CNC International Sees Surge in Orders at Shanghai Subsidiary... "Q2 Sales to Hit All-Time High"

Profitability and Operating Income Improved Through Solid Internal Management
Diversified Customer Portfolio and Expanded Market Share

CNC International, an ODM (Original Development Manufacturing) cosmetics company, announced on July 3 that its Chinese subsidiary, CNC Shanghai International, has significantly improved its profitability through increased orders from local brands and solid internal management.

CNC Shanghai International Plant 1. Provided by CNC International.

CNC Shanghai International is experiencing rapid growth, recording its highest-ever order volume. In the first quarter of 2024, the company secured a record-breaking order volume equivalent to 84% of its total orders for the entire year. The order volume in the second quarter is also accelerating this high growth trend. According to the company, second-quarter sales are expected to reach an all-time high, driven by the reflection of first-quarter orders and a steep upward trajectory.

The rapid growth of the Chinese subsidiary is attributed to two main factors: securing cost competitiveness through localization strategies, and strengthening collaboration with brands. The Chinese subsidiary has significantly reduced production costs by sourcing raw materials domestically, which were previously imported from outside China. By localizing raw and subsidiary materials, the company has secured price flexibility and enhanced competitiveness. The local research lab is quickly responding to the needs of local clients, thereby expanding its market share.

Continuous investment in research and development (R&D) and expansion of production capacity (CAPA) have also contributed to maintaining a 100% on-time delivery rate for customers.

The customer portfolio of the Chinese subsidiary is also diversifying rapidly. The company is strengthening cooperation with brands popular among the local "Zhalpa" generation, and expanding exports to Southeast Asia and other regions, which increases its potential to grow as an export hub and further expand its market share.

Bae Sua, CEO of CNC International, stated, "Through the strategic expansion of our client base in Shanghai, which leads beauty trends in China, and the development of differentiated localized products, we will achieve a quantum leap in performance this year compared to last year." She added, "We plan to continuously strengthen investment in production facilities and our own R&D capabilities to shorten the development period for trend-leading products."