SMEs Partnering with Coupang Triple in 5 Years... Employment Surpasses 23,000

Partnering Small and Medium Manufacturers Surpass 550 as of Last Year-End
9 out of 10 Are Small and Medium Manufacturers
Cases of Recovery Overcoming Bankruptcy Crisis Also Included

The number of small and medium-sized manufacturers producing and supplying Coupang's private brand (PB) products has more than tripled in the past five years. Their sales and employment figures have also shown an upward trend despite the low-growth environment.

Coupang announced on the 8th that the number of small and medium-sized manufacturers collaborating with CPLB, Coupang's PB subsidiary, exceeded 550 as of the end of last year. This is more than three times the approximately 160 companies at the end of 2019, representing a 20% increase compared to the previous year.

Coupang achieved an operating profit of over 600 billion won last year, marking its first annual profit in 14 years since its founding in 2010. The photo shows Coupang headquarters in Songpa-gu, Seoul, on the 28th. Photo by Jinhyung Kang aymsdream@

The number of employees at these partner small and medium-sized manufacturers surpassed 23,000 as of the end of January. This is an increase of about 3,000 employees in 10 months from 20,000 in March last year. According to Statistics Korea, the number of employed people in South Korea decreased by 1.7% from March last year to January this year, yet the employment at small and medium-sized manufacturers partnered with Coupang increased. The sales of these 550 small and medium-sized manufacturers increased by 20% compared to the previous year.

Among the 10 partner companies operating Coupang PB under CPLB, such as GomGom, Tamsa, Comet, and VitaHalo, nine are small and medium-sized manufacturers. They account for about 80% of the sales of Coupang PB products. Coupang explains that the more consumers purchase Coupang PB products, the more employment and sales increase for small and medium-sized manufacturers.

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Coupang receives PB products from these companies and is responsible for ▲marketing ▲logistics and distribution such as Rocket Delivery and Rocket Fresh (fresh food dawn delivery) ▲customer service (CS). Thanks to this, small and medium-sized manufacturers can focus solely on product production and quality.

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Coupang explains that PB products created in this way provide growth opportunities for small and medium-sized manufacturers. More than 80% of the small and medium-sized manufacturers cooperating with Coupang are located outside Seoul, creating employment opportunities in regions facing population decline.

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"Overcoming bankruptcy crisis thanks to Coupang"... Increased sales and even overseas expansion

The number of small and medium manufacturers of PB products partnered with Coupang surpasses 550 for the first time in history.
[Image provided by Coupang]

Small and medium-sized manufacturers cooperating with Coupang are experiencing effects such as increased sales and overseas expansion. Deungpureun Food, a seafood producer in Busan, is a representative example. This company overcame a bankruptcy crisis thanks to Coupang PB. Established in 2000, Deungpureun Food faced a crisis in 2011 due to inventory management failures and entered court receivership in 2015.

However, after starting to supply PB products to Coupang in 2019, it continued rapid growth and ended court receivership in 2022. Deungpureun Food's sales grew 29 times from 300 million KRW in 2019, the first year of joining Coupang, to 8.6 billion KRW last year. The growth in sales and profits from supplying Coupang PB products helped overcome the bankruptcy crisis. The number of employees also more than doubled from 22 to 48 last year. Lee Jong-su, Vice President of Deungpureun Food, explained, "The decisive reason for overcoming the bankruptcy crisis was Coupang's system responsible for cost reduction through large-scale supply, Rocket Delivery, customer service (CS), and marketing."

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Chowon Food, an instant food company in Gimpo, Gyeonggi Province, also saw a significant increase in sales through Coupang PB. Ten products made by Chowon Food, including GomGom Galbitang and Budae-jjigae, are bestsellers in their respective categories. Chowon Food's sales surged from 1.1 billion KRW to 6.7 billion KRW over the past four years. Lee Gyu-jin, CEO of Chowon Food, said, "Coupang's strict quality control system greatly improved product competitiveness, and as the collaboration with Coupang became known, the number of business partners increased, enhancing competitiveness."

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With Coupang's expansion into Taiwan, PB small and medium-sized manufacturers are also increasing exports overseas. KF Korea Natural Agriculture, a health food manufacturer, saw its sales triple from 700 million KRW in 2019 to 2.1 billion KRW in 2023. Ten products, including VitaHalo cabbage juice and pumpkin juice, have gained popularity among local customers through Taiwan Rocket Delivery. Kim Yong-hak, CEO of KF Korea Natural Agriculture, said, "We are pioneering overseas markets through Coupang as well as growing in the fiercely competitive domestic food market."

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A Coupang official said, "We plan to expand PB products in various categories such as food, beauty, and fashion to offer high-quality products at reasonable prices that satisfy customers. We will help small and medium-sized manufacturers with product competitiveness increase sales and create jobs, while also easing the burden on customers struggling with high interest rates and economic recession."