The Fashion Industry in Korea Faces Several Issues
The executive director of Seoul Fashion Week, Jung Kuho has admitted: “that the last four or five months have been complete chaos”. Luxury goods are a commodity many people do not want to buy during tough economic and political times. Korea’s international market specializes in the high-end market, but for Fashion Week, things might not run as smoothly as the designers want.
A major scandal erupted in Seoul back in October, which eventually led to the impeachment of Park Guen-hye who was the country’s President. While everyone in Korea was trying to get over the corruption that Park put them through, a crisis with China threatened Korea once again. Security concerns that rose out of the situation made it difficult for local and foreign individuals to want to shop.
There is much at stake for Korea, who reached up to $7.6 billion in luxury sales last year. However, just last month, sales in travel retail and cosmetic trade dropped to a 25 percent growth decline.
Starting in March, Korea faced another hardship between the U.S. and China, therefore creating more economic pressure on Korea. There is now a complete fight between China and Korea, where South Korean video games have been frozen, China is implementing fire safety, visitors from China going to Korea have been stopped at airports, and K-Pop bands have been banned from playing on TV in China. Matters will potentially become worse over time. All of this is due to a defense system the U.S. had built in South Korea to protect the country from North Korea attacks. China is against the U.S. doing this.
With the Chinese banning traveler’s to Korea and new restrictions on imports in Korea has led to a challenging atmosphere in South Korea. China would now like Korean products and music out of China because, in 2010, Korean culture became more popular in China. Citizens in China can now protest against Korean merchandise. This complicates both countries because Korea relies on China’s sales and Chinese citizens often travel to Korea to buy the goods that Korea supplies. All in all, both Korea and China are losing numbers.
Jung Kuho, director of Seoul Fashion Week has stated, “I don’t think numbers will pick up until May when we have an election and hopefully then we will get back on the right track,”. Fashion companies have been dealing with the political effects because it has been disrupting their business. Former President Park has been called out because apparently, she was extorting bribes for millions of dollars from huge firms in South Korea. Protests were getting ugly, which led to a shutdown of malls, businesses, and restaurants.
Chinese bloggers have been shown on footage destroying Korean goods. Press in Korea have been trying to figure out if the bloggers were staged. However, there are many Chinese consumers who plan to stick to the liking of Korean products. After the election in Korea, hopefully the travel bans will be lifted. Korean beauty brands are highly popular, putting them into a powerful position in Asia. Korea is looking into expanding towards the Southeast Asia market rather than China now.
Although, Korea has established a new law stating that people cannot give out luxury items that are more than $45, which puts luxury departments in turmoil. The new law and the decline of Chinese tourists creates an even bigger problem for high-end lines. Political issues make up for half.
Designers and business owners are hoping for their growth to return after the election. Chinese buyers are invited and are coming to Seoul Fashion Week so maybe it will move things in the right direction.