South Korean department stores set to smash sales record
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South Korean department stores are tipped to chalk up sales of more than 30 trillion won (US$25.6 billion) for the first time this year.
That would make if 86 years since the country’s first department store opened in 1930.
Industry commentators say the figure reflects the retail category’s emergence from “years of stagnation” to return to growth as they pursue new alliances, an expanded food offer and eCommerce.
Lotte, Hyundai and Shinsegae account for 80 per cent of the Korean department stores market with Galleria, AK Plaza and smaller brands hold the remainder.
Just seven years ago, department store sales surpassed the 20 trillion won barrier – this year’s projection is 31 trillion, a remarkable growth rate by any measure, especially considering sales stagnated at 29 trillion won for the last four years.
“Despite the prolonged economic slowdown and changing consumption trend, the domestic department store market is expected to post growth this year thanks to new concept stores and the expansion of online channels,” a Shinsegae Department Store official said.
Questions & Answers
Q.What factors are contributing to the projected growth in department store sales this year?
What factors are contributing to the projected growth in department store sales this year?
Industry commentators attribute the expected growth to new alliances, an expanded food offer, and a stronger focus on eCommerce. New concept stores and the expansion of online channels are also playing a role.
Q.Which companies dominate the South Korean department store market?
Which companies dominate the South Korean department store market?
Lotte, Hyundai, and Shinsegae collectively hold 80 per cent of the market share. The remaining 20 per cent is shared among brands like Galleria, AK Plaza, and other smaller operators.
Q.How does this year's sales projection compare to recent years?
How does this year's sales projection compare to recent years?
Sales are projected to reach 31 trillion won this year, a significant increase from the 29 trillion won where sales had stagnated for the past four years. This is a notable return to growth.
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