Incheon Seeking Mutually Beneficial Relationship between Traditional Markets, Supermarkets

In the Incheon Metropolitan City Mayor’s office, representatives of the top 3 leading domestic supermarkets gathered with Incheon merchant associations on Feb. 21 to hold a “Social Contribution Agreement Ceremony.” The purpose is to build mutually beneficial relationships between traditional markets and supermarkets.

This is the first time that large retailers have come together to sign a mutual agreement with local government to find a way to cooperate with local markets.

E-mart, Homeplus, and Lotte Mart agreed to offer a coexistence fund to support local merchants. In addition, the three companies plan to develop measures including transferring business and management expertise to provide real assistance to local markets.

Over the past 3 years, business regulations on big retailers have been the source of conflicts and disputes with smaller stores. Last year the Seoul High Court ruled that the restrictions on large retailers, which banned midnight operations and mandated closure two Sundays a month, were unlawful. The restrictions were put into place to aid small merchants at traditional markets. However, the measures turned out to have little impact on neighborhood businesses. Furthermore, shoppers crowded to the discount retailers on Saturday instead of going to traditional neighborhood markets on Sundays. Even the Swedish furniture giant IKEA complained that it has never experienced mandatory shutdown and regulations anywhere but in Korea, pointing out the inconvenience for consumers.

Mayor Yoo Jeong-bok emphasized the importance of the retail industry for all parts of society, and said that conflicts between the two markets will hamper national development. He said that Incheon would make a good example for other regions to achieve shared growth by establishing cooperation.