Small importers are delivering lower prices

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Small importers are delivering lower prices

Small private importers are aggressively expanding to sell a wider variety of products ranging from low-priced goods to expensive parkas and are prompting large retail chains to demand more inventory.

Vic Market, a membership-based wholesale market run by Lotte Mart, began a special sales event yesterday on North Face, Canada Goose and Moncler parkas. It is the first time a local discount chain has featured such high-end items, thanks to small importers. About 500 jackets in 23 styles will be available at 20 percent to 36 percent off department store prices.

Small importers previously tended to bring in small volumes of products, especially luxury goods, because they usually make business deals in cash and cannot return unsold inventory. However, the business structure started to change as demand surged.

“As high-end parkas recently became a boom, the number of smaller importers jumped 30 percent to 40 percent,” says Kim Yoon-sun, a fashion product developer at Vic Market. “Getting products is as difficult as picking a star from sky.”

E-Mart was also selling Canada Goose parkas at 20 percent to 30 percent less than department stores at its wholesale store called E-Mart Traders on Nov. 20. The online open market 11th Street will start selling the Canada Goose Expedition parka for 850,000 won ($803.40), whereas they typically retail for 1,250,000 won at department stores.

However, smaller fashion items showed the largest gap in price between products from large official importers and small private importers. Kipling’s Seoul backpack goes for 89,800 won at E-Mart, half the price of the department stores. Hollister parkas, which typically cost about 250,000 won, are priced at 100,000 won at 11th Street.

“Products imported through small private companies could be even cheaper than the normal retail price in the country of origin, especially when the companies purchased them during special promotion events,” said an employee at 11th Street.

Some foreign brands even lowered their initial price to grab Korean consumers who shop directly through their official online mall. In July, Ralph Lauren dropped prices by up to 40 percent on children’s parkas, but they were available for less via Korean private importers. The children’s down vest was 30 percent cheaper at E-Mart than at regular department stores.

Lotte Mart plans to privately import more name-brand products next year, including Toms shoes, Tory Burch handbags, Tumi luggage and Coleman camping equipment.

Last month, online store Gmarket partnered with a small private importer to open a foreign luxury brand online showroom with about 40,000 products from 80 brands. The market will certify the products are authentic through QR codes, which are linked to the Customs Service database, and will refund double the purchase price if products are found to be counterfeit.

Home shopping companies mainly sell premium handbags, including Gucci, Prada and Fendi, at a 5 percent to 40 percent cheaper price. This year, GS Shop sold Versace and Missoni mufflers worth 7 billion won with a price range between 200,000 won to 300,000 won, 60 percent cheaper than the regular price at department stores.

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