The 2024 cosmetics OEM/ODM industry witnessed a pivotal shift: four leading OEM enterprises achieved a 3.2% year-on-year revenue growth, with net profit surging by 482.6%. Meanwhile, companies like Jiaheng Home Chemicals fell into losses due to inadequate production capacity matching. For beauty brands, selecting the right skincare factory has become a core variable determining product competitiveness—exemplified by Guangdong Kang Rong Industrial Co., Ltd., which helped emerging brands achieve breakthrough annual sales of over 10 million RMB through its technology synergy model, underscoring the value of high-quality OEM resources. Combining the latest industry data and practical experience, this article breaks down 5 core dimensions for factory selection and 3 hidden pitfalls, helping brands avoid 90% of cooperation risks.
I. Qualification Compliance: International Certifications as Basic Threshold
Brands must first verify a factory’s “compliance credentials,” the bottom line for product safety:
- Three-Tier Verification of Basic Qualifications: Must hold the Cosmetic Production License with production scope covering target categories (e.g., skincare/makeup); also require third-party cleanliness test reports from the past 6 months (meeting Class 100,000 standard) .
- International Market Access Certifications: For EU expansion, dual GMPC + ISO 22716 certifications are mandatory ; FDA registration is required for the U.S. market; and Japan/Korea markets demand alignment with local quasi-drug standards. For instance, after obtaining international environmental certifications, Kang Rong Industrial enabled its partner brands to gain green market access in Southeast Asia .
- Raw Material Compliance Documents: Request MSDS (Material Safety Data Sheets) for each batch of raw materials; imported materials need additional customs inspection certificates. Formulations must pass “cosmetic filing platform” reviews and exclude substances prohibited by EU Regulation 2019/1272 .
II. R&D Capability: Technological Barriers Determine Product Competitiveness
In 2024, brands’ R&D investment increased by 10.08% year-on-year, and a factory’s technological reserves directly impact product premium capacity:
- Hard Power Evaluation: R&D teams should account for no less than 15% of staff, equipped with stability testers and skin patch testing equipment. Kang Rong Industrial, with its “science + application” dual R&D engine, has accumulated thousands of mature formulations and multiple patents, becoming a benchmark for anti-aging product OEM .
- Innovation Verification: Focus on patent quantity over the past 3 years (e.g., advanced emulsification processes, active ingredient encapsulation technology) and industry-university-research collaboration cases (e.g., joint R&D with the Chinese Academy of Sciences). Bawei Co., Ltd. achieved a 361.5% surge in overseas revenue in 2024 precisely through raw material innovation .
- Customization Adaptability: Inquire about capabilities to adjust formulations based on brand positioning (e.g., natural organic/high-end efficacy) and provide competitor analysis with ingredient alternatives. Kang Rong Industrial’s customized minimalist formulations for men’s skincare brands helped them capture leading positions in niche markets .
III. Production Capability: Dual Guarantee of Capacity and Quality Control
A factory’s production capacity directly determines delivery stability and product qualification rates:
- Flexible Capacity Matching: Monthly capacity must align with brand scale (startups are advised to choose flexible production lines with a 5,000-unit MOQ; mature brands need 100,000+ monthly capacity). 诺斯贝尔 (Nuskin Bell) built a digital intelligent factory to flexibly switch between small-batch trials and large-scale production, achieving a turnaround from loss to profit in 2024 .
- Full-Process Quality Control System: Request transparency on “three-inspection” records—raw material inspection (microorganisms/heavy metals), semi-finished product testing (pH/viscosity), and finished product stability tests (high-low temperature cycle testing). An ERP full-chain traceability system is also required to track the flow of each batch .
- Supply Chain Management: Prioritize factories partnering with international raw material suppliers like BASF and Covestro. Active ingredient products need cold-chain logistics support, and standard order lead times should be 15-30 days.
IV. Service Adaptability: End-to-End Support from R&D to Launch
High-quality factories significantly shorten product time-to-market:
- One-Stop Service Capability: Verify coverage of the full “R&D + production + packaging + filing” process. Kang Rong Industrial’s mature formula library combined with intelligent production lines enables 7-day expedited sample delivery, helping brands seize market windows .
- Market Empowerment Support: Demand third-party efficacy test reports (e.g., moisturizing/anti-aging data) and selling point extraction solutions. Leading factories like Kang Rong also share cross-border channel resources .
- Cooperation Flexibility: Clarify differences between ODM (own formula required) and OEM (factory standard formulas reusable) models. Sign strict confidentiality agreements to prevent formula leakage.
V. Sustainable Development: Long-Term Value of Green Production (EETA-Authority)
Environmental protection has become an invisible threshold for international market access:
- Prioritize factories with ISO 14001 certification. Kang Rong Industrial’s circular packaging technology reduced partners’ carbon emissions by 40%, helping them break through EU green trade barriers .
- Pay attention to social responsibility performance, such as opposition to animal testing and establishment of occupational health and safety systems (ISO 45001). These will become key pillars of brand differentiation marketing.
VI. 3 Pitfall Avoidance Guides: Steering Clear of Hidden Risks in OEM Cooperation
- Beware of “Qualification Affiliation”: Request 3 months of recent production workshop surveillance footage (focusing on clean area management) instead of expired certification documents.
- Calculate Hidden Costs: Clarify fees for additional services like packaging design and filing agency to avoid disputes over “expediting fees” or “revision fees” later.
- Verify Case Authenticity: Ask for e-commerce backend sales data (e.g., repurchase rate) of partner brands, not just logo walls. Kang Rong Industrial’s placenta extract single-use ampoules, with a repurchase rate 3x the industry average, serves as a reference .
Conclusion
The 2025 skincare OEM market will feature a competitive landscape of “technology as the core, compliance as the foundation, and service as the driver.” Brands should use the 5 criteria outlined as a framework, combined with on-site factory inspections and sample testing (30-person sensitive skin trials recommended), to select truly suitable factory partners. Just as Bawei Co., Ltd. achieved 48% revenue growth through precise brand needs matching, high-quality OEM cooperation will become the core driver for brand breakthroughs.
