Image: Visual China
BEIJING, January 6, 2022 (TMTPOST) — South Korean cosmetics and skincare giant Innisfree have reportedly shut down over 80% of its outlets in China.
Innisfree’s several outlets in China’s capital city Beijing have already closed down, including outlets at CapitaMall Taiyanggong, Joy City and Wanda Plaza at Huaifang, Beijing Business Today reported.
The South Korean company has reportedly suspended the operation of over 600 outlets in China, with only 140 outlets remaining.
Innisfree’s latest fiscal report shows that the company’s revenue in 2020 slumped by 37% year-on-year to around 2 billion yuan, which is only half of the revenue of its prime time in 2016.
Innisfree is a South Korean cosmetics brand owned and founded by Amore Pacific in 2000. Innisfree is popular for its affordability and brand concept, which emphasizes healthy and reasonably priced beauty products with ingredients sourced from Jeju Island.
Innisfree is not only closing down its business outlets in China. Innisfree shut down all of its outlets in North America on May 8, 2021 due to the prolonged Covid-19 pandemic, Amore Pacific’s spokesperson said. Innisfree will continue to sell its products on e-commerce platforms.
Amore Pacific’s another brand Etude House faced similar situations in China. The brand closed down all of its brick-and-mortar outlets in China in March, 2021. Etude House has been suffering from poor market performance since 2017. Its global sales dropped 38% year-on-year to around 660 million yuan in 2020.
Other foreign brands are not doing very well in China too. Japanese brand KATE will reportedly pull out from China. In 2021, American cosmetics brand Benefit Cosmetics decided to close all counters in China and shift focus to online channels and Sephora outlets.
The rise of Chinese cosmetics brands such as Perfect Diary and Florasis in recent years accelerated the decline of foreign cosmetics brands in China.
On the Double Eleven Shopping Festival in 2021, eight Chinese cosmetics brands made it into the top 10 brands on Tmall in transaction volume.