Shinsegae's E-Mart Hones Localization Strategy in Vietnam
Shinsegae's E-Mart Hones Localization Strategy in Vietnam
  • Korea IT Times (
  • 승인 2015.07.07 18:04
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"Instead of insisting on doing it our way, we have to focus more on our business spirit."

This is what Shinsegae Group vice chairman Chung Yong-jin said in 2011 when his retail group announced plans for entering the Vietnamese market. It meant that Shinsegae must be able to create stores and business practice that Vietnamese consumers want rather than trying to copy what works in Korea.

His remarks originated from the bitter experience in China when Shinsegae moved into the world's largest retail market in 1997 without thinking thoroughly about it. The first store in Vietnam to be open by the year's end will embody lessons from the past failure.

Shinsegae's E-Mart opened its store locations aggressively in China after establishing its presence in 1997. Due to poor results, the store number has shrunk to nine from the peak of 27. The main reason for the blunder was attributed to the insufficient understanding on the market and consumer tastes. In order to avoid making the same mistake,

E-Mart is now working hard to localize its operations in Vietnam. Unlike the organization of E-Mart China which was top heavy with Korea-dispatched managers, the number of Korean employees working in E-Mart Vietnam is only seven including the head of the unit while more than 40 locally hired Vietnamese nationals do the heavy lifting.

The company, which was established in December last year, is currently hiring more local workers in product planning, logistics, and store display. This is a far cry from the previous practice of sending scores of managers to prepare to launch a new store overseas.

An E-Mart official said, "When we opened Chinese stores, we tried to emulate everything from procurement to store display in accordance with what we were accustomed to doing in Korea. Now, we listen to what local employees have to say and try to run a store local consumers will really love."

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