Road shops return on cost-conscious baby boomers amid high inflation

Wellmade [Source : Sejung Corp.]

Road shop brands, affordable fashion brands mostly located in small chain shops instead of department stores or online platforms, are gaining momentum in Korea as baby boomers, their regular customers, are increasingly seeking value-for money consumption amid high inflation and economic downturn.

According to sources on Sunday, sales at Wellmade, a leading road shop fashion brand under Sejung Corp., increased by 12 percent on year to 280 billion won ($220 million) last year. Sales grew by double digits from 2020 and 2021, when sales were stagnant at around 250 billion won per year. Wellmade collects and sells men‘s brands such as ‘Indian’ and ‘Bruno Baffi’. Olivia Lauren, another road shop brand dedicated to women’s wear, also posted 180 billion won in sales last year, up 22 percent from the previous year. The number of their offline shops increased, reversing a 10-year trend of decline.

Last year, Wellmade added 10 more shops and Olivia Lauren 20 compared with the end of 2021.

The increase in road shop sales is unusual in the fashion industry as offline shops with mid- to low-end products have long been believed to be inferior to big outlets or online shopping malls in terms of price competitiveness.

But the high inflation trend that started last year brought a change to the market as the thrift-conscious baby boom generation is turning their eyes to road shops. Road shop owners are attracting consumers by offering various discounts. Road shops tend to have more room to lower prices as they spend less commission than those in department stores.

Annual sales at Wellmade’s Gwangmyeong store reached 1.35 billion won last year, up 10 percent from the previous year. Since opening in 1995, the branch has been in business for 28 years under the same owner.