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By Park Si-soo, Rachel Lee
Prada, Burberry, Ferragamo, Etro and other imported luxury goods are now being sold in big discount stores.
Vic Market and Emart Traders, two warehouse stores operated by retail giants Lotte and Shinsegae, are offering 30 percent discounts on the luxury goods, and these bargains are attracting customers.
"I thought they were counterfeit because they were so cheap," said a shopper at Emart Traders' outlet in Suwon, Gyeonggi Province. "It's good for me because now I can get them at lower prices. But I'm not sure if this is good news for (luxury goods) companies considering that their luxury image has been broken."
Another shopper said, "Luxury goods selling at discount stores will end up compromising manufacturers' efforts to build their brand image as purveyors of luxury."
Sung Ha-yong, an Emart Traders manager familiar with the issue, said the company plans to increase imports of luxury goods to meet growing demand.
"The demand for luxury goods is rising continuously. I think it's because of competitive prices," he said. "We will try hard to provide more luxury products at more competitive prices."
Officials at Emart Traders and Vic Market said "parallel imports" have made it possible for them to sell luxury goods at reasonable prices.
A parallel import is a non-counterfeit product imported from another country without the permission of the intellectual property owner, which is legal. It was allowed here from 1995. Foreign products worth four trillion won ($3.58 billion) were imported using this tactic during the first half of the year, nearly a two-fold increase in volume over the last three years, according to the Korea Customs Service.
On top of this, they said, the companies have adopted a variety of cost-saving measures to cut prices.
A Burberry Korea spokeswoman said the company was aware of the situation, but didn't elaborate. A Ferragamo spokeswoman refused to comment.
An Etro spokesman said the company was not sure about the current situation, but added the company will take "necessary action" in the future if a large amount of "grey market goods" tarnish Etro's brand image.
Thirteen brands are available at nine Emart Traders and nearly 50 brands at five Vic Markets.
Traders plans to expand the lineup to include Hermes, IWC Schaffhausen and other "super luxury" goods, according to their officials.
