South Korea’s Lotte Shopping Co. and Japan’s Fast Retailing Co. invested US$19.7 million to establish FRL Korea. (image: Fast Retailing Co.)
SEOUL, May 25 (Korea Bizwire) — Uniqlo’s budget brand GU, which has been hit hard by the coronavirus pandemic and a boycott of Japan in place since last summer, will withdraw from South Korea.
FRL Korea Co., an operator of Uniqlo Korea, recently announced that GU will stop operating offline stores in the country around August. In the future, GU will only sell its products via Uniqlo’s online shopping portal.
The decision came a year and nine months after the company entered South Korea in September 2018. GU currently operates three offline stores in South Korea, as well as an online store.
GU, which tends to have lower prices than the casual brand Uniqlo, was originally expected to increase its number of stores in the country. However, the boycott of Japanese products that started last summer has dealt a huge blow.
In addition, the company decided to withdraw because it could not withstand a drop in sales due to effects of the coronavirus pandemic.
Furthermore, GU suffered continuous issues and problems, including an advertisement speaking ill of the Japanese military’s sexual slavery of women euphemistically known as comfort women, and an email scandal involving the operating company’s CEO.
Meanwhile, Uniqlo, which operates 180 stores nationwide, is also known to be suffering from sluggish sales.
“We have to wait for the exact impact of COVID-19 to be released in August,” an official from FRL Korea said.
“There is no fixed plan or direction for Uniqlo’s future business in South Korea.”
D. M. Park (dmpark@koreabizwire.com)
