Korean Consumer Goods Expand Into China via Local Distribution Networks

From October 16 to 18, KOTRA hosted the "Hangzhou K-Consumer Promotion" at the Seci Union Hangzhou Canal Plaza, marking a significant push for Korean consumer goods to expand into the Chinese market. This initiative comes amid a reported 8.4% increase in exports of Korean consumer goods to China in the first eight months of this year compared to the previous year.

Seci Union, one of the primary local distribution brands in Zhejiang Province, operates 546 retail stores throughout major cities in the region, positioning itself among the top five supermarket companies in China by 2026. The promotion aims to introduce high-quality products from small and medium-sized enterprises (SMEs) in Korea, linking these offerings to extensive distribution networks and online transactions to amplify their market reach in China.

Collaboration with various entities such as the Shanghai branch of the Korea International Trade Association, the Korea Tourism Organization, and local government representatives from Jeju and Gwangju, transformed the event into a hybrid marketing initiative combining product showcases, cultural experiences, and online marketing strategies.

Zhejiang Province is a key consumer market in China, housing four out of the top five cities in per capita consumption expenditure. Hangzhou, in particular, is recognized for its high consumer spending and trend receptiveness, making it a valuable testing ground for entering the premium segment of the Chinese market. KOTRA's partnership with Seci Union strategically targets local consumer bases, ensuring closer consumer connections for Korean products.

Thirty-one Korean companies participated in the promotion, showcasing a range of items from food and cosmetics to lifestyle products and fashion accessories. Regionally distinct offerings were highlighted, such as traditional fermented foods from Jeollanam-do, mung bean tea, and Jeju citrus chocolate. Additionally, popular cosmetic brands and food products were featured in consumer experience booths to attract local visitors.

The event included extensive digital marketing efforts utilizing influencers and consumer reviewers, as well as exploring possibilities for entering the Chinese online market through direct purchasing mechanisms.

KOTRA aims to leverage this promotion to help SMEs in the K-beauty and consumer goods sector gauge local market response, secure placement in large distribution networks, and achieve tangible outcomes in online sales.

According to Jang Sang-hai, head of KOTRA's China Regional Headquarters, establishing a presence through local distribution networks is crucial for engaging the Chinese market, emphasizing the importance of connecting online channels with regionally specialized retailers.