K-beauty expansion: Lotte Duty Free to back local SME brands in Japan venture

The project was announced during a briefing session held at Lotte Duty Free headquarters in Seoul on August 24.

Since 2014, the Ministry of SMEs and Startups (MSS) and the Korea Foundation for Cooperation of Large & Small Business, Rural Affairs (KOFCA) have worked together to enhance cooperation between major companies and small and medium-sized enterprises (SMEs) for mutual benefit.

Lotte Duty Free will participate in the third edition of this programme to support local SMEs, which are existing partner brands, enter the Japanese market.

It was revealed that Lotte Duty Free and the KOFCA will invest a total of KRW470m (USD355,000) into this project.

“Lotte Duty Free has been working hard to expand the global base of domestic brands by creating K-beauty and K-fashion halls in our overseas markets. ​

“We plan to actively utilise both online and offline distribution channels, as well as the capabilities of the KOFCA and our company to develop new markets,” ​said Kim Won-shik, head of Lotte Duty Free’s EC division.

Establishing foothold in Japan​

Representatives from 25 SMEs attended the briefing, including cosmetics brands such as Cell Fusion C, LAVIEN, Curlyshyll, Luvum, and Siita.

From August to December, Lotte Duty Free will roll out various marketing activities to increase brand awareness and boost sales of participating brands in the Japanese market.

For instance, it plans to open a pop-up store within its downtown duty free outlet in Ginza, Tokyo, to showcase these brands.

The firm will also help to build presence for the SMEs through trade events and stocking their products at Lotte Duty Free stores across Japan.

In addition, Japanese e-commerce platforms Qoo10 and Rakuten will be engaged to support the promotional campaigns, and carry out social media marketing events with Japanese bloggers and influencers.

Win-win situation​

Underscoring its commitment to bolstering the development of SMEs in the country, Lotte Duty Free has signed a business agreement with the Commission on Shared Growth for Large and Small Companies (CSGLSC) for the “2023 ESG Support Project for Suppliers”.

The initiative aims to assist small and medium-sized partners in establishing ESG practices and management.

As part of the agreement, Lotte Duty Free has contributed KRW50m (US$38,000) to a cooperation fund named Win-Win Innovation Fund.