Korean discount stores’ PB kimchi sales surpass 5,000 tons this year

(Emart)

Private brand (PB) kimchi sold by South Korea’s three major retailers is gaining popularity as consumers turn to cheaper alternatives amid high inflation.

According to an analysis of the sales forecasts for PB kimchi at Emart Inc., Lotte Mart Co., and Homeplus Co. on Sunday, total sales volume this year is expected to surpass 5,000 tons, up by about 300 tons from last year.

Considering that prices have risen by roughly 10 percent due to higher raw material and labor costs, PB kimchi revenue growth at each retailer is likely to reach double-digit rates.

Emart expects sales of its No Brand kimchi to rise around 10 percent this year. The retailer currently sells more than 130 packaged kimchi products, and four of the top 10 items are No Brand kimchi.

At Lotte Mart, sales of its PB kimchi line Yorihada rose 20 percent on year through November. Since July, Lotte Mart has been offering its whole-leaf kimchi (3.3 kilograms) at a 25 percent discounted price of 19,900 won ($13.5), while its small-portion seasoned kimchi priced at 4,990 won, targeting one- to two-person households, has also gained popularity.

Price has been the key driver, with private-label kimchi at major hypermarkets averaging about 533 won per 100 grams, roughly 30 percent cheaper than comparable products from major food manufacturers.

Analysts attribute the growth in PB kimchi sales to the value-conscious consumption habits of young consumers in their 20s and 30s and single-person households.

“Retailers’ strategies to strengthen PB products are likely to gain even more momentum,” said an industry official.