Exclusive: Nitori closes third store in South Korea, raising exit concerns

Nitori, Japan’s largest furniture and home furnishings retailer, has shut down its third store in South Korea, the company confirmed on June 13. The closure comes just two months after it shuttered its first store in the country, located at the Emart Hawolgok branch. Less than two years into its South Korean expansion, the company’s decision to close both its flagship location and another branch in rapid succession is being described by industry observers as highly unusual. Some speculate the company may be weighing a full withdrawal from the market.

The Nitori store previously located inside the Homeplus Gayang branch was found closed and covered on June 12. According to Homeplus, the store ceased operations after May 31./Min Young-bin

Established in 1967 as a furniture specialty store, Nitori has evolved into a mid-range Japanese lifestyle brand offering a wide range of products, including daily necessities and household goods. In South Korea, the company sells more than 8,000 items, from compact and mid-sized furniture such as mattresses, sofas, and storage units to various interior and lifestyle products. Known for its SPA (Specialty store retailer of Private label Apparel) model—integrating product planning, manufacturing, logistics, and retail—Nitori has been dubbed “Japan’s IKEA” for its expansive offerings and competitive pricing.

Graphics by Son Min-kyun

The company officially entered the South Korean market in November 2023 with the opening of its first brick-and-mortar location at Emart Hawolgok. By August 2024, Nitori had launched five additional stores in quick succession, signaling an aggressive expansion strategy. At the time, Takeda Masanori, chairman of Nitori Korea, announced the company’s goal of operating 2,000 overseas stores by 2032, naming Seoul as a strategic hub and outlining plans to open 200 locations across South Korea within a decade.

All six stores adopted a “shop-in-shop” model, operating within major retail chains such as Emart and Homeplus. Rather than establishing standalone warehouse-style stores akin to IKEA, Nitori focused on accessibility and convenience by situating its outlets in large hypermarkets across the Seoul metropolitan area. However, the company has not opened any new stores since August 2024.

Graphics by Chung Seo-hee

Nitori has not disclosed sales figures for its South Korean operations. A Nitori Korea spokesperson confirmed in a phone call with ChosunBiz that the stores at Emart Hawolgok and Homeplus Gayang had been closed but declined to comment on the reasons behind the decision.

Industry sources suggest that the wave of closures—occurring just three months after the flagship store shut its doors—may be linked to the financial crisis facing Homeplus, which has entered corporate rehabilitation. With four of Nitori’s six stores located inside Homeplus branches, the Japanese retailer may have been significantly affected by the hypermarket’s decline.

“The Homeplus rehabilitation filing is the culmination of prolonged operational struggles,” one industry official said. “If overall foot traffic was already low, even fewer customers would have visited Nitori’s in-store sections. It’s likely this triggered a chain reaction.”

Lee Jong-woo, a professor of business administration at Ajou University, pointed to shifting consumer behavior as another contributing factor. “Furniture and kitchenware are increasingly purchased online,” he said. “With declining visits to physical stores, Nitori’s retail sales likely suffered. Against this backdrop, Homeplus entering court receivership may have cast additional uncertainty over its prospects, prompting Nitori to preemptively recover part of its investment.”

A Homeplus representative, however, denied any direct connection between the company’s legal proceedings and the Nitori closures. “The decision to close Nitori stores had been previously agreed upon and is unrelated to our rehabilitation process,” the official said. “Nitori ended operations at the end of May as part of a strategic realignment.”

Some industry analysts believe that, beyond sluggish demand in South Korea’s furniture and home décor market, Nitori’s broader market strategy may have run into complications. In a worst-case scenario, they say, the company could ultimately decide to exit the South Korean market entirely.