Japanese Brands Exploit Economic Blues With No-Nonsense Approach
By Kim Hyun-cheol
Staff Reporter
Many Japanese tourists can be found in the streets of Myeong-dong, Seoul's No.1 shopping district. And now, outlets of Japanese retailers and brands are expected to further add to the Japanese fever in the downtown of Korea's capital city.
A number of Japan-based distributors ― most of which are marketing less pricey, decent-quality goods ― have spread their shops into the heart of Seoul in a signal that they intend to enter into the spotlight.
Daiso, Japan's No.1 low-priced living ware supplier franchise, opened its largest shop in Korea in Myeong-dong last month. Since launching its Korean unit, Daiso Asung, in 2001, the retailer has opened nearly 500 branches across the country.
Just like its ``100-yen shops'' that gave the company huge fame back in Japan, most goods in Daiso shops in Korea sell for below 2,000 won ($1.6). It keeps prices low by purchasing directly from manufacturers in high volume, a strategy often compared to American retail giant Wal-Mart.
Sales of Daiso Asung have sharply grown from 50 billion won ($40.2 million) in 2005 to 200 billion won last year, selling 660,000 goods per day, in a representation of a successful case of ``small profits, quick returns'' retailers.
``Prompt merchandising and supplying are the key factors of the company,'' Daiso Asung said.
Another Japan-based retailer, ABC-Mart, plans to open its third store in Myeong-dong in September. The shoe retailer has purchased an Esquire store location. The Korean shoemaker is about to be sold to a Hong Kong-based private equity fund.
ABC-Mart was first introduced in Korea in 2002, and opened its first store downtown two years later. Price and sales policies appealed to local customers and contributed to its fast growth over the last few years, the retailer said.
UNIQLO, Japan's leading clothing specialty chain, has also been steadily making inroads into the Korean market since its debut in 2005. Its Myeong-dong store, which opened in December 2007, tops in the retailer's 29 nationwide stores.
It stole some of the spotlight two years ago, when the franchise replaced McDonald's first Korean store in Apgujeong, southern Seoul.
UNIQLO has been quick in expanding its network in Korea over the past few years, mostly thanks to its unique strategies known as ``specialty-store for private-label apparel'' (SPA). Under the policy, the company produces its own clothing and sells it exclusively.
Some local clothing retailers are set to follow the trail of their Japanese rivals. Earlier this month, E-Land announced it will launch SPAO, a new brand that will be operated in SPA system, in October.
hckim@koreatimes.co.kr
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