80% of Manufacturing Companies in Gwangju and Jeonnam Say Core Businesses Are Saturated or Declining

"Insufficient Marketability and Business Feasibility... Unable to Pursue New Businesses"
Gwangju Chamber of Commerce Survey on New Business Initiatives with 133 Companies

Exterior view of Gwangju Chamber of Commerce and Industry.

Eight out of ten manufacturing companies in the Gwangju and Jeonnam regions assessed that their main business sectors are either saturated or entering a period of decline.

According to the Gwangju Chamber of Commerce and Industry (Chairman Han Sangwon) on August 4, a recent survey titled "Current Status of Future New Business Initiatives" was conducted with 133 companies in the Gwangju and Jeonnam regions to understand their strategies in responding to changes in the internal and external industrial environment. Among the responding companies, 58.6% evaluated the overall market situation for their core business (products) as being in the "maturity stage (market saturation)." Additionally, 24.8% of companies considered their business to be in the "decline stage (market contraction)."

Regarding the competitive landscape in the market, 57.9% of companies responded that "competition has intensified as competitive gaps have disappeared," exceeding half of the respondents. Furthermore, 21.1% indicated that "competitors are catching up closely," confirming an overall trend of intensifying competition.

When asked whether they have initiated new businesses to respond to market stagnation or contraction, 56.4% said they are not pursuing such initiatives, while only 43.6% are either currently pursuing or considering new business ventures.

Regarding the initiation or consideration of new businesses to replace their main business in response to market saturation and decline, 56.4% said they are not pursuing such initiatives, while only 43.6% are either currently pursuing or considering new business ventures.

The main reasons for not pursuing new businesses were identified as follows: ▲lack of confidence in marketability and business feasibility (37.4%), ▲deteriorating business conditions such as lack of funds (33.3%), and ▲absence of new business items (20.0%). This indicates that uncertainty and financial burdens are acting as barriers to entry.

Among companies that have started new businesses, 65.5% are pursuing them through "in-house R&D," while 29.3% are responding through external collaboration, and 1.7% through mergers and acquisitions (M&A).

However, regarding the outcomes of new business initiatives, 48.3% responded that "it is still difficult to assess," which was the highest proportion. Meanwhile, 22.4% expect positive results, and 10.3% each cited "delays due to internal or external factors," indicating a lack of confidence in outcomes.

The biggest difficulties experienced when pursuing new businesses were ▲lack of funds and difficulties in raising capital (57.9%), followed by ▲challenges in securing sales channels and developing distribution networks (46.6%), ▲uncertainty in the new business market environment (43.6%), and ▲insufficient technology development and product completeness (23.3%).

Chae Hwaseok, Executive Vice Chairman of the Gwangju Chamber of Commerce and Industry, stated, "Although local manufacturing companies recognize the current market situation and the necessity of new businesses, the transition to new business is being delayed due to various constraints, such as funding, marketability, and workforce." He emphasized, "There needs to be both policy support for discovering new businesses and transitioning operations, as well as long-term strategies to strengthen corporate capabilities."

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