Reducing big retailers' operating hours fails to help traditional markets

A traditional market in Chungju, North Chungcheong Province / Korea Times file

By Lee Kyung-min

The government regulations limiting operating hours of large retailers do not help merchants at traditional markets and only benefit their e-commerce peers, according to an expert survey, Monday.

Over seven in 10 surveyed experts said the poorly planned measure ended up hurting the growth of not only large retailers but also traditional markets, and that online entities and convenience stores have benefited unexpectedly.

Under the related law established to foster equal, balanced growth of retail industry players, large retail stores must remain closed every other Sunday in most parts of the country. Their around-the-clock operating hours were also curtailed to 10 a.m. to midnight.

People shop for fruit and vegetables stacked at the Changdong branch of E-mart in Seoul. Korea Times file

The Korea Chamber of Commerce and Industry survey of 108 members of four retail logistics academic associations showed 70.4 percent of the respondents said that they thought the decade-long measure failed to protect both large retailers and traditional market players.

Over four in five, or 83.3 percent, said the measures should be lifted altogether or eased significantly. Only 16.7 percent said the status quo should be maintained.

Their assessment is supported by the market share of traditional merchants falling to 9.5 percent in 2020, down from 14.3 percent in 2013. The figures for large retailers also suffered a drop of 8.9 percentage points to 12.8 percent in 2020, from 21.7 percent in 2015.

More than half, or 58.3 percent, said the primary beneficiaries of the measure were e-commerce firms, followed by small and medium-sized brick-and-mortar shops (30.6 percent) and convenience stores (4.6 percent).

Only 14.8 percent said the competitors of large retailers are traditional market merchants, whereas over a quarter said they compete against e-commerce players.

The operating hour ban hurts consumers' right to a broader choice (39.8 percent), the survey found. About 19.4 percent said the measure was outdated. Some 11.1 percent said the measure discriminates against e-commerce entities, while 10.2 percent said it hampers fair market competition.

Nearly three-quarters, or 74.1 percent, called for flexibility in setting operating hours, reflecting the needs of consumers and retail chain operators.

Almost nine in 10 said the government measure should be revised to help the small and medium-sized counterparts of large chains in place of outright operating hour cuts or other bans.

About half, or 48.1 percent, said traditional market players should enhance customer services, while 42.6 percent said establishing logistics infrastructure was most pressing.

About 42.6 percent said they need to embrace digitization, and 20.4 percent said the merchants should cooperate with each other to strengthen their overall competitiveness.