As the business performance of SSMs (corporate-type supermarkets) continues to decline, GS The Fresh is achieving both expansion in scale and strengthening of profitability. Analysts suggest that its strategy of capturing nearby shopping demand and bolstering quick commerce has led to improved financial results. GS The Fresh plans to solidify its dominant position in the SSM market through aggressive franchise expansion.
According to the retail industry on the 18th, GS The Fresh reported sales of 469.8 billion won for the second quarter, a 10.1% increase compared to the same period last year. Operating profit also rose by 72.2% during the same period to reach 9.3 billion won. This marks a period of isolated growth while SSMs have been in contraction since December last year. According to the "Trends in Sales of Major Retailers" released by the Ministry of Trade, Industry and Energy, SSM sales in June decreased by 10.8% compared to the same period last year.
Not only financial performance but also physical expansion stands out. GS The Fresh increased its store count by 36 locations compared to the same period last year, bringing the total number of stores to 596—the highest among domestic SSMs. With growth in sales and operating profit alongside store expansion, the company is strengthening its position within the industry.
The situation of competitors presents a somewhat contrasting picture. Lotte Super turned into a loss-making business in the second quarter and reduced its store count by 32 locations. E-Mart Everyday also saw a decrease in the number of stores compared to the previous year. Homeplus Express is undergoing normalization efforts following its acquisition by NS Home Shopping.
Industry observers point to the capture of nearby shopping demand as the background behind GS The Fresh's growth. GS The Fresh has secured location advantages by operating stores centered around residential areas and key urban commercial districts. Additionally, it offers a wide range of fresh products comparable to those found in large-scale department stores, thereby increasing customers' purchase frequency.
Strengthening delivery competitiveness by linking offline LINE stores with quick commerce is also cited as a growth factor. GS The Fresh operates quick commerce services at all its stores, allowing customers to receive their orders within one hour after placing them. In fact, GS The Fresh's second-quarter quick commerce sales increased by 49.6% compared to the same period last year. Its share of total sales also reached 9.9%, marking a record high.
GS The Fresh is accelerating its franchise business expansion and plans to further broaden customer touchpoints. It will strategically open new stores centered around key urban commercial districts and strengthen product assortments tailored to each district's characteristics. In particular, the company aims to expand its store count to over 620 locations within this year, further solidifying its position as the industry leader.
A GS Retail official stated, "We have quickly established a franchise structure by applying our 30 years of accumulated expertise in franchise business to the supermarket sector," and added, "We plan to continue expanding customer touchpoints in the future."
in LIVING
