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A Study on the appropriateness of the Teukyakmaip system operated by department stores in Korea

Purpose - The domestic distribution market has been seeing rapid growth with power retailers, namely large distribution companies as the center since the market was opened in 1996. The large distribution companies have tightened a strong hold over a retail market, and then they have raised their bargaining power over their vendors in a large way. However, the public voices demanding restraint of the companies are rising and the government policy is being carried away in such a direction. Through establishment of related laws and enforcement of other means, support for restricting the forms and practices of transaction by the large distribution companies like department stores is growing. The study is aimed at seeking for the right direction making department stores, vendors, and customers win-win in the market through researching into the current condition of operation of Teukyakmaip system***-the distinctive trade system of Korean department stores-and the precedence cases. Research design - The study was made upon the request of the Korea Department Stores Association (“KDSA”) and the period of the study was from March 27 to May 20 in 2013. We conducted several investigations simultaneously consisting of an examination of various materials, analysis of preceding research, an interview with the incharges of department stores, and an in-depth survey on seventy two (72) vendors of three (3) main department stores which are the parties to the Teukyakmaip transaction. Results - We tried to verify whether the question that the Teukyakmaip transaction is beneficial to department stores, but unfavorable to vendors really makes sense. Significant results including figures and tables came out through the abovementioned method. Conclusions – And to conclude, the Teukyakmaip system is still in the interests of the vendors vulnerable to funding and brand power. Therefore, department stores with the government will keep and develop the system in order to

Abstract

Ⅰ. Introduction

Ⅱ. Economic environment and current state of department stores in Korea and abroad

Ⅲ. Analysis of the in-depth survey of the Teukyakmaip system

Ⅳ. Proper function and economic effect of the Teukyakmaip system

Ⅴ. Conclusions

References

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