Shinsegae to open grocery stores in US

Shinsegae Vice Chairman Chung Yong-jin speaks during the group's job fair at COEX convention center in Samseong-dong, Seoul. / Yonhap

By Nam Hyun-woo

Shinsegae Vice Chairman Chung Yong-jin said Wednesday the retailer will enter the U.S. market with its supermarket brand in May next year, as well as revealing a plan to build a massive facility to control the group's online shopping business.

“We are seeking to open a PK Market store in the U.S. in May of next year,” Chung told reporters during the group's job fair at COEX convention center in Samseong-dong, Seoul. “We are about to sell Asian groceries that can attract U.S. citizens.”

PK Market is Shinsegae's premium grocery store. Currently, it has two outlets at Starfields Hanam and Goyang in Gyeonggi Province.

Chung said the store will be located in Los Angeles and the group will seek to expand its store network in the western U.S. The store will also likely contain a restaurant.

“Unless we fix the timing of our U.S. entrance there could be delays,” Chung said. “We are carrying out preparations with the goal of opening the store in May of next year no matter what happens.”

“We have experienced bitter failure in China and decided to focus on an advanced market where there are no limits in entering or withdrawing,” he said, adding that the Australian and European markets are also on the radar.

For domestic business, Chung said Shinsegae will build a 30-story online center that controls the retailer's online shopping businesses in Hanam.

E-Mart, Shinsegae's core supermarket unit, has recently purchased a 21,422-square meter lot in Hanam for 97.2 billion won. Chung said it will be “a landmark” of the region.

The bid is in line with Chung's initiative to enhance the group's online business.

In January this year, Shinsegae signed memoranda of understanding with two foreign investors on their investments worth more than 1 trillion won. Also, it said it will restructure its online business by establishing a new corporate body that controls the group's online sales.

Shinsegae also said it plans to separate its online mall SSG.com as an independent company and keep its core facilities and workforce in the new building.

“The success of an online business depends on the system supporting it, and many Korean online shopping companies have been falling short of coming up with such a system,” he said, adding that Shinsegae is developing its own system on advice from experts including some who worked for Amazon.