AmorePacific, Korea’s No. 1 cosmetics maker, aims to be the 7th largest cosmetics maker in the world by 2020, said Chairman Suh Kyung-bae during a dedication ceremony on May 30 for the company’s Beauty Campus in Osan, Gyeonggi Province. The 89,000 square meter cosmetics production and R&D center was built on a 224,000 square-meter site at a cost of 370 billion-won.

The facility will be a key production and research center for the cosmetics company, which is striving to expand its output of all kinds of cosmetics products from the current level of 6 trillion won to 14 trillion won by 2020, including 2 trillion won worth to be produced at its plants in China.

The new business base is also equipped with solar power generation facilities, street lights, a water reservoir that can hold 1,400 tons of water, and a water refinement facility, among other environment friendly facilities.

Suh has been able to realize his long-time dream to build an R&D center in Osan to boost AmorePacific to among the leading cosmetics makers in the world. “We worked hard to make the site suitable to build a number of large structures for cosmetics plants and research facilities, a key beauty business operation base, to make Amore Pacific a globally-leading cosmetics maker satisfying all kinds of global standards such as international specifications, product capacity, and health regulations. 

All of the production lines have different pressures, are able to output 60 million units of skincare products, 23 million units of makeup products, and are equipped with the logistics capacity to deliver the products in one day.

The company plans to produce 10 cosmetics products worth 500 billion won and four cosmetics worth 1 trillion won annually from the Osan Beauty Business Operation Base, bringing the company’s total annual sales to 11 trillion won °™ 6 trillion won worth of cosmetics products produced at home and 5 trillion won worth produced abroad.

President Suh has been leading the company under a diverse strategy including the growth of over 200 kinds of raw material plants from its own farm, under the belief that superior products can only be made with excellent raw materials, which he learned from his father, the founder of the company. Suh plans to open the farm to the public, especially for the young so that they can be close to farms, which are not easily accessible to those living in the cities.

Suh said there was a big reason for the company’s investments in both R&D and production facilities, which was to invest in what the company can do best and wants to do the most so that they can go deeper into those businesses. The company invested 370 billion won to build the Osan base, and last year it invested 80 billion won in the mass cosmetics business facility in Daejeon. The company has earmarked 100 billion won to expand the healthcare center in Anseong, Gyeonggi Province, and another 100 billion won to build a business facility in Shanghai, China, next year, Suh said.

The company will also rebuild its head office in Yongsan, Seoul, next year. Its 4,000 employees will move to the Signature Tower in Supyo-dong, Seoul, next year and stay there until a new building is completed at the current Yongsan location in 2017.

AmorePacific Corp. aims to nearly triple its sales in China to $626 million by 2015 from this year’s estimated $230 million as the company continues to tap into one of the world’s fastest growing cosmetics markets, company officials said recently. 

In 2011, the company’s Chinese sales soared 34 percent from the previous year to $170 million on the popularity of its flagship brand Laneige as well as its masstige brand Mamonde. 

“We believe that China will drive our company’s growth in the future,” a high-ranking AmorePacific official said. 

“We will aggressively enter the Chinese market by introducing more brands and increasing distribution channels. We will be actively looking for acquisition targets to expand our business territory.”

China has become one of the most important markets for AmorePacific, as the second-largest cosmetics market in Asia after Japan continues to grow rapidly.

According to market researcher Euromonitor International, the cosmetics market in China is expected to reach $40.4 billion by 2015.

With huge growth potential, the Chinese cosmetics market is coveted by foreign cosmetics makers. Global cosmetics companies such as Procter & Gamble Co. and the L’Oreal Group, which have strong footholds in the mid to high-end segments, have been intensifying their competition in the world’s number two economy. 

The South Korean maker currently stands as the No. 14 cosmetics company in China. Chinese consumer demand for South Korean cosmetics products is growing, thanks to the South Korean cultural boom, or Hallyu, in the East Asian region. 

Amore Pacific Corp. said recently that it has completed a deal to take over French luxury perfume brand Annick Goutal. 

It was the first overseas acquisition for the nation’s largest cosmetics maker with nearly 40 percent of the domestic market share. 

According to the company, its overseas holding company AmorePacific Global Operations Ltd. signed the takeover deal with U.S. buyout fund Starwood Capital recently in Paris. 

“The takeover will strengthen the company’s status as a global beauty company while diversifying its brand portfolio,” the company said in a statement.

Even though it is currently focusing more on the Asian market, the company said, it aims to strengthen its market dominance in the United States and Europe in the long term. 

As part of its efforts, having a French luxury brand is an advantage to appeal to European consumers, the company explained. 

“We are always open to acquiring a good foreign brand. But we don’t have any pending case for now,” an AmorePacific official told a media recently.

The company declined to reveal the final bidding price, citing contract conditions.

Annick Goutal, named after a French pianist, is a highly upscale brand, which is favored mostly by U.S. and French consumers, the company said.

Its sales revenue last year amounted to about 20 billion won ($18 million).

“A growing number of mania groups are appearing here and in other Asian countries such as China and Japan. The brand will also pave the way for us to expand our perfume business in Asia,” said the official. 

Currently in Korea, the perfume products are sold mostly through the Internet by individual importers.

AmorePacific has already marketed its perfume brand Lorita Lempika since 1997, mainly targeting European consumers. 

In a brand license with a French designer, the whole production is carried out only in France. Last year, the brand logged sales of 97.5 billion won. 

The company expected that its two perfume brands will create a synergy effect in improving production efficiency. 

The manufacturer of premium brands such as Sulhwasoo and Amore Pacific holds a 1.2 percent share of the global market. The company, which is ranked 20th in the world, plans to enter the ranks of the global top 10 cosmetics companies by 2015.