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South Korea’s FTC (Fair Trade Commission) approved a set of voluntary rules agreed by convenience store operators to better protect struggling franchisees.
South Korean discount chain operator Emart signed an agreement with the local retailer Robinsons to launch two of its private labels in the Philippines.
Under the agreement, Robinsons will set up and operate 25 Emart “No Brand” and 25 “Scentence” stores by 2020. No Brand sells daily necessities and food items. Scentence is Emart’s beauty brand. Emart will be paid a licencing fee and profit from the export of products to the stores.
This deal sees the Emart business expands from the Central Asia (two Emart stores in Mongolia) and the Middle East (one Scentence store in Saudi Arabia) to South East Asia.
Around 70% of No Brand goods are manufactured by local small enterprises in South Korea. The brand has been so successful that stand-alone No Brand stores have been opened.
The launch of No Brand stores in the Philippines will be its first overseas expansion. According to Emart, outbound shipments of No Brand products jumped by 57.8% year-on-year during January to October this year.
Emart says it plans to develop Scentence beauty products that fit well with the climate of the Philippines to in order to boost its competitiveness.
“The deal to launch No Brand and Scentence in the Phillipines is meaningful to us in that it diversifies our global portfolio for specialized stores,” said Lee Joo-ho, who heads Emart’s global business.
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Shinsegae Group vice chairman Chung Yong-Jin has provided more details on its plans to open PK Market, an upscale version of Emart, in Los Angeles.
The announcement comes as Emart looks to expand its global business, opening stores in Vietnam, Mongolia and Cambodia. Vice chairman Chung said that opening stores in Vietnam has been slow due to tight regulations. The retailer is now looking to focus on more developed markets such as the US.
Different to Emart, PK Market will mainly stock premium products. The store in Los Angeles is to introduce Asian products to American shoppers in old-fashioned market ambience that reminds them of the 1950’s and 1960’s-style traditional markets. Products will range from Korean cuisine to Japanese, Chinese, Indonesian and Thai dishes.
The PK Market store will be at 712 Olive Street in downtown Los Angeles. Shinsegae will lease the first three floors of the building. The first two floors will be retail space, whilst the third floor will be used for offices. This will put PK Market in direct competition with Whole Foods Market, which has a nearby market that is only one block away at the corner of 8th Street and South Grand Avenue. “…the location will be next to Whole Foods Market to attract shoppers to come to our store …” Chung told reporters.
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Emart will build a hypermarket in Hanoi's StarLake area, which will be its second store in Vietnam.
Emart's first store was opened in late 2015 in Ho Chi Minh City. The retailer took four years to research the Vietnamese market before launching its flagship store. The retailer has taken a conservative approach to launching new stores so far, but this is set to change as it has announced plans to open 50 stores in the next five years in Vietnam.
After exiting the China market in 2017, the retailer is shifting its focus to other markets for expansion. It is opening more outlets in Mongolia, and will build its first retail supermarket in Cambodia.
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This Friday, Emart will open another cashier-less store in Seoul. The store will feature various technology the retailer has been testing over the last few months, including Pepper the robot and Eli smart shopping trolleys, to improve shopper experience.
At an existing 212 sq m Emart store in Gangnam, a modern district in Seoul, the retailer is remodelling how customers pay in-store. On Friday, customers will be able to pay via Shinsegae's (Emart's parent and operator) mobile payment service SSG Pay without having to go to a checkout counter.
To support shoppers who do not use the app, there will be a self-checkout counter, and a cashier will also be available for the sale of alcohol and cigarettes which require age verification. The revamped store will also introduce electronic price labels. This will add to the store's new and modern look, and allow the retailer to track, manage and analyse pricing more easily.
Emart already operates several unstaffed Emart24 convenience stores in Seoul as well as in North Joeolla Province (south-west of South Korea). The retailer uses self-checkout machines in some stores to service customers around the clock without workers, while other stores operate without staff members only in the early hours of the morning.
Unlike some unstaffed stores, which require mobile registration or facial recognition, Emart24 stores are accessible with a credit card. The store features 360-degrees scanners, and when customer place their items on a conveyor belt, the scanner locates the barcodes. For support, customers can speak to Emart24 employees at the head office via in-store microphones.
Lotte Mart, Emart's fierce rival began to introduce self-service checkout counters in April earlier this year. These initiatives are partly driven by the government's plan to increase the minimum hourly wage to KRW10,000 (US$9) by 2020. Earlier this year, the minimum wage increased 16.4% to KRW7,530 (US$7) per hour.
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