Small Business Shopping Mall 'Gachisapsida' Invested 11.7 Billion Won, but Sales Only 1.2 Billion Won

Average Annual Sales of 700,000 KRW per Location
About 860 Businesses with '0 KRW' Sales
National Assembly Planning Office "Effectiveness Must Be Reviewed"

[Asia Economy Reporter Kim Bo-kyung] It has been revealed that the total sales (over 13 months) of the online shopping mall exclusively for small business owners, which the government invested 11.7 billion KRW in, amounted to only 1.2 billion KRW. The number of tenant companies with no sales at all reached about 860. The National Assembly Budget Office urged, "The effectiveness relative to the financial input should be reviewed."

According to the Ministry of SMEs and Startups on the 29th, the sales performance of the small business online sales platform ‘Gachisapsida’ over about one year was recorded at 1.235 billion KRW. This is the report card from the platform’s launch in December 2019 to the end of December last year. There are a total of 1,768 tenant companies on Gachisapsida, and the average sales per company over about one year was calculated to be only 700,000 KRW. Even when combining sales generated from live commerce promotional events in collaboration with private channels such as TMON, WEMAKEPRICE, and 11st, the total sales amounted to only 3.53 billion KRW.

The Ministry of SMEs and Startups invested a total budget of 11.7 billion KRW in this platform project. In 2019, 700 million KRW was spent solely on platform construction, and last year, a total of 11 billion KRW was invested, including ▲24 billion KRW for platform operation and promotion, ▲6.6 billion KRW for cloud server transition, and ▲2 billion KRW for live commerce program operation. The budget was significantly increased through the third supplementary budget to build online and contactless sales channels in response to the COVID-19 crisis. However, during the same period, sales amounted to only 10% of the invested budget, showing poor performance.

[Image source=Yonhap News]

This platform only achieved ‘flash sales’ during two large-scale discount events last year. During the Korea Together Sale period in June and July, it temporarily recorded monthly sales exceeding 100 million KRW. In December, by holding a super special price event linked to the Christmas Market where one product was sold daily at a 99% discount, it earned about 400 million KRW in sales. At that time, the discount event became widely known, causing a surge in users that disrupted site access. However, once the discount events ended, sales inevitably declined, resulting in a disappointing report card. Nevertheless, the Ministry of SMEs and Startups reflected a budget of 9.7 billion KRW for Gachisapsida this year. In particular, it plans to invest an additional 1.5 billion KRW to discover products eligible for regular delivery among tenant companies and provide the service.

Criticism regarding Gachisapsida’s poor performance and low tenant effectiveness was also raised in the National Assembly. The Budget Office expressed the opinion that "it is necessary to closely examine the effectiveness of the platform project." According to the Budget Office, from December 2019 to September last year, the number of Gachisapsida tenant companies with no sales at all reached 862, accounting for 66.4% of the total. The Budget Office stated, "There are concerns about whether competitiveness can be secured compared to the private market," and "the sustainability of results relative to financial input should be reviewed."

A Ministry of SMEs and Startups official said, "Since September last year, we have been expanding live commerce in collaboration with private channels to increase awareness," and added, "We plan to complete the expansion of cloud servers by June this year to enhance user convenience."

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