Analysis of the Reasons Why the Average Annual Salary of R&D Personnel at Banmuhuatian is Below the Industry Average
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Based on the collected materials, I can now provide you with a detailed analysis of the reasons why the average annual salary of R&D personnel at Banmuhuatian is below the industry average.
Banmuhuatian is a brand under Shandong Huawutang Biotechnology Co., Ltd., and its holding company, Fujian Qingsong Co., Ltd. (Stock Code: 300132), is mainly engaged in cosmetic ODM/OEM businesses[1]. According to Qingsong Co., Ltd.'s 2024 annual report data, the company’s R&D investment status is as follows:
| Indicator | 2024 Data | Industry Comparison |
|---|---|---|
| Number of R&D Personnel | 187 people | Proya: 389 people |
| R&D Investment Amount | RMB 64,447,500 | Medium level in the industry |
| R&D Expense Ratio | 3.32% | Below the 5% standard of international brands |
| R&D Personnel Education Background: 120 bachelor’s degree holders, 28 master’s degree holders | Medium to low | [1] |
According to industry research data, the average R&D investment as a percentage of main business revenue for domestic cosmetic companies is only around 3%, while international giants such as L’Oréal allocate 5% of their annual operating revenue to R&D[2]. In 2024, the employee compensation in Qingsong Co., Ltd.'s R&D expenses was RMB 27,578,200. Calculated based on 187 R&D personnel, the average annual salary is approximately RMB 147,500. However, this figure is close to the average annual salary of R&D personnel at Proya in 2022 (RMB 140,000)[3], indicating that Banmuhuatian’s compensation level is at the lower-middle position in the industry.
As an ODM contract manufacturer, Qingsong Co., Ltd.'s major clients include emerging e-commerce brands such as Peilai, Guyu, Banmuhuatian, Xiwuji, Yatsen Holding, and Florasis[1]. The gross profit margin of contract manufacturing business is relatively low, and the company’s R&D expense ratio in 2024 was only 3.32%, a further decrease from 3.52% in 2023. This business model limits the company’s profit margin, which in turn affects the compensation competitiveness of R&D personnel.
The beauty industry generally faces the problem of excessively high marketing expense ratio. Taking Proya as an example, in the first three quarters of 2024, its sales expenses reached RMB 3.232 billion, while R&D expenses were only RMB 142 million, with marketing expenses being 23 times that of R&D expenses[4]. Data from CHANDO’s prospectus shows that from 2022 to 2024, its sales and marketing costs were RMB 2.445 billion, RMB 2.406 billion, and RMB 2.717 billion respectively, accounting for 57.0%, 54.2%, and 59.0% of revenue; in contrast, the R&D investment ratio has been declining, dropping from 2.8% in 2022 to 1.7% in the first half of 2025[5].
Qingsong Co., Ltd. is headquartered in Fujian. Compared with beauty industry clusters in first-tier cities such as Shanghai and Hangzhou, it has a geographic disadvantage in attracting high-end R&D talent. Enterprises in first-tier cities such as Proya and Bloomage Biotechnology can offer more competitive compensation packages.
According to Qingsong Co., Ltd.'s 2024 annual report, only 28 of the company’s R&D personnel hold master’s degrees or above, accounting for 15%, while 120 hold bachelor’s degrees, accounting for 64.2%[1]. Compared with Proya’s 389 R&D personnel in 2024, with 58.7% holding bachelor’s degrees or above, Banmuhuatian lags in the allocation of high-end R&D talent.
| Company | Average Annual Salary of R&D Personnel | R&D Expense Ratio | Number of R&D Personnel |
|---|---|---|---|
| Proya | RMB 140,000/year (2022) | Approximately 2-3% | 389 people |
| Qingsong Co., Ltd. (Banmuhuatian) | Approximately RMB 147,500/year | 3.32% | 187 people |
| Jahwa | High level | Approximately 3% | A large number |
| Industry Average | RMB 100,000-140,000/year | 3% | - |
- Increase R&D Investment: The company should raise its R&D expense ratio to 4-5%, aligning with international brands
- Optimize Talent Structure: Introduce high-end R&D talent to enhance the overall level of the R&D team
- Establish Incentive Mechanisms: Improve the enthusiasm of R&D personnel through equity incentives, project bonuses, etc.
- Industry-University-Research Cooperation: Establish joint R&D centers with universities and research institutes to reduce labor costs while improving technological capabilities
In summary, the average annual salary of R&D personnel at Banmuhuatian being below the industry level is mainly due to factors such as restricted total R&D investment, limited profitability of the business model, and the industry-wide trend of ‘emphasizing marketing over R&D’.
[1] Full Text of 2024 Annual Report of Fujian Qingsong Co., Ltd.
[2] “The Key to Domestic Cosmetics’ Counterattack Lies in R&D”, People’s Daily
[3] “Proya (603605): Organization and R&D Lay the Foundation, Strong Sustainability of Flagship Products”, CPOST Securities Research Report
[4] “Key Words of the Beauty Industry in 2024: Performance Pressure, Emphasizing R&D, Flagship Products”, Manager Network
[5] “Striving to be the ‘First Stock’: Beauty Companies Pursue ‘Full-Chain’ Listing”, Xinhua Net
Insights are generated using AI models and historical data for informational purposes only. They do not constitute investment advice or recommendations. Past performance is not indicative of future results.
About us: Ginlix AI is the AI Investment Copilot powered by real data, bridging advanced AI with professional financial databases to provide verifiable, truth-based answers. Please use the chat box below to ask any financial question.