Fashion Companies Nurturing Their Own Brands: Higher Margins, Uncertain Success

Major domestic fashion conglomerates are rapidly restructuring their business models to focus on their own brands. This shift comes as slowing consumer demand and increasingly fierce distribution competition have made it difficult to maintain profitability through the traditional model of importing and distributing overseas brands. However, industry insiders and observers are divided on whether this strategy will serve as a new growth engine or introduce new risks for these companies.

According to the fashion industry as of March 27, 2026, leading companies such as Samsung C&T Fashion Division, LF, and Shinsegae International have been reorganizing their portfolios in recent years to center on their own brands.

'LF Allegri' Launches 26SS Women's Line Officially. LF

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LF recently expanded its contemporary menswear brand, Allegri, into womenswear. After testing a women's apparel line during the fall/winter (FW) season last year, the company officially launched the women's line for the spring/summer (SS) season this year. TNGT, originally a male-focused brand, has transitioned to a unisex brand, while DAKS unveiled a new "The Original Line" that offers a modern reinterpretation of the brand's heritage. Hazzys is expanding its presence in overseas markets by opening a flagship store in Shanghai, China.

Samsung C&T Fashion Division is strengthening its "selection and concentration" strategy by focusing on competitive brands such as Juun.J, KUHO, and 8seconds. Juun.J is being developed into a global brand based on Paris Fashion Week, and 8seconds is seeking to shed its image as an SPA (Specialty retailer of Private label Apparel) brand and reposition itself as a K-casual brand.

Shinsegae International is also concentrating on rebranding its own brands. This year marks the 29th anniversary of VOV (Bove), which is undergoing a transformation from a mainstream casual brand to a "high-sensitivity contemporary brand" targeting career women in their 30s and 40s. Other brands such as Studio Tomboy, G-cut, and Man on the Boon are also reorganizing their brand concepts.

BOV Rebranding_26SS Collection. Shinsegae International

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The main reason behind the rush by domestic fashion conglomerates to strengthen their own brands is the structural limitations of the traditional distribution-centered model. Bringing in overseas brands involves high royalty and distribution fee burdens, and pricing power is limited. In contrast, with their own brands, companies can directly control their profit margins and accumulate brand value for long-term profitability.

However, the own-brand strategy also carries considerable risks. Fashion brands rarely deliver results in the short term, and the burden of investment in marketing and content is significant. If a brand fails to gain traction in the market, the losses are directly reflected in the company’s performance. An industry insider commented, "While the margin structure is better than distribution, the success rate for own brands is low and the payback period is long."

Another challenge is that companies are focusing more on reinterpreting existing brands rather than launching new ones. Changing the established image and consumer perception of a brand often requires more time and resources than launching a new brand. If there is a gap between the existing image and the new concept in the market, it can actually weaken brand competitiveness. Another industry insider noted, "Older brands may have high awareness, but are often not 'brands consumers want to buy now.' In the end, rebranding is not a choice but an inevitable process for survival."

8seconds 2026 Spring Season Lookbook. Samsung C&T Fashion Division

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The market environment itself is also challenging. Both domestic and international fashion markets are saturated with competition from global brands, SPA brands, and designer brands. The time and cost required for a new brand to gain consumer recognition and achieve a certain scale have increased significantly. In particular, during economic downturns, consumer spending tends to be concentrated on established brands with proven track records. Millennials & Gen Z are also focusing their spending on collaboration products or limited editions from existing brands, rather than trying out new brands.

Even the global market, which companies are pinning their hopes on as a breakthrough, is not easy to crack. Competition from local brands in China has intensified, and Southeast Asian markets are highly price-sensitive. Another limitation is that K-fashion brands have not yet achieved the same influence as K-content. Except for a few brands, there are only limited cases where significant results have been achieved overseas.

Another industry official said, "While domestic companies have shown strengths in product planning and distribution capabilities, they still lack storytelling and cultural scalability that resonate in the global market. Over the next three to five years, winners and losers will be sorted out, and except for a few core brands, companies will face increasing pressure to shrink their portfolios or undergo restructuring."

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