Today's Date:   Thursday February 07, 2013

1. ECONOMIC ISSUES

Korean Retail Industry Sales Totaled 300 Trillion Won in 2012 … Marked the Lowest Growth Since 2004 [Korean, OSY]

http://www.yonhapnews.co.kr/economy/2013/02/05/0318000000AKR20130205168200002.HTML

Summary: Korea National Statistics Office (NSO) reported on February 6 that total cash-register sales of retail industry amounted to 309 trillion won in 2012, up 3 percent from the previous year.  The 3 percent annual sales growth rate was the lowest level since 2004.

Korean Consumer Receives 10 Courier Service Deliveries Per Month on Average[Korean, OSY]

http://www.yonhapnews.co.kr/economy/2013/02/07/0301000000AKR20130207085800003.HTML

Summary: According to a survey by Korean Chamber of Commerce (KCC), each Korean consumer between 20 to 50 years old received 10.1 courier service deliveries on average per month in 2012, which was much higher than 7.1 deliveries reported in a survey in 2011.  KCC explained that rapid expansion of on-line shopping among the consumers is responsible for the steep rise in the number of courier service deliveries.  Products received most in courier service deliveries were clothing and cosmetics (27.4% each), followed by books and documents (24.6% each), house goods including electronics (22.2%) and agricultural products (20.8%).

2. MARKETING ISSUES

Large-scale Franchise Bakery Chains are Prohibited from Opening New Outlets within 500 Meter Radius from Existing Outlets … Annual Expansion of Large-scale Restaurant Chains is Restricted to Less than 2% of Existing Outlets [Korean, OSY]

http://news.donga.com/3/all/20130206/52848739/1

Summary: ‘Harmonized Growth Committee’ under the Korean government announced on February 5 that bakery and restaurant business belongs to one of 14 designated industries that are subject to measures of protecting small business from large-scale companies.  As a result, large-scale bakery chains will be prohibited from opening new outlets within 500 meters from existing bakery shops.  In addition, the number of new outlets that each franchise can open in a given year is limited to 2 percent or less of existing outlets.  The measures will take effect from March 2013 through February 2016.  Large-scale restaurant chains are prohibited from expanding the number of outlets over what they had at the end of 2012.  .  The measures will take effect from March 2013 through February 2016.  But the measure will not be applied in newly constructed residential areas and traffic hubs.  ‘Large-scale company’ is defined as a company that hires 200 employees or more and earns over 20 billion won of cash-register sales a year.  Many industry analysts agree that the restriction has many loopholes.  For example, mid-size bakery and restaurant companies (many of them under the umbrella of conglomerate business groups) are not subject to the restriction.  Café chains are also excluded from the restriction.  In addition, companies under foreign ownership, such as Outback Steakhouse, are not subject to the restriction.

Shinsegae E Mart under Investigation for Alleged Violation of Labor Union Law [Korean, OSY]

http://www.yonhapnews.co.kr/economy/2013/02/07/0302000000AKR20130207104600003.HTML

Summary: Investigators under Seoul Provincial Government Labor Office visited 10 offices under Shinsegae E Mart, including the headquarter, on February 7, searching for evidences of violation against labor union law.  Sinsegae E Mart has allegedly taken various illegal measures to prevent the employees from organizing a labor union.  By the way, CEO Y.G. Jung of Shinsegae E Mart has also been under investigation by Seoul Prosecutor’s Office for violation of anti-trust law.  NGO groups have indicted Shinsegae E Mart for having illegally supported its sister company, Shinsegae SVN, by charging much lower commission for selling bakery products in E Mart stores.