E-Land to Close 5 Underperforming Stores This Year

First Half: 3 Locations, Year-End Adds 2 More
Store Lease Contracts End... No Extensions
Total 5 Store Closures... Possible Restructuring Next Year
Emergency Management Activated Due to First Revenue Decline

E-Land Retail plans to close the 'Newcore Outlet Ansan Branch' on the 31st of this month. A total of five locations are expected to cease operations this year.

[Asia Economy Reporter Cha Min-young] E-Land Retail, which recorded double-digit sales decline for the first time since its establishment due to the impact of the novel coronavirus infection (COVID-19), is accelerating restructuring by closing five underperforming stores this year alone.

According to industry sources on the 9th, E-Land Retail plans to cease operations of NewCore Outlet Moran Branch and Ansan Branch as of December 31. The Moran Branch and Ansan Branch have been operating for 10 and 12 years respectively, and are currently holding final farewell sales to clear inventory ahead of closure. E-Land Retail declared an emergency management earlier this year and is hastening the cleanup of underperforming stores. In the first half of this year alone, it closed three stores including Songdo NC Department Store Canal Walk Branch, Daegu Dong-A Outlet Main Branch, and 2001 Outlet Suwon Nammun Branch, as well as some cultural centers. Once this restructuring is completed, 46 stores will remain, including 19 NC Department Stores, 15 NewCore Outlets, 5 Dong-A Outlets, and 7 2001 Outlets.

There is also a high possibility that restructuring will continue targeting some stores in the first half of next year. This is because the growth potential of offline distribution business has slowed down, making it inevitable for E-Land Retail, which primarily operates department stores and discount stores, to undergo structural changes. E-Land Retail's sales on a consolidated basis entered the 2 trillion KRW mark for the first time in 2017 with 2.0638 trillion KRW, but growth slowed to 2.151 trillion KRW in 2018 and 2.1067 trillion KRW in 2019.

Especially, with the COVID-19 situation overlapping at the beginning of the year, sales recorded a double-digit decline for the first time since establishment as of the first half of this year, triggering warning signals. In response, E-Land Retail CEOs Seok Chang-hyun and Kim Woo-seop sent an email to employees in August mentioning management uncertainties related to the COVID-19 crisis. The crisis management level was also raised by one step. Executives returned 50% of their salaries, officers 30%, and leaders gave up their position allowances to tighten their belts, but they judged that stronger measures were necessary and internally issued such orders.

An E-Land Retail official explained, "This store closure is part of measures to improve business efficiency," adding, "We plan to develop stores in a new direction by focusing on core commercial districts like the newly opened NC Shin Guro Branch this year and pursuing tenant changes."

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