Korea Becomes Ripe Market for One-Price Shops

A Miniso store

Next Monday, Korea will get its first branch of Miniso, a Chinese dollar store chain selling cheap-and-cheerful merchandise from homeware to toys.

Minisio will open in the Sinchon area in northwestern Seoul, where many students shop and hang out. The chain sells cheap products in some 150 countries, including Hong Kong, the Philippines, Singapore, the United Arab Emirates and the U.S.

Originally created in Japan and famous for its lacquer bowls, chopsticks and bamboo place mats, it was sold off to a Chinese company three years ago.

The prolonged economic slump has boosted the dollar store business, but now it is evolving into more stylish design and relatively durable goods that appeal to young people on a tight budget.

Industry watchers believe that the Korean market for low-priced household products, now scaled at W2 trillion, will grow to W4 trillion in two or three years (US$1=W1,109).

◆ Growing Market

Daiso, the biggest one-price shop currently operating in Korea, is opening a new store in Suwon south of Seoul in October which is more than twice as large as the current ones. It already has 1,100 outlets here.

The local competition is on to the trend. Budget household goods store Butter, run by fashion retailer Eland, now has 14 outlets less than two years after its launch, and sales soared 183 percent in the first half of this year compared to the same period of 2015.

Eland handles product design and production, which helps keep prices down. Won Kyoung-hoon at Eland said, "Main products like scented candles and clocks cost less than W10,000, and we launch 100 new products every other week for trendy young customers".

Stationer Artbox is expanding into household products with the Poom chain, which started in 2011 and sells a growing range of products like shower curtains, baby products and bicycles.

Sales surpassed W100 billion last year, and the company hopes to increase the number of shops from 60 to 70 this year. It also offers products online.

◆ Other Foreign Brands

Other foreign retailers are also cashing in on the trend. Flying Tiger Copenhagen, with its range of affordable Scandinavian home goods, is opening its first Korean store in the Myeong-dong shopping district in Seoul next week, its second store in Asia after Japan.

A Flying Tiger Copenhagen store

Most of the 8,000 products cost less than W5,000. "Young Korean consumers like simple Scandinavian designs made of wood", a staffer said.

The granddaddy of the style, IKEA, opened its first store here at the end of 2014 and more are planned. A staffer said kitchen utensils, toys and other household products costing less than W5,000 are more popular here than the furniture.