Yeokjeon Market struggles to survive mega retail giants

A merchant smokes at Yeokjeon Market in Suwon, Gyeonggi Province, Tuesday. Mom-and-pop stores in the market once enjoyed handsome profits, but have lost their customers to AK Plaza, a six-store department store established across the street. / Korea Times photo by Shim Hyun-chul

SUWON, Gyeonggi Province ― Jeon Hea-ok, 29, recalls the 1990s when Yeokjeon outdoor market near Suwon train station was still bustling with people seven days a week. Her parents ran a small stationery store in the market for several decades, and back then, take-home income was good for them and other merchants at perhaps the biggest shopping and leisure district in a rapidly growing city.

Of course, the biggest customer in town was Samsung Electronics which is headquartered in Suwon. As Samsung grew rapidly as a company, so did the paychecks of its employees, who would splurge in the market’s shops as well as on booze and prostitutes in the seedy “entertainment’’ district nearby.

Jeon said Yeokjeon market quickly lost its vibrancy after 2003 when Aekyung Group, an industrial heavyweight built on soap and franchise stores, opened a department store across the street.

Shoppers ditched the outdoor market for the department store, lured by the convenient services, bargain sales, movie theaters, restaurants, and of course, parking lots. The rise of mega discount chains such as E-mart and Home plus and the increasing usage of electronic commerce have also added to the existential crisis facing traditional markets.

While shop owners at Yeokjeon were left to perish, they decided to go out fighting. Survival required more than just brave faces but creativity. After searching for ideas to withstand pressure from Big Business, the merchants came up with an unusual method of surviving: As they didn’t have enough customers coming their way, they just might as well buy each other’s products.

“It was quite interesting. A rice store owner will buy suits at a tailor shop at the market and that tailor will buy rice from his new customer. The money continued to flow inside the market but barely out of it. We have become a small, tight and inter-dependent community,’’ Jeon said.

“A longtime merchant in the market opened a coffee shop in the market. Everyone in the market would go to that shop. The revenue of that shop was very stable because the owner knew he was getting a built-in customer pool.’’

Today, there are about 200 shops at the Yeokjeon market, involved in anything and everything, from grocery stores, restaurants, dish shops and dancing academies.

“Children and other family members of shop owners contribute to increase sales as well. It was a moment of pride for the merchants when their children and their generation of shoppers came to the market, which proved that the market gave itself a chance to continue further,’’ Jeon said.

One of the community leaders at Yeokjeon market is Lee Mi-hee, a 51-year-old supermarket owner. Her 30-square-meter shop is frequently packed with visitors, usually neighboring merchants who come for advice on business matters and family issues.

Lee will also go out of her way to teach her customers recipes and information about the best food products. She doubles as a businesswomen and a mother-like figure for all who go to Yeokjeon market, in contrast to the mechanical cashiers found at discount malls and department stores.

“I like it. I have friends here, talk with them and share stories. The market is a huge part of my life,’’ Lee said.

Surviving shouldn’t be confused with thriving. Jeon admits that revenue isn’t as good as it once was. What’s important, she claims, is that the market showed resilience as a community and earned its continuity from it. However, one has to question the lifespan of a market which is more like a closed pond.

“The merchants will just keep doing their business regardless of their profits. They will do it until they die. They know they will live and fight another day,’’ said Jeon, who runs her own takeout meal shop in Seoul.

“The market will die with this generation of merchants I think. The children of the store owners are buying their parent’s products, but will not inherit their business. Neither did I. Everybody knows that the market will fade with the people here.’’

Official data shows that a sales gap between mega retailers and traditional markets is huge and widening further. According to a report by the Agency for Traditional Market Administration, total revenue of traditional markets was estimated at 24 trillion won (about $22 billion) in 2010, down 7.5 percent from two years ago.

In contrast, that of department stores soared by 22.7 percent to 24.3 trillion won during the same period, according to data from Statistics Korea, showing a drastic comparison with their traditional market counterparts. Discount chains also enjoyed a big boost in sales as their combined revenue marked 33.7 trillion won in 2010, up 12 percent from two years ago.

Experts say that merchants in traditional markets need to beef up their efforts to attract more customers by providing customer-friendly services. They say a simple change of display could increase revenue and recommend mom-and-pop store owners to make their shops clean and neat. In terms of cooperation, they advise launching joint marketing, which could raise the brand image of the whole market. <The Korea Times/Kim Jae-won>