"Due to COVID-19 Impact," Shinsegae Duty Free Decides to Withdraw Gangnam Branch in July

[Asia Economy Reporter Yuri Kim] Shinsegae Duty Free is withdrawing from its Gangnam branch after failing to withstand the impact of COVID-19.

According to the distribution industry on the 16th, Shinsegae Duty Free decided to cease operations at its Gangnam branch located in Central City, Seocho-gu, Seoul, after July 17. This comes three years after opening the Gangnam branch in 2018, which spanned a total of 5 floors and 13,570㎡. Following this, the number of stores operated by Shinsegae Duty Free will be reduced to three: Myeongdong, Busan, and Incheon Airport branches.

Shinsegae Duty Free was paying approximately 15 billion KRW annually in rent for the Gangnam branch. The industry views that due to a sharp decline in visitors caused by COVID-19, the company judged it could no longer bear this cost. Last year, Shinsegae DF, which operates Shinsegae Duty Free, recorded sales of 1.903 trillion KRW, a 42.4% decrease compared to the previous year, and posted an operating loss of 42.6 billion KRW, turning to a deficit.

Employees working at the Gangnam branch, including partner companies, are expected to be relocated to Shinsegae Duty Free’s Myeongdong branch and others. Shin Yoon-yeol, CEO of Shinsegae DF, stated, "The suspension of operations at the Gangnam branch is part of a business restructuring for the survival of the company," adding, "We will strive to improve the overall structure of the duty-free business."