Neighborhood grocers ramp up short-distance delivery to compete with Coupang

[Image source: Gettyimagesbank]

Lotte Super, one of largest neighborhood supermarket chains in Korea, said on Tuesday it is boosting its short-distance delivery service for customers visiting its stores, a strategy to compete with costly early morning deliveries from giant online retailers such as Coupang and Curly.

Lotte Super previously offered free delivery on purchases of 30,000 won ($23.2) or more, but for the two months of July and August, it will offer free delivery on purchases of even one heavy product, regardless of the amount. The free delivery will be available at 130 Lotte Super stores that previously offered delivery services.

In addition, Lotte Super will expand the delivery area to more than 1 kilometer for 32 stores located in sparsely populated areas such as Cheorwon.

“We will increase store reservices visit rates by strengthening the delivery we provide to customers in the immediate vicinity,” said Hyun Young-hoon, Head of Super Operations at Lotte Super.

Another supermarket chain, Homeplus Express, operates an instant delivery service that allows customers to have goods delivered within an hour.

The chain said its online sales grew 72 percent on-year from August last year to May this year as a result of free shipping on purchases over 30,000 won.

Emart opened its second store specializing in short-distance delivery SSG-Go late last year and is testing its profitability. The company is using the space left over from the consolidation of small and medium-sized picking and packing (PP) centers into large PP centers as SSG-Go distribution centers.

In addition, Shinsegae is focusing on scheduled delivery to improve delivery accuracy by time zone. This is because it is more important for customers to receive their goods at the right time, not necessarily at dawn.

Lotte Shopping has partnered with Ocado, a British grocer, which plans to enter Korea for the first time in 2025. Ocado delivers items in 15-minute increments that customers can reserve for the same day, next day, or even a week in advance.