Coupang comes under fire for negligence in safety, consumer boycott underway

[Photo by Lee Chung-woo]

The deadly fire at a distribution center of South Korea¡¯s e-commerce giant Coupang Inc. that lasted for four days and claimed life of a firefighter raised alertness in safety negligence among e-commerce players due to their heated competition in speedy delivery.

Data from the National Logistics Information Center shows the number of logistics centers in Korea at 4,624, sharply up from 1,666 in 2012.

Warehouses mushroomed in the capital region due to heat in the contest in speedy delivery after Coupang made strides with its signature same-day delivery service. In 2020, a total of 732 new centers were added, more than doubling from 341 in the previous year. So far this year, 102 have been newly set up already.

Coupang operates over 170 logistics centers nationwide and plans to invest 1.02 trillion won ($899.55 million) to build more than five large-scale warehouses.

[Photo by Yonhap]

Its expansion has not been accompanied with safety investment, resulting in the massive fire in suburban area of Seoul last week.

According to a statement issued by Coupang CEO Kang Han-seung, the company has hired 700 safety professionals over the past year and invested 250 billion won, pitiful amount versus its warehouse expansion. Industry sources think other e-commerce players will be no different.

Coupang leadership came under fire as the New York Stock Exchange-trading company coincidentally announced its founder and CEO Kim Bom-seok is withdrawing himself from all titles at home to concentrate on overseas foray on the same day of fire, triggering controversy about negligence in liability and consumer boycott movement.

Coupang has vowed to come up with all possible measures to support the bereaved family members of a firefighter whose body was found 48 hours after the fire. The company has also promised to pay full salary to its 1,700 full-time employees who have become idled due to the fire. All employees, including temporary workers, will be given opportunities to transfer to other locations.

[¨Ï Maeil Business Newspaper & mk.co.kr, All rights reserved]