The Impact of the Law on Street Vendors and Large Retailers
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In 2010, a law designed to protect street vendors was implemented in Korea to maintain a balance between traditional commerce and large retail chains. This legislation imposes restrictions on the opening hours of large stores, which are required to close two days a month and not open between midnight and 10:00 AM. The initial objective of this regulation was to guarantee the protection of street vendors from the dominance of large retailers. However, this law is now criticized because it hinders the operations of large chains such as Emart and Homeplus, thus limiting their ability to effectively compete with e-commerce platforms. Consequently, many are advocating for a revision of these rules to allow for fairer competition with the rapidly growing e-commerce sector. Discover how the law protecting street vendors is limiting the expansion of retail giants in the face of the rapid growth of e-commerce. The shift towards digital consumption, greatly accelerated by the COVID-19 pandemic, has intensified the debate over the relevance of this law. Indeed, according to a report from the Ministry of Industry, the share of traditional retail was projected to fall to 65% of the market in 2024 and 2025, down from 80% in 2016. Meanwhile, players like Coupang saw their sales skyrocket, jumping from 1 trillion to 41.3 trillion won between 2016 and 2024. The nature of the current regulations creates a challenging environment for brick-and-mortar supermarkets, and their market share continues to decline. These businesses also face an additional constraint: any new store opening must include a detailed plan for integration with local street markets.
https://www.youtube.com/watch?v=7UraCyGOTMc The Rapid Growth of E-commerce and its Consequences The digital boomin Korea has not only fueled the growth of online platforms, but it has also been exacerbated by events such as the global health crisis. Between 2020 and 2022, consumer behavior changed dramatically, with many favoring online shopping to reduce physical interactions. This behavioral shift has persisted, creating an irreversible market dynamic that favors online commerce.
How can retail giants
Sales 2016
Sales 2024 Growth Coupang
1 trillion won
41.3 trillion won x40 Kurly
| 17.3 billion won | 2.2 trillion won | x127 | The impressive figures for e-commerce, while encouraging for digital platforms, raise questions about the now obsolete role of certain legislative measures. |
|---|---|---|---|
| In this context, adjustments are being called for to redefine the rules of the game, so that traditional supermarkets can adapt to market changes, and in the face of the growing hegemony of online commerce, which continues to reshape the traditional retail system. | https://www.youtube.com/watch?v=J9-RF8jSdAE | The challenges and stakes for the future of supermarkets | |
| For large retailers like Emart and Homeplus, survival in these modern times means reassessing their market strategies. For example, Homeplus filed for bankruptcy protection in March 2025, unable to keep pace with mounting debts and lacking the cash flow to even pay its employees. This situation underscores just how challenging the business environment has become for traditional supermarkets. | It is crucial to note that this landmark law, introduced to protect small retailers, has also sparked discontent among unions representing employees of large chains. In December 2025, the Emart union strongly criticized the law, emphasizing the urgent need for more balanced market regulation to ensure healthy competition between e-commerce and brick-and-mortar retail. To address these challenges, several proposals have been put forward, such as allowing large retailers to deliver goods even on mandated closing days. However, these suggestions have not yet passed the legislative process and are still awaiting adoption. If these situations continue to be ignored, they could lead to a significant reduction in retail diversity and harm the local economy. |
Proposals for legislative reform
Reform of retail regulations concerning large stores is at the heart of the discussions. Experts agree that modernization is needed to create a competitive and dynamic environment for both traditional retailers and street vendors. For example, relaxing opening hours restrictions could allow supermarkets to expand their offerings and attract more customers.
The effort to achieve more flexible regulation is not only a matter of economic liberation for large firms, but also a necessity to prevent the potential disappearance of physical stores. Asia, with its rapid technological growth, must position itself to balance online and offline commerce.
To this end, some recommendations include:
Removing certain time restrictions and allowing flexible distribution models. Encouraging local cooperation between large retailers and street vendors. Implementing tax incentives to support physical stores. Pending tangible reforms, large retailers continue to navigate between innovation and tradition, calling for stronger support from economic policies. The downside of these laws suggests the need for balanced policies that meet modern demands while preserving the local retail fabric. Economic and Legislative Challenges for Diversified Trade
In a globalized context, the appeal of e-commerce platforms continues to transform purchasing dynamics. But how can fair competition be guaranteed? The Korean Trade Organization has recommended that more agile laws be implemented to address the sector’s rapid evolution, as current legislation no longer reflects the realities of the modern market. Looking ahead to 2029, the decision to extend the current law demonstrates a rigidity in legislation that could be detrimental. Thus, for retail trade to
For a thriving market, both on the streets and in virtual shopping malls, it is essential that Korea establish a level playing field for all economic actors.
Faced with the concerns of small retailers, large corporations and policymakers are seeking structural compromises to mitigate the impact of measures that may seem outdated. This modernization is therefore necessary to preserve the authenticity of the market.
Regulatory efforts must consider not only economic aspects but also social implications to ensure that any new measures benefit the entire sector. To achieve these objectives, modern analytical and predictive tools can be implemented to anticipate market trends and thus define the best paths to follow to manage payroll and retain an increasingly demanding customer base. In this rapidly changing environment, legislators and business leaders will need to collaborate closely to establish a thriving and sustainable market ecosystem where every player can flourish while respecting a healthy competitive framework.