Asian Junkie Asian pop. Without discretion.
The North Face was recently hit with a four and a half million dollar fine in Korea for charging a fixed price for theirs goods, and I have no idea why.
The nation’s antitrust watchdog hit The North Face Korea last week with a 5.2 billion won ($4.6 million) fine for compelling all 151 of its retailers here to charge 10 to 15 percent higher prices than for rival brands since 1997 to maintain the brand’s premium image.
The Fair Trade Commission said that the unfair practices of the brand with over 30 percent market share also affected rival companies such as Kolon Sports, K2 and Columbia. Korean consumers also had to pay 50 percent more for the brand’s down jacket due to the price-fixing, according to Seoul Young Men’s Christian Association.
The way the article is written, it’s basically saying that they got slapped with a ginormous fine for trying to set a market price on their products.
How in the flying fuck is that illegal? Like how do you selectively enforce that? It’s not like Chanel and Gucci fucking sell their shit as low as they possibly can. Hell, even the fucking Gap doesn’t do that.
Korean consumers had to pay 50% more than what? Is anybody forcing them to buy the jackets? What?
I’m not familiar with Korean business law, so please school me on how it’s possible for them to get hit with this fine. Also, explain why it apparently only applies to The North Face, since it just seems like they want to price their brand so that it becomes an exclusive item … like every other designer brand out there on the market. Ever.
I thought firms that operate as cartels & indulge in price-fixing work with rivals in order to destroy potential incoming competition while being a market leader at the same time. In this case, idgi cause they say nothing about other firms being involved or mentioning who blew the whistle on the cartel ;-;
Yeah, I would get that, but there doesn’t seem to be a cartel.
Sorry for deviating but your prof pic is fucking boss.
It seems the issue is more about the way the north face importer treated his own distributors. Forcing them to stick to his own pricing structure instead of allowing them to freely compete….and thats illegal.
Hopefully some of the law bloggers will chime in on this.
that makes more sense
Where does it mention distributors?
The linked article says the fine is for compelling its retailers to sell at the higher prices.
Its a weird setup in korea..NF isnt actually NF. its just the importer and the stores. Not just NF stores but other stores too. The importer of NF in korea is actually another brand of outdoor gear. Its all kinds of complicated..but anyway, they are stopping their retailers/distributors being competitive in the marketplace. Thats whats breaking the law..Not the high prices.
Still don’t get why they shouldn’t have the right to dictate their product’s pricing.
They do…but individual stores have the right, by law, to offer discounts or have sales or whatever…the importer was threatening and coercing them out of that right..Which apparently breaks the law.
Im not legal expert so i cant really offer anything further than that..
$3000 for a Gianni Versace trench coat is legit, but $350 for a North Face wind breaker!? “Oh heell naw, this muthafucka betta have a built in heater!”
Frankly I think that shit should be illegal anyway. For everyone.
Why?
Cause it’s so fucking greedy, ugh.
(cause I’m poor lol.)
what’s up with the flags around it?even red cross flag was there but no korean flag?holy crap,Nooo!What about their patriotic pride?!!maybe that’s why!just guessing..
I see a Korean flag. Look at the 2nd floor windows on the right between the two glass panes.
you are right!it was in fold but it was there!!you have a very good vision my dear!!I probably need some glasses too..but i still want to think that korean’s missed it just like i did because it was in fold and they have only put one there unlike the other flags because i have this impression of them that they want all of us to hail korea.
The korean flag is next to the japanese flag to the right of the pic.
I dunno if those flags are part of the north face storefront or a street display.
It will be because i will put my faith on it!!that is the ultimate reason!!! I stand by it!!! why else would they pick on north face??oh my,,is it also possible that is because north face is a personification of north korea?they were in bad term right???what else is there?
* i’m not sure if personification is the right figure of speech for ^.I honestly only use simile metaphor and irony.please educate me if i was wrong.
koreans fucking love to put flags up in the outdoor market..
makes it look more bazzar like than it really is. and festive
Not legit. The Taiwan flag isn’t up there. I’d fine them too. Inconsiderate bastards. Yet there’s like a thousand fucking flags of Turkey and the one with the red cross up there….
red cross? you mean switzerland? lol
Ain’t the cross of the Swiss flag is white and around is red instead of the opposite?
