December 19, 2014 12:39
This time of year is traditionally the busiest shopping season, but only some companies are benefiting from the seasonal factor.
At Lotte Department Store, overall sales increased eight percent on-year in the first 16 days this month, largely due to booming sales in winter clothes. But sales of handbags, watches and jewelry fell in December while those of beauty products remained at a similar level to last year.
Supermarket chain E-Mart's overall sales were up 7.8 percent on-year in the first 14 days this month on the back of increasing sales of winter garments and heaters, while sales of daily supplies and processed foodstuffs like instant noodles and canned food decreased.
"When consumer confidence is high, consumers make more purchases even if they don't really need the goods, but now people only buy what is really necessary," said a spokesman for Shinsegae Group.
Companies are apparently cutting down on year-end parties amid dismal sales performances. A spokesman for a luxury hotel in Seoul said the reservation rate for banquet halls in December fell 15 percent on-year due to a decrease in the number of year-end parties by government agencies and corporations.
But rooms are almost fully booked for Christmas Eve and the New Year's Eve at high-end hotels in the capital. People seem to be refraining from large group binges but are willing to enjoy themselves with family and close friends, an industry insider said.
Meanwhile, the number of travelers going abroad is skyrocketing, with Japan benefitting most due to the weak yen.
According to Hana Tour, the proportion of travelers heading to Japan rose from 17 percent last year to 24 percent this year. Package tours to the island country are almost fully booked until early next year.
A researcher with the Korea Development Institute said retailers are seeing a temporary boom for certain items due to the freezing weather but there is no sign of a recovery in overall consumption.
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