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      Economy

      No need for Chinese to fly to Seoul for shopping(2)

      1
      2015-12-07 08:47China Daily Editor: Wang Fan

      Still, shops in Seoul offer 10 percent discounts in return for flashing the visas of often deep-pocket Chinese tourists and there is concern that the know-how to get into the Chinese online market is still a high hurdle for some.

      "Offline stores in China contribute the majority of our sales in the country, but we think e-commerce is the way to go in the future," said Smile Kim, who is in charge of Samsung C&T's business in China.

      Wang Xiaoxing, an analyst at Analysys International, said the promise of sales in China attracts every company, but standing out in an online crowd takes work.

      "The fashion and cosmetic related products from South Korea are hot items in China especially after the broadcast of popular Korean soap operas. It would be foolish not to pursue this sector," he said.

      "But it won't be easy for Korean vendors to run online stores in China. If they don't know how to play the e-commerce game here, which means they need to attract traffic online, their stores can be buried among the millions of vendors," he added.

      Costs to set up brick-and-mortar shops in China, as well as industrial and commercial registration rules, make the e-commerce portals the way to go, Lee Kwan-sup, vice-minister of South Korea's Ministry of Trade, Industry and Energy said at a press conference organized by Alibaba.

      "It is very difficult for foreign brands to expand in China via brick-and-mortar stores. Big companies, such as Eland and Samsung are able to do that but for startups and designer labels, it is financially challenging for them to set up stores in China, which makes online channels their ideal choice to tap the China market," he said.

      Zhang at Alibaba echoed that view on the best way to bring South Korean products directly to the doorsteps of Chinese consumers.

      "In the old times, companies needed to complete industrial and commercial registration in China first before opening an online store.

      "Especially for foreign cosmetic companies, they need to go through a time-consuming process to get all the licenses to prove their products are safe to sell in China," he said. "But if they choose to sell directly from South Korea online, they can avoid all these procedures, saving a lot of time and money."

      Suk Ji Roh, managing director with the Cosmetic Strategy & Planning Department with South Korea's pharmaceutical, healthcare and cosmetic products company Celltrion Inc, said the plan for greater China sales of a popular foundation primer likely rests on cross-border e-commerce.

      "So we are thinking launching our products in Tmall Global and selling to Chinese consumers as imported products. We will then decide our next move with feedback online," she said.

      To be sure, Liu Qiangdong, chief executive officer of JD.com, Alibaba's arch rival, visited Seoul in March to announce the launch of Korean Mall on his company's online platform.

      Liu promised vendors incentives as well, including discounts on commission fees and setting up warehouses in South Korea to help cut down logistic costs.

      "Myeong-dong commercial area is one of the hottest shopping destinations in Seoul. With an improved customs clearance process and logistic services, we can replicate thousands of Myeong-dongs on JD," he said.

       

        

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