[Square] 'Smart Small Business Owners' in the Post-Corona Era

The novel coronavirus disease (COVID-19) is changing our lives. The key keywords are contactless and digital transformation. In the distribution sector, the trend of applying new technologies such as online and mobile usage expansion, big data, Internet of Things (IoT), and artificial intelligence (AI) is becoming more solid. Small business owners and traditional markets are equally affected.

Looking around, you can feel the trend of change. From some point onward, people no longer frequently visit offline stores such as large marts. Agricultural products including vegetables and fruits, as well as manufactured goods, are being purchased well through online and mobile channels. Korea’s delivery system is more competitive than any other country in terms of speed and accuracy. There is endless competition such as Rocket Delivery and Dawn Delivery. It is also evaluated that our well-organized delivery system made social distancing possible during COVID-19.

In general stores, new technologies and concepts such as kiosk ordering counters, electronic menus, internet and QR code ordering, and robot baristas are being applied. Sales methods are also expanding in various unfamiliar ways including not only stores, home shopping, and online malls but also live commerce, V-commerce, and podcasts.

Distribution will engage in infinite competition for consumer convenience. Any distribution channel must respond to these changes. Otherwise, survival itself may be difficult. It is only a matter of timing and speed. This situation is also reflected in numbers. Looking at sales by distribution channel, online sales show an annual growth rate of 15-20%. Offline distribution channels such as department stores, large marts, and traditional markets show stagnation or low growth rates. This trend is expected to advance further through the COVID-19 period.

Currently, small business stores and traditional markets are not familiar with these changes. They have limitations such as small capital and aging. In this situation, since last year, the Ministry of SMEs and Startups has been actively promoting the smartization and online advancement of small business owners. The Small Enterprise and Market Service plays a role in field execution. This content is also included in the recently announced 'Korean New Deal Comprehensive Plan.' It plans to actively support this through building a data ecosystem in the small business sector.

First, it plans to support small business owners in applying advanced smart technologies. The idea is to apply advanced technologies from the private distribution sector to small business stores as well. Customers can pre-order via the internet or place contactless orders at store kiosks. Electronic menus will also be installed to provide diverse product information. Large signage promotions will be conducted.

Automatic ordering will be linked to parcel delivery and delivered to consumers. In the fashion and clothing sector, new technology mirrors will be used to support consumer choices. Smart workshops suitable for small-scale manufacturing sites will also be promoted. These activities will be carried out within a digital data ecosystem. This will lead to expanded sales opportunities and labor savings.

In addition, active promotion of traditional markets’ online advancement is planned. Until now, there have been many cases where individual stores increased sales using online channels. However, there have been almost no cases where multiple stores with various products participate at the market level.

At the market level, the range of consumer choices widens and various services become possible. There are new companies building systems, such as N companies, and existing N portals. Although they have only started 1-2 years ago, they are expanding their areas by establishing new digital systems and delivery structures. Recently, about 20 traditional markets have started. Although currently applied mainly in the metropolitan area due to ordering and delivery conditions, it will be expanded to regions as well. Small business stores and traditional markets must be reborn as convenient spaces for consumption.

Jo Bonghwan, Chairman of the Small Enterprise and Market Service

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