Lotte boss says group plans to close 200 offline stores
By Kim Jae-heun
Shin Dong-bin, Lotte Group chairman
Lotte Group Chairman Shin Dong-bin said the retail giant will invest more in expanding its hotel and chemical businesses with the money earned from the massive closure of its department and retail stores here.
In an interview with Japanese economic newspaper Nikkei, Thursday, the Lotte chairman said he plans to close up to 200 “unprofitable stores” in South Korea by the end of the year as part of a large-scale effort to focus more on the hotel and chemical businesses, which he identified as the group's next major revenue drivers. Lotte Group operates 71 department stores, along with a number of super- and hyper-markets across the country.
His remarks were confirmed by Lotte headquarters in Seoul. The Lotte boss said its signature Lotte Hotel will see substantial volume growth via acquisitions over the next five years. Lotte runs 12 hotels outside Korea, including three in the United States.
Regarding the specifics of plans for the expansion of the firm's chemical business, Shin said that the group intended to acquire a number of struggling Japanese chemical companies. U.S. President Donald Trump has also thanked Shin for his decision to invest $3.1 billion in Louisiana to boost the output of its chemical industry.
In addition, the chairman said he has made it possible for Lotte customers to pick up products bought online at any offline store nearby. The recently-launched, unified online service, “Lotte ON,” lets customers collect their purchases at any Lotte department store, supermarket, or home appliance retailer.
Shin also highlighted the group's gradual shift toward an “omni-channel business” as the conglomerate was on track to pursue the digitization of over 10,000 convenience stores and other offline stores. The Lotte boss said that recent management changes to mid and senior management were mostly due to some members' reluctance to side with the initiatives.