Native SPA Brand Chases Uniqlo, Surpassing Zara

Topten's Rapid Growth... Rises to 2nd Place Domestically
Spao Also Sees 50% Sales Increase in Q1

[Asia Economy Reporter Seungjin Lee] Following the boycott of Japanese products and the impact of COVID-19, sales of overseas SPA (manufacturing and distribution integrated) brands have significantly declined, while domestic SPA brands are aggressively reshaping the market.

Sharp Sales Decline for Uniqlo and Zara

According to the fashion industry on the 28th, Japanese SPA brand Uniqlo and Spanish brand Zara suffered a direct hit from COVID-19, resulting in a significant drop in sales last year.

FRL Korea, which operates Uniqlo, recorded sales of 574.6 billion KRW last year, about half compared to the previous year (974.9 billion KRW). The combined effects of the boycott of Japanese products and COVID-19 led to a reduction in the number of stores from around 180 at the end of 2019 to 141 this year. Zara, which had maintained the second position, was pushed down to fourth place in the domestic SPA market last year due to competition from local SPA brands.

Zara Retail Korea's sales last year were 305.6 billion KRW, a 26.5% decrease from the previous year, with sales dropping by over 100 billion KRW in just one year. H&M Hennes & Mauritz, operating the Swedish SPA brand H&M, also faced a similar situation. Last year's operating profit was 7.3 billion KRW, down about 50% from the previous year. Sales also declined by 2.2% to 266.7 billion KRW, showing poor performance.

Growth of Topten and SPAO

Topten, operated by Shinsung Tongsang, recorded sales of 430 billion KRW last year, about a 30% increase from the previous year, rising to the second position in the domestic SPA market. With Topten's continued growth, Shinsung Tongsang posted an operating profit of 9.4 billion KRW in the first quarter of this year, turning profitable.

SPAO, operated by E-Land, also made significant progress. SPAO's sales last year increased by 10 billion KRW from the previous year to 330 billion KRW. This year's growth is even steeper. First-quarter sales grew by more than 50% year-on-year, with offline sales increasing by over 90%. SPAO plans to focus on expanding sales by introducing various products favored by younger generations through collaborations with fashion YouTubers, hip-hop artists, and others.

The fashion industry expects the first and second positions in the SPA market to change this year. Topten had only 134 stores at the end of 2016, but as of May, the number has increased to 452. Topten's online sales growth rate from January to April this year also reached 100% compared to the previous year, and annual sales are expected to reach 550 billion KRW.

This content was produced with the assistance of AI translation services.