CJ CheilJedang foods return to Coupang after almost two years

Home > Business > Industry

CJ CheilJedang foods return to Coupang after almost two years

Published: 14 Aug. 2024, 18:44

LEE JAE-LIM
lee.jaelim@joongang.co.kr

Coupang's logistics trucks are parked in a parking lot in Jung District, central Seoul, on Aug. 7. [NEWS1]

The ice-out between e-commerce giant Coupang and CJ CheilJedang, Korea's largest food manufacturer, has thawed, and the latter’s flagship Hetbhan and Bibigo brands are back on Coupang’s shelves starting Wednesday.

Coupang customers will once again be able to receive CJ CheilJedang's popular products through the same-day Rocket Delivery service and will have access to all of the food giant’s products via the e-commerce platform by the end of September.

Starting with Bibigo Wang Gyoza dumplings, sales of refrigerated and fresh products like Gourmet Pizza, Bibigo Kimchi, Happy Soy, Samho Eomuk fish cake and Dasida seasoning powder will gradually resume. Foods such as Hetbhan, Spam, Maxbong sausages, Matbam chestnuts and Petitzel jelly will also be available, as will condiments like Haechandle’s hot pepper paste, soybean paste, Baeksul’s cooking oil, flour, frying powder, sugar and salt.

The renewed partnership stems from the companies’ efforts to lessen the burden of high inflation on consumers’ shopping carts, Coupang says.

“We have long awaited the collaboration with CJ CheilJedang, a company with many beloved brands,” a Coupang spokesperson said in a statement. “We plan to actively communicate and collaborate to ensure customers have access to a wider variety of high-quality products. Combining our nationwide Rocket Delivery logistics infrastructure with CJ CheilJedang’s popular product selection will create a synergistic effect.”

The resumption of distribution comes in one year and eight months after both companies decided to stall their transactions in December 2022, as tensions rose over the supply and price of CJ CheilJedang’s products.

Coupang, at the time, claimed that CJ CheilJedang had supplied fewer products than it was contracted to. The food manufacturer retorted that the supply slump was inevitable, particularly for its Hetbahn brand, for which demand was surging. It also claimed that it had turned down Coupang's request to purchase its products for lower prices during negotiations.

CJ CheilJedang has since partnered with other major e-commerce players such as Kurly, SSG.com, Baemin and China’s AliExpress. Coupang, instead, turned to substitutes such as Ottogi’s instant rice products.

However, the synergy created between two dominant companies in their respective industries appeared too valuable to give up; they did not discontinue their efforts to reconcile, even after formally halting their partnership.

Coupang first held out a hand for reconciliation, inviting CJ executives to Coupang Play’s Major League Baseball Seoul Series back in March. Coupang CEO Kang Han-seung met CJ Group Chairman Sohn Kyung-shik, CJ Corporation CEO Kim Hong-ki, CJ CheilJedang CEO Kang Sin-ho and CJ Logistics CEO Shin Young-soo.

“The two companies have been consistently communicating based on the need that their partnership needs to be continued,” an anonymous source close to the matter told the JoongAng Ilbo. “And the negotiation was propelled to action after the baseball game in March.”

In January, LG Household & Health Care resumed deals with Coupang for similar reasons after suspending its partnership with the company for four years and nine months.

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]