The golf industry in Korea has been heating up recently, boosted by a boom in popularity among the general population. Although only the well-to-do enjoyed this kind of leisure sport in the past, the situation has changed completely now, as evidenced by the increasing number of golf practice ranges, shops and courses. Some 20 golf-related magazines are being published in Korea and more than 2,000 professional golfers are now registered.
When one looks at the physical constraints of the country, Korea seems an unlikely place for the golf culture to flourish. The total area of the Korean peninsula is only 60 percent of Japan's size and South Korea makes up only 45 percent of that total, at about 980,000 square kilometers. That makes South Korea similar in size to Portugal, Hungary, or the 38th largest American state, Indiana (but with a population nearing that of California and New York combined). Seventy percent of the land area is mountainous, and the available plains are too small to even meet agriculture and residential demands.
Korea doesn't have the wide open spaces of Scotland, Arizona, or Australia, or the year round good weather of California, Hawaii, or Florida, and yet 119 eighteen-hole golf courses have sprung up like weeds. As a matter of fact, the nation has been engrossed in development of land for expansion of cities and golf courses, simultaneously.
But just because courses are being built, it does not mean it is easy for the average Korean to go out on the weekend and play a round. Demand is high and costs are most often astronomical. If it costs so much for the masses to enjoy the sport, why are the Koreans increasingly rushing to the courses and driving ranges?
One big reason is the fact that there is a perception that golf is a sport traditionally played by the upper crust. That is, playing golf itself may give both themselves and others the impression that the duffers are members of the jet set.
Korea's recent history has been characterized by a struggle to achieve economic development. There was little time (or money) to be used playing the rich man's games. Now, of course, the situation has changed. Economic development is here, with all the perks that come with it, including higher incomes and leisure time. Outbound travel is skyrocketing, amusement parks are packed, and Korea's relatively small territory is bursting at the seams with domestic tourists on weekend getaways. The country hardly seems big enough to meet the demand, which discourages some from even going out.
But the apparent obstacles have not kept the golfers at bay. People seem to have no hesitation in investing a relatively large sum of money for the sport. A golf club membership can cost between $100,000 and $300,000 and greens fees will cost $130 to $200.
"Most probably, Korean golfers use the most expensive golf clubs, on average, in the world. As a matter of fact, it appears that there are more people using golf clubs priced at over $6,000 than there are people using clubs priced under $1,000," said one industry source. Such spending sometimes arouses suspicions of a loss of the collective common sense in a society where "frugality" is being pushed. Many are seeing golf not as a sport, but simply as excessive consumption.
The government, for its part, has also taken measures designed to curb the golf industry, wary of possible speculation in golf memberships, antagonism from the underprivileged against the well-to-do and distrust of high ranking government officials and business figures who have sometimes given golf courses the image of a modern reincarnation of seedy graft parlors where under-the-table deals are carried out. Levying heavy taxes on golf clubs and golf courses have been examples of past government intervention.
But the governmental regulations and sometimes critical perception of golf has failed to dampen the enthusiasm for the sport. Rather, the passion is now spreading to the population at large. An increasing number of young school children are entering into the golf community, brightening the prospects for the nation to emerge as a golf power as was previously seen in the cases of soccer and baseball.
Upon closer examination, the government's restrictions and the negative sentiments against golf have struck a severe blow to the golf industry, however.
Korea began to manufacture golf clubs in the 1970s, mainly boosted by the golf boom in Japan, which prompted imports of parts and exports of end-use products from Korea. But at that time there was no domestic market for golf products. In other words, golf club assembly was done only for export purposes. And due to relatively small demand, companies began abandoning the industry and Japan began to disregard Korea as a main supplier. As an alternative to Korea, Japan chose Taiwan, which has emerged as one of the leading producers of golf clubs.
Low demand for golf clubs and heavy taxes on the finished products, along with a variety of regulations on production processes, shrunk the nation's golf industry. Taiwan, on the other hand, became Asia's source for club parts, producing them in the kind of small- and medium-sized companies that dominate that country's economy. But it did not necessarily mean that golf club production disappeared entirely from Korea. Some small and medium firms have maintained production mainly because Japan has needed Korea's high-technology. This phenomenon was even prominent in the case of making shafts for which massive production has been possible, boosted by the vast domestic market demand for fishing rods. Korea's production of fishing rods once accounted for 90 percent of the world's total supply. And since golf club shafts require a simpler manufacturing process and less material than fishing rods, the development of the fishing rod industry resulted in progress in shaft production and the current technology development.
