Uniqlo expands in Korea as No-Japanese boycott wanes

Homegrown fast fashion brands may keep Uniqlo's growth in check

Uniqlo expands in Korea as No-Japanese boycott wanes
Hun-Hyoung Ha 2
2024-09-27 20:28:00 hhh@hankyung.com
Fashion

Uniqlo Co., a Japanese fast fashion brand, is vigorously expanding brick-and-mortar stores in South Korea, attracting budget-conscious consumers amid protracted inflation as Koreans' boycott of Japanese goods and travel to the country wanes.

FRL Korea Co., which operates Uniqlo stores in South Korea, said on Friday it reopened an outlet within Dundun, a shopping complex in Dongdaemun, Seoul, after four years. The 1,558-square-meter store was shuttered in 2020 at the height of COVID-19.

It marked its second outlet opening this month after launching its largest offline store in South Korea within Lotte World Mall in eastern Seoul early this month.

Next month, it will add four more stores: three in Gyeonggi Province surrounding Seoul and one in the capital city of South Korea.

Fashion industry officials forecast Uniqlo to rake in more than 1 trillion won ($760 million) in sales in South Korea in 2024 for the first time in five years.

Founded in 2004, FRL Korea is a 51:49 joint venture between Japan’s Fast Retailing Co., the parent of Uniqlo and South Korea’s Lotte Shopping Co.

It had led the boom of specialty store retailers of private label apparel (SPA) in South Korea and operated up to 186 outlets at its peak in 2019 before COVID-19 struck. 

Uniqlo has since scaled back domestic operations, reducing the number of stores to 127 in the country as of 2022.

It was among the hardest hit by South Koreans' No-Japan boycott campaign launched in 2019 in retaliation to Japanese government’s control of imports of South Korean goods.

Uniqlo expands in Korea as No-Japanese boycott wanes

In its fiscal 2020 that ended in August 2020, FRL Korea swung to an operating loss of 88.4 billion won versus a 199.4 billion won profit the year prior. Its sales halved from 1.4 trillion won in fiscal 2019. In 2021, it bounced back to report an operating profit of 52.9 billion won.

Uniqlo is benefiting from the rise in South Koreans' trips to Japan on the back of the yen’s weakness, which reduced their resistance to Japanese products.

As of the end of 2023, it runs 132 stores in South Korea. Last year, its operating profit jumped 23.1% on-year to 141.3 billion won, with sales up 30.9% to 921.9 billion won.

Some industry watchers, however, said the ascent of homegrown brands such as Topten and Spao could keep Uniqlo’s growth to pre-pandemic levels in check.

KKR-backed online fashion platform Musinsa has also bet big on offline sales by opening a slew of new fast fashion stores under the Musinsa Standard brand.

Write to Hun-Hyoung Ha at hhh@hankyung.com
 

Yeonhee Kim edited this article
#Uniqlo #fastfashion #FRLKorea #specialty store retailer of private label apparel #fashion #Musinsa #Topten #Spao

CJ Olive Young, Musinsa rivalry heats up in Brooklyn of Seoul

CJ Olive Young, Musinsa rivalry heats up in Brooklyn of Seoul

A CJ Olive Young outlet in Gwangju, South Jeolla Province South Korea’s top beauty chain CJ Olive Young Corp. is turning up the heat against Musinsa to contain the rise of the country’s No. 1 online fashion platform in the beauty market, with the cosmetics giant being called out for

Shein cracks Korea's ultra-low-cost online fashion market

Shein cracks Korea's ultra-low-cost online fashion market

Korean actress Kim Yoo-jung, the first global ambassador for Shein's fashion subbrand Dazy Shein, a Chinese fast fashion online retailer, announced on Thursday its official debut in South Korea with the launch of its Korea-dedicated platform in April and will step up marketing efforts in the co

Native Korean fast-fashion brands poised to snatch market

Native Korean fast-fashion brands poised to snatch market

Topten ad (Courtesy of Topten) South Korea’s homegrown fast-fashion brands are expected to continue making big strides at home as cost-conscious consumers shifted toward more bang for the buck to combat galloping prices amid stubborn inflation. According to Shinsung Tongsang Co. on Tuesda

Licensed casual apparel brands' luster fades in Korea

Licensed casual apparel brands' luster fades in Korea

The Discovery Expedition is a clothing brand licensed from the Discovery Documentary channel The fad for licensed casual fashion brands appears to be cooling in South Korea, where American sports clubs, broadcasting networks and documentary channels were reborn as apparel brands. The rise of th

Foreign streetwear brands flock to rich districts in Seoul

Foreign streetwear brands flock to rich districts in Seoul

Noah, a US men's clothing brand, opened Cityhouse, a flagship store, in Seoul in Nov. 2023 Palace Skateboards will likely join other foreign streetwear brands such as Noah, Supreme and Stussy, which have made their debut in South Korea, targeting young Korean consumers known as early adopters g

Japan's fever for Korean homegrown brands on the rise

Japan's fever for Korean homegrown brands on the rise

HiteJinro's distilled spirit soju ad in Japan (Courtesy of HiteJinro)  Shimamura Co., Japan’s second-largest apparel company that runs around 2,200 stores nationwide, has dispatched a team of four buyers to Seoul every month since June to find South Korean fashion brands that have po

End of No-Japanese boycott? Uniqlo Korea turns to black

End of No-Japanese boycott? Uniqlo Korea turns to black

Shoppers line up outside a Uniqlo store in Seoul following the launch of +J, Jil Sander-Uniqlo's winter collaboration line in November Japanese companies operating in South Korea are making a comeback after being hit hard by a campaign that began in mid-2019 to boycott Japanese products in the

(* comment hide *}