The Japanese beauty company Pola Orbis Holdings has decided to shut down Orbis Beijing Inc., the group’s China subsidiary in charge of its Orbis brand.
The company will also shut down the brand’s online retail operations. Its official Tmall store and Douyin store will stop taking orders by June 30, according to Orbis’ e-commerce customer service.
“With the Chinese economy stagnating and competition in the e-commerce market becoming increasingly intense, it is difficult to foresee an immediate improvement in profitability, and the group has been compelled to reduce the scale of business,” said the company in a press release.
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Pola Orbis has yet to determine the dissolution date and will be working with the local authority to complete the necessary legal procedures, according to the press release.
As a result, the company will record an extraordinary loss of around 1.3 billion yen, or $8.9 million, in its consolidated financial statements for the fiscal year ending December 2025.
The loss will be offset by a 1.6 billion yen, or $11 million, in corporate tax deduction, which leaves the company’s overall earnings forecast, which was published in February, unchanged.
The Beijing subsidiary, established in 2008, has been in charge of operating the Orbis brand in China. The company has suffered a loss for three consecutive years, from 2022 to 2024, leaving the company with net liabilities of 3.33 billion yen, or $22.9 million.
Pola Orbis entered the Chinese market in 2004 by setting up a subsidiary for its Pola brand in Shanghai.
In November, the company established a new subsidiary based in Japan to oversee its China business.
The reorganization comes as the company moves toward its “Vision 2029” strategy to “develop the cosmetics business globally; reform and enhance the brand portfolio,” “create new value and expand business domains,” and “strengthen research and technical strategy,” the press release noted.
The J-beauty giant is not only facing trouble in China, but it is also undergoing a reorganization process to enhance brand value. In recent years, the group axed beauty brands such as H2O+, Amplitude and Itrim to focus on its flagship brands, including Pola, Orbis, Jurlique, as well as newly developed brands such as Three, Decencia, Fujima and Fiveism x Three.
For the three months ended March 31, the company reported a 1 percent increase in net sales, but profit attributable to owners fell by 58.1 percent.