Chocolate products sold on overseas online shopping malls cheaper than the price offered in the domestic market

-Prices cheaper by 9.5%~47.7% if purchasing within tariff rate quota-

  Chocolate demand surges ahead of Valentine's Day (Feb 14) and White Day (Mar 14). The Korea Consumer Agency (www.kca.go.kr) conducted a survey on the price of six imported chocolate brands^* sold on overseas online shopping malls, and found that certain brands were cheaper than the price offered in the domestic market.^**

  * Brands: Godiva Signature Truffles Collection (24pcs), Royce Nama Chocolate Mild Cacao (20pcs), See's Candies Toffee-ettes, Leonidas Gold Metal (25pcs), Laderach Collection (24pcs), and Michel Cluizel Les 1er Crus De Plantation (140g per type)

   ** Survey based on selling price of official online shopping malls operated by overseas manufacturers or importers. Prices offered by overseas online shopping malls include shipping (delivery agent) charges.

  According to the KCA, single product purchases are more expensive due to shipping (delivery agent) costs but two or more purchases within the tariff rate quota^* are cheaper by 9.5%~47.7% than the price offered in the domestic market.

 * Tariff rate quota: 150,000 won ($138)

■ If purchasing a single product via overseas online shopping mall: three brands 11.0~26.6% cheaper

   Prices of three out of the six chocolate brands were found to be cheaper on overseas online shopping malls, despite shipping (delivery agent) cost burden. Compared to the domestic selling price, ‘Godiva’ was cheaper by 26.6%, ‘Leonidas’ by 16.8%, and ‘See's Candies' by 11.0%. Of note, the three chocolate brands cannot be directly shipped so delivery agents need to be used. Agent services charge more than 13,000 won($12)/two pounds for delivery to Korea from the US, and more than 15,000 won($14)/two pounds from the UK and Japan.

 ■ If purchasing within tariff rate quota via overseas online shopping malls: cheaper by 9.5%~47.7%

  Taking into account shipping (delivery agent) costs and delivery period when using overseas online shopping malls, consumers tend to purchase products within the tariff rate quota (150,000 won($138)). In this case, prices are cheaper than the domestic selling price by 9.5%~47.7%. By brand, the largest price gap was 'See's Candies' (cheaper by 47.7%) followed by 'Godiva' (41.5%), 'Royce' (38.4%), 'Leonidas' (26.3%), 'Laderach' (11.6%), and 'Michel Cluizel' (9.5%).

  The KCA recommended that when using overseas online shopping malls, consumers should: 1) bear in mind that tariffs and VATs may be imposed if purchases exceed 150,000 won for general items cleared by customs (such as chocolate); 2) compare prices when making single purchases as shipping (delivery charge) costs may be higher than product prices; and 3) make purchases in advance for special occasions by taking into account that deliveries take ten days or more from date of purchase.

  In order to preemptively address consumer complaints related to the sharply growing overseas online shopping mall industry, the KCA created the International Transaction Support Team in January to focus efforts on the following areas: ▲monitor and survey the overseas online shopping mall industry, ▲develop an online portal site to provide cross-border transaction information and counseling, ▲address global consumer complaints and disputes based on cooperation with international organizations (such as the UN and OECD). Going forward, the International Transaction Support Team will select top-selling items on overseas online shopping malls and offer timely price comparisons to help consumers make rational decisions.