Korean d-store sales slide
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South Korea’s department store industry is still struggling to arrest falling sales as consumers tighten spending and turn to online.
New figures released by the trade ministry Tuesday show sales at top department and discount stores in December fell at a sharper rate than initially expected – by 0.9 per cent compared with the earlier projected 0.3 per cent.
That makes the fourth successive month that combined sales from stores managed by Hyundai Department Store, Lotte Shopping and Shinsegae Co have declined.
However, the new data still reflects a significant improvement from the 6.5 per cent drop in November.
The ministry blamed the slump on falling in-store clothing purchases due to consumers preferring to shop online. Rising sales of food and beverages cushioned the effect of apparel’s fall.
Discount store sales fell 3.8 per cent in December year-on-year, compared to 4.7 per cent in November.
Questions & Answers
Q.What was the actual combined sales decline for South Korean department and discount stores in December?
What was the actual combined sales decline for South Korean department and discount stores in December?
Combined sales from stores managed by Hyundai Department Store, Lotte Shopping and Shinsegae Co fell by 0.9 per cent in December. This decline was sharper than the initially projected 0.3 per cent drop for the month.
Q.How did December's sales performance compare to the previous month, November?
How did December's sales performance compare to the previous month, November?
December's combined sales decline of 0.9 per cent represented a significant improvement compared to November. Sales in November had seen a much larger drop of 6.5 per cent, indicating some recovery.
Q.Which specific product category was identified as the main reason for the sales slump?
Which specific product category was identified as the main reason for the sales slump?
The ministry attributed the slump primarily to falling in-store clothing purchases. Consumers are increasingly preferring to shop for apparel online, which directly impacted physical store sales in this category.
Q.What helped mitigate the overall negative impact on department store sales?
What helped mitigate the overall negative impact on department store sales?
Rising sales of food and beverages helped to cushion the overall effect of the decline. While clothing purchases fell, increased sales in these categories prevented an even larger total sales drop.