Large Retailers Threaten Small Business Owners with Closure,
But Some Hope for a 'Trickle-Down Effect'
Opinions are divided between small business owners and local organizations regarding the planned opening of the American warehouse discount retailer Costco in Iksan.
The "Emergency Countermeasure Committee to Prevent Costco from Entering Iksan" (hereinafter referred to as the Committee) held a press conference in front of the Costco Korea headquarters on the 22nd, strongly demanding a halt to the efforts to open a Costco branch in Iksan.
Cars of customers visiting the American membership-based warehouse Costco Gimhae branch are lined up in front of the parking lot. Photo by Yonhap News
The Committee stated, "The opening of a Costco branch in Iksan will push not only small business owners and self-employed people in Iksan but also throughout the entire North Jeolla region to the brink of crisis." They argued, "Costco’s vast capital and overwhelming sales capacity will shake the foundation of the local commercial district and drive countless small business owners to the edge of survival."
While Costco claims that its entry into Iksan will attract a floating population and create between 100 and 200 jobs, the Committee countered that there is no realistic verification of these economic effects. Instead, they argued that a large number of small local stores would be forced to close down.
The Committee also raised concerns about the structure in which Costco’s profits are remitted to its overseas headquarters, warning that if Costco opens in Iksan, tens of billions of won in local capital could flow overseas every year.
Some Expect a 'Trickle-Down Effect' from Large Retailers
On the 22nd, the Emergency Countermeasure Committee to Prevent Costco from Entering Iksan held a press conference in front of the Costco Korea headquarters in Gwangmyeong, Gyeonggi Province. Photo by Jeonbuk Jeonju Supermarket Cooperative
On the other hand, some local organizations support the opening. Civic groups in Iksan and horticultural agricultural cooperatives are reportedly in favor of Costco’s entry, expecting it to revitalize the local economy and expand sales channels for agricultural products. As consumer spending stagnates for a prolonged period, there are voices hoping for a 'trickle-down effect' from large retailers.
Meanwhile, Costco Korea previously attempted to enter the Honam region, including Suncheon in South Jeolla Province (2012) and Jeonju and Wanju in North Jeolla Province (2017), but failed due to opposition from local small business owners. Currently, Costco operates 20 stores in South Korea, mainly in the Seoul metropolitan area, Gyeonggi, Incheon, as well as the Chungcheong and Yeongnam regions.
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