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South Korean retail sales surged in August

Korea Retail sales in August 2020

Retail sales in South Korea moved up 6.6 per cent in August year on year, due to a sharp rise in online sales amid the coronavirus pandemic, government data shows.

The combined sales of 26 major offline and online retailers reached US$10 billion last month, up from $9.56 billion last year, according to the Ministry of Trade, Industry and Energy.

After keeping the number of daily new virus cases under control for more than five months, South Korea added more than 100 cases on August 14 before the number shot up to 441 on August 27.

The figures recently returned to double digits, but cluster infections and untraceable cases are still causing problems.

Online platforms led the growth in South Korean retail sales, with their revenue advancing 20.1 per cent over the period, the data showed.

In contrast, sales from offline stores dipped 2.4 per cent as people avoided crowded places. The longest rainy season in nearly 50 years, which ran from late June to mid-August, weighed down on the sales as well.

At online stores, sales of foodstuffs shot up 43 per cent over the period. The demand for home appliances, such as air conditioners and fans, also moved up 28 per cent.

Due to the Covid-19 pandemic, however, the sales of travel packages and entertainment tickets from online platforms dipped 6.3 per cent on-year.

Offline stores, on the other hand, continued to lose ground. Convenience stores were the sole winners thanks to rising demand for sanitary items, such as protective masks, with their revenue advancing 2.3 per cent. Sales of other health-related items, such as vitamin pills, lent a hand to the strong sales as well.

Department stores saw their revenue drop 6.5 per cent due to weak sales of fashion items due to the pandemic.

Sales of food decreased nearly 30 per cent as this year’s Chuseok holiday – the Korean equivalent of Thanksgiving – fell weeks later than last year.

Sales at supermarkets decreased 2.3 per cent due to a sharp decrease in the demand for sales, affected by the prolonged rainy season coupled with the virus pandemic.

In the first six months of the year, combined retail sales reached $57.19 billion up 3.7 per cent from the previous year. Shipments by online stores advanced 17.5 per cent, while those of offline stores dipped 6 per cent.

Last year, South Korean retail sales rose by 4.8 per cent year on year. Revenue at online shopping malls advanced 14.2 per cent, while that of offline stores shed 0.9 per cent.

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