This paper examines the internationalisation paths of Japanese cosmetics companies in the second half of the twentieth century. The paper aims to show why Japanese cosmetics companies – for the most part– did not internationalise beyond the regional Asian markets, despite early attempts to expand further into global markets. We relate the experience of the Japanese cosmetics industry to those of other sectors, positioning the development of the cosmetic industry within the Japanese business system until the 1980s and subsequent transformation. We illustrate how institutional dissonance between different components of the Japanese business system and those of most global markets undermined the ability of Japanese firms to internationalise, despite having quality, innovative products.

The paper builds on existing works on the evolution of the Japanese cosmetics industry (Mizuo 1998, Sasaki 2004, Ida 2001), as well as the growing number of works on cosmetic industries around the world (Jones 2010, Briot 2011). This paper not only contributes to international business theory using a business history approach, it also builds upon recent scholarship that have highlighted how institutions undermined the internationalisation of highly competitive Japanese products – from mobile phones to videogames (Kushida 2011, Matsushima 2013).