By Seo Jee-yeon
Staff Reporter


Shinsegae, the nation’s largest retail group, is putting the final touches to its remodeled and expanded main store that will open Aug. 8 in Myongdong, Seoul’s upscale commercial district.

The move is set to spark a fierce competition with rival Lotte to attract shoppers in downtown Seoul.

The main branches of Lotte and Shinsegae are cross-town rivals. Lotte, the nation’s largest department store brand, has enjoyed a dominant position for the past few decades particularly, in the Myongdong, the biggest shopping district in Northern Seoul.

``We aim to restore our reputation as a pioneer of the nation’s department store industry in Myongdong,’’ a Shinsegae official said.

The retail group also moved its headquarters to the Myongdong branch, which reflects the group’s determination to boost its department store business where the group originated.

Shinsegae has overtaken Lotte in the discount chain business but still lags behind its rival in the department store sector. Lotte is the biggest department store in Korea and Shinsegae and Hyundai are in competition for the second post.

According to industry sources, the main store of Shinsegae posted 120 billion won last year, while sales of Lotte’s main branch reached 1.15 trillion won.

The big gap in sales between the two main shops is mainly attributed to the size of the branches.

In the showdown with Lotte, Shinsegae has poured money into remodeling the existing main branch and building a new shop with 19 floors just behind the main branch for the past year.

The size of the shops in the group’s renewed main branch was extended to 17,000 pyong from 3,000 pyong. (One pyong equals 3.3 square meters).

``To meet the taste of sophisticated local shoppers, we paid attention to the store’s decor, improvement in services and the introduction of new brands,’’ the official said.

Shinsegae expects sales at the strengthened main branch in Myongdong will rise to 550 billion won per year.

Facing Shinsegae’s aggressive drive to enhance its presence in Myongdong, Lotte also opened a luxury hall linked to its main branch.

Lotte is preparing to open ``Lotte Town’’ on Aug. 8, strengthening the store’s entertainment zones, including Lotte cinema adjacent to the Myongdong branch.

Industry watchers are worried about growing competition between the two retail giants in the Myongdong market.

``The overheated competition between the two department stores in the area could hurt themselves in the end, launching excessive bargain sale events and providing free gifts to attract shoppers.’’

jyseo@koreatimes.co.kr