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Photo = Yonhap news |
[Alpha Biz= Kim Jisun] Seoul, May 1, 2025 — South Korea’s four leading duty-free operators — Lotte, Shilla, Shinsegae, and Hyundai — have all launched voluntary retirement programs as part of cost-cutting measures in response to prolonged financial losses.
According to industry sources, Shilla Duty Free is currently accepting applications privately from employees aged 40 and older or those with more than five years of service. The program offers two options: an immediate payout equivalent to 1.5 times the annual salary, or a leave of absence for 18 months with monthly base salary payments followed by retirement.
With Shilla now joining, all of the "Big Four" duty-free companies have implemented staff reduction initiatives. Lotte and Shinsegae began offering similar programs in 2024, and Hyundai Duty Free followed suit earlier this month.
Despite a slight rebound in sales after the COVID-19 pandemic, the sector continues to suffer from poor profitability. In 2024, the combined operating loss of the four companies exceeded KRW 277.6 billion. Lotte posted the largest loss at KRW 143.2 billion, followed by Shilla (KRW 69.7 billion), Shinsegae (KRW 35.9 billion), and Hyundai (KRW 28.8 billion).
The companies are also scaling back operations. Lotte closed 35% of its Lotte World Tower store in Jamsil and shut down its Now In Myeongdong showroom. Shinsegae has reduced the floor area of its Busan store, and Hyundai recently announced the closure of its Dongdaemun location. Some overseas branches are also under review for possible closure.
These developments reflect a broader restructuring trend in the duty-free industry, which has yet to fully recover from the pandemic’s impact on international tourism and consumer demand.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
