Chairman Jeong Ji-seon Emphasizes "Challenge," Says "We Must Prepare for a New 50 Years"

49th Anniversary Celebration, Message to Executives and Employees

[Asia Economy Reporter Lim Hye-seon] Chung Ji-sun, Chairman of Hyundai Department Store Group (photo), called it a "critical time" on the occasion of the 49th anniversary of the company's founding. He also said, "If we do not actively and boldly take on challenges, we will not become a 100-year company, but only a 50-year company." This statement was also meant for himself, who is focusing on expanding new businesses.

According to the distribution industry on the 18th, Chairman Chung recently conveyed this message to employees through the company bulletin board. He began by saying, "Among about 2,000 large companies, only 90 have continued their business for more than 50 years," and "The average lifespan of the global top 500 companies is also shortening to 15 years." He added, "We must take pride in our company," and "Let's prepare for a new 50 years by leveraging our strengths and build a 100-year company."

While Chairman Chung had previously emphasized steady management by cautiously proceeding step by step, this year he is focusing on reshaping the business through proactive investments. This includes the sale of Hyundai HNC, entry into the cosmetics business, and expansion of duty-free shops. The reason Chairman Chung is actively pushing for 'change' is understood to be his judgment that the current distribution industry structure cannot survive the industrial paradigm shift.

The business Chairman Chung is most dedicated to is cosmetics. The luxurious image of the fashion brand Handsome is sufficient to create synergy with distribution channels such as department stores and duty-free shops. The group entered the cosmetics business by acquiring a 51% stake in Cleanzen Cosmeceutical, a cosmeceutical (functional cosmetics with medicinal ingredients) specialist company, through its affiliate Handsome. They are also pursuing the acquisition of SK Bioland, a natural cosmetics raw material company. Since SK Bioland is also involved in pharmaceuticals and medical devices, if Hyundai Department Store Group succeeds in acquiring it, they can enter the pharmaceutical sector in the mid to long term.

They are also strengthening their explosively growing online business. Along with the existing specialized malls such as Hyundai H Mall, The Hyundai.com, The Handsome.com, and Livart Mall, they will challenge the dawn delivery market in the second half of the year. Hyundai Department Store will launch 'Hyundai Food Hall To Home,' an online mall specializing in fresh food delivery, in July. The concept is to deliver over 5,000 products from Hyundai Department Store's food hall to customers' homes. In addition to dawn delivery, they plan to offer a specialized service that delivers food from department store restaurants to nearby areas within 1 to 2 hours during the day.

The duty-free business is also undergoing an expansion strategy to achieve economies of scale. They acquired the duty-free store site vacated by Doosan in the second half of last year and opened a downtown duty-free shop in Dongdaemun, Seoul, in February. They also won the duty-free business rights at Incheon Airport (Terminal 1 DF7 fashion and accessories) and will start operations in September.

Unlike competitors who are restructuring offline retail stores, the group is increasing large stores. Starting with Hyundai Premium Outlet Daejeon in June this year, they plan to open three large stores in succession: Hyundai Premium Outlet Namyangju (November this year), and Hyundai Department Store Yeouido (tentative name, January next year). In particular, Hyundai Department Store Yeouido will be the largest in the Seoul area with a sales area of 89,300㎡ (about 27,000 pyeong). They aim to present a new future model for the distribution industry based on advanced retail tech and differentiated MD strategies. Once these stores open, the group will operate 16 department stores and 8 outlets. Through Hyundai Green Food, a comprehensive food company, they have also actively entered the care food market, launching the care food specialized brand 'Greeting' in March.

A Hyundai Department Store Group official said, "We are proceeding with new projects according to business strategies based on 3-5 year cycles," and "We will secure growth engines to prepare for the future."

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