"Small Business Owners Suffer Huge Losses Due to COVID-19... Oppose Mandatory Closure Abolition for Large Marts"

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Stock photo of a large supermarket / Photo by Moon Honam munonam@

[Asia Economy Reporter Kim Bo-kyung] "Mandatory closure of large discount stores is the minimum measure to prevent monopolization by large distribution corporations and distortion of the distribution market transaction order."

The small business sector voiced opposition to the abolition of mandatory closure for large discount stores. They argued that small business owners were the ones hit hardest by the shift to online distribution after COVID-19 and that the mandatory closure system must be maintained.

The Korea Federation of Small and Medium Business, the National Merchants Federation, and the Korea Supermarket Cooperative Federation held a joint press conference on the 10th at the Korea Federation of Small and Medium Business conference room. They opposed the abolition of mandatory closure for large discount stores and urged a halt to efforts to ease regulations on online delivery.

Oh Se-hee, president of the Korea Federation of Small and Medium Business, emphasized that the mandatory closure system for large discount stores, implemented under the Distribution Industry Development Act in 2012, is a "social safety net" for the survival of small business owners in neighborhood markets, local supermarkets, and traditional markets.

He added, "(Reforming the mandatory closure system) would cause irreparable loss to small business owners who struggled under extreme conditions while fulfilling social responsibilities and duties during the COVID-19 period, inflicted by large corporations and the government."

A traditional market in downtown Seoul.
Photo by Mun Ho-nam munonam@

President Oh said, "The rapid changes in the distribution environment are a reality affecting both large corporations and small business owners alike," and "the market shares of both small business owners and large discount stores have decreased."

He cited Statistics Korea data, explaining that in 2020, when COVID-19 occurred, sales at large discount stores increased by 4.2% compared to the previous year, while sales by small business owners decreased by 9.9%, resulting in huge losses.

He criticized, "During the two years that were like a disaster for small business owners, the large distribution industry, which relatively enjoyed a boom, complains about 'unequal competition' with the online market," and "they are disguising themselves as the only victims in the changed distribution environment."

Finally, he demanded, "Please propose a win-win solution to correct the unfair competition between large distribution giants and small business owners in neighborhood markets and to somewhat restore the tilted playing field of the distribution order."