Retailing in South Korea consists of hypermarkets, department stores, flea markets, traditional markets, and underground shopping malls. Hypermarkets sell dry goods and groceries, similar to Western supercentres. Traditional markets are also popular throughout South Korea.
Hypermarkets
South Korea's's large stores usually cover over and sell self-service food, household goods and home appliances at a discount. Food products (fresh and processed foods) account for 50 percent of sales, followed by household goods and appliances. Hypermarkets include E-Mart, Homeplus and Lotte Mart, as well as warehouse stores such as Costco, Traders and Big Market.
History of hypermarkets
Hypermarkets were introduced to South Korea in 1993. Shinsegae opened its first E-mart store in Changdong-gu. The first hypermarket was a warehouse with minimal service and an uncluttered interior. During the late 1990s, hypermarkets included more luxurious interior, better service and facilities designed to match Korean buying habits. In 1996, Korean companies and foreign global retailers such as Wal-Mart and Carrefour began to compete; Wal-Mart and Carrefour withdrew from the South Korean market in 2006 and 2007. When Homeplus acquired 35 Homever stores from E.Land Retail in 2008, three retailers—E-mart (1993), Lotte Mart (1998) and Homeplus (1999)—took over the market.
Sales
Hypermarket sales were about $3.4 billion as of 2013, at 483 stores nationwide. Korea's 2013 retail market was $310 billion, with hypermarkets accounting for about 10.8 percent of the total. This is the highest percentage of major retail outlets such as department stores, supermarkets and convenience stores.
South Korea's three largest hypermarkets (E-mart, Lotte Mart and Homeplus) had 395 stores in 2013; E-Mart had 148 stores (37.5 percent), Homeplus had 139 (35.2 percent), and Lotte Mart had 108 (27.3 percent). E-Mart and Lotte Mart's outlets included warehouse stores.
Department stores
A department store carries a variety of products in a number of price ranges. They generally offer more customer service, and are located in cities and rural areas.
In South Korea, department stores are defined by the Distribution Industry Development Act as retail stores with more than 3,000 square meters of floor space, diverse inventory and customer-friendly facilities. Under the law, the stores are registered and managed by local governments as large stores. Large stores include department stores, large marts, shopping centers, shopping malls, specialty stores, and other large retail stores. Most are registered as department stores; some are shopping centers or shopping malls, and some outlet and shopping-mall buildings have been registered as department stores. Lotte, Hyundai and Shinsegae are the largest nationwide department store chains, in terms of market share.
History of department stores
Department stores in Korea were opened in Seoul, Busan and Pyongyang around 1930, primarily with Japanese capital when the country was under Japanese rule. The first was the Hwasin Department Store, founded by Park Heung-sik in 1931. During the 1980s, the store went out of business. In 1963, Samsung Group acquired the Donghwa Department Store (located at Shinsegae headquarters) and changed its name to Shinsegae. In 1966, Midopa Department Store was established. It was based on Jeongjaok, which was founded by national capital in 1938. During the 1970s, department stores became more popular as living standards improved. The stores, which had been concentrated in Seoul's Myeong-dong shopping district, have begun to spread throughout cities and near luxury housing. Lotte Department Store was established in 1979, followed by Hyundai, New York, Yeongdong, and Grand. During the 2000s, department stores also became leisure and cultural centers.
Galleria Department Store
The Galleria Department Store, operated by the Hanwha Group, is headquartered in Seoul's 63 Building. The chain operated five stores in 2015. Its main branch is located in Apgujeong-dong, Gangnam-gu, Seoul, and includes the café chain Beans and Berries.
Hyundai Department Store
The Hyundai Department Store chain (Hangul: 주식회사 현대백화점, 株式會社 現代百貨店) was established by the Hyundai Group in 1968. Its main branch is at 165 Apgujeong-dong, Gangnam-gu, Seoul, and the chain has several other stores nationwide. Hyundai is pursuing diversification from its department-store business. In 1985 it moved its head office to Apgujeong-dong, and changed its name to Hyundai Department Store in April 2000 at the Geumgang Development Industry.