Competition with 500W bean sprouts
|Last month I paid attention to the government's plans to alleviate the regulations concerning the opening of mammoth retail establishments and the movements of the small retailer associations against the proposed legislation. After quoting figures from the Korea Federation of Small and Medium Business that during the last four years the large-scale discount stores have grown by 100% while 20% of small and medium businesses have closed their doors, Ohmynews goes to visit one "supermarket" keeper in Goyang, Gyeonggi province: how does a 10 p'yông (pyeong, 33 sqm) survive against the big discount stores.|
The supermarket introduced in the article is a Kosa-Mart (코사마트) franchise belonging to the 한국슈퍼마켓 협동조합연합회, which in English would be something like Korean Supermarket Association (can't find no homepage!). The man of the shopkeeper couple used to be a salaryman until 2003, when he decided to quit his company, which was apparently in the midst of legal proceedings. "I cried a lot, and we seemed to have no future," the woman told of the time when the man quit his job and they decided to open the store.
What the story tells about the couple and their shop is familiar to me from my own data on a couple of such places: taking care of the shop for 17 hours a day - and in this case the man goes to shop for fresh veggies in the wholesale market from where he comes back at 4 am. (Even though that I know that Koreans and especially keepers of small businesses can do wonders in reducing their sleep, I'd still think that it's the woman who opens the shop in the morning. Does she prepare the breakfast before that? She'd have to...)
One thing this small shop has in competing with retail giants is that it makes its purchases through the local association of supermarkets, which makes it kind of a cooperative (perhaps franchise that I used above is a wrong term). With the help of the local cooperative association the shop also has a real-time checks on its sales and stock. The shopkeeper couple points out that it's especially due to the association that they are able to survive in a situation where there are several large retailers in proximity. (There are many of those especially in these so-called new towns in the Gyeonggi province around Seoul.)
The difference of fees for small and large retailers is something I haven't yet tried to find out about.
"The government is telling that they're going to help the self-employed and small and medium companies, but supermarket keepers like us and the large retailes have a different starting point. All the expenses are too disfavorable for us. Large discount stores pay only 1.5% fee for the use of credit card, but we pay 2.5%. Use of credit card is growing, but when the commission is 2.5%, supermarkets want to avoid them, right?"
Categories at del.icio.us/hunjang: self-employment ∙ companies ∙ work ∙ businesskeepers