Price war in daily goods waged by stores and online sites

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Price war in daily goods waged by stores and online sites

A price war among discount chains and e-commerce players has intensified, and the range of targeted products is widening.

TMON, the mobile-oriented e-commerce start-up, announced Friday that it will offer the biggest bargains in feminine hygiene products.

The announcement takes aim at E-Mart, the country’s top discount chain, which made the same claim on Thursday. Since last month, the supermarket chain has been working on adjusting the prices of major daily necessities to levels offered by e-commerce platforms including Coupang, TMON and WeMakePrice in a bid to win back customers.

The first item in the battle was diapers, but the battleground has moved on to sanitary napkins.

E-Mart said on Thursday that its new prices for sanitary napkins are up to 51.4 percent lower than other discount retailers and 33.4 percent cheaper than e-commerce sites.

TMON fired back on Friday, saying that it offered 15 percent discounts on sanitary napkins to provide the lowest prices in all retail channels.

The e-commerce player said that it can afford more drastic price cuts because it saves on fixed costs such as maintenance of brick-and-mortar stores and staff.

“TMON’s strategy is not to provide attractive prices for the time being,” said Yoo Han-ik, head of the core business project division at TMON, “We provide the lowest prices for major daily household items after we survey the prices of 5,400 kinds of items on a daily basis.”

The digital shopping platform opened a section devoted to household products.

More consumers are purchasing household goods like bottled water and tissues and baby products like diapers in bulk online.

Analysts said that price wars could lead to big losses for retailers and smaller suppliers. Retailers could squeeze contracted suppliers to keep waging the war.

“This type of price war can benefit consumers, but retailers will become victims when many players join such a battle,” said a source in retail circles.

“Losses are inevitable because profit margins narrow and suppliers suffer as well. A good case is the prolonged price war among U.K. retailers, but the ultimate price was paid by them,” the source said.


BY PARK EUN-JEE [park.eunjee@joongang.co.kr]

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