Coupang 1Q Food Sales Up 20%... Domestic Market Growth Rate 3 Times Higher

"Q1 Sales Growth Centered on Small and Medium Enterprises"
Coupang Expands Assortment Including Rocket Delivery Food Items

Coupang announced on the 15th that its food sales in the first quarter of this year grew by 20% compared to the same period last year. This growth rate exceeds three times the growth rate of food sales in the domestic online and offline distribution market. Coupang attributed this achievement to overcoming the three major challenges of high inflation, high interest rates, and high exchange rates that have hit the domestic distribution market, and evaluated that the expansion of products emphasizing cost-effectiveness (performance relative to price) and quality by small and medium-sized food companies played a positive role.

Q1 Food Category Sales Growth Rate
Photo by Coupang.

Coupang stated that its food sales (excluding fresh food) in the first quarter of this year increased by 20% compared to the first quarter of last year. This growth trend in the food category is similar to Coupang's overall sales growth during the same period. Coupang's sales in the first quarter of this year recorded 7.399 trillion KRW (5.8053 billion USD), a 20% increase compared to the same period last year.

According to Statistics Korea, the growth rate of domestic online and offline food and beverage sales in the first quarter was only 6%. Coupang's growth rate is 3.3 times higher. During this period, the domestic online and offline distribution market (excluding retail sales of automobiles and fuel) grew by only 4%. The proportion of food and beverages in the overall distribution market in the first quarter of this year was the highest at 35%.

Coupang cited that the driving factor behind the food sales growth was that despite external difficulties such as high inflation and economic recession, small and medium-sized food manufacturers nationwide increased sales of food products with cost-effectiveness and quality. Coupang explained that by taking responsibility for logistics and distribution, including Rocket Delivery, and customer service (CS), while supporting food manufacturers to focus on product production and quality upgrades, a virtuous cycle effect is being created. Next-day Rocket Delivery and same-day delivery based on Rocket logistics infrastructure in over 100 locations across 30 regions nationwide also played a role in driving food sales growth.

Looking at Coupang's food sales from January to May this year, companies such as Daehan Flour Milling Co. (98%) and Gwangcheon Woori Wheat (41.6%) showed significant growth in the flour and pancake mix categories. In the seaweed category, medium-sized company Pulmuone Foods (234%), as well as small and medium-sized companies in various regions such as Gwangcheon Gim in Chungcheong Province (49%), fishing company Sunsuhaejak (221%), and agricultural corporation Jayeonhyanggi (615%) showed steep growth. Growth of small and medium-sized companies was also prominent in categories such as salt, curry/jjajang, and ssamjang.

Sales of 'S&Food' in Gangneung-si, Gangwon Province, which supplies Coupang's private brand (PB) 'GomGom Protein Bar,' jumped 15 times from 200 million KRW in 2019, the first year of entering Coupang, to 3 billion KRW last year. Jo Seong-eun, CEO of S&Food, said, "In a situation where all offline distribution store entries were rejected, we have steadily grown on Coupang by focusing on a cost-effectiveness strategy that increases grain and protein content even in a high inflation environment."

Coupang stated, "We will strengthen collaboration with small and medium-sized food companies that urgently need to expand their sales channels to increase their sales and job creation opportunities, while increasing the number of high-quality food products that will make customers say 'WOW' in this era of high inflation."

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