Top babywear brand hit for relationship with Choi
By Park Jae-hyuk
One of Korea’s most popular children’s clothing firms is facing a boycott, over suspicions it received preferential treatment for its CEO’s close ties with President Park Geun-hye’s longtime confidant Choi Soon-sil.
Many mothers commented on online community forums, demanding other moms not buy products of Suhyang Networks. Its CEO Seo Dong-beom is the husband of Choi Soon-cheon, Soon-sil’s younger sister.
Before the nation-shocking scandal, Suhyang’s babywear had been in high favor among mothers for its reasonable prices and good quality. The Seoul-based company has supplied its products to various retail channels, including department stores, discount chains and online open markets, thanks to its popularity.
However, the major customers of Suhyang ― mothers of young children ― are angered at the thought they supported Choi’s family by spending their money at its stores.
“I bought a bunch of clothing from its store to dress my children and they still wear the brand. I’m so angry that I was the one who enriched Choi’s family,” one mother wrote on Remon Terrace, an online community for mothers. Other mothers are also staging boycotts at many online communities, such as Momsholic Baby.
Established in 1984, Suhyang has launched several children’s clothing brands over the years ― Bluedog, Minkmui, R. Robot, Little Ground and Laughing Child. Although the company was sold to Hong Kong-based retailer Li & Fung in 2013, Seo is still the CEO as the second-largest shareholder holding 30 percent of stocks.
After the disclosure of the scandal, Suhyang has been suspected of receiving business favors in the Park Geun-hye administration.
A month after Park’s inauguration in February 2013, Seo was honored as an Exemplary Taxpayer by the National Tax Service, delaying tax investigation and collection for three years.
His firm is also suspected of receiving a loan at a lower interest rate than other blue-chips that have more capital and post more sales than Suhyang. The Financial Consumer Agency is considering charging Suhyang and involved banks with unfair preferential interest rates.
Some even point out that Suhyang benefited from the government’s measures against the low fertility rate.
Sales of Suhyang Networks rose from 153.2 billion won ($133 million) in 2013 to 180 billion won last year.
A Suhyang official said the company has no plans to respond to the scandal.
“We cannot argue about our customers’ decision,” he said. “As our company is unrelated to the scandal, we have nothing to say about it.”
As well as boycotting Suhyang, some customers are boycotting S Plus International, a restaurant chain run by Choi Soon-cheon. The company has western-style restaurants at Garosu-gil and Gyeongnidan-gil in Seoul and Haeundae in Busan.
Meanwhile, stock prices of other children’s clothing brands were high for a while on Wednesday, because investors expected the brands will benefit from the Suhyang boycott. However, their prices returned to the normal range soon.