A renewed focus on discount shopping, warehouse stores and affordable private label products is paying off for South Korean retail giant Emart, which reported its highest quarterly sales on record as consumers continued to seek value amid persistent inflation.
The strategy reflects a retail approach familiar to American shoppers, where competitive pricing, bulk purchases and store brands have become central to attracting customers.
Emart, the flagship retail company of South Korea’s Shinsegae Group, has strengthened those areas while investing in physical stores designed to offer more than traditional grocery shopping.
The results mark a significant achievement under Shinsegae Group Chairman Chung Yong-jin, whose efforts to strengthen the company’s core retail operations have delivered higher sales and improved profitability. Emart reported standalone third quarter revenue of $3.8 billion, up 11.1% from a year earlier and surpassing 5 trillion won for the first time. Operating profit jumped 46.3% to $124 million.
Emart attributed the gains to more efficient purchasing arrangements, aggressive discount promotions and stronger performance across its supermarkets and warehouse stores.
By combining procurement operations across its retail businesses, the company reduced purchasing costs while offering customers more competitive prices. The approach helped increase sales and improve profit margins during the quarter.
The impact was particularly evident during Emart’s flagship Great Festa promotional campaign. Sales generated during the event increased 29.2% from a year earlier, while customer visits climbed 14.7%.
Inflation also encouraged shoppers to turn to more affordable products. Revenue from 5K Price, Emart’s budget private label brand, more than doubled compared with the same period last year.
The growing popularity of value shopping also benefited Traders, Emart’s warehouse discount chain, which operates a retail format comparable to warehouse clubs familiar to American consumers.
Traders recorded its strongest quarterly performance on record, with revenue rising 16.6% to $872 million. Operating profit surged 40.5% to $41 million, establishing new quarterly highs in both categories.
The results reinforced the importance of warehouse retailing to Emart’s broader growth strategy as the company expanded its focus on competitive prices and bulk shopping.
Emart has also sought to strengthen its physical stores by transforming them into destinations where consumers can shop, relax and spend time.
Its Starfield Market concept combines supermarkets with leisure spaces and major retail tenants, creating a shopping environment that extends beyond traditional grocery purchases. The company identified the strategy as another contributor to its improved performance.
Growth extended to Emart Everyday, the group’s neighborhood supermarket chain, which benefited from coordinated purchasing, discount promotions and expanded rapid delivery services.
Emart Everyday reported third quarter revenue of $298 million, up 7.7% from a year earlier, while operating profit increased 11.1% to $8 million.
Emart24, the group’s convenience store business, also improved its financial performance, narrowing its operating loss to $2 million.
Several subsidiaries outside the company’s traditional retail business delivered positive results.
Josun Hotels & Resorts, Shinsegae Group’s hospitality subsidiary, reported operating profit of $16.8 million, up 2.7% from a year earlier. The increase was supported by growing international tourist arrivals and higher spending per guest.
Shinsegae Property, the group’s real estate development company, recorded operating profit of $22.5 million, while food manufacturer Shinsegae Food posted a $2 million profit.
Despite the strong performance of Emart’s core businesses, weakness at several subsidiaries weighed on the group’s consolidated earnings.
SCK Company, the South Korean company that operates Starbucks stores under a licensing arrangement with the American coffee brand, reported a third quarter operating loss of $33 million, compared with a $44 million profit a year earlier.
Revenue fell to $576 million from $659 million as the coffee chain continued to struggle following controversy over its Tank Day marketing campaign in May. SCK Company had already reported an operating loss in the second quarter, and its losses widened in the third quarter.
The downturn was significant because Starbucks Korea had traditionally served as one of Shinsegae Group’s major sources of cash flow.
The group’s ecommerce business, SSG.com, also remained unprofitable, although its losses narrowed as transaction volumes increased and its subscription membership program expanded.
SSG.com reported a third quarter operating loss of $19 million, an improvement from its $31 million loss a year earlier.
Including its subsidiaries, Emart reported consolidated third quarter revenue of $5.6 billion, up 1.2% from a year earlier. Operating profit declined 69.6% to $34 million, reflecting the impact of weaker earnings at businesses outside its core retail operations.
The difference between standalone and consolidated results highlights the progress Emart has made in strengthening its primary retail businesses, even as some subsidiaries continue to face financial challenges.
The company expects its earnings performance to improve from the fourth quarter onward as Chung’s strategy gains momentum.
Emart is also advancing major development projects, including Starfield Cheongna, a large shopping and entertainment complex in South Korea that forms part of Shinsegae Group’s efforts to expand its retail destinations.
Signs of a sales recovery at Starbucks Korea have also strengthened expectations that the business could resume contributing to group profitability.
Emart’s record quarter demonstrates how its renewed emphasis on traditional retailing has translated into measurable growth. Stronger warehouse sales, rising demand for budget products and improved purchasing efficiency have helped the company reach a new revenue milestone, laying the groundwork for a broader earnings recovery as its other businesses work to regain profitability.
