Frustrated retailers discover outlets
Shinsegae’s Paju outlet is five minutes away from Lotte’s outlet also in Paju, Gyeonggi.
The reopened store is the largest in terms of number of brands and floor space among suburban premium outlets. Shinsegae has added 55 more fashion brands for a total of 220, compared to the 215 available at the Lotte outlet. And Shinsegae Simon targets customers in their 20s and 30s.
“Due to the nearby Heyri Artist Valley and Provence village in Paju, often visited by young customers, we brought in brands that are popular among these young shoppers,” said an official of Shinsegae Simon.
Shinsegae also introduced new select shops selling Kolon’s popular handbag brand Couronne, Toms shoes and outdoor brands The North Face and Canada Goose. It also added more menswear brands, including Custom Mellow, Seig and Comodo Square.
For family customers, it has a home appliances retailer Home and Kitchen, which carries German kitchenware Silit products. It has also increased facilities for children with a 165-square-meter (1,776-square-foot) playground.
Shinsegae made large investments after outlets reported revenue growth of 41.3 percent last year, compared to 4.9 percent for department stores and 1.4 percent for large discount stores.
Shinsegae Retail Research Institute projected that premium outlets will grow this year by 31 percent, double that of other retailers.
“As reasonable consumption is in the spotlight, in line with the recent economic situation, premium outlets have settled as a familiar purchasing channel for consumers,” said Kang Myung-koo, CEO of Shinsegae Simon.
Meanwhile, as the premium outlet market emerges as a strong source of growth for large retailers, cutthroat competition between the retail giants Shinsegae and Lotte is also heating up, especially in the regions such as Paju, Busan and southern Gyeonggi.
Lotte reportedly plans to open an outlet in October with 360 fashion brands in Icheon, southern Gyeonggi, to compete with the Shinsegae’s first premium outlet in Yeoju, southern Gyeonggi, opened in June 2007. In response, Shinsegae is set to revamp its Yeoju branch next year to 48,900 square meters with 250 brands.
Lotte will expand its outlet in Gimhae, South Gyeongsang, to 46,200 square meters and 300 brands this June, and Shinsegae will open a 33,000-square-meter premium outlet in Busan with 180 fashion brands.
By Kim Jung-yoon [firstname.lastname@example.org]