|
Japanese electronics brand JVC has announced that it's withdrawing from Korea because of poor sales. In April Sony restructured its Korean operations, and last year Panasonic, the brand name of the world's leading PDP TV maker Matsushita, gave up trying to sell PDP TVs in Korea. Japanese electronics companies that dominate markets elsewhere around the world are failing miserably here in Korea.
¡ß Market leaders abroad, but failing here
JVC said on Monday that its Korean office will be closed at the end of this month, and that Korean retailer The Mito will be in charge of sales and service of JVC products from July. The admission of failure comes just seven years after the company opened its Korean office in 2000.
JVC competes at the top level in the world's digital camcorder and audio electronics sectors. The company launched an aggressive marketing campaign during the Korea-Japan World Cup in 2002 and built up sales of W100 billion (US$1=W938) a year. Company president Masahiko Terada even visited the Korean office in 2002 and promised that the Korean unit's sales would double within two years. Despite the promise, money and effort, continuously depressed sales have forced the company to disband the Korean office.
That's not all. SONY Korea restructured in April, cutting back staff by about 10 percent after suffering stagnating digital TV sales in fierce competition with Samsung and LG Electronics. Panasonic Korea gave up selling PDP TVs in Korea altogether and is focusing on household appliances like electric massage machines. Its performance here is in sharp contrast with its dominance of the world's PDP TV market where it ranks number one with a 29.6 percent share.
¡ß Tariffs, service networks blamed
The hard times for Japanese companies come as Korean firms are making huge advancements. In the TV sector, for example, Samsung Electronics has built up both its competency and its reputation, so local consumers no longer look for foreign products. Industry insiders also pointed their fingers at import tariffs that make foreign products more expensive. Without significant product differentiation, it has become difficult for foreign electronics brands to compete here.
Foreign company officials meanwhile are blaming their retail and service networks for their failures. Samsung Electronics and LG Electronics have 150 and 130 after-sales service centers nationwide, respectively, while Japanese companies have about 10. An official from a Japanese electronics firm said, "Although breakdown rates are not high, Korean consumers tend to be overly attached to the number of after-sales service centers."
Some experts point out that the withdrawal of Japanese companies will hurt consumers in the end. Yoon Yeo-eul, president and CEO of Sony Korea, said, "Having foreign companies competing in Korea widens the variety of choice and leads to lower prices for Korean consumers."
(englishnews@chosun.com )
|
