Cosmetics CEO started small, but dreams big with collagen
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Beautee Collagen’s CEO Lee Kyoung-sook
By Kim Ji-soo
CHEONGJU, North Chungcheong Province — Lee Kyoung-sook, 52, didn’t envision herself running a “K-beauty” or Korean cosmetics company.
A Korean literature major at Chungbuk National University, Lee worked as a journalist for nearly a decade with a local newspaper. But the world of business piqued her interest in 1999, after she married a researcher and entrepreneur who had started a business that processed pig oil and later made a foray into processing collagen, mostly marine collagen used for the products of Beautee Collagen.
Today, people are more or less familiar with the word collagen, which is in fact a major structural protein that strengthens and supports body tissues. After 25, the body stops producing collagen, which is important for maintaining supple skin. Therefore, collagen is also a preferred ingredient in skin products.
“Collagen, as you know, is a leader in revitalizing cells. Our products are known for their effects on restoring cells and treating wrinkles. Our best-sellers are the Cell Pure 2500 Ampule and the Essential Skin Lotion,” Lee said.
Cosmetics firms at home and abroad have collagen-based cosmetics products.
“It helps that we have the technology that allows us to produce products from one source, collagen,” Lee said, expanding that “our products use collagen that is not heat-processed or acid-processed.” The company uses the process of two-stage hydrolysis on collagen from raw fish skin, so the resulting collagen contains more hydroxyproline, glycine and lysine. Collagen that is hydrolyzed a second time becomes a pure fermented product that is more absorbable.
In Korea, Beautee Collagen products are sold in 100 shops including Lotte and Shilla duty-free stores. It also has a duty-free store at the Macao international airport.
The company has been successful in the Chinese market, especially with plastic surgery and dermatology hospitals in Shanghai. The expansion of the Korean wave overseas has translated into better business for most Korean cosmetics companies. Statistics show that Korean cosmetics production in 2014 was around 8.8 trillion won, a significant increase from 6 trillion won in 2010. In 2015, so called K-beauty firms exported around 3. 8 trillion won ($2.9 billion) of products, which is an impressive 52.7 percent increase from 2.2 trillion won in 2014. Amid the boom, Beautee Collagen products have been selling in overseas markets, particularly in China and Mongolia. Reparo, its joint and more high-end brand with BioMark of China, was also the first to open a counter at the Friendship Shopping Center in Gubei, Shanghai. “‘Quanxi’ is about trusting each other,” Lee said, when asked about her thriving partnership in China.
Beautee Collagen’s location in Cheongju enables it to perform joint research with neighboring colleges and with the North Chungcheong Province’s innovation center for marketing and brand development. Cheongju is also near Osong, where the North Chungcheong Provincial Government has said it will build a cosmetics and beauty promotion center to strategically promote the K-beauty business there. At last year’s export conference held at Cheong Wa Dae, Lee asked President Park Geun-hye to help ensure the Osong project’s on-time schedule and in turn, help the city increase its cosmetics exports.
Although the company’s current annual sales are not significant — at around 800 million won — she has been working diligently on the business since 2008 and has made headway. For example, at a recent expo in Vietnam, Beautee Collagen was only one of three companies that clinched a 1.1 billion won export deal.
She is constantly on the phone talking to partners and meeting buyers in her 12-employee office.
Lee has ambitious ideas on the booming Korean beauty industry. “Companies should focus on one source or area in which they are competitive. It is not desirable for cosmetics firms overall when big or small companies all jump in and try their hand in many areas, from raw material development, to branding and marketing.
She hadn’t planned to join her husband in the business. In an anecdote, she recalled when she visited a fortuneteller, who said she was born a businesswoman. She scoffed at the comment at the time. But she started helping out at her husband’s company with purchasing raw materials and setting up the website.
With regard to what was different about her work in the business from her work as a journalist, she said: “The work was easy, like I had been doing it all that time,” she said.
But was it also easy for her to shift from journalism to business?
“When push comes to shove ... when you have to make a living, you make it work,” Lee said.
She said initially, her husband’s company went toward bankruptcy around 2005 as it changed course to processing collagen from processing pig oil. When the company stopped producing pig oil-based products in order to experiment and produce collagen-based cosmetics goods, the bank that had made them loans for the pig oil processing factory called in their loans.
“Banks should also recognize intellectual properties (like collagen-processing technology) as collateral,” Lee said.
At that time, when the business seemed all but destroyed, she said she wasn’t greatly depressed.
“I was young, and I was not scared,” she said.
Instead, she just looked ahead. She also received business advice from her mother-in-law, who used to run a bus company near Cheongju.
“She always said, dress up for business, look the part,” Lee said. “She also advised me to never take up a lunch or dinner invitation from a man,” Lee added, laughing. Asked if that was possible in this day and era, Lee said she took the advice to mean finding her own singular method of doing business in the male-dominated Korean society.
As a CEO who has had no business background, Lee chose the quickest path to learning. “I looked for role models in books, videos or in special lectures,” Lee said. In her every waking hour, whether she was watching television or reading a book, she did so with a focus on marketing.
As the leader of a small-and medium-sized business, she said she also has difficulty recruiting good talent whom she could nurture and encourage to stay on.
“For female CEOs, there is also the challenge of having to develop male talent for the company,” Lee said. Despite more women in the workforce, Korea’s labor market has been dominated by men. And women CEOs, Lee has observed, tend to rely on family and relatives in recruiting employees.
But over the years, she said she has grown bolder and more confident in delegating tasks. “Business is, I think, about how much risk you’re willing to take with you on your plans. It’s about positioning, from the start, the conceptualizing, branding and marketing, with the end goal of getting the product to the consumer,” she said. Products in warehouses are not products; only those that are sold and that reach the consumers are products, she explained.
Soft-spoken and modest, Lee hardly seemed like the typical CEO. But she envisions bigger things for the company in the next 20 years.
“We have core technology, and therefore, core products. Now we are also making products using mineral water from the Chojeong area,” Lee said.
Lee said she uses her company products, and offered a sample for this reporter to try. The products brought a certain tightness and moisturizing effect to the skin.