Barely coping through the sub-par business trends, Korea's golf industry has now entered into an era of leaps and bounds. Demand for golf clubs has begun to focus on relatively low-priced products with a high level of utility rather than the deluxe brands used for showing off. Discount stores like Price Club and E-Mart began to put golf clubs on sale, most of which are medium-priced imports. But there are still a large number of high-priced imported golf clubs being purchased, because the market flamboyance is still strong. With the demand for imports strong in every category, then, Korean golf clubs make up only about 8-10 percent of the annual $312 million market. That means products from the United States and Japan account for more than 90 percent of the domestic market. Now it appears, though, that the Korean golfers have begun to recognize that the domestic products are not inferior to the imports. In addition, Korean golfers are recording good results in international contests, a strong argument in favor of the development of the Korean golf industry.
"The most important factor in playing golf well is, of course, the capability of the golfers. And the second most important point is the quality of the golf club," says Koo Hyun-soo, president of David Company. "But contrary to our original conception, the performance quality of the golf club is determined by the shaft. Flexibility, for example, is a very essential factor determining the quality of the shaft. To produce high quality golf clubs, design is important, but the importance of manufacturing technology cannot be underestimated."
The company conducted a long-shot contest where participating professional golfers were urged to play three shots using their own clubs and to make the same number of shots with clubs provided by the company. The prevalent expectation was that the golfers would perform well with the clubs they were used to. Interestingly enough, the results were completely contrary to the speculation. The three best shots came from those who used the company's products. Golf industry experts could not hide their surprise, especially after they had objected to the contest, fearing confirmation of the perceived low quality of the domestic clubs. This episode implies many things in regard to the direction for the domestic golf industry.
Golf shaft materials have evolved through wood, steel, and carbon, and carbon graphite began to be used as material from 1994 in the United States. Now 50 percent of irons and 80 percent of wood clubs use carbon graphite shafts. By using graphite in the making of shafts, Korean companies have become able to compete with Taiwanese firms. Taiwan has been dominant in the area of medium and low priced shafts while Korea has outperformed in the sector of high-priced products. Sunwoo Company, Korea's largest shaft maker, is now exporting some 200,000 pieces per month, most of which are deluxe shafts used for foreign golf clubs. Sunwoo has established production lines for manufacturing prepreg, the main material for golf clubs, and fishing rods as well. Most golf club producing firms are maintaining cooperative relations with manufacturers of finished products.
As stated, one of the most essential materials determining the quality of carbon graphite is prepreg, the character of which is determined by carbon fiber. It is not too much to say that all the considerations in designing a shaft-weight, flexibility, inside/outside diameter, and torque-are closely related to carbon fiber quality. But Korea is not currently equipped with the facilities for the production of carbon fiber. As an equipment industry, the production of the goods becomes possible only after securing a certain amount of demand. Carbon fiber is used for sports equipment, aerospace and industrial purposes. Before the 1990s, it was used mainly for sports equipment but the demand from the aerospace and other industrial sectors has expanded sharply to the extent of seeing the rates between sports and industrial purposes reach almost the same level. Currently, Japan is supplying more than 70 percent of the world's demand but Korean firms are now poised to begin production to meet the ever increasing demand from around the world. Sunkyong Industries, for example, has succeeded in pilot production through joint research with Chungnam National University. But due to still lackluster domestic demand, full-scale production has yet to be initiated.
The club head also plays an important role in determining the quality of the golf club, and one of the most important factors in this respect is repelling power. Head materials have gone from persimmon wood to titanium via other metals. And Korea has lagged behind in the manufacture of golf club heads. In particular, the nation's design technology remains at a very low level, mainly because domestic companies have so far produced the products in accordance with designs made by Japanese firms. Now, Korean firms are sparing no efforts to improve their design power.
Park Jong-hyun of Kolon International Corp., who has been in charge of designing golf clubs for ten years said, "I feel more hardship as time goes by. I started the work with the expectation that things would get better but the situation has been different and things have in fact become more difficult, requiring more time and energy at advanced stages." Kolon has developed related know-how under cooperation with Japanese companies, and expanded its market share in the process, mainly through a system under which the company provides customers with golf clubs after determining their golf profile with machines at its retail shops. It has also been operating a fast delivery service to furnish the golfers with clubs immediately after their sticks are broken while playing golf.
