South Korean convenience stores are continuing their upward trajectory since the Covid-19 pandemic, with fierce competition between the No. 1 and No. 2 ranked players for the top spot.

The overall sales of convenience stores in the first half of this year were close to those of department stores, government data showed on Tuesday. Convenience stores accounted for 16.6 percent of the industry sector in sales during the first half of this year, while department stores took 17.6 percent, just 1.0 percentage points ahead, according to the Ministry of Trade, Industry and Energy.

As the local luxury market began to wane this year, department stores witnessed a 2.5 percent increase in first-half sales from a year ago. However, convenience stores exhibited a high growth rate of 9.5 percent. Large supermarket chains, during the same period, captured 13.3 percent of the first-half sales, and online sales made up 49.8 percent. The ministry releases monthly sales trends for local retailers, basing its data on three major department stores - Lotte, Shinsegae, Hyundai ? and three major convenience store chains - GS25, CU, Seven-Eleven.

The competitive landscape among convenience store operators is intensifying as these businesses continue to experience rapid growth. According to their semi-annual reports, GS Retail’s convenience store business division recorded sales of 3.96 trillion won ($2.96 billion). BGF Retail, which operates CU convenience stores, reported sales of 3.92 trillion won during the same period. The sales gap between these two stands at only 38.3 billion won.

On the other hand, CU holds the lead in terms of the number of stores. According to estimates from each company, CU runs 17,400 stores and GS25 17,000 stores as of the end of June.

Smaller convenience store chains beyond the Big 2 are also experiencing rapid growth along with the market expansion. Korea Seven, which operates Seven-Eleven stores, reported first-half sales of 2.82 trillion won on a consolidated basis this year.

While there may be a large difference in sales between the Big 2, increasing sales from Mini Stop convenience stores acquired by Seven-Eleven last year are expected to help narrow the gap fast. With the addition of Mini Stop, Seven-Eleven’s total store count is now around 14,000.

Emart24 operates a total of 6,652 stores as of the second quarter of this year, and is gradually getting back on track, with operating profit of 6.8 billion won last year. Revenue was 2.12 trillion won, up 10.4 percent from a year ago. The previous year marked a significant milestone as Emart24 achieved an annual sales figure surpassing 2 trillion won for the first time.

By Kim Gyu-sik and Minu Kim

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]