By Kim Hyun-cheol
Staff Reporter
The unstoppable juggernaut of conglomerate-backed big retailers has been stopped cold in its tracks, at least for the moment, in the face of an organized effort by a group of mom and pop store owners.
Samsung Tesco, the operator of the Home Plus discount hypermarket, said Tuesday it has postponed the launch of its smaller-sized outlet store in Yeonsu-gu, Incheon, which was scheduled for this week.
The retailer made the decision ahead of a ``suggestion'' by the Small and Medium Business Administration (SMBA), a government agency, to not open the store, following a petition filed by the Incheon branch of the Korea Supermarkets Alliance (KOSA), a group of small neighborhood stores.
Proprietors of grocery and other shops had been staging a sit-in in front of the site of the Home Plus supermarket last week. The KOSA Incheon claimed Home Plus super super-markets or SSMs will drive them out of business. SSMs are small outlets affiliated with big discount stores, giving parent companies deeper access to neighborhoods, posing a threat to small stores in their vicinity.
Samsung Tesco said it decided not to open its outlet in Incheon to prevent the small storeowners' protest from turning violent. The government's intervention is not legally binding, but apparently Home Plus decided to stand down due to possible friction with the government and bad publicity
``We are now internally reviewing our project in an effort to create a win-win relationship with local businesses,'' a Samsung Tesco spokesman said. ``But the decision to suspend the opening can be reversed.''
KOSA Incheon, however, said that another SSM store is scheduled to open in the Bupyeong-gu district next week, vowing to thwart its opening. Currently some 20 SSMs are in operation in Incheon.
SSMs are spreading by leaps and bounds throughout the country. Home Plus currently runs over 150 stores called ``express shops,'' while Lotte Mart and GS Retail also operate over 100 each nationwide.
The Incheon case is expected to trigger a chain reaction of organized protests by small storeowners. Already last week, about 200 merchants of traditional markets and neighborhood stores in Cheongju, North Chungcheong Province, returned their business registrations to their local taxation office in protest of the operation of Home Plus and its express shops.
Other major retailers are keeping a low profile, being wary of the aftermath of the Home Plus setback. ``For now, we are not sure if we can go on with planned SSM openings for the rest of the year. We just hope for a clear guidance from the government,'' said an official of Lotte Mart, which runs its Lotte Supermarket SSMs.
Small store merchants say they will not back down. ``We will oppose any new opening of SSMs at whatever cost,'' said Shin Hyun-sung, president of Incheon KOSA.
Shin said that their ultimate goal is to press for legal protection for their survival.
``Conglomerate retailers don't just hurt us but also other small businesses,'' Shin said. ``Without protection, we are as good as going out of business.''
Samsung Tesco, on the other hand, said it is much more efficient for both sides to opt for coexistence but added a caveat. ``Customers should be entitled to a wider range of choices,'' the spokesman said, explaining that SSMs account for a mere 1 percent of the whole retail market.