"Korea is no longer easy prey for the foreign golf club makers." This is popular copy in promotions made by Kortech Company, which has engaged in manufacturing driver heads since 1980 through OEM contracts. Aware of the potential demand in the domestic market, the company has recently begun production of their own finished products. The company can secure materials easily because it is the Asian agent for Russia's Titanum Company, and it has already secured needed technology through manufacturing the related goods under the OEM system. The company is planning to expand its business in the made-to-order category through establishing a franchise system in the United States as well as in Korea.
"While guaranteeing the feeling and sense of direction that was felt when we used clubs made of persimmon wood, these made of duralumin are not inferior to the clubs made of titanium," said Mr. Koo at David Company, which has recently come up with a new product made from duralium 7075T6, considered to be the next generation material-lighter weight and better manufacturing efficiency. The company is now making efforts to export the goods to China. "The complete development has yet to be made, but we expect that the material will emerge as a better material than titanium once some defects, such as erosion, are ironed out," said Koo, revealing self-confidence that the company will be able to grow as one of the leading club makers with duralumin as their ace-in-the-hole.
Korean companies are thought to fall short of expectations in regard to iron heads, mainly because of the lower prices compared with those made by Taiwanese companies. The problem is even more serious in the case of metal products. But Myungsung Ltd., coping with just such problems, has maintained continuous production of the metal goods. "People say that iron shot should have the same weight irrespective of their serial numbers. To this end, Myungsung has manufactured products with same weight," explained manager Lee Yong-kyu.
Korea's golf balls have shown up on golf courses around the world more frequently than the clubs. Fantom Company, for instance, began production of two-piece golf balls from 1984, only the fourth company in the world to do so, and started to manufacture three piece balls called Fantom Winner R&A in 1993, winning a certificate from the United States Golf Association (USGA). In addition, the company has begun to transform into a comprehensive golf maker by starting production of gloves, clothes and bags. Choice and Farmax are also golf balls manufactured in Korea.
Besides golf balls, bags, gloves and shoes made by Korean firms have long maintained a sharp competitive edge. In particular, Korean firms have strongest competitiveness in manufacturing golf shoes. Ever Green, while rejecting an offer to produce shoes under OEM contract with a U.S. firm, has been pushing ahead with a plan to export them under its own brand.
Based on high-level technology for rubber processing, Korean companies have also been engaged in OEM glove exports and are responsible for 100 percent of the domestic market as well. The brands are represented by Choice and Wanggrip. Kangaroo Company, for its part, has started to export its own brand of gloves.
Three Seven Trading Company has led a drive to sell golf bags separately from other golf sets, in defiance of the past trend when the bags were included with the sets. To this end, the company has begun to introduce state-of-the-art fashion brands into their bag manufacturing. It is now producing products priced at between $200-$560 per set mainly for the domestic market and is also exporting them under the company's own brand name. Though exports still remain low, exports to Japan, whose companies consider quality first, have been increasing continuously. Along with Seven Trading, other leading firms include Mazda Company and Two & One Korea, which together account for 80 percent of the domestic market.
There are no companies yet manufacturing grips in Korea, because the limited market does not yet justify the mass production required.
Before 1995, only one company was allowed to import golf clubs under only one brand, which enabled the importer to play with the market by adjusting the prices. This also resulted at one time in more than 50 percent of the products on the market being knock-offs. But since the government has permitted multiple importers, multiple brands, and took Japanese-made golf clubs off the import restriction list, the realignment of the market has been heralded, with domestic companies readying themselves to make up for lost time. The prevalent view is that Korean firms will be able to catch the foreign makers through quality and service even though imports will be tough to displace because of their high brand recognition. The manufacturers are preparing for an expected "big bang" in the industry with mitigation of the special tax on golf clubs and the continued spread of the golf boom.
 | Kolon International Corporation |
With practice came the experience, and they were able to put their clubs on the market in 1989. But they still coo-perate with Taiwanese and Japanese companies, especially for club heads. Kolon designs a club set, and orders forged heads from Japan and casted heads from Taiwan. They assemble them
based on data gained from analyzing the end user. The company also has several research teams concentrating on each major component, like driver heads, iron heads, and shafts. Now consistent skill for making shafts has been achieved, and they will also design and produce heads on their own beginning this year.
