Hanssem Achieves '5-Day Construction' for 2024 Remodeling Projects

Kim Jin-tae, CEO of Hanssem, is presenting Hanssem's management strategy.
[Photo by Hanssem]

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[Asia Economy Reporter Kim Jong-hwa] Hanssem announced its plan to leap forward as a 'living tech company' based on IT technology that combines online and offline, aiming to realize '5-day remodeling construction' through construction method innovation and standardization of construction processes.

On the 15th, Kim Jin-tae, CEO of Hanssem, stated at the 'Analyst Day' for major domestic and international securities firms, "To achieve sales of 4 trillion KRW by 2026, we will focus on five key business areas: ▲digital transformation ▲innovation of construction processes ▲customer experience innovation ▲maximizing operational efficiency ▲and active pursuit of new businesses."

First, the strategy is to become an 'online platform company combining online and offline' through the realization of digital transformation. Hanssem plans to accelerate digital transformation in the home remodeling sector by adding IT technology to the foundation of its accumulated competitiveness in design, logistics, construction, and distribution, enhancing the 'information search' area so that customers can easily find all information and design by themselves.

The goal is also to realize '5-day construction' by 2024. Hanssem plans to shorten the construction period of entire home remodeling projects, which currently takes about 10 to 15 days, to a maximum of 5 days by 2024. The construction process, which causes dust, noise, and vibration throughout the construction period, has been a psychological barrier preventing customers from readily undertaking remodeling. Hanssem aims to achieve 5-day remodeling construction through 'innovation in construction methods' and 'standardization of construction' that can reduce construction time while improving finishing quality.

Hanssem also plans to innovate customer experience throughout the entire home interior process to make 'the customer's home the most desirable space to stay.' They have integrated marketing, customer consultation, and consumer protection-related organizations to establish the 'CX (Customer Experience) Innovation Headquarters,' and will strengthen 'quality indicators' standards that continuously monitor customer experience and prioritize improvements when quality service issues are detected.

To improve profitability, Hanssem will also focus on maximizing operational efficiency in core areas such as sales, SCM (Supply Chain Management), and product development. The Rehouse Business Division, responsible for remodeling, and the KB (Kitchen & Bath) Business Division, specializing in kitchen and bathroom, have been integrated into the 'Home Remodeling Business Division.' By unifying the previously dual remodeling-related organizations, they plan to create sales synergy across all stages from customer consultation, design, estimation to construction.

Hanssem will expand its business scope in the home interior field through active new business discovery such as overseas expansion, smart homes, and mergers and acquisitions (M&A). Based on successful domestic models, the overseas business plans to partner with offline home remodeling operators in the U.S., Japan, China, and Southeast Asia for online home remodeling businesses abroad. The smart home business will be actively developed by introducing a 'smart home package' where lighting, hoods, cooktops, electric beds, curtains, etc., are interconnected via the Internet of Things (IoT). They will also actively pursue investments in home remodeling startups, strategic alliances with related companies, and M&A to broaden core business areas.

Hanssem also plans to enhance corporate value through profitability improvement, focus on core businesses, and increased asset efficiency, while continuously implementing mid- to long-term shareholder return policies such as maintaining a dividend payout ratio above 50%, quarterly dividends, and share buybacks.

CEO Kim Jin-tae said, "Hanssem will grow not as a traditional manufacturing and distribution company but as a living tech company organically combining online and offline," adding, "Through this, we plan to achieve total sales of 4 trillion KRW by 2026, including 2 trillion KRW in the home remodeling sector."

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