The media report that South Korea's trade balance ran into the red for the first time in 99 months this April seems to add to the anxiety that it has finally come. Due to 'COVID-19' the global economic downturn, exports fell 24.3% from the previous year, domestic consumption and production slumped, and imports fell 15.9%. So the trade balance turned into $950 million deficit.

South Korea, which has maintained its trade surplus for more than 20 years since 1998 when the currency crisis hit, is now spreading a sense of crisis that the trade surplus, which was taken for granted, could become "olden."

As a role-model country for the Corona epidemic quarantine, the government has said domestic manufacturing will operate normally, domestic demand will be better than major countries, and it will recover early. But experts say the South Korean economy, which accounts for 44 percent of exports, will have to fall due to sluggish exports, and a bigger crisis will come if it does not improve its fundamental investment environment, such as labor control reform.

The LCC was founded in 1998 at the time of the currency crisis, and had received a concern and doubt from many people. "What do you mean by setting up a manufacturing industry when the IMF situation is approaching and many companies are going bankrupt one after another?"

It is true that the construction of the Fifth Factory, which will be used for more than 10million dollars, will start during the period of the global economic crisis and the contraction of the domestic economy due to the COVID-19, and that the anxiety of the people involved and the hesitation of myself have come before us.

However, the sales of TheraBreath, the Premium oral rinse, which was released in January of this year, have skyrocketed, and we have decided to build a Fifth factory to meet the demand for additional Lip Care items exported to the U.S. and set a plan that we will construct the fifth Factory within October of this year.

In addition, in order to meet the domestic and export demand of hand sanitizers and hand wash, it seems that we have to expand our existing oil refineries in parallel. In any case, most major domestic companies diagnosed the current economic situation as having fallen into a long-term recession and decided to overcome the crisis through "austerity management". In contrast, LCC have decided to overcome this crisis through with "aggressive investment".

The Fifth factory manufacture mouthwash on the first and second floor, and the third floor manufacture Lip Care. So this Factory is a "complex factory" that produces two different kinds of products.

The first and second factories are made of emulsified products and wash products, the third factory is Lip Care, the fourth factory is exclusively for Quasi-Drug product such as mouthwash and hand-sanitizers, and the fifth factory manufacture mouthwash and L/C for solve the capacity shortage in the third and fourth factories.

In 2018, we expanded the third Factory(L/C) for export to the U.S.

We were pressured by the increase in demand, but we were faced with a limitation due to the difficulty of securing land to solve this problem. We have introduced a new idea that can be easily expanded to double the capacity if the existing factory manufacture and charge and the blister package do on the third floor of the new Factory to complete the arrangements.

Since Lip Care's charging and packaging are not continuous manufacture process, but separated process that packaging is carried out after charging. So, It is possible to determine that separate packaging at the new factory is a more efficient process.

Therefore, we installed two high-speed elevators, one for supplying the secondary materials and boxes for mouthwash, and the other for Lip Care filling and product. Once the expansion is complete, it will have 50 million Capacity per year and will have extra space in the building, so it will be able to expand to 67 million Capacity per year, which is estimated to be the world's largest factory in Lip Care.

The 5th Factory with 5000m2 is 34.5meter length, 55meter depth and 15 meter height, and is designed to have about 2.5 times the size of existing 4th mouthwash Factory(Capacity: 12,000 T/year 18 million units/year), and after a few years all the equipment is completed, it will become a huge 30,000 Ton, 60 million units of mouthwash Factory. The new mouthwash Factory can install a total five charging lines, but one is primary high-speed lines for TheraBreath and the other is medium-speed lines for Propolinse mouthwash, and has 1 million production per month per line.

It facilitates the entry of TheraBreath Oral Rinse into China and Japan, has the production capacity to expand into the global market of Propolinse mouthwash, and automatically wraps containers for mass production, including automatic alignment, charging, capping, labeling and box packaging to bring about revolutionary changes in productivity.

The existing mouthwash Factory(4th Factory) is designed to accommodate domestic and export small variety production and change to meet the demand for various hand-sanitizers. Demand for Dispenser Mouthwash in the U.S. and the expansion of small size(150ml) Propolinse mouthwash newcomers to convenience stores such as Family Mart in Japan will also allow high speed auto-charging facilities to be installed in new factory.

The proverb, "Necessity is the mother of invention" has become a reality. The first and second factories, which are factories that produce Skin-Care and wash products, were not able to secure additional space and had to give up the expansion. While I was traveling around the site, I was watching the emulsified measuring room of liquid, powder and perfume, and I thought to divided this area in two floor. If then we could using the remaining 330m2 to secure wash and hand-sanitizers production space.