Kolon is aiming to extend its market share in the domestic market by establishing before- and after-sales service. They won't sell clubs on the basis of quantity but rather on the basis of quality, so they only sell through their agent stores which are all equipped with swing analyzing systems. The company has a fleet of service cars to repair customer's clubs even while they are still out playing the course.
They have produced a new model, named Be'X, in cooperation with a Japanese company, to make the best driver in Korea. This driver is designed into three types, which are categorized by the golfers' swing characteristics. Kolon has also produced a titan face iron set, TMH-501.
Kolon International Corp., Elord Business Team
35-34, Tongui-dong, Chongro-gu, Seoul, 110-040, Korea
Tel: 82-2-3700-6172/4
Fax: 82-2-3700-6179
 | David Corporation |
Because duralumin is lighter and cheaper than titanium, processing it is easier, making it much simpler to design and shape the head.
The material David's driver, Maxpower, is made of 7075T6, an ultra-strong duralumin. David has designed the driver face with a 6mm thickness, attaching a 10mm power bridge on the back to enhance tensile strength, so it gives a soft feeling for the golfer. The head is oversized with a deep center depth, which is the distance from the face to the center, thus widening the sweet spot, and has a long center distance, which is the rectangular distance from a shaft's narrow end to the head's center, which heightens head speed.
David also uses two excellent shaft types. The one is for normal power users, super light and flexible, and the other is for strong power users with a balloon shape to maximize power. They are producing titanium iron sets and wood sets.
David started exporting club heads on an OEM basis to Japan as well as introducing finished product in 1989. They have put their own brand product on the domestic market, with plans to export to China.
David Corporation
Kyung-yang Bldg. 2fl.,786-17, Yoksam-dong, Kangnam-gu, Seoul, 135-080, Korea
Tel: 82-2-3452-1232
Fax: 82-2-3452-8298
 | Myung Sung Company, Ltd. |
With wide experience and know-how in metal work, the company is producing superb forged iron sets made of metal which have been on the market for five years and are still in the spotlight. They are using shafts which are designed and produced at their own facility. The shafts have the
same weight from long irons to short irons, so that golfers can maintain their swing form and feel while using any club in the bag.
Myung Sung is also producing titanium wood and iron sets as well as metal wood sets. The titanium wood's head is made by mixed forging and casting technology. They have adopted the forging technique to get a low center and the casting technique for appropriate weight allocation.
Myung Sung is exporting to the U.S.A., Japan, Germany, Singapore, and other countries. Even though "Draco," their own brand, has low brand recognition and relatively high price, it has been evaluated as a high-class club through its quality and has received good reviews from the golfers who use it.
Myung Sung Co., Ltd.
19, Gupyung-dong, Saha-gu, Pusan, 604-060, Korea
Tel: 82-51-262-1105
Fax: 82-51-262-1110
 | Kortech Inc. |
But with high expectations for the domestic market's possibilities, Kortech started to make a finished product, branded "Mckenly,"and has put it on sale on the domestic market this year. Ever since, they have been sweeping the market with these relatively inexpensive clubs of high quality. The Mckenly wood is made from Kortech's titanium head, the Aldila Company's shaft, and the Golf Pride grip, which are world famous golf component companies.
Kortech designs the wood heads on their own and even provides them to some head importers. But they import iron heads from Taiwan where they can get them cheaper, and assemble with the same shafts, and grips.
Upon completing their factory expansion in Korea, they will have the largest plant in Asia, and can provide their goods throughout the world. Kortech plans to establish a franchise system first in Korea, then in the U.S.A.
Kortech Inc.
Korea World Trade Center #4206, 159, Samsung-dong, Kangnam-gu, Seoul, 135-729, Korea
Tel: 82-2-551-6484
Fax: 82-2-551-6459
 | Sunkyong Industries |
Sunkyong, established in 1966, has produced prepreg since 1987 with the expectation of widening usage in aerospace and industrial fields. The company is now supplying all types of prepreg to local fishing rod making companies and is also exporting. As mentioned, prepreg is increasingly being used in industry and aerospace, so Sunk-yong is seriously considering setting up such a facility. And they have also succeeded in producing carbon fiber through a pilot process in cooperation with Chungnam University.
