauty sector.

Based on the "Overseas Missions SME Support Council," which is led by overseas missions and involves local institutions and associations, four overseas missions will be designated as K-Beauty entry hubs and will operate local entry programs. Next year, 10 popup booths will be set up in emerging markets, and new large-scale cosmetics stores will be established in the United States and the EU, expanding the number of flagship stores supporting K-Beauty exports to eight.

Additionally, 500 promising export products in the four major consumer goods sectors-beauty, fashion, lifestyle, and food-will be identified by 2030, with a focus on joint public-private overseas marketing. Support will also be provided for the use of joint brands for K-Beauty export products, as well as for establishing brand rights and marketing strategies in local countries.

In line with international eco-friendly and clean beauty trends, a Natural Cosmetics Testing and Inspection Center will be established in Namwon, Jeonbuk, and a full-cycle clean cosmetics technology support infrastructure for raw materials, production, and packaging will be built in Osong, Chungbuk. To overcome the high proportion of imported raw materials, support will be provided for building mass production facilities and equipment for raw materials, promoting the localization of cosmetic ingredients, and continued support will be given for research into high-value-added new materials and future cosmetics development.

To support the development of cosmetics tailored to the skin characteristics of each export country, the ongoing project to collect and analyze skin and genome information from about 16,000 people in 19 countries will be further expanded. Next year, about 12 new projects will be launched to develop AI teamwork technologies specialized for cosmetics manufacturing, and specialized support will be provided for K-Beauty in consulting and technology verification (PoC) centered on the Manufacturing AI Center.

From next year, a program will be implemented to support the registration of manufacturing facilities with the U.S. Food and Drug Administration for cosmetics classified as over-the-counter drugs in the United States, such as sunscreen (25 companies). Training programs to nurture about 500 safety assessment specialists annually will continue. Customized information services will also be expanded, integrating safety data on cosmetic ingredients and market and regulatory information by country using AI.

The legal foundation for the sustainable growth of the cosmetics industry will also be established. The Ministry of Health and Welfare will enact the tentatively named "Act on the Promotion and Development of the Cosmetics Industry," introducing an innovative cosmetics company certification system and establishing a development committee. The Ministry of SMEs and Startups will also begin work next year on legislation to provide comprehensive support for SME exports and overseas expansion, aiming to accelerate the overseas expansion of K-Beauty and related industries.

At the National Policy Coordination Meeting, Minister Han Sung-sook of the Ministry of SMEs and Startups stated, "K-Beauty, in addition to its innovative manufacturing capabilities and the agility of small brands, is establishing itself as a global beauty powerhouse thanks to the influence of K-Culture, which has become part of our modern cultural heritage. Now, to further establish K-Beauty as a global premium brand, we will join forces with the Ministry of Health and Welfare and other relevant ministries to actively support the private sector’s export capabilities."

Minister Chung Eun-kyung of the Ministry of Health and Welfare said, "To further strengthen the global competitiveness of our companies’ creative ideas and innovative challenges across all areas, from raw materials and packaging to manufacturing and exports, the government will support digital marketing, overseas certification acquisition, manufacturing innovation, and brand power enhancement, so that Korea can rise to become the world’s second-largest cosmetics exporter."

This content was produced with the assistance of AI translation services.