Korean retailers fostering fashion brands; Homeplus, Korea’s No. 2 supermarket chain run by British retail giant Tesco, first introduced their fashion brand Florence& Fred in 2010

2013-10-02 17:53

Retailers fostering fashion brands

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Seen above is the inside of a Florence & Fred store run by the country’s second largest retailer Homeplus. The fashion brand was launched in 2010 in Korea

By Rachel Lee
The country’s major retailers are stepping up efforts to grow their own fashion brands to the level where they can compete with the world’s global SPA brands.
SPA brands are those that produce their own clothing, distribute and sell it exclusively. Names such as H&M, Zara and Uniqlo are classified as SPA brands
According to industry sources, large discount chains including E-Mart and Homeplus have been aiming to do the same with their fashion labels Daiz and Florence& Fred, by launching and expanding the range of high quality products at competitive price.Homeplus, Korea’s No. 2 supermarket chain run by British retail giant Tesco, first introduced their fashion brand Florence& Fred in 2010 in the country. Designed by a local designer, Florence& Fred offers affordable clothing and accessories for people of all ages and is now distributed to 11 countries worldwide including the United Kingdom, Poland and Hungary.
To develop the ability to vie with global SPA brands, the company has begun active online sales of the brand in order to reach the entire nation, as well as opening offline stores in major shopping districts rather than restricting its sales in their existing Homeplus branch.
“Florence& Fred has been sold on the company’s official online shopping website since last month,”said a company spokesman. “And for the brand’s offline shops, they are currently under construction for remodeling, and the company is planning to continue to sell the brand in all of our Homeplus branches.”
The company has targeted and approached consumers in their 20s and 30s in particular by endorsing pop stars and other well-known celebrities as the face of the brand, and has offered many benefits to online customers including free delivery service and discounts on certain items.
Emart, the country’s largest retailer run by Shinsegae Group, has also steadily improved its own fashion label Daiz since about two years ago. Daiz was launched in 2009.
According to the company, Daiz’s total sales reached 264.2 billion won last year, a 20 percent increase over the previous year. The figure proves the brand’s second largest position as a SPA brand after Uniqlo in the country. The retail giant aims to hit the 500 billion won sales mark by 2015 and one trillion won sales mark by 2018.
“Daiz’s new items for this Fall/Winter season are introduced at an even more competitive price since we have minimized our distribution process. And the products are also a reflection of what consumers want the most. A lot of them are simple designs, which are most popular among our consumers,” said a company spokesman. “Through this season’s collection, it will be our start to become the country’s first SPA brand.”
Among the new items this season, the fashion brand’s cashmere cardigans and knitwear are launched with some being as much as 39 percent lower in price than similar products designed by other SPA brands. Apart from the price competition, Emart has targeted young customers by showing the most up-to-date, trendy and fashionable designs not only of clothing but a wide range of products like shoes and sportswear.
The company currently runs a total of 128 stores nationwide and plans to open more in major shopping streets and districts in the country. It also plans to expand the brand’s overseas business in China and Southeast Asian countries including Vietnam.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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