[Reporter’s Notebook] A Step Late: The Relaxation of Large Mart Regulations

"If we allow dawn delivery, we could start as early as tomorrow. We just need to secure delivery vehicles. However, we need to consider whether dawn delivery is actually commercially viable."

The government is currently pushing to ease regulations that prohibit large supermarkets from operating from midnight to 10 a.m. If the law is amended, dawn delivery by large supermarkets, which has been banned for over 10 years to protect small local businesses, will be permitted. The large supermarket industry has long opposed the ban on dawn delivery, calling it an excessive regulation that hinders fair competition. The government's announcement to lift such regulations is something they welcome with open arms. However, the sentiment on the ground is lukewarm, with reactions like "Why bother now?"

The background is as follows. Coupang’s Rocket Delivery has explosively expanded the dawn delivery market during the COVID-19 pandemic. Consumer demand is also high. According to a survey conducted last year by the Korea Chamber of Commerce and Industry targeting 1,000 consumers aged 20 to 59, 9 out of 10 respondents (88.8%) said they would use dawn delivery if a large supermarket near their home offered it. Especially in areas where dawn delivery is currently unavailable, 84% expressed a desire for it.

However, the large supermarket industry is pessimistic about the commercial viability of dawn delivery. The industry consensus is that "the gap with Coupang is already significant." They believe it is too late for large supermarkets to catch up with the logistics network Coupang has built nationwide with a budget exceeding 6 trillion won. While large supermarkets can utilize existing stores to enter the dawn delivery market in earnest, significant investment in manpower is required. In a market where cutthroat competition is inevitable, latecomer large supermarkets cannot recklessly pour in funds.

In fact, latecomers who entered the dawn delivery market are scaling back their services. SSG.com, an affiliate of E-Mart, ended dawn delivery in the Chungcheong region including Daejeon in 2022 and is now focusing only on the metropolitan area, while Lotte Shopping has discontinued its own dawn delivery service.

About 10 years ago, a right-handed pitcher (large supermarkets) throwing at an average speed of 150 km/h was made to pitch left-handed to ensure fair competition with league pitchers (small local businesses) averaging 130 km/h. Meanwhile, a rookie player (Coupang) has grown to dominate the league, freely throwing fastballs exceeding 160 km/h and forkballs reaching 150 km/h. Now, they are telling the right-handed pitcher, who was only allowed to use the left hand for fair competition, to throw with the right hand again. The easing of large supermarket operating hour regulations is exactly this situation.

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