Forget about the flags. For a second I thought why is that dude hanging off the building? Lol I need glasses.
he is sent by the government to put up s. korean flag because north face is such an ingrate not to put as many of it up on their store..
I’ve always thought that competitors usually get harassed for price cutting, not raising.
But I heard Abercrombie was expensive as shit there too.
This makes no sense well a lot of things about korea dont make sense
http://www.kimchicapitalism.com/2012/02/16/korea-ymcas-misguided-crusade-against-foreign-apparel-brands/
http://www.expathell.com/?p=3887
Guess I’m not alone.
Only browsed through those articles and will read more thoroughly when I have the time.
The way people talk about chaebols makes me feel like they are like royalty or something. Boys Over Flowers didn’t help change that sentiment either… I read about Go Hyun Jung who was apparently a famous actress back in the day but had to quit to focus on being a “chaebol’s wife.” WTF?
Because they are royalty.
The source material for “Boys Over Flowers” is Japanese and it’s because it’s the same there.
ye, my bad my bad :X
Somebody at the Fair Trade Commission needs to crack open an Economics 101 book.
Prices on non-essential items like this are ultimately determined only by the people who buy them.
I read a story recently about an American company that was selling some luxury item to Chinese people. The item wasn’t selling well, so they met with a local marketing expert. He suggesting doubling the price. They did that and sales went through the roof. The rich Chinese didn’t want it at half the price because it didn’t seem “premium” enough to them.
Slightly arrogant dont you think? Im pretty sure some of them might have a clue about economics.
but that isnt even what this issue is about. Its about the way the north face importer treated his distribution network. Not allowing them to be competitive.
Its not about the customers.
Simple. Ever since Big Bang promoted for them they’ve probably been making even more than usual, so the government wanted a slice of the pie.
yeah im sure that 5 million dollars is a big score for the government.
They get what they can take.
Er, do Kpop idols really have that much power in convincing other people to buy the shit their endorsing? Just because Jennifer Hudson is endorsing Weight Watchers doesn’t mean I’ll even look into it…
Do they have power? Yes.
It’s the perfect mix of their fan demographic and the advertising demographic.
18-49.
Hahaha oh yes. I mean, I bought the Cyon Lollipop 2 phone because 1) it’s freaking adorable 2) Big Bang was promoting it.
Lolli-lolli-lollipop dalgomhage dagawa~
Hmmm interesting article~!
I asked my economist friend about it and this is how he explained to me:
Price fixing is an agreement among competitors to reduce competition.
Minimum resale price maintenance, is established by the upstream manufacturer on distributors. It may not necessary affect selling price to consumers, but rather it could be a strategy imposed by manufacturers to increase incentives for distributors.
These two terms are often used synonymously but they definitely do not have the same implications
Here is a good article differentiating the two terms: http://gbr.pepperdine.edu/2010/08/price-fixing-and-minimum-resale-price-restrictions-are-two-different-animals/
So what TNF is doing is minimum resale price maintenance, all premium brands do this and it’s perfectly ok, since there is no colluding agreement with the other domestic Korean outdoor equipment manufacturers. If TNF can charge such a premium and still maintain sales, then that’s simply a market driven position.
What is the real reason TNF is being fined? Most likely due to trade protectionist activities. Domestic Korean brands are jealous of TNF’s position and through some underhanded networking, revolving door type conflicts of interest, alerted the FTC watchdog to abuse it’s government position to slap TNF with this fine that in effect makes TNF less competitive.
Hey it’s your site you can do whatever but I thought this site was about asian pop.
I didn’t know it was going to be a “Everything stupid I find about Korea” blog.
I thought it was interesting. Considering an Asian pop group is endorsing this foreign brand I find it somewhat relevant. Even if it wasn’t, plenty of people here find it intriguing.
Hater much?
It’s everything I find about everything in Korea/Japan and America in the context of Asians.
Nobody forced you to read this article.
Considering every other kpop site portrays Korea as a magical, wondorous land where nothing bad ever happens, I like that this site reports on what the others choose to overlook.
It’s good to think of Kpop within the context of a real country with issues rather than the soundtrack emanating from some kind of faultless utopia.
I don’t get how they can do that either.