Inevitable "War" Between Agents

　　 Kang Jin Young's China agent The lawsuit will not become an isolated case, and the agency dispute caused by the change of overseas brand equity, the trend of brand direct marketing, and the further improvement of industry concentration will continue.

For tens of thousands of domestic agents swarming in the "chaotic period" of the market, it is now time to think about their own future.

"No termination of the contract! SKN unilaterally announced the termination. Up to now, we insist that the contract is valid and has been continuing." Zhao Yunhu, president of Shenzhen Kepai Industry Co., Ltd., raised his voice at the end of the phone and emphasized. A battle has begun against Kang Jin Young, a Korean high-end women's wear brand.

Honeymoon

Shenzhen Kepai Industrial Co., Ltd., one of the branches of Kepai family business, was founded in August 1983. Since 2003, the top management of the company has paid more and more attention to the operation and construction of the brand and started acting as an agent for some international brands. With the help of the successful experience of Kepai family in other industries, Kepai has successfully operated such high-end fashion brands as Barbara Bui, Class Roberto Cavalli, Alessandro Del'acqua, Malloni, Tara Jarmon, and Exception (Chinese designer brands). In July 2007, he won the "Excellent Agent Award" at the first China Excellent Clothing Agents Conference.

Kang Jin Young brand is from South Korea designer The couple combination Kang Jin Young and Yoon Han Hee was founded in 1993. According to the report of Fashionbiz, an authoritative fashion magazine in South Korea, "Kang Jin Young" has won the first place in the market survey of "The Best of The Best Brands" organized by it.

The initial contact with Kang Jin Young brand was due to another Korean brand represented by the company at that time. When inspecting the brand in South Korea, Zhao Yunhu noticed Kang Jin Young.

"At that time, we acted as an agent for another Korean brand, besti belli. We saw OBZEE in South Korea, namely Kang Jin Young. The price was very high, so we wondered why the products of this brand were so expensive. Later, we learned that this brand was really good."

So Zhao Yunhu and Kang?Jin?Young OBZEE, the owner of. However, at that time, many people who made Korean brands in China did not dare to touch it, and felt that its price was too high for consumers to accept.

"Most people don't think highly of our brand, but we are confident in our ability to operate the brand. Our company is good at doing high-end and expensive brands, and our services can match them. We are not an organization that relies on brand awareness, on the contrary, our operation can make the brand produce added value." Zhao Yunhu said, Kepai is particularly good at market development of some niche high-end brands, especially in the Chinese market.

After nearly a year of contact, on July 1, 2005, the company could be officially appointed as the general agent of Kang Jin Young brand in China.

Zhao Yunhu said that, like two people's love, they always show their best side to each other at the beginning. When talking about agency rights with OBZEE, Zhao Yunhu felt that "they were sincere", "and OBZEE at that time was not as strong as SKN's people. In South Korea, they had considerable competitive pressure and needed to find opportunities to break through in the Chinese market, so they were eager to cooperate with us at that time. The first two years of cooperation were relatively smooth." As a top brand operator in China, Kepai Company has successfully made the Korean women's wear brand Kang Jin Young become an international famous women's wear favored by China's fashion celebrities, top actresses, celebrities and other people at the top of the social pyramid through its original creative business model.

Kepai believes that under the operation of Kepai, Kang Jin Young's position in China has far exceeded that in South Korea, becoming a representative of oriental senior women's wear. KANG JIN YOUNG's market size, market performance and market competitiveness in China also overwhelmed TIME, which has strong performance in South Korea. On the other hand, at a relatively high price and in the same market environment, Kang Jin Young's single store sales performance has always been above other brands operated by SK in South Korea. Finally, for the operation of Kang Jin Young in China under the leadership of Can Dispatch, its store space and store image also exceed that of South Korea.

In the first two years of cooperation, Kepai enabled Kang Jin Young brand to open more than a dozen stores in Shanghai Jiuguang, Beijing Xinguang Tiandi, Beijing International Trade Mall, Hangzhou Tower, Hangzhou Lane Crawford (after the mall closed) and other malls.

"In April 2006, when the first store opened in Jiuguang, Shanghai, the South Korean side did not have much cooperation measures, but provided us with a little promotional materials, and other work could be done. In general, they were unwilling to pay too much, which was reflected at that time. They think that since you are responsible for the operation of the brand in China, you should do more. However, this process has really exercised our ability. " Zhao Yunhu said.

According to the contract signed five years ago, the South Korean side requires that it can open 50 stores within five years. At that time, Zhao Yunhu did not think that the number was harsh.

