- Korea's retail industry grows 9.3% in H1 2022 2022-07-28
The Ministry of Trade, Industry and Energy (MOTIE) announced on July 28 that Korea’s overall retail sales in the first half of 2022 increased 9.3 percent. Offline and online retailers gained 8.4 percent and 10.3 percent, respectively.
Retail sales for the month of June increased 9.2 percent, with both offline and online retailers experiencing growth, up 9.3 percent and 9.1 percent, respectively.
The Ministry releases monthly retail sales figures based on surveys of 25 major retailers. Thirteen of them are physical retailers: three department store chains, three hypermarket chains, three convenience store chains, and four “super supermarket” (SSM) operators. The remaining 12 are online retailers.
The growth in offline retailers for H1 of 2022 can be attributed to the base effect from previous year’s pandemic and social distancing measures, with this year’s growth powered mostly by department stores (up 18.4 percent).
Online retailers in H1 posted double-digit growth (up 10.3 percent) driven by cosmetic products, groceries and other contactless purchases.
With overseas travels still somewhat limited, designer brands sales rose (up 0.8 percentage points), as did demand for food deliveries and coupons, which led to growth of the services/other (up 0.6 percentage points) category.
In contrast, home appliances/culture (down 0.9 percentage points), living/home (down 0.5 percentage points) declined, the spike more noticeable among categories that benefited from COVID-19 last year.
Physical sales increased as social distancing eased, with department store sales (up 18.4 percent) at the helm.
Department stores saw a steep rise across all categories, such as designer brands (up 26.9 percent), kids/sports (up 26.3 percent), women’s clothing (suits up 17.1 percent, casual wear up 16.1 percent), and men’s wear (up 19.8 percent).
Hypermarket chains slid 1.5 percent as home/living (down 3.7 percent), home appliances/culture (down 3.6 percent) inched down, which more than offset the slight surges in “other” (up 3.7 percent) sales like cafes and food courts, and clothing (up 0.6 percent).
Convenience store chains recorded a 10.1 percent growth thanks to strong demand for miscellaneous items (up 11.5 percent) and food products (up 10.6 percent) like processed and instant foods, as close-vicinity and small-portion purchases are trending.
Sales at SSMs dipped 1.9 percent in the first half. Daily necessities (down 4.9 percent), miscellaneous goods (down 1.1 percent), food products (down 1.7 percent) and non-food products (down 3.3 percent) have become increasingly available online, and the shift in purchase channels has added to the drop.
Sales at online stores grew 10.3 percent overall, as online grocery shopping is now more mainstream, and the increase in food products (up 17.8 percent) has driven up total online sales.
In particular, cosmetics (up 21.2 percent) and services/other (up 17.0 percent) like food delivery, performances achieved steep growth.
For the month of June, both offline (up 9.3 percent) and online sales (up 9.1 percent) displayed similar growth, overall sales reaching 9.2 percent year-on-year.
For physical stores, laxed social distancing and increased outdoors activities equal revenge shopping, which raised sales across all categories, including kids/sports (up 24.1 percent).
June online sales saw persistent demand in cosmetics, food and services (performances, leisure packages) and sales rose all-round.