By Park Si-soo
Retail giant Shinsegae Group has unveiled a series of aggressive steps this month, including the biggest investment plan in its history, in pledging to improve employees' job security and opening the country's first wine-only department store.
The moves are seen as evidence of its determination to challenge its biggest rival Lotte Group, which is widely perceived as the market leader and trend-setter.
These expansionary plans will help improve the company's market profile significantly, officials said. Lotte is wrestling with the worst image crisis ever, which was driven by a series of scandals linked to its half-built skyscraper in Seoul and discord regarding its attention-drawing leadership succession.
"Shinsegae appears to be very aggressive this year," an industry insider said. "There may be many reasons behind this. But it's meaningless to talk about this without Lotte."
A Shinsegae spokesman said the measures will help cement the firm's "leadership."
"One thing the two companies have in common is that their corporate roots lie in the department store business," he said. "Shinsegae started the department store business first. So we have worked believing that we are a leader in the industry."
By sales, Lotte is the country's biggest retailer ― with an estimated 83 trillion won ($76.5 billion) last year ― and Shinsegae is the runner-up, with 25 trillion.
According to allegations the initiatives were designed with the aim of bolstering the reputation of Shinsegae Vice Chairman Chung Yong-jin, 47, ahead of his taking the group's throne. Lee Myung-hee, 72, Chung's mother, is the group's chairperson.
"There is no immediate sign that Chung will be promoted to chairman," the spokesman said.
He hinted that the vice chairman had been deeply involved in the initiatives, saying his role is developing the firm's future growth engine.
Early this week, the firm said it will invest 3.35 trillion won ($3.1 billion) in 2015, up 50 percent from last year and the biggest in the company's history, to open more shopping malls and strengthen its online retail platform. It also plans to hire 14,500 additional workers this year, 1,000 more than it did last year.
On Thursday, the company said from March it will extend the retirement age of its regular workers to 60 from the current 55. Nearly 46,000 employees at Shinsegae and its 27 affiliates will benefit from the extension. The group also decided to streamline its chain of command to become more flexible to the fast-changing market.
On top of that, the company will open the country's first wine-only department store in February in Paju, Gyeonggi Province.
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Chung Yong-jin |
The moves are seen as evidence of its determination to challenge its biggest rival Lotte Group, which is widely perceived as the market leader and trend-setter.
These expansionary plans will help improve the company's market profile significantly, officials said. Lotte is wrestling with the worst image crisis ever, which was driven by a series of scandals linked to its half-built skyscraper in Seoul and discord regarding its attention-drawing leadership succession.
"Shinsegae appears to be very aggressive this year," an industry insider said. "There may be many reasons behind this. But it's meaningless to talk about this without Lotte."
A Shinsegae spokesman said the measures will help cement the firm's "leadership."
"One thing the two companies have in common is that their corporate roots lie in the department store business," he said. "Shinsegae started the department store business first. So we have worked believing that we are a leader in the industry."
By sales, Lotte is the country's biggest retailer ― with an estimated 83 trillion won ($76.5 billion) last year ― and Shinsegae is the runner-up, with 25 trillion.
According to allegations the initiatives were designed with the aim of bolstering the reputation of Shinsegae Vice Chairman Chung Yong-jin, 47, ahead of his taking the group's throne. Lee Myung-hee, 72, Chung's mother, is the group's chairperson.
"There is no immediate sign that Chung will be promoted to chairman," the spokesman said.
He hinted that the vice chairman had been deeply involved in the initiatives, saying his role is developing the firm's future growth engine.
Early this week, the firm said it will invest 3.35 trillion won ($3.1 billion) in 2015, up 50 percent from last year and the biggest in the company's history, to open more shopping malls and strengthen its online retail platform. It also plans to hire 14,500 additional workers this year, 1,000 more than it did last year.
On Thursday, the company said from March it will extend the retirement age of its regular workers to 60 from the current 55. Nearly 46,000 employees at Shinsegae and its 27 affiliates will benefit from the extension. The group also decided to streamline its chain of command to become more flexible to the fast-changing market.
On top of that, the company will open the country's first wine-only department store in February in Paju, Gyeonggi Province.
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