"We thought we had the ability to reach this number or even more. At that time, we thought the number of 50 companies was completely reasonable." During the initial negotiation, Kepai proposed to sign a 15 year agency contract directly, which was finally repeatedly compressed by Korean companies, and later compressed to 8 years (5 years of security agreement plus 3 years of conditional extension agreement). In terms of the contract, the Korean side did not make any restrictions on the location, area, etc. of the store, but said that the brand should have the right to confirm the opening of the store.

Change

After two years of "sweet period", the cooperation between Kepai Company and South Korea gradually became problematic - the South Korean side delayed the plan to open stores.

"At the beginning, because OBZEE was not familiar with the Chinese market, it was too slow to make decisions, which virtually delayed many of our store opening plans. The decision to open a store was basically delayed for two to three months." Zhao Yunhu said.

Zhao Yunhu believes that if the decision to open a store was delayed initially because of the lack of understanding of the Chinese market, the delay later showed signs of deliberate intent.

"Because less than two and a half years after the agency contract was signed, OBZEE began to sell the brand and began to talk with SKN about the acquisition. We didn't know at that time. The acquisition was not negotiated in a day or two. It must have gone through a long negotiation process. I think they have made plans for the future development scale of the brand during the negotiation process, so it gradually evolved into a complete rejection. "

In Shanghai Xintiandi, Zhao Yunhu talked about a shop covering more than 300 square meters. "It's a very good location. We are going to open a flagship store, but they didn't agree with us and kept delaying. But when our plan finally fell through, they opened another brand under their own brand, which is less than 100 square meters." Zhao Yunhu said that later, Rolex took the location of more than 300 square meters that was originally discussed. "You say that Rolex can go in, but why can't Kang Jin Young go in? They have no reason to delay."

In March 2008, SKN, a subsidiary of SK Group in South Korea, formally acquired OBZEE and took over the brand Kang Jin Young.

"Hearing the news of the acquisition, we also thought that the future cooperation would definitely change. We also issued a statement to SKN, stating our rights, and they also sent someone to make a commitment that they would continue to cooperate, but only verbally," said Zhao Yunhu.

Shortly after the acquisition, SKN made it clear several times that taking back Kang Jin Young was part of SK's global strategy and asked for a new contract, but Zhao Yunhu refused. Zhao Yunhu believes that the new contract does not have the right to be assigned as a partner, but a command relationship between superiors and subordinates. "There are even similar clauses that can terminate the contract at any time. We have no rights protection."

Since then, the store opening application of Kepai Company has been repeatedly rejected by South Korea SKN. {page_break}

In 2008, the company can be sent to apply for opening a store in the Venetian Mall in Macao. After being approved by OBZEE, it can be sent to pay a deposit of 280000 yuan to the mall, when SKN just acquired OBZEE.

"Then under the leadership of SKN, the other party delayed three months for the reason of reviewing the assignable decoration scheme, which led the mall to ask us to compensate for the three month delay in opening the store, with a total of nearly 800000 yuan. The final establishment of the store failed. We lost all of the 280000 yuan deposit and all related costs we had invested in the early stage, and were also faced with compensation lawsuits from Venetians in Macao." Zhao Yunhu recalled.

Also in 2008, Zhao Yunhu got a shop in Shanghai Meilong Town Square. "At that time, they said that the shop on the second floor of your store was not very open and its appearance was not very good. So we negotiated with the mall again. Later, we reserved a larger location, which could be seen on the first floor of the mall. It was a very good location. We talked about it, and then the Korean side confirmed it, but only half a month later, they immediately denied it." The next year, SKN opened their other brand, O '2nd, to the third floor of the mall.

"The opening of this brand (O'2nd) follows our path. Where we contact the store, they will follow. Sometimes they refuse our application and drive in. " Zhao Yunhu said.

In fact, since the official acquisition of OBZEE by South Korean SKN in March 2008, the number of stores that can be dispatched has declined significantly. After the acquisition of the brand, Kepai Company has never received brand authorization, so that five years ago, Kepai did not complete the 50 stores required in the plan, but only opened 17 stores. Two of these 17 stores were demolished for other reasons, and the remaining 15 stores.

"Without brand authorization, how do you ask me to open a store? One of the important prerequisites for opening a store in any mall is to have the authorization of the brand dealer. SKN should re authorize me after acquiring the brand, but they do not. This is not deliberately difficult. What is it? You asked me to open a shop, but you didn't give me the authority to open a shop. " Zhao Yunhu believed that most of the 43 rejected stores were deliberately rejected by SKN.

In addition to refusing to open a store, SKN refused to accept the return of goods from the company that can be sent after taking over the brand Kang Jin Young, and did not provide any promotional materials.

