Park Jae-hyuk is a seasoned journalist who has provided comprehensive coverage of South Korea's corporate dynamics, economic policies, industry challenges and the global positioning of Korean companies. Based on the articles he has written since joining The Korea Times in 2016, his investigative approach has helped readers understand corporate governance, economic trends and business strategies shaping South Korea’s economy.
E-mart plans to leave China
By Park Jae-hyuk
Shinsegae Group Vice Chairman Chung Yong-jin speaks at a Shinsegae Group job fair at KINTEX in Goyang, Gyeonggi Province, Wednesday. He confirmed the group’s E-mart discount chain will exit China. / Courtesy of Shinsegae Group
By Park Jae-hyuk
E-mart discount chain will leave the Chinese market, Shinsegae Group Vice Chairman Chung Yong-jin told reporters at the group’s job fair at KINTEX in Goyang, Gyeonggi Province, Wednesday.
Industry watchers had already expected the retail giant would shut down its discount stores in the world’s most populous country this year, although the company had refused to confirm this.
This was first time for the conglomerate’s owner to officially announce its departure from China. The vice chairman, however, did not mention the exact timeline of the pullout.
Opening its first E-mart store in Shanghai in 1997, Shinsegae had a grand plan of running 1,000 stores in China, opening 27 stores there as of 2010.
But the company failed to take firm root over high rents, unfavorable locations and a slump in the Chinese economy.
On top of the worsening profitability and growth, anti-Korea sentiments among Chinese consumers over the deployment of a U.S. anti-missile system here seem to have dealt a fresh blow to the group’s performance.
To deal with the challenges, Shinsegae tried to restructure its business in the country, and as a result it now runs just seven stores there.
The retailer did not renew a rental contract for its Shanghai Laoximen store and is expected to close its other six outlets as soon as possible.
At the fair, the vice chairman also showed his willingness to continue working on building a Shinsegae Department Store in Bucheon, Gyeonggi Province.
The construction work of the new department store has been delayed due to strong opposition of small retailers in the area.
Chung also vowed to offer better working conditions for the group’s employees.
He stressed that Shinsegae has strived to reduce irregular workers for the past 10 years without regard to the new administration, which is pushing a zero irregular workers policy.