SEOUL: South Korean household electronic products manufacturer Woongjin Coway Co Ltd plans to invest about 70% of its market development fund for this year in its Malaysia branch, as it offers the best outlook among the company’s overseas branches, its chief executive Hong Joon Kee said.
However, he would not reveal the value of the fund. Besides Malaysia, the group has operations in China, Japan, Thailand and the United States.
Speaking to Malaysian journalists here recently, Hong said the fund was on top of the RM30 million investment in Coway Malaysia that it announced earlier. The company’s Malaysian venture began in 2006. Last year, it invested RM15 million in the venture.
Hong said Coway Malaysia would emulate the group’s success in its home country by employing Woongjin’s investment and marketing strategy.
“In the next two years, we hope to put in more investment, training and advertisements in Malaysia. We would arrange any kind of support including new product launches and more marketing efforts for Coway Malaysia,” he said.
James Park, managing director of Coway Malaysia, said the company planned to spend some RM6 million this year on its advertising and promotion activities and strive to become a benchmark for other overseas branches.
He added that the group’s Malaysian outfit had the most advanced operation system and fastest growth rate despite its relatively low potential due to the country’s small population, compared to its branches in China and the US.
“Besides, the Malaysian operations have the highest monthly sales among overseas branches. We hit 2,000 units of sales every month while the United States hits 1,200-1,300 units; 700 to 800 units for Thailand; 700 units for Japan and 1,000 units for China,” he said.
Currently, Coway Malaysia offers 13 products, comprising water purifiers, air purifiers and bidet systems. It aims to achieve sales of RM70 million this year, from RM40 million last year, by expanding its business to Kota Kinabalu and launching more products.
Thus far, its operations cover Kuala Lumpur, Klang, Petaling Jaya, Seremban, Kuantan, Penang, Malacca and Johor.
More branches would be opened in East Malaysia if the response to its Kota Kinabalu branch was positive, Park said.
He also said more wellness products including a water softener and a new air purifier model would be launched this year.
Woongjin posted a revenue of US$1.4 billion (RM4.75 billion) in its fiscal 2009. It has a market share of more than 60% of the South Korean households.
The group invests 5% to 6% of its revenue annually on research and development (R&D). Its R&D centre at Seoul National University develops about 40 products each year.
It has three factories in South Korea — in Yugu, Incheon and Bucheon. The main factory in Yugu was built in 1994 with an investment of US$33 million.
This article appeared in The Edge Financial Daily, March 1, 2010.