Negotiations

In order to implement SK Group's global strategy and recover Kang Jin Young, South Korea SKN unilaterally proposed to terminate the contract on July 1, 2010. After that, Kepai started a painful negotiation process with SKN. "SKN has been changing all the time. One moment it said it would talk to us, the other moment it said it would terminate the contract." Zhao Yunhu said.

On May 20, South Korea SKN sent a letter to Kepai Company requesting that the agency agreement expire on July 1 this year.

On June 5, Zhao Yunhu replied to the letter and said that he would not accept this opinion. At the same time, South Korea can be asked to continue to implement the contract for the next three years, to achieve the "win-win" of the brand in the Chinese market, to correct the malicious behavior of South Korea that has hindered the implementation of the contract since the cooperation, to correct the past cooperation mode, and to improve the quality of cooperation.

On June 20, Zhao Yunhu sent a letter to Cui Taiyuan, President of SK Group in South Korea, stating to him the situation that SKN used to block the execution of the contract to tear up the contract, hoping that the Group could investigate and intervene in the cooperation between SKN and Kepai, and reiterated the position of Kepai. However, Cui Taiyuan has never replied to Zhao Yunhu.

At the end of June, the company can be sent to the Shenzhen Intermediate People's Court to file a lawsuit against SKN.

On June 30, the company could be sent to hold a press conference in Beijing to explain its experience to more than 100 media reporters. At the press conference, Mr. Zhao Yunhu, President of Kepai, felt heavy hearted and complained every word of South Korea SKN's improper behavior of deliberately obstructing the implementation of the contract in order to tear up the contract.

However, as of the time of press release, neither SK Group of South Korea nor its subordinate SKN enterprises had a direct dialogue with the assignable companies. The reporter sent an interview email to SKN enterprises, but no reply was received.

"They didn't reply to us at all. They didn't even send us the statement, so they just posted it online. We can't understand this company, which is called one of the top 500 enterprises in the world, but what they do is just a wild thing. Before the press conference, we have informed them at least 10 times, and we only started to file a lawsuit and release it when we could not bear it. " The SKN statement that Zhao Yunhu said was the one that appeared on a few domestic websites on July 7.

The first person who published this solemn statement of SK Networks (SKN) was TOM, but the website editor was unable to contact. The reporter contacted Li Hui, the editor of the financial industry website who had earlier released the statement. She said that the Chinese statement of SKN was forwarded to her by the company leader through QQ, and the leader obtained the statement from a public relations company, but because the computer disk had just been formatted, the original of the statement could not be provided.

In SKN's statement, SKN requested Shenzhen Kepai Industrial Co., Ltd. to immediately stop its unprovoked attacks on SKN, believing that its irresponsible remarks have constituted a reputation infringement, and SKN will use legal weapons to defend its legitimate rights and interests when necessary.

The statement pointed out that any business cooperation must be based on contracts. The assignable company failed to perform first. The statement believes that the number of stores that can be dispatched does not meet the requirements, and only about one-fifth to one-third of the sales target is achieved every year. Therefore, as an agent, the performance of the dispatched stores is far from reaching the target, which has constituted a major breach of contract. In this case, SKN has stopped extending the contract for the next three years after completing the five-year contract.

Zhao Yunhu also saw the statement. Zhao Yunhu denied SKN's unprovoked attack on SKN. "What we said was all facts. At the press conference, we didn't have any subjective comments. Every word, every data, every position and proposition we said were supported by relevant written evidence and other factual evidence."

Zhao Yunhu also believes that SKN cannot justify its statement that the assignable performance is not up to standard.

"It's normal that we didn't meet the standard. You asked me to open 50 stores, and I submitted 60 stores for approval. You only allowed me to open 17 stores. But the average sales performance of each of our single stores is in line with the contract. The average sales performance of each single store exceeds the contract requirements by at least 20%, and the maximum is more than 100%. Our single store sales performance far exceeds the contract requirements, but it is impossible for our 15 stores to complete the sales of 50 stores. "

The problem returns to SKN's refusal to open a store. "He said that he had reasons to refuse 43 stores, but the contract did not stipulate these reasons. Can you enter the mall where LV and GUCCI have entered? Most of our rejected stores are in malls with international first-line brands, such as Meilong Town Square, Henglong, and other domestic malls with more weight. If his refusal is reasonable, why did he open another brand of his own? "

It is understood that 15 Kang Jin Young stores in China are still operating normally. Although the South Korean side said it would terminate the contract, it did not take over the stores of Kang Jin Young brand in China.

"He didn't dare to take over. He has no right. First, we are managing the team. Second, he didn't pay any price. Why did he take over? Third, we designed the whole decoration image of the store, not him. We have the ownership of the store image." Zhao Yunhu said that he would follow up the progress of the event, Ask SKN to continue to guarantee the supply of goods in these stores, and ask them to continue to perform the contract.