Seocho District lifts business hour restrictions on large discount stores

[Photo by Yonhap]

Seocho District in southern Seoul has relaxed restrictions on the business hours of large discount stores, allowing supermarkets to operate for longer hours.

Seocho District announced on Monday plans to change the business restriction hours for large discount stores and retail shops from the previous 12 a.m.-8 a.m. to 2-3 a.m.

This means that large discount stores in the district, which were previously required to close for 8 hours overnight, will now be able to operate during all hours except for 2-3 a.m.

The businesses affected by this measure include four large discount stores within Seocho District (Emart Yangjae Branch, Lotte Mart Seocho Branch, Kim’s Club Gangnam Branch, Costco Yangjae Branch) and 33 medium-sized supermarkets (Lotte Super, Homeplus Express).

Seocho District plans to proceed with final announcements and aims to implement the changes to the operating hours of large discount marts as early as July.

Regarding the regulatory change, Seocho Distrct said the local government actively addressed outdated regulations that do not fit into today’s retail environment.

This policy aims to broaden consumer choices and promote growth and development in the retail industry through free competition, it added.

With the relaxation of business hour restrictions, the operating hours of large discount stores will become longer, and the areas eligible for early morning delivery will expand.

Previously, in regions like Seoul and the metropolitan area where logistics infrastructure facilities are available, early morning delivery was feasible, but it was challenging in remote areas without logistics centers.

Since each large discount store in Seocho District has already been offering early morning delivery services, consumers may not perceive significant changes. The retail industry is more interested in whether the district’s regulatory relaxation will spread to other local governments than the rule relaxation itself.

“Operating hours are a crucial factor directly related to the profitability of large offline retailers,” said an industry official. “If regulations start to loosen in other regions like Seocho District, it will be a significant driving force.”

Seocho District had previously converted mandatory weekend closure days for large discount stores to weekdays, starting from January.

Dongdaemun District also changed the mandatory closure days for large discount marts from the second and fourth Sundays of each month to the second and fourth Wednesdays starting from February.

Outside Seoul, Daegu City and Cheongju City changed the mandatory closure days for large discount stores to weekdays starting from February last year and May last year, respectively.

[Graphics by Song Ji-yoon and Minu Kim]

According to a survey conducted by the Korea Chamber of Commerce and Industry in April, the average satisfaction rate among consumers of areas where mandatory closure days were shifted to weekdays was 81 percent.

After the conversion of Seocho District’s mandatory closure days for large discount marts to weekdays, one large discount mart in the area saw an increase of around 10 percent in the average number of Sunday customers from January to May compared to the same period last year.

Despite changes at the local government level to relax regulations, there has been no significant change in Korea’s regulations, which require two mandatory closure days per month for large discount marts and restrict early morning delivery.

The retail industry argues that over the past decade since the enforcement of the Distribution Industry Development Act, the protection of traditional markets, which was the goal of these regulations, has not been achieved, with consumers shifting their purchases to online platforms.

The proposed amendment to relax regulations on mandatory closure days for large discount marts and their online early morning delivery is expected to be discarded with the end of the 21st National Assembly.