In Markets

Japan’s Shu Uemura to exit Korea

Shu Uemura

Japanese beauty brand Shu Uemura is ceasing all retail operations in South Korea this September, after entering the neighbouring Asia nation some 16 years ago.

SEE ALSO : Korea’s retail sales up 10% in February

According to local media reports, the L’Oreal Group-owned cosmetic brand is exiting South Korea on the back of ongoing boycotts of Japanese products by Korean consumers since 2019, in protest of Japan’s restrictions on exports of key industrial materials to Korea.

L’Oreal released a statement last week, diverting attention away from the boycott, attributing the Korea exit to its business portfolio readjustment plan.

“L’Oreal Korea decided to close Shu Uemura by September 2021, gradually closing online and offline stores,” said the company in a statement.

The decision “is part of a plan to maximize our brand portfolio. As a global company, [we] periodically review our brand portfolio based on demand from the local market.”

Shu Uemura has more than 70 points-of-sale in Korea, 35 in department stores and others in health and beauty stores like Olive Young and Chicor.

It is estimated that Shu Uemura department store sales have dropped between 10 and 20 per cent since the boycott started some two years ago, according to local media reports.

Founded in 1958 by Japanese makeup artist, Shu Uemura, the cosmetic company was acquired by French beauty conglomerate L’Oreal in 2003.

According to GlobalData, Japanese beauty or J-beauty is projected to grow at a compound annual growth rate (CAGR) of 3.5% over the next two years between 2021 and 2023, driven by its simpler regime, in comparison to Korean beauty’s ten-step beauty routine.

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The market research firm said Japanese brands such as Shiseido, Pola Orbis, Kosé (Decorte), SK-II, DHC, Sekkisei, and Shiro, as well as Shu Uemura are the leading J-beauty brands in both the domestic market and abroad, thanks to partnerships with top international retail chains both online and offline.

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