Korean anti-corruption law impacts on retail sales

The Korean anti-corruption law may be showing its desired extra effect of creating more time for family and home cooking if sales record at a leading retailer is any indication.

October sales figures from E-mart released show an 11.5 per cent increase for the month to 1.14 trillion won (US$987.3 billion) compared to a year ago. Discount chain E-mart marked a 7.6 per cent jump while the retailer’s warehouse outlet Traders made a 43.7 percent leap. The online store E-mart Mall showed a 28.3 percent increase.

The retailer had recorded a 6.1 per cent sales increase for the third quarter.

Company officials said the Korean anti-corruption law that took effect on September 28 likely boosted the sales. The law sets limit to the price of gifts and paid meals that can be provided to public employees, school teachers and journalists. People who may serve one’s interests are also restricted by the price limit.

Advocates of the law, still under controversy for restricting even gifts of good will and intent, had argued that the law will free individuals from business-related dinners and engagements, giving them personal evening time.

“People leaving office on time and shopping for groceries, all due to the anti-corruption law, appear to have contributed largely to the double-digit growth in E-mart’s sales,” Lee Joon-ki of Mirae Asset Daewoo said.

Food sales at E-mart rose 13.1 per cent in the month from a year ago, outdoing the average sales increase. In a breakdown, sales of fresh foods jumped 14.1 per cent while ready-made meals increased 14.5 per cent. Sales of processed foods were up 11.2 per cent.

The number of customers coming in from 6pm had also increased, according to E-mart. The retailer had 3.5 per cent more shoppers since the day of the law’s enactment to November 8. The number of customers in the 6-9 pm period was up 5.3 percent.

“We are focusing our marketing on foods section for our 23rd anniversary event since food sales are improving,” Choi Hoon-hak, marketing team chief at E-mart, said. “We intend to continue to introduce a variety of products that fit into the lifestyle changes of the customers.”