Sunkyong Industries., Prepreg Business Team
Kukdong Bldg. 60-1, Choongmooro 3-ga, Jung-gu, Seoul, 100-705, Korea
Tel: 82-2-273-3131
Fax: 82-2-273-3920
 | Three Seven Trading Company, Ltd. |
With over 40 years' experience in bag pro-duction, Three Seven has been making golf bags since 1990. But it has been just two years since they began using their own brand on golf bags, Three Seven (777). Three Seven is the first in Korea to have adopted a fashion brand to golf bags. Before, only sports brands were used for the bags.
The bags have been licensed by Lancetti, Elle, Daks, and Michiko London, and they have developed style, color, and design to fit to each brand's image. As a result of this endeavor, they are now one of the first-class companies in the world producing golf bags in fashionable designs.
Three Seven has a market share of 40-50 percent in the Korean market and also exports to Japan and Spain on an OEM basis as well as with their own brand.
Three Seven Trading Co., Ltd.
746-12, Banpo-1 dong, Socho-gu, Seoul, 137-041, Korea
Tel: 82-2-546-0720
Fax: 82-2-544-5269
 | Sunwoo Company, Ltd. |
Today 60 percent of graphite shafts are supplied by the U.S.A. and Japan. But those numbers are expected to shift as East Asian countries become bigger suppliers. And Korea is one of the most experienced countries in making graphite products.Sunwoo, established in 1973, was the first related company to appear in the world market. They are focusing on graphite-related business by operating factories making golf shafts, fishing rods, and prepreg. At the same time, they have invested in China for the same items.
Sunwoo is producing four types of golf shafts--UHMB, Tour, FMS, and STG--which each target different pools of players, all level, heavy, accuracy, and intermediate players.
Sunwoo exports more than 200,000 pieces a month as well as selling in the domestic market. The company maintains a subsidiary in the U.S., Sunwoo U.S.A. Co., Ltd. to promote the products there.
Sunwoo Co., Ltd.
6-1, Ssangrim-myun, Goryung-gun, Kyungbuk, 717-850, Korea
Tel: 82-543-955-1700/4
Fax: 82-543-955-1715
 | Fantom Company, Ltd |
After starting to produce golf balls in 1973, Fantom is now making two-piece, three-piece and titanium balls, along with all kinds of golf-related goods, such as clubs, golfwear, bags, shoes, gloves, etc.
The company established Fantom U.S.A. Inc. in 1994, and is taking part in the Orlando and Las Vegas PGA Shows every year. They are also indirectly involved in international and local shows in other countries through their buyers.
Fantom exports clubs for women, T-bird II and Sense, mainly to Australia, which are spoken well of because of their good quality and low price points. The Sense clubs have the unique composition of five woods and seven irons. By substituting field woods for long irons, which are difficult for women to use, they gained instant popularity in the domestic market and have held it for quite some time.
With over 30 percent market share in Korea and exporting to 30 countries, Fantom has plans to develop their brand "Fantom" as a world famous one for all golf items.
Fantom Co., Ltd
Fantom Tower 8th Fl., 705-18, Yoksam-dong, Kangnam-gu, Seoul, 135-080, Korea
Tel: 82-2-3451-7830/40
Fax: 82-2-552-5779
 | Hanyoung Kangaroo Company, Ltd. |
Until 1995 they had been exporting one item only, but they have since developed special golf gloves, Wanggrip, and have begun exporting them as well. Wanggrip is designed not to slip in any climate or under conditions like sweat on the palms.
The company has received patent rights for a utility model in Japan. They are planning to export with their own brand to Japan and the U.S.A.
Hanyoung Kangaroo Co., Ltd.
252-10, Jungkock-dong, Kwangjin-gu, Seoul, 143-220, Korea
Tel: 82-2-466-6342
Fax: 82-2-461-6421
 | Ever Green Company, Ltd. |
Being a company in one of the world's top shoe producing nations, it is natural for a company like Ever Green to be producing high-quality golf shoes. Ever Green, established in 1986, exports women's shoes, the "Lady Fairway" to the U.S.A. and is preparing to do the same with the men's "Meister." The company is also going to export on an OEM basis to the U.S.A., Japan, and Taiwan.
Ever Green Co., Ltd.
353-4, Myungil-dong, Kangdong-gu, Seoul, 134-070, Korea
Tel: 82-2-476-3954/6
Fax: 82-2-488-3579
