© News1 All products go through the supply and
distribution process through their own channels in order to get to consumers. Distribution
is a very important means of connecting producers and customers. It is
desirable for distribution to grow based on the process of persuading
consumers, such as consulting with producers according to consumer choices, and
modifying sales strategies or enhancing products. However, the essential role
of distribution becomes distorted in some cases as it occupies an excessive amount
of steps between producers and consumers. Such situations are also occurring in K-beauty
distribution. With K-beauty's worldwide popularity, middle-tier distributors
are enjoying an unprecedented boom. However, there are issues like forcing a low
price regardless of the producer's distribution policy or excessive profit
margins created by taking advantage of a monopolistic distribution position.
Because of such cases, many distributors damage the brands of K-beauty products
or cause a loss of trust and attractiveness to consumers. Still, distributors
are only desperate to boost immediate sales. Their long-term perspective is
disappointing. This may make the K-beauty craze into nothing more than a
passing trend. However, there is one company that is
attracting attention by proposing new solutions in the K-beauty market. Goodai
Global proposed a new business model called BRAND2C to solidify the position of
K-beauty, including the popularity of Korean cosmetics, into a single culture
& product category from a long-term perspective. Accordingly, they created
BRAND2C, a beauty wholesale platform, and are currently running a beta version.
The core value of BRAND2C is to simplify the existing complex distribution
structure and eliminate any unnecessary steps that may occur in the
distribution process. Cheun Ju Hyuck, CEO of Goodai Global, said that the main business model of
BRAND2C is to purchase products directly from brand companies and supply them
only to distributors who operate B2C platforms. CEO Cheon believes that only
these three business entities, the supplier (BRAND companies), the B2C
platforms, and the intermediate distributor (ie, BRAND2C) connecting these two,
are the minimum and essential conditions needed for actual distribution. In fact, Goodai Global is
exporting 130 K-beauty brands overseas through global B2C platforms to areas such
as the United States, China, Singapore, Vietnam, and Australia. Recently, they have
highly valued the growth potential of direct purchases from overseas markets
and are gradually increasing transactions with these customers. In particular,
their activities stand out in the US market, which has recently been mentioned
as the second-largest K-beauty importer market, replacing China. Small and
medium-sized K-beauty brands such as Hidden Course, Botanic Farm, and
Elizavecca are available and distributed on leading overseas B2C platforms such
as ULTA BEAUTY, FOREVER 21, and COSTCO. At the same time, they are taking the
lead in long-term brand positioning of these brands by conducting local
marketing. Recently, they increased the
opportunity for success of the BRAND2C business model by signing an exclusive
domestic and overseas distributor contract with ‘Beauty Of Joseon’, a brand of
Womanstalk, which is more famous abroad than in Korea. Cheon Ju Hyuck said, “We
will make sure to further expand BRAND2C into a platform that not only exports
K-beauty products, but connects all beauty suppliers (BRAND companies) and B2C
companies in the world.” He also added, “After 5 years, I want to build a
global sales network that connects French suppliers (BRAND companies) for
purchases and Malaysian B2C companies for sales through the BRAND2C platform.”Source : Reporter No Su-min, "Goodai Global presents a new possibility in wholesale cosmetics with its beauty platform 'BRAND2C'", News1, 2017. 05. 18., https://www.news1.kr/articles/2997357