By adding two more Mixers and installing an additional semi-finished storage tank and a raw material tank, the production capacity will be double. Of course, we will move the RO facility of purified water and install the new elevator in weighing room, and install new transport pipe line for raw materials and semi-finished products. With the removal of the Nivea Can charging facility, two lines of wash and hand-sanitizers can be installed, and not only domestic demand but also various overseas exports will be covered, which is expected to grow as another export contributing item.

In the past, there were times when the best secret plan for grow and develop the company through active sales performance such as lobby. That's why there was even a position called "drink business" in order to meet the favor of the other party. However, as the world changed and globalized, management became more transparent. It became the most important and absolute evaluation of the company's ability and credit level. In other words, product's quality and price competitiveness is priority.

In addition, large and medium-sized companies are turning to outsourcing rather than expanding their own facilities to expand into new fields and increase supply, and are making rapid progress in the division of labor for production and sales. We can avoid the risk of wasting huge capital investment and inefficiency, and we have no conflict with the labor union, so we can concentrate on sales and marketing.

Production and sales are no longer in the relationship between A and B, but they are partners, and can be explained as a division of labor. The sales department is responsible for developing brand power of products and delivering the Concept products sought by consumers, but also for providing products of good quality in the manufacturing (production) department at competitive prices.

Customers will be able to come naturally if manufacturer support the superior technical capabilities of the clean environment and have quality and price competitiveness in the superior factory layout and process. Therefore, if we build a good Factory and maintain trust with customers, we will be able to grow and develop in our manufacturing industry.

Building a small house requires a lot of difficulty and time. From design and licensing to choosing a constructor, to fund and to reconcile with the friction and opinion that they encounter while executing.. I heard that the younger generation of building a new house after retiring “feeling get older with so many difficulties and stresses during building”. What's more, imagine the difficulty and pain of building a Factory that will cost more than 10 million dollars.

Fortunately, however, I was able to accumulate good experience and knowledge while working as a Factory manager for six years during my tenured LG. It reminds me vividly that I experienced the importance of shortening the construction period, efficiency of investment and long-term design for more than 10 years. Even during establishment of 1,2,3 and 4 Factory, a new idea was applied for the efficiency to Factory construction. Unlike major companies, we had invested 30 million dollars since our founding, but we have not made a single contract (replaced by a purchase order), and we didn't receive a contract regarding defective insurance policy from our partner company. What is the reason why we have to make a contract with the excellent cooperation company that we have chosen and receive the insurance policy against the contract money and performance defects?

Usually, in order to facilitate large scale factory construction, it is common to form a separate project team so that each person in charge of building, machine, piping and electricity can share Synergy at regular meetings.

However, small and medium manufacturers cannot supply such additional personnel, so they have no choice but to handle the factory construction work during their duty. Mr. Byung-Ho Park, who is a Factory Director, is working on the design, ordering, construction supervision and commissioning of building, equipment, piping, utility supply and demand while managing the current production operations.

Mr. Park is the best talented person I have ever met in the 40-year production field, and he is initiative and has the ability to understand, so I think he can finish building the factory on time. In addition, I am personally sorry to him that he has to carry out a big project 'the construction of the fifth Factory' during the busy schedule cause of COVID-19 when it is open until the holidays.

Due to COVID-19, the recession of United States, Japan and Europe affect the decrease in demand so that the utilization rate after the fifth factory completion is seem to be low. So it may be pointed out that it is a wise idea to deal with it through night work and holiday work in four factories. However, 15 years after the completion of the L/C factory (third factory), the mouthwash factory (fourth factory) was fully operational for the first time in 10 years.

However, if the new factory is fully equipped with the entire building and the manufacturing, charging and packaging facilities are installed in sequence, we can conclude that there is no problem.

I firmly believe that night-time and holiday operation can increase employee fatigue and cause other quality problems.

Also i believe that it is the correct method to challenge the global market with quality and price competitiveness, equipped with sufficient facilities Capacity to develop into an export company of $20 million or $30 million and $50 million.

Anyway, Mouthwash, Lip Care, Hand Sanitizers, and Body Lotion have recorded the largest domestic production with Capacity, and the burden on LCC seems to be heavier. In 2027, the 30th anniversary of our establishment, we are committed to achieving $50 million in exports and becoming an one hundred years company through exports.

CEO BAIK, SUNGCHUN