S.Korea's KGC to spur ginseng sales in China with state-run CR Group

Korea Ginseng Corp. (KGC), wholly owned by South Korean tobacco giant KT&G Corp., is set to accelerate sales of its ginseng products across China via a new partnership.

The ginseng firm said on March 1 it will cooperate with China Resources Sanjiu Medical & Pharmaceutical Co. (CR Sanjiu), one of the largest pharmaceutical manufacturers and distributors in China, to intensify supply chains in the country. 

CR Sanjiu is a subsidiary of state-run China Resources Group, a conglomerate that owns pharmaceutical, healthcare, beverage, energy, asset management, construction and other units.

KGC CEO Heo Cheol-ho and CR Sanjiu CEO Huawei Qiu discussed details of the two firms’ strategic partnership in Shenzhen, China on Feb. 24.

Through CR Sanjiu’s distribution networks, KGC will expand the number of offline stores selling its products in China from the current 10,000 to 100,000, including pharmacies, hospitals, supermarkets and shopping malls, and also strengthen its online promotion. 

In addition, the two parties will join forces to enter Singapore, Thailand and Malaysia with KGC’s ginseng products.

KGC aims to quickly expand its presence in the Chinese market as its revenue at home have shrunk over the past years.

The firm’s revenue dropped 13.1% from 1.27 trillion won ($968.4 million) in 2019 to 1.1 trillion won last year. On the other hand, its overseas revenue jumped 51.3% from 133.3 billion won to 201.7 billion won during the same period. 

Write to Jiyoon Yang at yang@hankyung.com

Jihyun Kim edited this article.