Lee Hyo-sik is Finance Desk editor at The Korea Times. He manages finance-related stories on macroeconomics, banks, stocks, bonds, crypto etc. He is passionate about covering what's happening in Korea's financial industry and explaining it to both Korean and non-Korean readers. You can reach him at leehs@koreatimes.co.kr. Your insights and feedbacks are always appreciated.
Kitchen container war intensifies
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Lock & Lock Chairman Samkwang Glass CEO Kim Joon-il Hwang Do-hwan
By Lee Hyo-sik
Lock & Lock,
Samkwang clash
head-on in Southeast
Asian market
By Lee Hyo-sik
Lock & Lock and Samkwang Glass, Korea’s two largest kitchen container makers, are engaged in fierce competition abroad in the rapidly growing global market.
Lock & Lock, which has introduced a wide range of plastic kitchen containers and other household items over the past few years, has established a strong foothold in China and is raising its profile in Southeast Asia.
Samkwang has been shipping glass kitchen containers to 83 countries, including the United States and China, and is now turning its eye to Southeast Asia for new sources of revenue.
Industry watchers say that the two firms, which together account for about 20 percent of the $4 billion global market, have turned Korean containers into a must-have item for many households around the world.
Lock & Lock vs Samkwang
Lock & Lock, founded in 1978, earned revenue of 514.6 billion won ($481 million) in 2012, up from 476.1 billion won the previous year. It now exports airtight containers to 110 countries. Chairman Kim Joon-il recently unveiled a plan to turn his company into the world’s largest comprehensive kitchen container maker by 2020 with revenue of 10 trillion won.
``Our China business has been expanding at an explosive pace over the years. We have become one of the most trusted consumer goods makers in the world’s fastest growing economy,’’ a Lock & Lock spokesman said. ``In 2011, our China sales accounted for 44 percent of our entire revenue.’’
The company operates two plants in China and one in Vietnam, saying it wants to become Asia’s largest kitchen container maker in a year or two.
``The firm produces not only plastic containers, but also other kitchen items. We are now trying to establish a strong presence in Vietnam and make inroads into Indonesia and other Southeast Asian nations. We will then advance into South America and the Middle East in order to become the world’s No. 1 by 2020.’’
Samkwang Glass, headed by CEO Hwang Do-hwan, has also been expanding its reach overseas over the past few years, selling its flagship product Glasslock and other kitchen products in 83 countries. It generated 285 billion won in sales last year, projecting the figure will increase about 10 percent to 304 billion won in 2013.
The firm, founded in 1967, began producing glass kitchen containers in 2005.
``We have been successful abroad, particularly in North America and China. Our overseas sales accounted for nearly 30 percent in 2012,’’ a Samkwang Glass spokesman said. ``Glasslock and our other kitchen items made of glass are immensely popular with consumers around the world thanks to their sleek, user-friendly designs, and durability.’’
The spokesman said Samkwang has no plan yet to build a plant overseas but will reinforce its sales capability in China and North America.
``Currently, we supply our products to Costco in the United States. We will soon do business with Wall Mart and other retailers to boost our sales there. At the same time, we will invest more in China and advance into Southeast Asia,’’ he said.
With the two container makers locked in intense competition, particular in China, they are increasingly holding each other in check.
They have also been waging negative publicity campaigns against each other. Lock & Lock has argued that Samkwang’s glass containers are heavy and break easily, with Samkwang claiming Lock & Lock’s plastic products may contain substances that are harmful to humans.
They are also engaged in trademark disputes in Indonesia and several other countries.