Coway's overseas sales have surpassed 40% for the first time. The company has successfully implemented localized strategies tailored to the cultural preferences of each country, such as 'K-Rental' in Malaysia and Thailand, and a combination of direct sales and retail channels in the United States.
According to Coway, overseas sales for the first half of this year amounted to 1.1245 trillion won, accounting for approximately 40.6% of total consolidated sales of 2.7719 trillion won. This marks the first time that the share of overseas sales has exceeded 40%.
The company's international business has shown remarkable growth. Ten years ago, overseas sales represented only 8% of total revenue, but by the end of last year, this figure had risen to 38%. The average annual growth rate for overseas sales over the past five years has been around 20%. As of the second quarter of this year, the number of overseas accounts reached 4.51 million. Coway currently operates seven overseas subsidiaries in Malaysia, the United States, Thailand, Indonesia, and Vietnam, exporting products to over 50 countries.
The success of Coway's 'Customized K-Rental' strategy has been evident. In Southeast Asia, including Malaysia, the company has aggressively promoted its successful rental and management services from Korea. In contrast, in Western markets like the U.S. and Europe, where consumers are less familiar with home visits for service, Coway has adopted a dual approach that combines direct sales with local distribution channels.
Malaysia stands out as the most successful case. Coway introduced rental and management services there in 2007, differentiating itself by offering regular maintenance visits in a market where consumers typically replaced water purifier filters themselves. The company now holds the top market share in Malaysia's water purifier sector, with consumer awareness exceeding 90%.
Coway has also adapted its products and services to reflect local religious and lifestyle practices. Recognizing the high Muslim population, the company became the first in the water purifier industry to obtain local halal certification in 2010. Additionally, it has enhanced its water purifiers to cater to the Southeast Asian preference for hot water. Recently, Coway has expanded its rental offerings to include products such as air purifiers, air conditioners, and massage chairs.
As a result, Coway's Malaysian subsidiary reported second-quarter sales of 434.5 billion won, a 22.2% increase compared to the same period last year. The subsidiary's annual sales reached 1.4095 trillion won last year, marking a 21.7% increase from 1.1584 trillion won in 2024, solidifying its position as Coway's largest overseas market.
In the United States, Coway has adapted its K-Rental model to fit local lifestyles. The company's dual strategy of operating both a direct sales team and retail channels has proven effective. In the second quarter, U.S. sales reached 66.9 billion won, up 16.3% from 57.5 billion won in the first quarter.
To address the local culture, which often prefers limited interaction with outsiders, Coway has strengthened its non-contact filter management system instead of traditional home visits. The company has partnered with Amazon to analyze air purifier filter usage and set up an automatic ordering and delivery service based on replacement needs. Recently, it has developed a third-generation service called 'DART,' which allows customers to check filter life and place orders using Alexa voice commands.
Thailand is emerging as a 'second Malaysia' for Coway. Since introducing the Korean rental system in Thailand in 2021, the company has expanded its business based on financial infrastructure and sales personnel. Over the past three years, Coway has recorded an average growth rate of about 30%, broadening its product range to include air conditioners and massage chairs in addition to existing environmental appliances. In the second quarter, sales from the Thai subsidiary reached 66 billion won, a 53.9% increase year-on-year.
Coway plans to strengthen its competitive edge in established markets like Malaysia and the United States while also focusing on the establishment and expansion of new subsidiaries in Indonesia and Vietnam.
* This article has been translated by AI.
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