Drinking culture in Korea Essay

Despite the economic down turn, Korean consumers are still ardent drinkers. The drinking culture in Korea are favourable towards on-trade channels, as drinking is considered an important social activity. Alcoholic drinks are an important accompaniment to events ranging from orientation program in universities to company dinners and welcoming parties for new employees or farewell parties, as well as birthdays, weddings and funerals. 11 There is a unique and peculiar drinking custom in Korea. When Koreans drink alcohol with someone older than them, they are extremely cautious when pouring the alcohol. It is important not make the senior’s glass over flow, but more importantly It is important to use two hands when you are pouring the alcohol. This shows respect and a token of admiration, and this custom is applied to every case in Korea. For example you should submit you coursework with two hands to your teacher. 12 Koreans on occasion will exchange glasses. When somebody offers liquor with his glass, the drink should be drunk straight away and offer more liquor with the glass. Drinkers tend to serve one another rather than have the drinks poured by a bartender. 13 South Korea has a well-known reputation for having the most dangerous drinking culture in the world. A night out in town with Korean businessmen can entail some serious culture shocks, as Koreans are well known for the alcohol tolerance. Drinking plays a big part in the Korean culture as it helps build trust and deepen relationships. It is believe that alcohol is an invaluable social lubricant. There are also well known drinking games in Korea amongst the young generation. The latest report from by the â€Å"Korean Institutes for Heath and Social Affairs† shows that the average adult male in Korea drinks about 11 days out of the month and women four. 14 This suggests that there is a strong drinking culture in Korea and that it is integrated into every aspect of their lives some way or another. Domestic reports show that in 2002, an average Korean drank 59 bottles of Soju, 86 bottles of beer and 1. 3 bottles of whisky annually. Consumer expenditure on alcoholic drinks had an overall increase throughout the late 1990’s through to the 2003. 2003 started with a gloomy outlook for the South Korean economy. Most economist report low consumer sentiments and affected alcoholic drinks in a varying manner. 29 Whisky imports have fallen by 30%; this may be due to the continuation of Korea’s economic slump. In June Korea imported $15. 76 million (approx i 9. 3) worth of whisky, however in May it imported $20. 7million (approx i 12. 17). It is the first time that whisky imports have marked a double-digit fall since July 2001. According to industry experts, the reduction in imports resulted in a drop in consumption of premium whisky due the slow moving economy. Many companies have instructed their employees not to go to expensive bars when they meet their clients. â€Å"Whisky consumption responds to business fluctuations† an official at the commerce, Industry and energy Ministry Said â€Å"diminishing whisky imports are likely to continue for the time being†. Whisky consumption has fallen over four successive months, from January to April, for the first time since the 1997 financial crisis. 30 As a result there has been an increase in Soju consumption and a decline in whisky consumption. This can be seen from the quantity of whisky actually delivered into Korea, which fell by 50% from March to April. Soju on the other hand increase its sales with 16% during the same period. 32 33 South Korea’s whisky consumption is a barometer of how confident the country’s 48 million people re feeling about their economy. All foods and beverages imported into Korea are subject to inspections by the Ministry of Health and Welfare/food quantitative division. There are two types of food and beverage inspections: a detailed chemical analysis test and visual/document inspection. Korean-language labels must include the following: name of the product; country of origin; type of product; importers name, address and telephone number; business licence number of importer; expiration date; alcohol percentage and volume; name and volume of ingredients by percentage; name of place where the product can be returned or exchanged in case the product is damaged or defective; instructions for storage; name of food additives; the Government’s health warning clause and lot number or manufacturing date. As a result if Glen Sporran is imported into Korea, it must abide with the labelling instructions stated above. 42 9. 3 Price When Pricing Glen Sporran, it should be noted that it is a premium malt whisky and the price should reflect the quality of the product. When pricing Glen Sporran the direct competitors should be considered. The Price should be compared to the other single malt whiskies that are already in the Korean market, as they would have went through similar strategies to make the whisky available. 10. Distribution There is a high consumption of alcoholic beverages through on-trade channels in Korea. There are well-developed on-trade channels in Korea such as restaurants, pubs, and nightclubs especially in Seoul. On- Trade sales continued to account for a significant percentage of sales in the overall alcoholic drinks market in 2003. Even though there is a significant price gap for whisky due to high import tax and high local duties, Glen Sporran can be sold in premium on-trade outlets where consumers do not mind a high price gap as they enjoy the mood and the environment such outlets have to offer.