Homeplus Considers Suspending Operations at 5 Out of 15 Stores with Deferred Closures

Normal Operations Virtually Impossible Due to Reduced Delivery Volumes
Staff to Be Transferred to Other Stores, 100% Employment Guaranteed

Homeplus announced on December 2 that it has decided to consider suspending operations at five out of the 15 stores whose closures had been put on hold, citing that its cash flow has reached its limit.

On this day, Homeplus stated, "In order to prevent insolvency, we have been forced to consider suspending operations at some of the 15 stores whose closures were postponed, particularly those with significant deficits."

Yonhap News Agency

The company explained, "Liquidity issues have been further aggravated as the restoration of trading terms with major suppliers and normalization of deliveries have been delayed. With reduced delivery volumes leading to lower sales, it has become virtually impossible to conduct normal business operations, while fixed costs continue to accrue. As a result, our cash flow and business performance have significantly deteriorated."

Back in August, Homeplus entered an emergency management system across the company and decided to close 15 stores where rent adjustments had not been achieved as part of emergency measures for survival. The company cited a severe deterioration in its management situation due to worsening liquidity caused by stricter trading terms from major suppliers and a reduction in delivery volumes.

Subsequently, after discussions with the parliamentary task force for the normalization of the Homeplus situation, the company decided to postpone the closures of the 15 stores until the end of the year, on the condition that trading terms with major suppliers would be restored to pre-restructuring levels, liquidity issues would be resolved, and delivery volumes would return to normal.

However, Homeplus stated that for some stores, it has become difficult to carry out even basic work necessary to maintain operations, leading to the decision to close five stores. From a workforce management perspective, the company explained that uncertainty following the commencement of rehabilitation procedures has increased anxiety and led to ongoing employee departures, making normal operations challenging.

Homeplus plans to guarantee 100% employment by transferring the staff from the five stores to other locations facing staff shortages, thereby ensuring continued operation for all employees.

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