Is the Era of Huge Profits in Imported Cosmetics Agency Coming to an End?

Have you ever been bombarded by the "overseas hot-selling products" promoted by purchasing agents on your WeChat Moments? From Japanese luxury face creams to French niche perfumes, imported cosmetics are seizing the Chinese market at a rate of 20% per year. However, in this seemingly prosperous "blue ocean", less than 30% of the agents can actually swim to the other side. Today, let's unveil the mystery of imported cosmetics agency.

When Mr. Zhang was acting as an agent for a certain European organic brand last year, a container worth 800,000 yuan was detained at the customs due to his lack of understanding of the new regulations on cosmetics record-filing. Currently, imported cosmetics are required to complete the following:

• Record-filing with the National Medical Products Administration (for non-special use cosmetics)
• Safety assessment report
• Chinese labels for all ingredients

Ms. Li's lesson came from the difference in cross-border tax rates: the value-added tax rate for skincare products imported through general trade is 13%, while the comprehensive tax for cross-border e-commerce is only 9.1%. This 4% difference directly ate up 30% of her profit margin.

A certain Korean cushion foundation sold 100,000 boxes per month through short video marketing last year, but three months later, the agents received a large number of allergy complaints. Professional buyers suggest paying attention to:

• The list of prohibited ingredients by the local medical products administration
• The market life cycle of the brand in its home country
• The big data report on the skin types of Chinese consumers

It is worth noting that the pH values of European and American products are generally on the high side, and direct introduction may damage the skin barrier of Asian consumers.

The offline counter model of traditional agents is being impacted by three major forces:

• Direct procurement by cross-border e-commerce platforms
• Establishment of Chinese official websites by overseas brand owners
• KOL community group buying

The person in charge of the Chinese region of a certain Japanese brand revealed that they now prefer to cooperate with service providers like Zhongshitong that have the ability to operate across all channels, rather than traditional provincial agents.

When the dividend of information asymmetry disappears, smart agents begin to transform:

• Provide skin testing + product customization services
• Build private domain ingredient science popularization communities
• Develop AR virtual makeup trial mini-programs

As an industry observer said: "In the future, those who can survive will not be goods resellers, but beauty solution providers."

The era when imported cosmetics agency could make money simply by "transferring goods from one hand to another" has long passed. Whether you are a potential entrant who is still on the sidelines or a struggling practitioner, you need to rethink: What exactly is your core competitiveness? Welcome to share your agency stories or confusions in the comment section. We will randomly select three readers and present them with the 2024 Imported Beauty Compliance White Paper.