Provincial Development
The Jeju Special Self-Governing Province Development Corporation (JPDC) was established in 1995 to contribute to the development of regional society and promote the welfare of residents by creating high added value from the clean natural resources of the region. It has moved ahead with the spring drinking water business by making use of high-quality bedrock water resources so as to add to local finance and preserve resources in an organized way. Also, it has stressed the importance of corporate ethics and social responsibility since its inception by launching various projects for public interests, all of which have led to value creation in the interest of the people.
Half of Business Profits Returned to Local Residents
Since the inauguration of president Oh Jae-yoon in 2011, JPDC has pursued intensive innovation to boost its transparency and fairness across all sectors, ranging from production and distribution to marketing. One of its priorities has been laid on the improvement of logistics systems. It ended the unfair, automatically extended contract with Nongshim through litigation and introduced open bidding systems for commissioned sellers.
“In the past, local transporters’ presence in the industry was limited to 15 percent due to major logistics companies covering the entire country,” the president explained, adding, “However, we dealt with the problem, and now the local companies are allowed to have up to 49 percent shares.”
The corporation overhauled the way of material procurement, too. It adopted fully open bidding, in place of the restricted tender for three companies that resulted in rigging in many cases, to save billions of won in annual costs. As a result, the sales volume, sales amount, and net current profits of Samdasoo amounted to record highs of 612,000 tons, 191.2 billion won (US$186.4 million), and 41.2 billion won (US$40.2 million) last year, respectively.
In particular, the current net income has more than doubled when compared to the 20.5 billion won of 2010. Furthermore, the corporation returned 57 percent of the net profits earned from 1998, or 132.8 billion won (US$129.6 million) out of 232 billion, to Jeju Island residents. 116 billion won (US$113 million) was earmarked as tax revenue of the province to be spent on local projects, and the rest was reverted to the local community, 6.3 billion won (US$6.1 million) of it in 2013.
“We put first our responsibility as a public organization in returning the profits to the regional community, and this will remain one of our top priorities in the future,” the President continued.
Samdasoo, #1 Mineral Water of Korea
The Jeju Samdasoo manufactured by JPDC has an O-index valThe Jeju Samdasoo manufactured by JPDC has an O-index value of 8.2, meaning that it has much clearer taste than other drinkable spring water products. It ranked 15th on the 100 Brands of Korea list published by Brand Stock in December 2013, too. In addition, it topped the mineral water product segment of the 2014 Korea Brand Stars, announced in March this year, for as long as nine years in a row to win the Most Beloved Brand Prize. Jeju Samdasoo’s share in the PET bottle water market has remained over 50 percent for years, while recording the highest consumer satisfaction and preference.
“Such excellent achievements have been possible thanks to the high brand value and quality of the volcanic mineral water product produced in Mt. Halla, a clean region,” president Oh remarked. Groundwater derived from the volcanic bedrock aquifer at a depth of 420 meters is used to produce Samdasoo, which has passed the tests of the Food and Drug Administration (FDA) of the United States and the Ministry of Health and Welfare of Japan. In short, Samdasoo is one of the symbols of the clean Jeju.
Premium Water Hallasu
“Jeju water products can be comparable in quality to Evian,” he stressed, “However, these top-quality products need to be able to arouse consumers’ interest in order to compete with the highly-reputed Evian.”
JPDC released the premium water product of Hallasu in April in this vein. The table water product comes in two types, PET and glass, so that its up-market image can be maximized. The glass bottled water is supplied mainly to high-class hotels and restaurants, department stores, international conference venues, and the like for effective overseas market penetration. Hallasu, in the meantime, won the Red Dot Design Award 2013 in July last year and the iF Design Award in February 2014 for its high design value.
Local Beer Brand Jespi
JPDC launched the beer brand Jespi in July last year. Jespi is a premium beer using the region’s clean volcanic mineral water and barley for a totally unique taste. It contains neither starch nor other additives, only malt to provide a very rich beer taste.
According to the corporation, the launch of Jespi has more to do with the revitalization of the regional economy than profit generation. “We procure barley harvested in Jeju in producing Jespi beer to help farming households, and the snacks served in Jespi stores are locally produced agricultural, fisheries and livestock goods, too,” it said.
Jespi has been a great boon for the regional economy in spite of its short history. It has resulted in the creation of new jobs and new culinary culture along with an increasing number of inbound tourists. The beer is currently available at the 460 m2-wide store located in downtown Jeju.
This year, the corporation is going to continue its recordhigh business performance for the fourth consecutive year by increasing its sales volume, sales amount and net profits by at least 10 percent from a year ago. Specifically, its Samdasoo sales targets for this year are 671,000 tons, 206 billion won (US$200.9 million) in sales and 46 billion won (US$44.8 million) in net profits. JPDC is also concentrating on two key projects during the course of this year. One is the export performance of 10,000 tons and US$5 million. The corporation, which won the Export Tower Prize in 2013 by recording US$3 million in exports, is aiming to boost the volume to US$5 million.
The other is a successful development of the Jespi business for higher awareness. JPDC is planning to accelerate the progress of the Jeju Craft Beer Project and the incorporation process, so that more consumers can taste the quality beer both at home and abroad. The corporation proceeds with its Mandarin Food Industry Cluster Project, too. At present, an integrated R&D and production complex is under construction in Seogwipo City, home to JPDC’s mandarin factory, to help increase the profits of mandarin farming households.
“As a local public enterprise, we strive to serve the interest and win the trust of all Jeju residents, and this is my and my staff’s number one philosophy and conviction in every single day-to-day business activity,” the President emphasized.