Are Asian retails chains targeting Israel? After reports that the Daiso Japanese discount chain was commencing operations in Israel, another Asian chain has joined the game. The South Korean Minigood chain is likely to set up shop in Israel, sources inform "Globes."
Minigood, which operates a network with hundreds of stores in Asia, is now likely to arrive in Israel through a local franchise holder, which has obtained a five-year exclusive franchise with an extension option.
According to Advocate Daniel Pardilov from the Pardilov & Co. law firm, which represents the chain's local franchise holder, the plan is to open at least 10 outlets in the first two years, including three in 2018. The chain operates exclusively in Asia; outside of South Korea, it has several branches in Malaysia, Singapore, and other countries.
The chain's stores currently have an average space of 80 square meters. The plan in Israel, however, is to open stores with 120-150 square meters of space each, One of the conditions in the agreement with the Israeli franchise holder is the manufacturing of special products for the Israeli market at the company's plant in South Korea.
Minigood, founded in 2013 in Seoul by Mike Wu, manufactures and markets bags and clothing, household goods, personal care and cosmetic products, office equipment, digital products, and toys. According to the chain's website, the company's activity is projected to reach 2,000 stores and a sales turnover of over $1 billion worldwide by 2020.
The Israeli franchise holder is a businessperson with a real estate background. Pardilov says that he is currently negotiating with larger retail groups in order to form a partnership with them for operating the chain. Negotiations are currently underway for opening stores at two shopping mall locations.
Following the spread of local stock stores, such as Max Stock, which was sold during the past year to Apax Partners, managed by Zehavit Cohen, it appears that competition in the sector is intensifying. Only recently, it was reported that the Union group, the franchise holder for H&M and COS in Israel, would operate Japanese retail giant Daiso in Israel. In contrast to Daiso, however, which sells products at a uniform price on the "dollar shop" format, Minigood's products are slightly more expensive, with prices varying from $1 to $100. It was reported in recent months that the Hoodies-Castro group was also likely to bring a Chinese retain chain named MINISO, which also sells discount accessories and gadgets, to Israel.
Published by Globes [online], Israel Business News - www.globes-online.com - on February 7, 2018
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