South Korean department store Shinsegae has opened its first overseas off-price store, marking the international debut of its Factory Store format.
The outlet is located at the KOKKOK Mega Mall Patuxai branch in Vientiane, the Laotian capital, and operates under a franchise arrangement with Grand View Property, part of Laos-based retail company Kolao Group.
According to Seoul Economic Daily, this is Shinsegae’s first venture of this type beyond its home market.
Off-price retailers typically source surplus stock and end-of-season merchandise from recognised brands, offering these at reduced prices.
The Vientiane store covers approximately 1,320m² and follows a department-store-style off-price format, stocking a selection of brands chosen by Shinsegae.
Shinsegae intends to use the Vientiane location as a base for extending its franchise model to further Southeast Asian markets, with Thailand and Vietnam among those under consideration.
The company plans to apply the off-price approach it has built domestically, using its existing sourcing and store-management experience.
It also anticipates that the overseas expansion will help ease inventory pressures by creating additional sales outlets abroad for end-of-season stock from South Korean brands, while assisting smaller labels in reaching international markets.
Among the labels available are South Korean fashion brands Kirsh, Brownbreath and Covernat, along with City Breeze, Volt, Cleveland Golf and Adidas Golf.
According to the report, a representative from Shinsegae described the Laos store as “a meaningful starting point for introducing Shinsegae Factory Store, which has proven its competitiveness at home, to overseas markets for the first time”, and said that “beginning with Southeast Asia, we will continue to expand the reach of our Korean-style off-price business.”
The news comes as Shinsegae’s consolidated operating profit for the second quarter climbed 121.9% year-on-year to Won167.1bn ($117m).
Net sales rose 5.1% to Won1.78tn, compared with Won1.69tn in the same period last year.
“Shinsegae launches first overseas off-price store in Laos” was originally created and published by Retail Insight Network, a GlobalData owned brand.
