A Study Of Korean Cosmetics Industry's Competitiveness In China

Cosmetics is one of the way that people express their beauty,which is the basic desire of the human.Nowadays,cosmetics industry has increased even though we have economic crisis world-widely.It is because cosmetics considered as must-have product.Moreover,the increase of female economic population,diversion of consumer needs,the expansion of the consumption,developed shared platform,and increase of aging society lead cosmetics industry's expanding.While Chinese economy is developing rapidly,Chinese cosmetics consumers demands and standards are improving.For the past 20 years,Korean cosmetics have grown tremendously in the Chinese market,and their status is increasing in the world market as well.There are many reasons for this popularity of Korean cosmetics.The first reason is that the product concepts and the high qualities,which cause attraction of consumers.Secondly,trade is more convenient because Korea and China are neighboring countries,and both countries are from Asia.This also leads to the development into a cultural industries.The booming cosmetics industry is penetrating,not only China but also the international market with the " Korean Wave ",which marks the trend in the nation's entertainment culture.A major challenge for the Korean cosmetics industry is that Korea have to maintain its market share and competitiveness.Accordingly,this paper compared Korean cosmetics industry's competitiveness,by using the International Market Share(IMS),Trade Competitive Index(TC),and Revealed Comparative Advantage Index(RCA).Firstly,Korea has been compared vertically in the cosmetics trades within China since 2000.Secondly,Korea has been compared horizontally with other countries to determine the status of Korean cosmetics in the world since 2000.In Chinese cosmetics market,Korea cosmetics industry had International Market Share(IMS)more than 2% from 2000.It increased 22% in 2015 and the highest points was 26% in2016.Korea cosmetics industry has Trade Competitive Index(TC)between 0.63-0.97,and it seems grow more.Korea cosmetics industry had Revealed Comparative Advantage Index(RCA)over 1 in 2013,and it reached over 2 in 2015.In international market,United States of American(USA)and Japan were compared with Korea and China.USA and Japan have big cosmetics market and they are the representative market of the continent in this study.According to Trade Competitive Index,USA,Japan,and Korea have comparative advantage.Especially,Japan and Korea have higher numbers by the time.However,USA and China have lower number by time.According to Revealed Comparative Advantage Index(RCA),USA,Japan,and Korea have competitiveness in their cosmetics industries.USA has the stable numbers and Japan and Korea have higher number by the time.Throughout this thesis,we see Korea's cosmetics industry current status and its comparison with nations by using the International Market Share(IMS),Trade Competitive Index(TC),and Revealed Comparative Advantage Index(RCA).Korea's cosmetics industry has big possibilities to grow more.This study proved that Korean cosmetics market has the International Comparative Advantage and its competitiveness.Korean cosmetics industry's problem,however,is that Korea depend their trade on China cosmetics market.Not only cosmetics market but also another industries of Chinese market are larger by the time.Therefore,Korean cosmetics industry has to have trade competitiveness,which is not affected by other nations' cosmetics market changes.Also,Korean cosmetics industry have to see what the consumers' needs are and transformed their products marketing quickly while market change quickly.If there are the ways of increase its competitiveness,no other factor can affect the nation's trade.Moreover,The Korean government should help Korean cosmetics industry with political support,such as discussing between nations about export tariffs,simplification of export or export administration procedures.