Does Starfield Close on Weekends Too... Countdown to Distribution Regulation

Retail Industry Concerns Over Implementation of Complex Shopping Mall Operating Restrictions
70% of Complex Shopping Mall Stores Are SMEs and Small Businesses, Facing Reverse Discrimination
Analysis Also Shows Complex Shopping Malls Revitalize Local Commercial Areas

[Asia Economy Reporter Lim Hye-seon] The distribution industry is on high alert over the 'variable restrictions on complex shopping mall operations.' This is due to concerns that the ruling party, which won a landslide victory in the 21st National Assembly elections, may actualize policies restricting the opening and operation of complex shopping malls. Offline retailers, struggling amid the growth of e-commerce, economic recession, and the impact of the novel coronavirus disease (COVID-19), now face the risk of new regulations once again.

According to the distribution industry on the 18th, the joint policy pledges of the Democratic Party of Korea and its proportional satellite party, the Together Citizens' Party, include regulations on complex shopping malls such as location restrictions from the urban planning stage, operating hour limits, and mandatory closing days, similar to large supermarkets. Although the complex shopping mall regulation bill was pending in the 20th National Assembly, it is expected to accelerate legislation with the emergence of the dominant ruling party.

If this pledge becomes a reality, complex shopping malls like Shinsegae Starfield and Lotte World Tower will have to close twice a month like large supermarkets. The requirements for opening new stores will also become stricter, making it practically difficult for new complex shopping malls to open. A distribution industry official stated, "Although this measure is said to protect small business owners, 70% of the stores in complex shopping malls are operated by small and medium-sized enterprises and micro-businesses," adding, "This will actually result in reverse discrimination against them." He continued, "Weekend sales at complex shopping malls are more than three times those on weekdays, so designating mandatory holidays will increase difficulties for tenant businesses."

In fact, there is analysis that complex shopping malls revitalize local commercial districts. According to a survey by the Korea Distribution Science Association on 'The Impact of Complex Shopping Malls on Surrounding Stores and Customers,' sales in the commercial district within a 5 km radius increased by 6.3% compared to the previous year just one year after Starfield City Wirye opened.

The industry expects that changes in consumer patterns accelerated by COVID-19 will further weaken the competitiveness of the offline market. Experts believe that now is a time for measures to stimulate consumption rather than regulations.

Professor Ahn Seung-ho of Soongsil University said, "If complex shopping malls are regulated, the growth of offline retailers will be zero," adding, "Now is the time for consumption stimulation measures rather than regulations."

Park Jin-yong, president of the Korea Distribution Science Association, pointed out, "We need to seek activation plans and win-win strategies where distribution formats can establish themselves," and emphasized, "We should avoid a direction that aims solely at regulation." He added, "For the distribution industry to grow, offline stores such as shopping malls, department stores, and marts must develop in a balanced way by leveraging their strengths," emphasizing, "It is important to create an environment where various offline businesses can freely develop new formats in the market."

Meanwhile, the temporary easing plan for mandatory closures of large supermarkets, which had been under review by local governments after the COVID-19 outbreak, is also facing difficulties. Andong City in Gyeongbuk is the first to discuss the temporary easing of mandatory closures for large supermarkets, but it is reported that no decision has been made due to opposition.

This content was produced with the assistance of AI translation services.